FORM 10-Q

                      SECURITIES AND EXCHANGE COMMISSION
                             Washington, DC 20549

     {X}  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
                       SECURITIES EXCHANGE ACT OF 1934


                 For the quarterly period ended June 30, 2001
                                     OR
     { }  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
                      SECURITIES EXCHANGE ACT OF 1934

             For the Transition period from ________ to ________

                        Commission file number 0-15846

                           First Health Group Corp.
                      formerly HealthCare COMPARE Corp.)
            (Exact name of registrant as specified in its charter)

               Delaware                              36-3307583
 -------------------------------         ------------------------------------
 (State or other jurisdiction of         (IRS Employer Identification Number)
  incorporation or organization)

              3200 Highland Avenue, Downers Grove, Illinois 60515
              ---------------------------------------------------
              (Address of principal executive offices, Zip Code)

                                (630) 737-7900
               ------------------------------------------------
               (Registrant's phone number, including area code)

                          __________________________
             (Former name, former address and former fiscal year,
                        if changed since last report)

 Indicate by check  mark whether  the registrant  (1) has  filed all  reports
 required to be filed by Section 13  or 15(d) of the Securities Exchange  Act
 of 1934 during the preceding 12 months (or for such shorter period  that the
 registrant was required to file such  reports), and (2) has been subject  to
 such filing requirements for the past 90 days.

           Yes      X                     No ________

 Indicate the number of shares outstanding of each of the issuer's classes of
 common stock, as of the latest practicable date.

 The number of shares of Common Stock, par value $.01 per share, outstanding
 on August 3, 2001, was 99,195,199.

<PAGE>

             First Health Group Corp. and Subsidiaries

                               INDEX


 Part I.  Financial Information
                                                                  Page Number
                                                                  -----------
       Item 1.  Financial Statements

       Consolidated Balance Sheets - Assets at June 30, 2001
         and December 31, 2000 ...................................     3

       Consolidated Balance Sheets - Liabilities and Stockholders'
         Equity at June 30, 2001 and December 31, 2000 ...........     4

       Consolidated Statements of Operations for the three months
         ended June 30, 2001 and 2000 ............................     5

       Consolidated Statements of Operations for the six months
         ended June 30, 2001 and 2000 ............................     6

       Consolidated Statements of Comprehensive Income for the
         three months ended June 30, 2001 and 2000 ...............     7

       Consolidated Statements of Comprehensive Income for the
         six months ended June 30, 2001 and 2000 .................     7

       Consolidated Statements of Cash Flows for the six months
         ended June 30, 2001 and 2000 ............................    8-9

       Notes to Consolidated Financial Statements ................   10-12

       Item 2.  Management's Discussion and Analysis of Financial
                  Condition and Results of Operations ............   13-17

       Item 3.  Quantitative and Qualitative Disclosures About
                  Market Risk ....................................    18

 Part II.  Other Information

       Item 4.  Submission of Matters to a Vote of
                  Security Holders................................    19

       Item 6.  Exhibits and Reports on Form 8-K .................    19

 Signatures.......................................................    20

<PAGE>
<TABLE>

 PART 1.  Financial Information
 First Health Group Corp. and Subsidiaries
 CONSOLIDATED BALANCE SHEETS
 (Dollars in 000's) (Unaudited)
 ----------------------------------------------------------------------------

 ASSETS                                      June 30, 2001  December 31, 2000
                                                ----------      ----------
 <S>                                            <C>             <C>
 Current Assets:

   Cash and cash equivalents ............       $   12,089      $   23,538
   Short-term investments ...............            1,963           2,015
   Accounts receivable, less allowances
      for doubtful accounts of $10,813
      and $10,811 respectively...........           68,455          57,137
   Deferred taxes .......................           16,502          16,480
   Other current assets .................           12,007          14,443
                                                 ---------       ---------
   Total current assets .................          111,016         113,613

 Long-Term Investments:

   Marketable securities ...............            65,433          58,242
   Other ...............................            49,870          43,787
                                                 ---------       ---------
                                                   115,303         102,029
                                                 ---------       ---------
 Property and Equipment:

   Land, buildings and improvements.....            81,449          71,135
   Computer equipment and software......           172,803         148,846
   Office furniture and equipment.......            18,877          16,597
                                                 ---------       ---------
                                                   273,129         236,578
   Less accumulated depreciation and
      amortization......................          (100,483)        (80,861)
                                                 ---------       ---------
   Net property and equipment ..........           172,646         155,717
                                                 ---------       ---------
 Goodwill, less accumulated amortization
   of $14,089 and $12,355, respectively.            88,241          89,975
 Reinsurance recoverable................            27,192          28,215
 Other Assets...........................             1,928           2,047
                                                 ---------       ---------
                                                $  516,326      $  491,596
                                                 =========       =========

                See Notes to Consolidated Financial Statements

</TABLE>
<PAGE>
<TABLE>

 First Health Group Corp. and Subsidiaries
 CONSOLIDATED BALANCE SHEETS
 (Dollars in 000's) (Unaudited)
 ----------------------------------------------------------------------------

