First Health Enters Into Long-term PPO Network Agreement with Health Net
And Completes Acquisition of Health Net Employer Services, Inc.

Investor Contact:
Joseph E. Whitters, CFO
630-737-7511

Media Contact:
Erin Gardiner, Public Relations Manager
630-737-5016

FOR IMMEDIATE RELEASE

DOWNERS GROVE, IL –October 31, 2003 - First Health Group Corp. (NASDAQ: FHCC), announced today a long-term agreement to provide its national Preferred Provider Organization (PPO) network to Health Net, Inc.’s (NYSE: HNT) group health commercial health plan PPO members and Administrative Service Only (ASO) members who utilize medical services outside of Health Net’s geographic service area. The company also announced the completion of the acquisition of Health Net Employer Services, Inc., a workers’ compensation managed care company based in Irvine, CA, from Health Net, Inc.

“The long-term group health alliance will provide Health Net PPO and ASO members with access to over 425,000 providers and nearly 4,400 hospitals in The First Health® Network,” said Edward L. Wristen, president and CEO of First Health. “No matter where PPO or ASO members live, work or travel in the United States, they will have access to a provider through either the Health Net network or The First Health® Network.

After announcing in September a definitive agreement to purchase the stock of Health Net Employer Services, Inc., First Health today announced the completion of the $80 million cash purchase, subject to certain adjustments, which includes Health Net Plus Managed Care Services, Inc. and Health Net CompAmerica, Inc.

“We will build additional value for our workers’ compensation clients by combining product strengths from each organization. In addition, over the next 18 months we will combine many departments to realize operating synergies,” said Patrick G. Dills, Executive Vice President of First Health.

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.

Health Net Employer Services, Inc. and its subsidiaries provide workers’ compensation-related managed care and cost containment programs to employers, insurance carriers, third party administrators and public agencies. In addition, the company operates a state certified Health Care Organization (HCO) in California, where it provides employers with access to contracted networks of physicians.

Health Net, Inc. is one of the nation’s largest publicly traded managed health care companies. Its mission is to help people be healthy, secure and comfortable. The company’s HMO, insured PPO and government contracts subsidiaries provide health benefits to approximately 5.3 million individuals in 15 states through group, individual, Medicare, Medicaid and TRICARE programs. Health Net’s subsidiaries also offer managed health care products related to behavioral health, dental, vision and prescription drugs, and offer managed health care product coordination for multi-region employers and administrative services for medical groups and self-funded benefits programs. For more information on Health Net, Inc., please visit the company’s Web site at www.health.net.

Forward-Looking Statements Notice
Certain statements herein regarding anticipated financial results for 2004 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 and (iv) achieve operation and cost synergies anticipated as a result of the Health Net Employer Services acquisition. All forward-looking statements herein are made as of the date hereof, and the Company undertakes no obligation to update such statements.