For Immediate Release

TMG Health to be acquired by Health Care Service Corporation
New owner committed to keeping jobs, increasing investment in Northeastern PA

Scranton, October 22, 2008 –TMG Health, the nation's leading provider of business process outsourcing for Medicare, Medicaid and group retiree health plans, and one of northeastern Pennsylvania's largest employers, today announced that it has reached a merger agreement with Health Care Service Corporation (HCSC) of Chicago.

According to Dunmore native Jack Tighe, who founded TMG Health in 1998, HCSC will retain the company's National Operations Center in Dunmore, its office in downtown Scranton and its corporate office in suburban Philadelphia. Ninety-five percent of TMG Health's 1,200 employees work in Scranton, Dunmore and the surrounding communities; over 30 percent work from home.

"As one of TMG Health's own clients, HCSC values the unique nature of our company," Tighe said. "Even more important, they respect my deep personal commitment to our employees and the long-term investment we are making in northeastern Pennsylvania."

When the merger is finalized, TMG Health will become a wholly-owned subsidiary of HCSC operating as an independent organization with a separate board of directors. Tighe will remain President and CEO of TMG Health and serve on this board.

HCSC, a Mutual Legal Reserve Company, is the largest customer-owned health insurer in the United States and the fourth largest health insurer in the country overall. It has 12.4 million members in its Blue Cross and Blue Shield plans in Illinois, New Mexico, Oklahoma and Texas. The company is an independent licensee of the Blue Cross and Blue Shield Association.

"The complexity of government business requires highly-skilled workers knowledgeable in all compliance regulations," said Patricia Hemingway Hall, President and Chief Operating Officer of HCSC. "We know that TMG Health's greatest asset is its employees and we are excited about gaining immediate access to the expertise we need to pursue growth opportunities in this area."

Earlier this year, TMG Health received the 2008 Northeastern Pennsylvania Innovation Award for Entrepreneurial Achievement. TMG Health was recognized as the company that best exemplifies the quintessential entrepreneurial spirit: a combination of ingenuity, hard work and innovation that has resulted in the creation of a successful and growing business venture.

"HCSC understands that TMG Health's success is directly attributed to the hard work, entrepreneurial spirit and dedication of our employees, the many clients that trust us to manage their government health plans, and the strong, visionary leadership of our management team," Tighe said. "We know this will be a great relationship."

TMG Health currently serves over 1.9 million Medicare and Medicaid members and about three dozen health plans nationwide.

About TMG Health
TMG Health is a technology-enabled, Business Process Outsourcing (BPO) services firm providing a variety of administrative services to the Medicare and Medicaid health plan markets. As the leading vendor in this field, TMG Health provides operational outsourcing solutions and information systems for health plans, providers and insurers. TMG Health is the most experienced vendor in the market and has the broadest solution set serving over 36 health plans in all 50 states. TMG Health's client base consists of one of the nation's largest PBMs for Part D administration insurance carriers, 14 Blue Cross and Blue Shield plans, several national start-up PFFS plans for individuals and group retirees, and the fastest growing PFFS plan and the fastest growing Special Needs Plan (SNP) in the nation. TMG Health serves over 1.5 million Medicare and Medicaid members. Benefits of partnering with TMG Health include state of the art systems, rapid implementations, reduced capital costs, fixed operational costs and proven regulatory compliance.

TMG Health is a privately held corporation located in suburban Philadelphia with a National Operations Center in Northeastern Pennsylvania. For more information, please visit www.tmghealth.com.

Contact:
Karen Walsh
(717) 982-8194
kwalsh@neimangroup.com

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