 LIABILITIES AND STOCKHOLDERS' EQUITY

                                             June 30, 2001  December 31, 2000
                                                 ---------       ---------
 <S>                                            <C>             <C>
 Current Liabilities:

   Accounts payable ....................        $   30,242      $   31,727
   Accrued expenses ....................            28,185          28,603
   Claims reserves .....................            12,881          13,013
                                                 ---------       ---------
   Total current liabilities ...........            71,308          73,343

 Long-Term Debt.........................            62,500         127,500
 Claims Reserves - Non-Current..........            27,192          28,215
 Deferred Taxes.........................            64,922          58,621
 Other Non-Current Liabilities..........            22,379          22,504
                                                 ---------       ---------
   Total liabilities ...................           248,301         310,183
                                                 ---------       ---------
 Commitments and Contingencies..........                --              --

 Stockholders' Equity:

   Common stock ........................             1,302             795
   Additional paid-in capital ..........           288,169         252,092
   Retained earnings ...................           583,413         534,428
   Accumulated comprehensive loss.......              (466)         (1,509)
   Treasury stock, at cost .............          (604,393)       (604,393)
                                                 ---------       ---------
   Total stockholders' equity ..........           268,025         181,413
                                                 ---------       ---------
                                                $  516,326      $  491,596
                                                 =========       =========

                See Notes to Consolidated Financial Statements

</TABLE>
<PAGE>
<TABLE>

 First Health Group Corp. and Subsidiaries
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (Dollars in 000's except per share amounts) (Unaudited)
 ----------------------------------------------------------------------------

                                                Three Months Ended June 30,
                                                 -------------------------
                                                    2001            2000
                                                 ---------       ---------
 <S>                                            <C>             <C>
 Revenues............................           $  138,949      $  125,884
                                                 ---------       ---------
 Operating expenses:

   Cost of services .................               60,438          55,964
   Selling and marketing ............               13,233          11,914
   General and administrative .......                8,622           8,510
   Healthcare benefits ..............                3,396           3,374
   Depreciation and amortization ....               11,285           9,374
                                                 ---------       ---------
                                                    96,974          89,136
                                                 ---------       ---------
 Income from operations..............               41,975          36,748

 Other (income) expense:

   Interest expense .................                1,119           4,079
   Interest income ..................               (1,714)         (1,841)
                                                 ---------       ---------
 Income before income taxes..........               42,570          34,510

 Income taxes........................              (17,241)        (13,977)
                                                 ---------       ---------
 Net income..........................           $   25,329      $   20,533
                                                 =========       =========
 Weighted average shares
   outstanding - basic...............               97,765          95,940
                                                 =========       =========
 Net income per common share - basic.           $      .26      $      .21
                                                 =========       =========
 Weighted average shares
   outstanding - diluted..............             102,396          99,968
                                                 =========       =========
 Net income per common share - diluted          $      .25      $      .21
                                                 =========       =========

                See Notes to Consolidated Financial Statements

</TABLE>
<PAGE>
<TABLE>

 First Health Group Corp. and Subsidiaries
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (Dollars in 000's except per share amounts) (Unaudited)
 ----------------------------------------------------------------------------

                                                 Six Months Ended June 30,
                                                 -------------------------
                                                    2001            2000
                                                 ---------       ---------
 <S>                                            <C>             <C>
 Revenues............................           $  275,933      $  248,359
                                                 ---------       ---------
 Operating expenses:

   Cost of services .................              120,175         111,399
   Selling and marketing ............               26,177          23,387
   General and administrative .......               16,992          17,235
   Healthcare benefits ..............                7,099           5,733
   Depreciation and amortization ....               21,887          18,487
                                                 ---------       ---------
                                                   192,330         176,241
                                                 ---------       ---------
 Income from operations..............               83,603          72,118

 Other (income) expense:

   Interest expense .................                3,590           8,045
   Interest income ..................               (3,565)         (3,398)
                                                 ---------       ---------
 Income before income taxes..........               83,578          67,471

 Income taxes........................              (33,849)        (27,326)
                                                 ---------       ---------
 Net income..........................           $   49,729      $   40,145
                                                 =========       =========

 Weighted average shares
   outstanding - basic...............               97,270          95,724
                                                 =========       =========
 Net income per common share - basic.           $      .51      $      .42
                                                 =========       =========
 Weighted average shares
   outstanding - diluted..............             102,034          99,544
                                                 =========       =========
 Net income per common share - diluted          $      .49      $      .40
                                                 =========       =========

                See Notes to Consolidated Financial Statements

</TABLE>
<PAGE>
<TABLE>

 First Health Group Corp. and Subsidiaries
 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
 (Dollars in 000's) (Unaudited)
 ----------------------------------------------------------------------------

