New York State Ranks Last in the Nation for Payment Performance With State Physicians in 2008 PayerView(SM) Rankings

Complex patient referral authorization requirements, slow or non-existent reimbursement policies, insistence on the use of proprietary medical claims forms, and confusing and paper-based billing requirements have resulted in the State of New York’s Medicaid program ranking last in the nation for their business dealings with medical providers according to the third annual PayerView(SM) Rankings issued today by athenahealth, Inc., (Nasdaq: ATHN), and Physicians Practice(R), America’s leading practice management journal for physicians. All data used for the rankings comes from actual claims performance data of athenahealth customers on its national on-demand athenaNet(R) System and depict athenahealth’s experience in dealing with payers through the 2007 calendar year. To view the complete 2008 PayerView Rankings including state Medicaid programs, visit www.athenaPayerView.com.

“These PayerView data speaks volumes about why many physicians simply refuse to participate in Medicaid,” said William F. Jessee, MD, FACMPE, president and CEO, Medical Group Management Association (MGMA). The MGMA serves 21,500 members who lead and manage more than 13,500 organizations in which almost 270,000 physicians practice. “Not only are Medicaid payment rates far lower than any other payer, but many Medicaid programs are incapable of making timely, accurate payments. Unfortunately, it is the poor who suffer most from Medicaid program incompetence, because they are unable to gain the access-to-care that Medicaid was intended to provide them.”

“athenahealth has seen tremendous supply chain improvement on behalf of our national physician clients as a result of the PayerView Ranking Initiative which has increased our ability to work with various health insurers to help them improve their business dealings with medical groups,” said Jonathan Bush, Chairman and CEO of athenahealth. “Unlike other State Medicaid programs we rank, the experience of our clients with New York State has gotten progressively worse in core areas like the amount of time a medical claim is paid and their overall denial patterns. We are seeing that the administrative process issues with New York-Medicaid are resulting in physicians no longer accepting new Medicaid patients in some cases.”

New York-Medicaid Ranked Last in Five of the Seven PayerView Ranking Metrics in 2008:

— New York-Medicaid claims were the slowest to be paid for athenahealth users, averaging over 137 days to pay a claim, more than double compared to the average of almost 68 days for the other State Medicaid programs ranked. New York was not only the slowest payer among Medicaid programs but ranked the lowest among all 137 payers ranked nationally.

— New York-Medicaid had the highest denial rate of athenahealth customer claims, rejecting claims or requiring back-end rework by medical practices over 33 percent of the time on average.

— New York-Medicaid ranked at the bottom on the clarity of why the program rejects a medical claim. New York physicians served by athenahealth resubmitted denied claims at least twice over 65 percent of the time on average – delaying payment and increasing administrative hassle on medical providers and their staff.

— The 2008 rankings indicate that over five percent of medical claims are rejected by New York-Medicaid due to program deviation from federal correct coding initiative standards.

Bush continued, “New York-Medicaid is adding a tremendous burden to the physicians of New York State and creating a potentially serious access-to-care issue for the millions of New York residents that receive medical care coverage from the State program as doctors are increasingly opting out from seeing Medicaid patients due to the hassle associated with trying to obtain payment for care delivered.”

About Physicians Practice

Physicians Practice creates content to help physicians strengthen their practice operations to improve patient care through its award-winning journal, popular Web site, audioconferences, newsletters, and live seminars. Physicians Practice(R), America’s Leading Practice Management Journal, received numerous awards in 2006-2007, including: Publication of the Year, Best Publication Redesign, and Best Regular Column for “The Bigger Picture” from the American Society of Healthcare Publication Editors (ASHPE); Publication Redesign from the American Society of Business Publication Editors (ASBPE); and recognition as one of Baltimore’s Future 50 companies from SmartCEO magazine. For more information about Physicians Practice, visit our web site at www.PhysiciansPractice.com.

About athenahealth

athenahealth is a leading provider of internet-based business services for physician practices. The Company’s service offerings are based on proprietary web-native practice management and electronic medical record (EMR) software, a continuously updated payer knowledge-base and integrated back-office service operations. For more information visit www.athenahealth.com or call (888) 652-8200.