American Healthways, Tufts Health Plan Expand Relationship for Second Time This Year; Five-Year Agreement Brings Full Suite of Disease Management Programs to Tufts Health Plan's Self-Insured Employer Customers.

NASHVILLE, Tenn. -- American Healthways Inc., (NASDAQ: AMHC) today announced an expansion of its relationship with Massachusetts-based Tufts Health Plan for the second time in as many months, signing a five-year agreement to offer the nation's leading disease management and care enhancement services to Tufts Health Plan's self-insured employer groups - representing more than 250,000 employee lives. The program will enhance the nationally recognized suite of care management programs offered to Tufts Health Plan members through Tufts Total Health Care.

"As we continue to broaden the health support we provide to our fully insured members, we also want to make that level of support available to our self-insured employer groups," said Allen J. Hinkle, M.D., chief medical officer of Tufts Health Plan. "We believe our employer groups will quickly see the value of disease management and will embrace the solution we are offering through our partnership with American Healthways."

Last month, American Healthways announced an expansion and extension of its relationship with Tufts Health Plan to include full care enhancement services for eligible members of the health plan's 365,000 fully insured commercial health plan members.

Both new agreements begin July 1 and include a broad array of disease management services, including diabetes, congestive heart failure, and coronary artery disease. American Healthways already works with Tufts Health Plan to provide its StatusOne high-risk health management program to members of its Medicare Advantage plan.

Ben R. Leedle Jr., president and CEO of American Healthways, said, "Employers are striving to achieve quality, affordable health care for their workers in an environment where neither side of that equation is being consistently delivered. We are excited to partner with Tufts Health Plan to bring its employer groups a proven solution for improving care, reducing costs and enhancing the productivity of their workforces."

Tufts Health Plan is a Waltham, Massachusetts-based health plan nationally recognized for its commitment to providing innovative, high-quality health care coverage. Tufts Health Plan has New England's highest enrollment in consumer-driven health plans. The plan is on the cutting edge of empowering its members and employers to make informed health care decisions and supports them with an array of physician and clinician led health management programs. Tufts Health Plan's HMO, POS and Medicare Advantage plans maintain Excellent accreditation status from the National Committee for Quality Assurance. And, Tufts Health Plan HMO has been recognized as a Distinguished Health Plan by J.D. Power and Associates, for providing "An Outstanding Member Experience." Tufts Health Plan is the first health plan in Boston to earn a J.D. Power and Associates award for nine years, for outstanding member satisfaction or service excellence.

J.D. Power and Associates recognition as a Distinguished Health Plan based on the benchmarks established by the 2003 National Managed Care Satisfaction Study(SM). Previous awards based on national studies conducted by CareData, Inc. (acquired by J.D. Power and Associates in 2000) and J.D. Power and Associates (2002). For more information about the J.D. Power and Associates Distinguished Health Plan Program, visit www.jdpower.com/healthcare.

Safe Harbor Provisions

This press release contains forward-looking statements that are based upon current expectations and involve a number of risks and uncertainties. In order for American Healthways to utilize the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, investors are hereby cautioned that these statements may be affected by the important factors, among others, included in the discussion in Part I, Item 1, and Part II, Item 7, of American Healthways' Annual Report on Form 10-K for the fiscal year ended Aug. 31, 2004, and Part I, Item 2 of American Healthways' Quarterly Report on Form 10-Q for the quarter ended Feb. 28, 2005. Consequently, actual operations and results may differ materially from those expressed in these forward-looking statements. American Healthways undertakes no obligation to update or revise any such forward-looking statements.

About American Healthways

American Healthways, Inc. is the nation's leading and largest provider of comprehensive disease management, care enhancement and high-risk health management services proven to improve the quality of health care and lower costs. As of May 31, 2005, the Company had more than 1.6 million lives under management nationwide. For more information, visit www.americanhealthways.com.