                                                Three Months Ended June 30,
                                                 -------------------------
                                                    2001            2000
                                                 ---------       ---------
 <S>                                            <C>             <C>
 Net income..................................   $   25,329      $   20,533
                                                 ---------       ---------
 Unrealized gains on securities, before tax..           79             859
 Income tax expense related to items of other
   comprehensive income......................          (45)           (348)
                                                 ---------       ---------
 Other comprehensive income..................           34             511
                                                 ---------       ---------
 Comprehensive income........................   $   25,363      $   21,044
                                                 =========       =========



                                                 Six Months Ended June 30,
                                                 -------------------------
                                                    2001            2000
                                                 ---------       ---------
 <S>                                            <C>             <C>
 Net income..................................   $   49,729      $   40,145
                                                 ---------       ---------
 Unrealized gains on securities, before tax..        1,673           2,644
 Income tax expense related to items of other
   comprehensive income......................         (630)         (1,051)
                                                 ---------       ---------
 Other comprehensive income..................        1,043           1,593
                                                 ---------       ---------
 Comprehensive income........................   $   50,772      $   41,738
                                                 =========       =========

                See Notes to Consolidated Financial Statements

</TABLE>
<PAGE>
<TABLE>

 First Health Group Corp. and Subsidiaries
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Dollars in 000's) (Unaudited)
 ----------------------------------------------------------------------------

                                                 Six Months Ended June 30,
                                                 -------------------------
                                                    2001            2000
                                                 ---------       ---------
 <S>                                            <C>             <C>
 Cash flows from operating activities:
   Cash received from customers ............    $  265,706      $  240,744
   Cash paid to suppliers and employees ....      (163,697)       (158,465)
   Healthcare benefits paid ................        (8,545)         (3,150)
   Interest income received ................         2,613           2,755
   Interest expense paid ...................        (3,848)         (6,718)
   Income taxes paid, net ..................       (15,976)         (3,516)
                                                 ---------       ---------
   Net cash provided by operating activities        76,253          71,650
                                                 ---------       ---------
 Cash flows from investing activities:
   Purchases of investments ................       (22,711)        (13,398)
   Sales of investments ....................        12,211           7,064
   Purchase of property and equipment ......       (37,107)        (23,682)
                                                 ---------       ---------
   Net cash provided by (used in)
     investing activities...................       (47,607)        (30,016)
                                                 ---------       ---------
 Cash flows from financing activities:
   Purchase of treasury stock ..............            --         (10,938)
   Repayment of long-term debt .............       (65,000)        (45,000)
   Stock option loans to employees .........        (1,500)         (3,337)
   Stock option loan repayments ............           756           3,547
   Proceeds from issuance of common stock...        25,649          17,715
                                                 ---------       ---------
   Net cash used in financing activities....       (40,095)        (38,013)
                                                 ---------       ---------
 Net increase (decrease) in cash and
  cash equivalents..........................       (11,449)          3,621
 Cash and cash equivalents,
   beginning of period......................        23,538          35,639
                                                 ---------       ---------
 Cash and cash equivalents, end of period...    $   12,089      $   39,260
                                                 =========       =========
 Non-cash financing activity:
     Stock options exercised in exchange
       for common stock.....................    $       --      $    8,733
                                                 =========       =========

                See Notes to Consolidated Financial Statements
</TABLE>
<PAGE>
<TABLE>


 First Health Group Corp. and Subsidiaries
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Dollars in 000's) (Unaudited)
 ----------------------------------------------------------------------------

                                                 Six Months Ended June 30,
                                                 -------------------------
                                                    2001            2000
                                                 ---------       ---------
 <S>                                            <C>             <C>
 Reconciliation of Net Income to Net Cash
   Provided by Operating Activities:

 Net Income..................................   $   49,729      $   40,145
                                                 ---------       ---------
 Adjustments to Reconcile Net Income to Net
   Cash Provided by Operating Activities:
     Depreciation and amortization ..........       21,887          18,487
     Change in provision for uncollectible
       receivables...........................            2             (92)
     Tax benefit from stock options exercised       10,935           7,632
     Deferred income taxes ..................        5,649          13,408
     Other, net .............................       (1,024)           (625)

     Changes in Assets and Liabilities:
     Accounts receivable ....................      (11,320)         (8,916)
     Other current assets ...................        2,436          (1,192)
     Reinsurance recoverable ................        1,023          15,678
     Accounts payable and accrued expenses...       (1,903)         (2,653)
     Claims reserves ........................       (1,155)        (13,094)
     Income taxes payable ...................           --           2,773
     Non-current assets and liabilities .....           (6)             99
                                                 ---------       ---------
   Total adjustments ........................       26,524          31,505
                                                 ---------       ---------
   Net cash provided by operating activities    $   76,253      $   71,650
                                                 =========       =========

                See Notes to Consolidated Financial Statements

</TABLE>
<PAGE>

 First Health Group Corp. and Subsidiaries
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 (Unaudited)

