Corporate Background

Founded in 1997, XLHealth has a proud history as an industry leader in improving the quality of care for chronically ill Medicare beneficiaries through chronic care management services. Over the past three years, the company has evolved from an outsourced provider of disease management services to become the owner and operator of Care Improvement Plus, provider of care management-focused health plans offered to Medicare beneficiaries with special needs such as those with chronic conditions, and those receiving assistance through Medicaid.

XLHealth has been at the forefront of chronic care management innovations since its inception with a unique approach resulting in positive healthcare outcomes while lowering healthcare costs.

XLHealth’s care management model goes beyond the more customary approach of telephone or direct mail communications with members. The company’s approach is based upon the belief that support services must be customized for each individual across the spectrum of their healthcare needs. The company is a recognized pioneer in its delivery of care management services in a personal, “high touch” way that supports physicians in increasing the quality of care for their Medicare patients and eliminating unnecessary barriers to preventive treatment.

XLHealth’s programs emphasize the critical importance of the role physicians have in the healthcare equation. In fact, the premise upon which XLHealth is predicated is that care management services and support programs are most effective when they establish strong ties with the local healthcare community.

In 2003, the United States Department of Health and Human Services and the Centers for Medicare & Medicaid Services (CMS) awarded XLHealth one of three demonstration projects in the nation to test whether disease management services would improve the care of chronically ill Medicare beneficiaries. Within the program’s first year, XLHealth successfully recruited and provided disease management services to approximately 10,000 participating Medicare beneficiaries.

In 2004, CMS selected XLHealth to administer the Medicare Health Support pilot program in Tennessee, a major initiative to help improve the quality of care for chronically ill beneficiaries under the Medicare fee for service program. Through Medicare Health Support, XLHealth provided health support services to more than 12,000 Tennessee Medicare beneficiaries with diabetes and/or heart failure.

In 2006, XLHealth launched its first Care Improvement Plus plan, a Medicare Advantage Special Needs Plan focusing on the unique healthcare needs of beneficiaries with chronic conditions such as diabetes and heart failure. Approximately 6 million Medicare beneficiaries in Arkansas, Georgia, Maryland, Missouri, South Carolina and Texas are eligible to join a Care Improvement Plus plan, which combines traditional Medicare coverage with a comprehensive Medicare Part D drug benefit and care management services. Since its initial launch, Care Improvement Plus has grown to become XLHealth’s core business focus, with over 50,000 chronically ill members.

In August of 2007, XLHealth completed a $290 million private placement, with funding provided by MatlinPatterson Global Opportunities Partners III L.P., and MatlinPatterson Global Opportunities Partners (Cayman) III L.P., investment partnerships managed by MatlinPatterson Global Advisors LLC, a private equity firm. GS Capital Partners, LP, the private equity arm of Goldman, Sachs & Co. which helped fund the company’s growth in 2005, continues as an investor of XLHealth.

XLHealth continues to evolve as a key participant in Medicare’s renewed focus on the approximately nine million participating beneficiaries with chronic illness. Based on the company’s experience as a chronic care management company focused on the needs of seniors, XLHealth expects to continue to reduce rates of complications and hospitalizations by improving the quality of care for the Medicare lives it manages.