HealthSouth Network Services Selects Physmark's Managed Care Software; Oracle-Based MEDICOMP Will Manage Risk Contracts of Largest Provider Organization.

DALLAS--(BW HeathWire)--May 19, 1999--

HealthSouth Network Services, a subsidiary of HEALTHSOUTH Corp.(NYSE: HRC) based in Birmingham, Ala., has selected Physmark Inc.'s Oracle(R) based MEDICOMP software to administer its Management Services.

HealthSouth Network Services manages physical, occupational and speech therapy services under capitated and fee-for-service arrangements to 2 million covered lives, and episode-of-care case rates for orthopedic and neurologic diagnoses.

Along with the scaleability and reliability of Oracle's database, MEDICOMP's power to perform dynamic analysis of costs against budgets, identify reasons for cost over-runs and implementing quick fixes is critical to the successful management of HealthSouth's risk contracts.

HealthSouth Network Services goal is to keep employees healthy and costs down. It offers a number of services designed to assist payors and employers in reducing their medical and administrative costs for worker's comp, group health and disability benefits.

Traditional approaches of discounted fees and utilization review are often ineffective and expensive. Confidence in cost control strategies and existing program successes allow HealthSouth Network Services to offer risk-sharing contracts that can limit payor's exposure to healthcare expenses.

"With millions of lives and small caption amounts per enrollee, managing utilization and costs on a real-time basis is critical to our success," says Tom Peterson, regional vice president, HealthSouth Network Services.

"Based on Oracle's flexible software, Physmark's MEDICOMP offers the most powerful analytical and graphical tools to efficiently perform these functions. MEDICOMP's web-enabled technology and data analysis tools allow us to manage our business more efficiently and more effectively."

HealthSouth Network Services will implement MEDICOMP on Sun Microsystems' enterprise server E3500 with multi-processors and running its Solaris version of UNIX. Many of MEDICOMP's Java technology compatible web features perform particularly well on Sun Microsystems' hardware and Solaris operating environment.

"Due to its extensive network of operations and national presence, HealthSouth redefines the word, `enterprise,' for the healthcare industry," says Dr. Jacob Kuriyan, president of Physmark. "Oracle and Sun Microsystems offer the most scaleable and robust system available to meet enterprise-wide needs."

In a managed care environment, contracts with providers, rules for pre-authorization, payment schemes for specialists and reporting requirements, are all subject to rapid change. MEDICOMP is based on state-of-the-art software technology and designed from a provider's point of view. As a result, it is a vital tool for managing change rapidly and economically.

MEDICOMP enables HealthSouth to manage risk contracts which stipulate payment to providers in a variety of ways: fee-for-service, capitated and episodic rates. HealthSouth Network Services will use MEDICOMP for claims repricing and adjudications, pre-authorizations, disbursements to HealthSouth and sub-contracted network providers, care management and utilization review.

MEDICOMP's Healthcare Analyzer with Oracle's OLAP tool Express(R) Server cut administration time and costs by providing analytic profiles of treatment patterns and associated healthcare costs. MEDICOMP's "thin client" modules for eligibility, benefits and other inquiries are web-enabled and ready for use on Oracle's internet computing platform.

Physmark's MEDICOMP family of software, all of which is Y2K compliant, is built using Oracle Developer (TM) a productive development for building enterprise-class Internet database applications.

MEDICOMP is fully web-enabled and available on secure internet and intrants. Using Oracle's leading database technology, MEDICOMP is "portable" and runs on more than 85 different hardware platforms and operating environments, including Novell's Netware, Microsoft's Windows and NT and many versions of UNIX. Sun Microsystems' reliable multiprocessing servers and scaleable Solaris operating environment are preferred by enterprise and power users of MEDICOMP.

Physmark Inc. is a software and services company that exclusively addresses the data management needs of managed care organizations.

A pioneer in the industry, the company is the leading provider of information systems for more than 150 provider-based integrated delivery networks (IDNs), such as Physician Hospital Organizations (PHOs), Management Service organizations (MSOs), Provider Sponsored Organizations (PSOs) and Independent Practice Associations (IPAs).

MEDICOMP is the exclusive managed software endorsed by VHA Inc., the purchasing organization for 1,500 nationwide community hospitals for managing IDNs.

Physmark's corporate headquarters are in Dallas; additional offices are located in Los Angeles, Durham, N.C., Chicago, Denver and Albuquerque, N.M. For more information, call 505/897-7500 or visit Physmark at http://www.physmark.com.

HealthSouth has signed 700 national, regional and local payor contracts in 1998, boosting its total to 4,200 contracts covering 168 million lives. HealthSouth treats more than 100,000 patients a day.

HEALTHSOUTH Corp. (NYSE: HRC) is the nation's largest provider of outpatient surgical and rehabilitative healthcare services, with nearly 2,000 locations in all 50 states, the United Kingdom, Puerto Rico and Australia. Its worldwide web address is http://healthsouth.com.

Oracle(R) is a registered trademark and Oracle Developer(TM) and Oracle Express(R) Server are trademarks or registered trademarks of Oracle Corp. (Nasdaq: ORCL). Novell is a registered trademark of Novell Inc. (Nasdaq: NOVL). Windows and Windows NT are registered trademarks of Microsoft Corp. (Nasdaq: MSFT). Java, Solaris and Sun are registered trademarks of Sun Microsystems Inc. (Nasdaq: SUNW)