 1.  The  unaudited financial  statements herein  have been  prepared  by the
     Company pursuant  to the  rules  and regulations  of the  Securities and
     Exchange Commission.  The accompanying interim financial statements have
     been prepared under the presumption  that users of the interim financial
     information have  either read or  have access  to the  audited financial
     statements  for  the  latest   fiscal  year  ended  December  31,  2000.
     Accordingly,  footnote disclosures  which would  substantially duplicate
     the disclosures  contained in  the December  31, 2000  audited financial
     statements have  been omitted  from these interim  financial statements.
     Certain  information  and  footnote  disclosures  normally  included  in
     financial statements  prepared in accordance  with accounting principles
     generally accepted in  the United States of  America have been condensed
     or omitted pursuant to such rules and regulations.  Although the Company
     believes  that the  disclosures  are adequate  to  make  the information
     presented not misleading,  it is suggested that  these interim financial
     statements be read in conjunction  with the financial statements and the
     notes  thereto  included  in the Company's latest Annual Report on Form
     10-K.

 2.  On May 22, 2001,  the Company's Board of  Directors authorized a 2-for-1
     common stock split in the form of  a 100% stock distribution.  The stock
     split was  paid on June  25, 2001 to  stockholders of record  on June 4,
     2001.  All historical common share  amounts, per share amounts and stock
     option data for all periods presented  have been restated to give effect
     to this 100% stock distribution.

 3.  The Company's investments in  marketable securities which are classified
     as available  for sale  had a  net  unrealized gain  in market  value of
     $1,043,000, net of deferred income taxes, for the six month period ended
     June 30, 2001.  The net unrealized loss as of June 30, 2001, included as
     a  component of  stockholders'  equity, was  $466,000,  net  of deferred
     income  taxes.  The  Company has six  separate investments  in a limited
     partnership which invests in equipment which is leased to third parties.
     The  total investment  as of  June 30,  2001  was $44.2  million  and is
     accounted for using the  equity method since the  Company owns between a
     20%  and  25%  interest  in  each  particular  tranche  of  the  limited
     partnership.  The  Company's  proportionate  share of  the partnership's
     income was $1,357,000 and  $1,082,000 for the six  months ended June 30,
     2001 and 2000, respectively, and is included in interest income.

 4.  The Company's Board of Directors has approved the repurchase of up to 15
     million shares  of  the  Company's outstanding  common  stock  under its
     current  authorization.   Purchases  may  be  made  from  time  to time,
     depending on  market  conditions and other relevant factors.  As of June
     30,  2001,  approximately  5.2   million  shares  remain  available  for
     repurchase under the Company's current repurchase authorization.

 5.  Weighted average shares  outstanding increased for  diluted earnings per
     share  by  4,631,000  and  4,764,000  and  by  4,028,000  and  3,820,000
     respectively, for the three and six months  ended June 30, 2001 and 2000
     due to the effect of stock options  outstanding.  Diluted net income per
     share was  $.01 and $.02  less than basic  net income per  share for the
     three  and six months ended  June 30,  2001 due  to the effect of  stock
     options  outstanding.  Diluted net income  per share was  equal to basic
     net income per  share for the three  months ended June 30,  2000 but was
     $.02 less than basic income per share  for the six months ended June 30,
     2000 due to the effect of stock options outstanding.

 6. Effective  January 1,  2001, the  Company adopted Statement  of Financial
    Accounting Standard No.  133, ("SFAS No. 133), "Accounting For Derivative
    Instruments  and Hedging  Activities".   SFAS No.  133 requires  that all
    derivative instruments  be recognized as either  assets or liabilities in
    the  balance sheet  and that  derivative instruments be  measured at fair
    value.  This  statement  also  requires  changes in  the  fair  value  of
    derivatives   to  be  recorded   each  period  in   current  earnings  or
    comprehensive  income depending on  the intended  use of  the derivative.
    There  was no material effect  on the Company's results  of operations or
    financial position as a result of the adoption of SFAS No. 133.

    In  July 2001, the  Financial Accounting Standards  Board ("FASB") issued
    Statement  of  Financial  Accounting  Standards  No.  141  ("SFAS  141"),
    "Business  Combinations."   SFAS  141  requires  the  purchase  method of
    accounting  for  business combinations initiated after June  30, 2001 and
    eliminates the pooling-of-interests method.  The Company does not believe
    that  the adoption  of SFAS  141 will  have a  significant impact  on its
    financial statements.

    In July 2001, the FASB issued Statement of Financial Accounting Standards
    No.  142 ("SFAS 142"), "Goodwill  and Other Intangible  Assets", which is
    effective  January 1, 2002.   SFAS 142 requires, among  other things, the
    discontinuance  of  goodwill  amortization.   In  addition,  the standard
    includes   provisions  for  the  reclassification   of  certain  existing
    recognized intangibles  as goodwill, reassessment of  the useful lives of
    existing recognized  intangibles, reclassification of certain intangibles
    out of  previously reported goodwill and  the identification of reporting
    units for purposes of assessing potential future impairments of goodwill.
    SFAS  142 also requires the  Company to complete  a transitional goodwill
    impairment  test six months  from  the date  of adoption.  The Company is
    currently assessing but  has not yet determined the impact of SFAS 142 on
    its financial position and results of operations.

