Healthways Awarded Contract to Expand National Chronic Disease Management Program in France and France’s Overseas Territories

Ben R. Leedle, Jr., President and CEO of Healthways (Nasdaq: HWAY), today confirmed that the company has been selected by France’s Caisse Nationale d'Assurance Maladie des Travailleurs Salariés (CNAMTS) to broadly expand services for CNAMTS’ Sophia program to improve health and well being for all citizens with diabetes, in France and French Territories overseas. The 4-year contract awarded to Healthways, in partnership with French consulting firm Altran (Euronext: ALT), was made following an extensive evaluation process which reviewed proposals from approximately 20 potential service providers including two global technology firms, a multinational health insurance firm, a multinational pharmacy benefits manager and the incumbent service supplier.

“The decision by CNAMTS to award this contract to the Healthways-Altran Group, particularly given the caliber of our competition, is a highly meaningful validation of the depth and breadth of both our comprehensive well-being solution and of our EmbraceTM platform,” said Matt Kelliher, President, Healthways International. “Clearly, our solutions are the world class benchmark, capable of meeting the needs of millions of individuals threatened by the challenge of living with a long term condition.”

The evaluation addressed key areas including: technology capabilities, quality and scalability of the solution, best practices in patient engagement, population segmentation, clinician and analytics training, proven expertise and results, project management and innovation. Healthways, together with its strategic partner Altran, was selected by the unanimous decision of the judging panel as the outstanding choice to provide the technological infrastructure, specialist patient support software and expert consulting support needed to improve the health and quality of life for Sophia patients.

“We look forward to working with Healthways in our efforts to extend the benefits of Sophia to a greater number of citizens afflicted with diabetes and other chronic diseases,” said Frédéric van Roekeghem, Managing Director of CNAMTS. “We have a high level of confidence that, through this relationship, both the technical integration of systems and the delivery of services to our members with chronic disease will lead to significant improvements in their well-being and quality of life.”

Integration of the CNAMTS information system and Healthways’ EmbraceTM Platform and infrastructure is expected to take 7-8 months, during which period Altran will provide expert technology consulting services. At the same time, Healthways will be training CNAMTS clinicians on the Healthways application and intervention model. Delivery of services using the new solution is scheduled to begin by the end of 2011. In addition, the agreement provides for Healthways’ support in transitioning services at two existing service centers, opening four new service centers and developing programs for two new disease states, most likely cardiac and respiratory, to the program. Further, CNAMTS may secure additional work in any of six specified areas including, additional integration, development of new functionalities, selection and installation of new telephone technology, and additional service center staff training.

“The CNAMTS technology environment and Healthways’ EmbraceTM Platform and infrastructure are both highly advanced and complex systems. The successful integration will provide improvements in the performance of the overall system, resulting in both enhanced effectiveness and efficiency for the Sophia program. Altran is proud to be part of the winning team and is excited to have the opportunity to demonstrate its expertise and contribute to an ambitious patient centered health project on behalf of the growing number of French citizens with chronic situations,” commented Yves de Chaisemartin, Chief Executive Officer, Altran.

Individual participation in Sophia is accomplished by an opt-in process initiated by the patient’s physician. As part of the plan for this agreement, Healthways and Altran will be working closely with CNAMTS to develop approaches to significantly increase participation while ensuring that the patient’s physician remains at the center of their patients’ interactions with Sophia staff. Services to Sophia participants ultimately will be provided from six service centers, distributed throughout France and its overseas territories. In accordance with France’s medical privacy law, CNAMTS will continue to manage these service centers and the staff will continue to be CNAMTS employees.

“Our selection by CNAMTS, following our recently announced agreements with Hawaii Medical Service Association and the State of New South Wales, Australia, is convincing evidence that purchasers have significantly raised the bar with respect to process, technology and outcomes expectations across the entire spectrum of population health management services,” Leedle said. “We have been preparing for these new demands for several years. Our signing of these three agreements would suggest that our planning and execution have been right on target.”

Leedle continued, “At this time we expect to recognize relatively modest revenue from the contract during the current fiscal year and are in the process of analyzing and defining key implementation milestones and customer acceptance criteria over the next several weeks to further refine our revenue estimate for 2011. Based upon our current revenue expectations for 2011 and the corresponding estimated implementation and support costs, we would expect this contract to be approximately breakeven in 2011 and begin to achieve target revenue and profitability in 2012 and beyond.”

About CNAMTS

La Caisse Nationale de l'Assurance Maladie des Travailleurs Salariés (CNAMTS), the national health insurance fund for salaried workers in France, is under the supervision of both the Health Ministry and Finance and Economy Ministry. CNAMTS is the primary health insurer for 56 million lives, almost 86% of the French population. It is also responsible for optimization of the healthcare system as well as implementing coordinated treatment pathways throughout the country, with the primary care doctor at the centre of this system. As the key player in the healthcare system for which it ensures medical control, CNAMTS ensures that expenditures are balanced with allocated public resources. For more information, please visit their website http://www.ameli.fr.

About Altran

As European leader in Innovation and High-Tech Consulting, Altran has been providing services for almost thirty years to key players in the Automotive, Aeronautics, Telecoms, Energy, Healthcare and Finance sectors. Thanks to its expertise in the fields of advanced technology and innovation, the Group is able to advise and accompany its clients in the creation and development of their products and services. Present at every stage of project development from strategic planning through to manufacturing, Altran provides new technology services in the fields of Innovation Management, Mechanical Engineering, Engineering and Embedded Systems, IT Systems and Performance Management. For more information, please visit http://www.altran.com.

About Healthways

Healthways is the leading provider of specialized, comprehensive solutions to help millions of people maintain or improve their health and well-being and, as a result, reduce overall costs. Healthways' solutions are designed to keep healthy people healthy, reduce health-related risks and optimize care for those with chronic illness. Our proven, evidence-based programs provide highly specific and personalized interventions for each individual in a population, irrespective of age or health status, and are delivered to consumers by phone, mail, internet and face-to-face interactions, both domestically and internationally. Healthways also provides a national, fully accredited, complementary and alternative Health Provider Network and a national Fitness Center Network, which offer convenient access to health services outside of, and in conjunction with, the traditional healthcare system for interested individuals. For more information, please visit http://www.healthways.com/.

Safe Harbor Provisions

This press release contains forward-looking statements that are based upon current expectations and involve a number of risks and uncertainties including, but not limited to, future performance by Healthways, the results to be achieved, including the levels of participation, health, well-being and quality of life outcomes for populations, and performance of systems and programs. In order for Healthways to utilize the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, investors are hereby cautioned that these statements may be affected by the important factors, among others, included in the discussion in Part I, Item 1A, and Part II, Item 7, of Healthways' Annual Report on Form 10-K for the fiscal year ended December 31, 2010. Consequently, actual operations and results may differ materially from those expressed in these forward-looking statements. Healthways undertakes no obligation to update or revise any such forward-looking statements.

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