Exhibit 10.3

AMERICAN HEALTHWAYS, INC. (THE “COMPANY”)

FISCAL YEAR 2006 BONUS CRITERIA UNDER CAPITAL ACCUMULATION PLAN

On August 24, 2005, upon recommendation of the Compensation Committee, the
Company’s Board of Directors approved the bonus criteria for fiscal year 2006
under the Capital Accumulation Plan (the “CAP”), a copy of which has been filed
as Exhibit 10.11 to the Company’s Registration Statement on Form S-1
(Registration No. 33-41119) and Exhibit 10.8 to Form 10-K of the Company for its
fiscal year ended August 31, 1995. For fiscal year 2006, awards made under the
CAP will be predicated on achieving targeted earnings per share. Under the CAP
for fiscal year 2006, eligible participants may receive a maximum deferred
compensation award of up to 18.5% of such participant’s base salary.