 7. The Company and its subsidiaries are subject to various claims arising in
    the  ordinary  course  of  business  and  are  parties  to  various legal
    proceedings that constitute  litigation incidental to the business of the
    Company  and its  subsidiaries.  The  Company's wholly  owned subsidiary,
    First Health Services Corporation ("Services") continues to be subject to
    an investigation by  the District of Columbia Office of Inspector General
    (OIG").  In July 2000, the OIG issued a report evaluating the District of
    Columbia's  ("the  District")  Medicaid program  and  suggesting  ways to
    improve  the program.   Services, a  subsidiary of  the Company  that was
    acquired  in  July   1997,  has  acted  as  the  program's  fiscal  agent
    intermediary for 20 years.  The OIG report included allegations that from
    1993  to 1996, Services,  in its role as fiscal  agent intermediary, made
    erroneous Medicaid payments  to providers on behalf of patients no longer
    eligible to receive Medicaid benefits.  The Company does not believe that
    the claim or the investigation will have a material adverse effect on the
    Company's business or financial position.

 8. On  May  21, 2001,  the  Company announced  that  it had  entered  into a
    definitive  agreement  to  acquire  CCN  Managed  Care,  Inc.  ("CCN"), a
    national  group  health,  workers'  compensation  and  auto  managed care
    company  based in San  Diego, CA from  HCA- The Healthcare  Company.  The
    Company  will acquire 100% of  the capital stock  of CCN and  100% of the
    capital stock of Preferred Works, Inc., a wholly owned subsidiary of CCN,
    for a purchase  price of approximately $195 million in cash which will be
    financed  through the  Company's revolving line  of credit.   On  July 2,
    2001,  the Company  received a  second request  for information  from the
    Department  of Justice  and  is working  closely with  the  Department of
    Justice to complete the regulatory review process.

<PAGE>

 First Health Group Corp. and Subsidiaries

 Item 2.
 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
 AND RESULTS OF OPERATIONS
 (Unaudited)


 Forward-Looking Information

   This  Management's Discussion  and  Analysis of  Financial  Condition  and
 Results of Operations may include certain forward-looking statements, within
 the meaning of Section 27A  of the Securities Act  of 1933, as amended,  and
 Section 21E of the  Securities Exchange Act of  1934, as amended,  including
 (without limitation) statements with respect to anticipated future operating
 and financial performance,  growth and acquisition  opportunities and  other
 similar forecasts and statements  of expectation.  Words such as  "expects",
 "anticipates", "intends", "plans", "believes", "seeks", "estimates", "could"
 and "should"  and variations  of these  words and  similar expressions,  are
 intended  to  identify  these forward-looking  statements.   Forward-looking
 statements made by the  Company and its management  are based on  estimates,
 projections, beliefs  and assumptions  of management  at  the time  of  such
 statements  and  are  not guarantees  of  future  performance.  The  Company
 disclaims any obligations to update or revise any forward-looking  statement
 based on the occurrence of future events, the receipt of new information  or
 otherwise.

   Actual  future performance,  outcomes and  results may  differ  materially
 from those expressed in forward-looking statements  made by the Company  and
 its management  as  a  result  of  a  number  of  risks,  uncertainties  and
 assumptions.   Representative examples  of  these factors  include  (without
 limitation) general industry and economic conditions; interest rate  trends;
 cost  of capital and capital  requirements; competition  from other  managed
 care companies;  the  ability  to expand  certain  areas  of  the  Company's
 business;  shifts  in  customer  demands;  changes  in  operating  expenses,
 including employee wages, benefits  and medical inflation; governmental  and
 public policy changes  and the continued  availability of  financing in  the
 amounts and at the terms necessary to support the Company's future business.
 In addition, if the Company does not continue to successfully implement  new
 contracts and programs and control healthcare benefit expenses, the  Company
 may not achieve its projected 2001 financial results (discussed below).

 Recent Developments

 On May 21, 2001, the Company announced that it had entered into a definitive
 agreement to  acquire  CCN Managed  Care,  Inc. ("CCN"),  a  national  group
 health, workers' compensation  and auto managed  care company  based in  San
 Diego, CA from HCA - The Healthcare Company.  The Company will acquire  100%
 of the capital  stock of  CCN and  100% of  the capital  stock of  Preferred
 Works, Inc.,  a wholly  owned subsidiary  of  CCN for  a purchase  price  of
 approximately $195  million  in cash  which  will be  financed  through  the
 Company's revolving line of credit.  On July 2, 2001, the Company received a
 second request for information from the Department of Justice and is working
 closely with the  Department of Justice  to complete  the regulatory  review
 process.

 On May  22, 2001,  the Company's  Board of  Directors authorized  a  2-for-1
 common stock split in the form of a 100% stock distribution.  The split  was
 payable on June 25,  2001 to stockholders of  record on June  4, 2001.   All
 historical common share amounts, per share amounts and stock option data for
 all periods presented have been restated  to give effect to this 100%  stock
 distribution.

