First Health Reports Record Third Quarter Results

Contact:
Edward L. Wristen, President and CEO
or
Joseph E. Whitters, CFO
First Health
630-737-7511
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FOR IMMEDIATE RELEASE

DOWNERS GROVE, IL - November 4, 2002 - Edward L. Wristen, President and Chief Executive Officer of First Health Group Corp. (NASDAQ: FHCC), announced today the results of operations for the third quarter ended September 30, 2002.

Highlights include: 

• Record revenue of $204.9 million, up 35% from 3Q 2001 
• Record income of $33.7 million, up 28% from 3Q 2001 
• Record EPS of $.32, up 28% from 3Q 2001 
• Addition of the Mail Handlers Benefit Plan administration business, effective July 1, 2002  
• Claims administration revenue grew 72% from 3Q 2001 
• PPO revenue grew 22% from 3Q 2001

In a quarter that produced record results, diluted earnings per share (EPS) and net income for the three months and nine months ended September 30, 2002, increased 28% to $.32 or $33,743,000 and 26% to $.93 or $97,241,000 respectively, compared with $.25 or $26,364,000 and $.74 or $76,093,000 respectively, during the same periods last year. Revenues for the three months and nine months ended September 30, 2002, increased 35% to $204,928,000 from $152,207,000 and 29% to $550,212,000 from $428,140,000 respectively, during the same periods last year.

Mr. Wristen commented that the third quarter results reflect a continuing strong growth in revenue and net income. Claims administration revenue increased 72% to $71,685,000 from $41,793,000 during the third quarter of 2001 primarily due to the addition of the Mail Handlers Benefit Plan administration business effective July 1, 2002. Also during the quarter, the PPO business grew 22% to $111,105,000 from $91,112,000 from the third quarter last year. Additionally, Mr. Wristen noted that net income was the highest ever achieved at $33.7 million, a 28% increase over the same quarter last year.

Business Description 
First Health, the premier national health-benefits services company, specializes in providing large payors with integrated managed care solutions. First Health is a unique national managed care company serving the group health, workers' compensation and state agency markets. Using technology to enable service and managed care innovations, First Health sets the bar for industry performance. For more information, visit the company website at www.firsthealth.com.

Forward-Looking Statements Notice
Certain statements herein regarding anticipated financial results for 2002 and the Company's business prospects are forward-looking statements that involve substantial risks and uncertainties. In accordance with the Private Securities Litigation Reform Act of 1995, factors that could cause the Company's actual results to differ materially from those expressed or implied by such forward-looking statements include, among others, the inability of the Company to continue to: (i) enter into contracts with and successfully implement programs for new clients within the time frame established by the Company and achieve the revenue growth expected to result from the addition of such clients, (ii) expand its group health, workers' compensation and public sector business, (iii) control health care benefit expenses, (iv) achieve operation and cost synergies anticipated as a result of the CCN and Mail Handlers acquisitions, (v) add CCN's contracted providers to The First Health® Network on a timely basis, or (vi) successfully integrate the recently acquired Mail Handlers Benefit Plan administrative assets. All forward-looking statements herein are made as of the date hereof and the Company undertakes no obligation to update such statements.

First Health Group Corp.
(000's Omitted Except EPS and Percentages)
(Unaudited)