[November 15, 2012]

Healthways, Mercy Focusing on Population Health Management

Healthways (NASDAQ: HWAY) and Mercy today announced an exclusive agreement to identify potential market opportunities and assess complimentary capabilities in which Mercy and Healthways may develop and deploy strategies to manage the health of populations. The opportunity to bring these combined capabilities to regional employers and insurance companies that serve them is significant. Mercy was recently named one of St. Louis' Healthiest Employers by the St. Louis Business Journal. The ultimate objective of the assessment is to determine how Mercy and Healthways might deliver more efficient and effective solutions for total population health management. The aim is to keep healthy people healthy, empower people to reduce modifiable lifestyle risks and address acute and chronic disease which afflict the populations served.

Mercy and Healthways have agreed on eight "Imperatives for Success" that form the foundation for the assessment and ultimate actions for a quickly evolving healthcare marketplace:

1. Enhance physician alignment with integrated and independent physicians

2. Develop innovative and market-unique product offerings for consumers, employers, payers and governments

3. Manage the well-being of populations across the healthcare continuum

4. Grow and strengthen market share

5. Manage care transitions and form high-performing disease management networks

6. Manage financial risks associated with caring for populations

7. Drive excellence in clinical performance

8. Leverage a strong brand

Mercy, one of the largest Catholic healthcare systems in the nation, has gained a reputation for leading change in the communities that it serves with a particular focus on delivering a transformative health experence. That focus is driven by the recognition of the need to manage health instead of just treating periodic illness.

"In recent years, Mercy has been particularly focused on being absolutely community-based in our care and building a technology infrastructure that will support our patients and caregivers," said Lynn Britton, president and CEO of Mercy. "When it comes to managing the health of populations, we believe that working from the heart of the community through a fully optimized electronic health record gives us the best opportunity to bring about change. We look forward to working with Healthways and assessing the opportunities before us."

Healthways CEO, Ben R. Leedle, Jr., noted, "The leadership of Mercy clearly understands the rapidly evolving changes in healthcare today, particularly in the communities that they serve. We are honored to have been chosen by Mercy to work with them on the initial steps of assessment and creating a plan of action to meet their emerging needs. We have every reason to believe that our experience and proven capabilities in well-being improvement - coupled with our consultative and change management capabilities - will serve as the foundation for an expanding and enduring relationship with Mercy as they continue to transform their array of physicians, clinicians, healthcare facilities and services into a model for the health management system of the future."

About Mercy

Mercy is the sixth largest Catholic healthcare system in the U.S. and serves more than 3 million people annually. Mercy includes 31 hospitals, 300 outpatient facilities, 38,000 co-workers and 1,700 integrated physicians in Arkansas, Kansas, Missouri and Oklahoma. Mercy also has outreach ministries in Louisiana, Mississippi and Texas. Mercy Clinic is a physician-governed group of more than 1,700 medical providers with access to Mercy's facilities, electronic health records, telemedicine and each other. Mercy Clinic providers can give their patients the best care available, regardless of the patient's location. Patients of Mercy Clinic providers can connect to their own health records and health teams anywhere they connect to the Internet. For more about Mercy, visit www.mercy.net.

About Healthways

Healthways is the largest independent global provider of well-being improvement solutions. Dedicated to creating a healthier world one person at a time, the Company uses the science of behavior change to produce and measure positive change in well-being for our customers, which include employers, integrated health systems, hospitals, physicians, health plans, communities, and government entities. We provide highly specific and personalized support for each individual and their team of experts to optimize each participant's health and productivity and to reduce health-related costs. Results are achieved by addressing longitudinal health risks and care needs of everyone in a given population. The Company has scaled its proprietary technology infrastructure and delivery capabilities developed over 30 years and now serves approximately 40 million people on four continents. Learn more at www.healthways.com.

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