 Results of Operations

   The  Company's revenues  consist primarily  of  fees for  cost  management
 services provided under contracts on a percentage of savings basis (PPO)  or
 on a predetermined contractual  basis (claims administration, fee  schedule,
 pharmacy benefit management and clinical management services).  As a  result
 of the  Company's  insurance  company acquisitions,  revenues  also  include
 premium revenue.

   The following table sets forth information with respect to the sources  of
 the Company's revenues for the three and six months ended June 30, 2001  and
 2000, respectively:


   Sources of Revenue

                                            ($ in thousands)
                                       Three Months Ended June 30,
                                      -----------------------------
                                        2001     %       2000     %
                                      -------   ---    -------   ---
      Sources of Revenue:
        PPO Services                 $ 78,104    56%  $ 67,683    54%
        Claims Administration          42,529    31     37,381    30
        Clinical Management Services    6,824     5      8,120     6
        Fee Schedule Services           7,759     5      9,743     8
        Premiums, Net                   3,733     3      2,714     2
        Service                            --    --        243    --
                                      -------   ---    -------   ---
      Total Revenue                  $138,949   100%  $125,884   100%
                                      =======   ===    =======   ===

                                            ($ in thousands)
                                        Six Months Ended June 30,
                                      ------------------------------
                                        2001     %       2000     %
                                      -------   ---    -------   ---
      Sources of Revenue:
        PPO Services                 $153,815    56%  $132,600    53%
        Claims Administration          84,074    30     74,926    30
        Clinical Management Services   13,911     5     15,831     7
        Fee Schedule Services          16,513     6     18,701     8
        Premiums, Net                   7,620     3      5,622     2
        Service                            --    --        679    --
                                      -------   ---    -------   ---
      Total Revenue                  $275,933   100%  $248,359   100%
                                      =======   ===    =======   ===

   Revenue  for the  three  and six  months  ended June  30,  2001  increased
 $13,065,000 (10%) and $27,574,000 (11%), respectively, from the same periods
 of 2000  due to  strong PPO  revenue  which increased  15% from  the  second
 quarter of 2000.  The increase in PPO  revenue for the three and six  months
 ended June 30,  is due to  new client activity,  existing clients  utilizing
 more  PPO  services  and the  overall  increase  in PPO  providers.   Claims
 administration  revenue increased $5,148,000 (14%) and $9,148,000 (12%) from
 the same periods last year due primarily to new business particularly in the
 commercial sector.  Revenue from clinical cost management services decreased
 $1,296,000 (16%) and  $1,920,000 (12%) for  the three and  six months  ended
 June 30, 2001 from  the  comparable periods in  2000.  This decrease is  due
 principally to the  termination of certain  healthcare management  contracts
 with various state Medicaid  programs.  Revenue  from fee schedule  services
 decreased $1,984,000 (20%) and $2,188,000 (12%) from the comparable  periods
 in 2000 due to  a loss of  business primarily from  General Motors and  some
 smaller  workers'  compensation  carriers  who  have  exited  the  business.
 Premium revenue  increased $1,019,000  (38%) and  $1,998,000 (36%)  for  the
 three and six months ended  June 30, 2001 due  primarily to the addition  of
 new stop loss  insurance clients.   Risk-related  service revenue  decreased
 $243,000 (100%) and $679,000 (100%) from  the comparable periods of 2000  as
 the Company no longer offers this product.

   Cost of  services increased $4,474,000  (8%) and  $8,776,000 (8%) for  the
 three and six  months ended  June 30, 2001  from the  comparable periods  of
 2000.  Cost of services consists primarily of salaries and related costs for
 personnel involved in claims administration, PPO administration, development
 and expansion, utilization management programs, fee schedule and  other cost
 management and administrative services offered by the Company.  To  a lesser
 extent, cost of services includes telephone expenses, facility  expenses and
 information processing costs.  As a percentage of revenue, cost  of services
 decreased to 43% and 44%, respectively,  from 44% and 45% in  the comparable
 periods last year.  This decrease is due primarily to  efficiencies achieved
 as the Company's business continues to expand.

   Selling and marketing  costs for the three and  six months ended June  30,
 2001 increased $1,319,000  (11%) and  $2,790,000 (12%)  from the  comparable
 periods of  2000.  The increase is due  primarily to increased  expenditures
 for  the Company's focused national marketing  campaign  which began in  the
 first quarter of 2000 and to the addition of new sales personnel.

   General and administrative costs for  the three and six months ended  June
 30, 2001  increased  $112,000 (1%)  and  decreased $243,000  (1%)  from  the
 comparable  periods  of 2000.  These  expenditures are  comparable to  prior
 quarters  and   reflect  the   increased   efficiencies  achieved   in   the
 administrative operations.

