Coastal Healthcare Group names Jacque J. Sokolov, M.D. chairman of the board.

DURHAM, N.C.--(BUSINESS WIRE)--Nov. 30, 1994--Coastal Healthcare Group Inc. (NYSE:DR) announced Wednesday that it has acquired Advanced Health Plans Inc. (AHP) and related companies, and named its founder and chief executive officer, Jacque J. Sokolov, M.D., age 40, as chairman of the Coastal board of directors. Dr. Sokolov will team with Steven M. Scott, M.D., Coastal's president and chief executive officer, to aid in the continued development of Coastal's physician-driven integrated health care delivery systems.

"Dr. Sokolov is regarded as one of the founding fathers and leading authorities in the development of integrated delivery systems," stated Dr. Scott. "As a physician and highly successful health care consultant to Corporate America, Dr. Sokolov brings significant expertise and skills to Coastal. As a member of our board, he has already made important contributions to the company's long-term strategy. As chairman, he and I will work together during the next decade to further engage Coastal's transition into an advanced integrated health care delivery system. This will include alliances with physicians, payors, hospitals and other health care entities in strategic markets.

"Dr. Sokolov and I are confident there will be multiple strategic alliances and partnerships that we will develop over the next several years and that health care reform will be driven by organized physician groups, like Coastal, which offer innovative solutions for developing integrated health care delivery systems," continued Dr. Scott. "The addition of Dr. Sokolov amplifies Coastal's commitment to organizing and managing physician-driven integrated delivery systems."

Dr. Sokolov added, "I look forward to working closely with Dr. Scott and his management team to extend Coastal's proven physician-driven integrated networks across many strategic markets.

"As CEO of Advanced Health Plans, we will continue to develop, finance and implement advanced, integrated health systems that meet the needs of patients, payors and providers by delivering superior quality care and outstanding customer service at the lowest possible cost. Over the past three years, AHP has developed an extensive multiple-sponsor client list (physician organizations, hospital systems, insurance companies, managed care organizations and health care system vendors) in 85 major U.S. markets in 35 states and three foreign countries," said Dr. Sokolov. Terms of Coastal's acquisition of AHP were not disclosed.

AHP is the continuation of relationships and concepts first applied by Dr. Sokolov while he was vice president and medical director at Southern California Edison Company. These relationships enabled the creation and implementation of Southern California Edison's highly successful managed care program, HealthFlex, which integrated the company's self-insured medical plans with an in-house claims payment system, a utilization management program, a preferred provider network and primary care clinics. For the five years (1988-1992), HealthFlex saved Southern California Edison in excess of $100 million.

Dr. Sokolov received a B.A. in medicine from the University of Southern California (USC) and an M.D. with honors from the USC School of Medicine. He completed his internal medicine residency at the Mayo Graduate School of Medicine and his fellowship in cardiovascular diseases from the University of Texas-Southwestern Medical School. He previously held and currently holds academic appointments and advisory board responsibilities including positions in the Schools of Medicine, Management, Public Health and Pharmacy, at Harvard, the Massachusetts Institute of Technology, the University of Pennsylvania, the University of California, Los Angeles, and the University of Southern California.

Dr. Sokolov serves on the boards of the Washington Business Group on Health, the National Fund for Medical Education (NFME), the National Health Foundation, and California Health Decisions. Dr. Sokolov also serves on the advisory boards of the National Health Policy Council, the National Resource Center on Worksite Promotion, the White House Health Project, and the Health Care Advisory Committee for California Insurance Commissioner John Garamedi.

Also announced today was the election of John P. Mahoney, M.D. to the Coastal Board of Directors to fill the vacancy created by Dr. Mike Solnik's resignation announced earlier this year. Dr. Mahoney is president of Health Enterprises Inc., the parent company of HealthPlan Southeast, the Tallahassee-based managed care company acquired by Coastal in November 1994.

Coastal Healthcare Group Inc. -- The Physician Company, is the largest physician management company in the U.S., and provides a broad range of health care and administrative services to physicians, hospitals, managed care programs and other health care providers.

CONTACT: Coastal Healthcare Group Inc.

             David H. Fater, 919/383-0355
             Kenneth S. Dennard, 919/383-0355