American Healthways Receives NCQA's First Disease Management Accreditation; Accreditation Provides Purchasers Proof of Program Quality and Effectiveness.

Business Editors/Health & Medical Writers

NASHVILLE, Tenn.--(BW HealthWire)--June 10, 2002

American Healthways (Nasdaq: AMHC), the nation's leading provider of specialized, comprehensive care enhancement services to health plans, physicians and hospitals, today announced that it has earned the first National Committee for Quality Assurance (NCQA) disease management program accreditations.

American Healthways' diabetes (DM), congestive heart failure (CHF), coronary artery disease (CAD) and chronic obstructive pulmonary disease (COPD) programs received full accreditation for three years and are the only disease management programs in the United States bearing the NCQA seal of approval.

The health care community nationwide (including physicians, hospitals and health plans) relies on the NCQA to provide objective, external quality assessments of health care services. These formal assessments play a crucial role in purchasers' evaluation and selection of services.

"Receiving accreditation from the NCQA is a significant achievement for American Healthways as well as for the disease management industry," said Thomas G. Cigarran, American Healthways Chairman and CEO. "The NCQA stamp of approval on our programs reinforces our longstanding commitment to providing quality care and will be extremely influential in helping health plans seeking to provide these services for their members better distinguish among care enhancement program offerings."

This NCQA certification gives health plans, and their customer employers, additional confidence that American Healthways' programs are quality-assured and crucial to an outcomes-driven approach to medical management. Additionally, integration of American Healthways' NCQA-accredited programs will facilitate health plans achieving their own quality accreditation.

"Effective disease management programs like those provided by American Healthways offer new solutions to the issues of health, cost and productivity, all of which are of critical importance to the employers who provide health care benefits for their employees," said Becky Cherney, Chair of the National Business Coalition on Health. "In addition, independent third-party accreditation for disease management programs assures employers that the programs with which their employees are affiliated meet essential quality and operational standards."

NCQA began accrediting managed care organizations in 1991 in response to the need for standardized, objective quality review. Today, almost half of the HMOs in the nation have been reviewed by NCQA. In recognition of the growing importance of disease management programs and their increasing use by health plans, in December of 2001, NCQA released standards for its Disease Management Accreditation and Certification programs.

"After a rigorous review of American Healthways' programs, we are confident that health plans and their members can expect and receive quality, beneficial care from the company's diabetes, CHF, CAD and COPD programs," said NCQA president Margaret E. O'Kane. "NCQA's review process is designed to ensure that the enormous promise of disease management is fulfilled. As these programs continue to gain acceptance in the health care industry, we are proud to provide purchasers with the information they need to make informed decisions."

"With more than 100 organizations offering disease management services, there is an increasing need for a recognized organization like NCQA to evaluate and identify the disease management programs capable of improving health status and cost outcomes," said Warren Todd, Executive Director of the Disease Management Association of America. "NCQA accreditation of American Healthways' disease management programs is clearly a major event for the disease management industry and reflects the continued leadership that American Healthways has demonstrated over the past decade."

American Healthways participated in NCQA's comprehensive Disease Management Accreditation program, which involves in-depth review of a full range of program functions. Company representatives have been working with NCQA as members of the Standards Development Committee and participated in NCQA's beta testing for the new program.

This press release contains forward-looking statements that are based upon current expectations and involve a number of risks and uncertainties. In order for the Company 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 as described in the Company's reports on Form 10-K and 10-Q on file with the Securities and Exchange Commission, as well as by, among other factors, the Company's ability to implement the anticipated number of contracted lives within time frames contemplated by the Company and the ability to maintain the number of covered lives anticipated to be enrolled in the BCBSMN programs. The Company undertakes no obligation to update or revise any such forward-looking statements.

Nashville-based American Healthways (www.americanhealthways.com ) is the nation's leading provider of specialized, comprehensive care enhancement services to health plans, physicians and hospitals. The Company's programs have been recognized for innovation and excellence, most recently by the Disease Management Association of America's 2001 Comprehensive Disease Management Company Leadership Award. American Healthways provides disease and care management programs to health plans with members in all 50 states, the District of Columbia and Puerto Rico. The company also operates diabetes management programs in hospitals nationwide.