   Healthcare benefits represent  medical losses incurred by insureds of  the
 Company's insurance entities.   Healthcare benefits  increased $22,000  (1%)
 and $1,366,000 (24%) for the three and  six months ended June 30, 2001  from
 the comparable  periods of  2000.   This increase  is due  primarily to  new
 client  activity.  The  loss  ratio (healthcare  benefits  as a  percent  of
 premiums) was 91% and 93% for the three  and six months ended June 30,  2001
 compared to 124% and  102% for the comparable  periods  of 2000.  Management
 has reviewed  its insurance  business in  detail and  has taken  appropriate
 action at renewal in an effort to reduce the loss ratio going forward.

   Depreciation  and amortization  expenses  increased $1,911,000  (20%)  and
 $3,400,000 (18%) for the three and six  months ended June 30, 2001 from  the
 comparable  periods   of  2000   due  primarily   to  increased   technology
 infrastructure investments made  over the course  of the past  few years  as
 well as various  software applications which  came on-line  during 2000  and
 2001.  Depreciation expense will continue  to grow primarily as a result  of
 continuing investments the Company is  making in its information  technology
 infrastructure.

   Interest  income for  the three  and six  months ended  June 30,  2001  is
 comparable to the same periods in 2000 as  the Company has used much of  its
 cash generated from operations to repay debt in 2001.

   Interest expense decreased $2,960,000 (73%) and $4,455,000 (55%) from  the
 comparable periods of 2000 as the  outstanding debt has decreased from  $240
 million at June 30, 2000 to  $62.5 million at June  30, 2001.  The  interest
 rate at June 30, 2001 was approximately 5% per annum.

   Net income  for the three and  six months ended  June 30, 2001,  increased
 $4,796,000 (23%) and $9,584,000 (24%) from  the comparable periods of  2000.
 This increase is due  primarily to the  increase in PPO  revenue as well  as
 increased efficiency in the Company operations and, to a lesser extent,  the
 other factors discussed above.

   Diluted net  income per common share  for the three  and six months  ended
 June 30, 2001 increased 19% to $.25 per share and 23% to .49 per share  from
 the comparable periods of 2000.  For  the three months and six months  ended
 June 30, 2001, diluted  common shares outstanding increased  2% and 3%  from
 the comparable periods of 2000.

 Liquidity and Capital Resources

   The Company had $39,708,000 in  working capital at June 30, 2001  compared
 with working capital of $40,270,000 at December 31, 2000.  Through the first
 six months of the year, operating  activities provided $76,253,000 of  cash.
 Investment activities  used $47,607,000  of cash  representing purchases  of
 fixed assets of $37,107,000 and net purchases of investments of $10,500,000.
 Financing activities used  $40,095,000 of cash  representing $65,000,000  in
 repayment of long-term debt and $744,000  in loans to employees to  exercise
 stock options  (net of  $756,000 in  loan  repayments) partially  offset  by
 $25,649,000 in proceeds from issuance of common stock.

   The  Company has  a  revolving credit  agreement  in the  amount  of  $350
 million.  As  of June  30, 2001, $62.5  million was  outstanding under  this
 facility.

   The  Company believes  that its  working capital,  long-term  investments,
 credit facility and cash generated from future operations will be sufficient
 to fund the Company's anticipated operations and expansion plans.

 2001 Outlook

   The  Company is  currently targeting  revenue growth  in the  10% area  to
 approximately $560 million in 2001 (excluding any effects of the pending CCN
 acquisition).   Diluted  earnings  per  share  (EPS)  percentage  growth  is
 currently estimated to be in the  20% area to approximately $1.00 per  share
 for the year.

   Revenue growth  is anticipated  to be  led by  our PPO  business which  is
 expected to grow in  the mid teen  area.  The  Company anticipates that  our
 claims administration business will grow in the double digits area and  that
 fee schedule revenue  will decline due  to a loss  of business from  General
 Motors  and  some  small  workers'  compensation  carriers  who  exited  the
 business.  See "Forward-Looking Information".

 New Accounting Pronouncements

   Effective  January 1,  2001, the  Company adopted  Statement of  Financial
 Accounting Standards  No. 133,  "Accounting for  Derivative Instruments  and
 Hedging Activities"  ("SFAS No.  133").   SFAS  No.  133 requires  that  all
 derivative instruments be recognized as either assets or liabilities in  the
 balance sheet and  that derivative instruments  be measured  at fair  value.
 This statement also requires changes in the fair value of derivatives to  be
 recorded each period in current  earnings or comprehensive income  depending
 on the intended use of the derivatives.  There was no material effect on the
 Company's results of  operations or financial  position as a  result of  the
 adoption of SFAS No. 133.

   In July  2001, the Financial  Accounting Standards  Board ("FASB")  issued
 Statement of Financial Accounting Standards No. 141 ("SFAS 141"),  "Business
 Combinations."   SFAS 141  requires the  purchase method  of accounting  for
 business combinations  initiated  after June  30,  2001 and  eliminates  the
 pooling-of-interests method.  The Company does not believe that the adoption
 of SFAS 141 will have a significant impact on its financial statements.

   In July 2001, the FASB issued Statement of Financial Accounting  Standards
 No. 142  ("SFAS 142"),  "Goodwill and  Other  Intangible Assets",  which  is
 effective  January  1, 2002.  SFAS  142 requires,  among other  things,  the
 discontinuance of goodwill amortization.  In addition, the standard includes
 provisions  for  the   reclassification  of   certain  existing   recognized
 intangibles as  goodwill,  reassessment  of the  useful  lives  of  existing
 recognized intangibles,  reclassification  of  certain  intangibles  out  of
 previously reported goodwill and the  identification of reporting units  for
 purposes of assessing potential  future impairments of  goodwill.  SFAS  142
 also requires the  Company to  complete a  transitional goodwill  impairment
 test six  months  from the  date  of  adoption.  The  Company  is  currently
 assessing but has not yet determined the impact of SFAS 142 on its financial
 position and results of operations.

 Legal Proceedings

   The Company and its subsidiaries are subject to various claims arising  in
 the ordinary course of business and are parties to various legal proceedings
 that constitute litigation incidental to the business of the Company and its
 subsidiaries.  The Company's wholly owned subsidiary, First Health  Services
 Corporation ("Services") continues to be subject to an investigation by  the
 District of Columbia Office of Inspector General (OIG").  In July 2000,  the
 OIG issued a report evaluating the  District of Columbia's ("the  District")
 Medicaid program and suggesting  ways to improve the  program.  Services,  a
 subsidiary of the Company that was acquired  in July 1997, has acted as  the
 program's fiscal agent intermediary for 20  years.  The OIG report  included
 allegations that from  1993 to 1996,  Services, in it  role as fiscal  agent
 intermediary, made erroneous  Medicaid payments  to providers  on behalf  of
 patients no longer eligible to receive Medicaid benefits.  The Company  does
 not believe that the claim or the investigation will have a material adverse
 effect on the Company's business or financial position.


 Item 3.  Quantitative and Qualitative Disclosures About Market Risk

      The Company's market risk exposure at June 30, 2001 is consistent  with
 the types of market risk and amount of exposure presented in its 2000 Annual
 Report on Form 10-K.
 PART II

 Item 4.   Submission of Matters to a Vote of Security Holders

 At the annual meeting of  stockholders of the Company  on May 22, 2001,  all
 directors of the  Company who  stood for  reelection were  re-elected.   The
 number of votes cast for and withheld for each director were as follows:

                                        For        Withheld
                                    ----------    ---------
        Michael J. Boskin           39,701,133      366,835
        Daniel S. Brunner           39,697,333      370,635
        Robert S. Colman            39,868,028      199,940
        Ronald H. Galowich          39,190,133      877,835
        Harold S. Handelsman        39,697,783      370,135
        Don Logan                   39,871,028      196,940
        Thomas J. Pritzker          39,702,333      365,635
        David E. Simon              39,192,924      875,044
        James C. Smith              32,993,190    7,074,778
        Edward L. Wristen           39,701,085      366,883

 A proposal to approve  the Company's 2001 Directors'  Stock Option Plan  was
 approved with  31,556,319  shares cast  for,  5,095,523 shares  against  and
 125,210 shares abstaining.

 A proposal to approve the Company's 2001 Stock Option Plan was approved with
 29,357,593 shares  cast for,  7,277,899 shares  against and  141,560  shares
 abstaining.

 A proposal to approve  the performance based  compensation provision of  the
 employment agreement  with  the  Company's  President  and  Chief  Operating
 Officer was approved with 35,898,785 shares cast for, 736,722 shares against
 and 141,495 shares abstaining.

 A proposal  to approve  the grant  of four  stock options  to the  Company's
 President and Chief  Operating Officer was  approved with 33,398,271  shares
 cast for, 3,226,877 shares against and 151,904 shares withheld.

 Item 6.   Exhibits and Reports on Form 8-K

      Exhibits:

           (a)  Exhibit 11 - Computation of Basic Earnings Per Common Share

           (b)  Exhibit 11 - Computation of Diluted Earnings Per Common Share

      Reports on Form 8-K:

           The Company  filed  a  Report  on Form  8-K  dated  May  21,  2001
             reporting  under Item  5 its  announcement that  it had  entered
             into a  definitive agreement to acquire  CCN Managed Care,  Inc.
             from HCA-The Healthcare Company.


<PAGE>
                                SIGNATURES


      Pursuant to the  requirements of  the Securities  Exchange Act of
      1934, the registrant has duly caused  this report to be signed on
      its behalf by the undersigned thereunto duly authorized.

                                    First Health Group Corp.




      Dated:  August 8, 2001        /s/James C. Smith
                                    ------------------------------------
                                    James C. Smith
                                    Chairman and Chief Executive Officer


      Dated:  August 8, 2001        /s/Joseph E. Whitters
                                    ------------------------------------
                                    Joseph E. Whitters
                                    Chief Financial Officer
                                    (Principal Financial Officer)