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 March 31, 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 May 7, 2001, was 48,809,864.

<PAGE>

                 First Health Group Corp. and Subsidiaries

                                   INDEX


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

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

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

       Consolidated Statements of Operations for the three months
         ended March 31, 2001 and 2000 ...........................       5

       Consolidated Statements of Comprehensive Income for the
         three months ended March 31, 2001 and 2000 ..............       5

       Consolidated Statements of Cash Flows for the three months
         ended March 31, 2001 and 2000 ...........................      6-7

       Notes to Consolidated Financial Statements ................      8-9

       Item 2.  Management's Discussion and Analysis of Financial
                  Condition and Results of Operations ............     10-13

       Item 3.  Quantitative and Qualitative Disclosures About
                  Market Risk ....................................      14

 Part II.  Other Information

       Item 6.  Exhibits and Reports on Form 8-K .................      15


 Signatures.......................................................      16


<PAGE>
<TABLE>
 PART 1.  Financial Information
 First Health Group Corp. and Subsidiaries
 CONSOLIDATED BALANCE SHEETS
 (Unaudited)
 ----------------------------------------------------------------------------

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

   Cash and cash equivalents ............    $  20,496,000   $  23,538,000
   Short-term investments ...............        2,202,000       2,015,000
   Accounts receivable, less allowances
     for doubtful accounts of $10,813,000
     and $10,811,000, respectively.......       58,604,000      57,137,000
   Deferred taxes .......................       16,480,000      16,480,000
   Other current assets .................       14,465,000      14,443,000
                                              ------------    ------------
   Total current assets .................      112,247,000     113,613,000


 Long-Term Investments:

   Marketable securities ................       63,714,000      58,242,000
   Other ................................       43,986,000      43,787,000
                                              ------------    ------------
                                               107,700,000     102,029,000
                                              ------------    ------------
 Property and Equipment:

   Land, buildings and improvements......       75,303,000      71,135,000
   Computer equipment and software.......      162,432,000     148,846,000
   Office furniture and equipment........       17,884,000      16,597,000
                                              ------------    ------------
                                               255,619,000     236,578,000

   Less accumulated depreciation and
     amortization........................      (90,145,000)    (80,861,000)
                                              ------------    ------------
   Net property and equipment ...........      165,474,000     155,717,000
                                              ------------    ------------

 Goodwill, less accumulated amortization
   of $13,221,000 and $12,355,000,
   respectively..........................       89,109,000      89,975,000

 Reinsurance Recoverable.................       27,398,000      28,215,000

 Other Assets............................        1,917,000       2,047,000
                                              ------------    ------------
                                             $ 503,845,000   $ 491,596,000
                                              ============    ============

                See Notes to Consolidated Financial Statements

</TABLE>
<PAGE>
<TABLE>


 First Health Group Corp. and Subsidiaries
 CONSOLIDATED BALANCE SHEETS
 (Unaudited)
 ----------------------------------------------------------------------------

 LIABILITIES AND STOCKHOLDERS' EQUITY

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

   Accounts payable ..............           $  27,981,000  $   31,727,000
   Accrued expenses ..............              28,199,000      28,603,000
   Income taxes payable ..........               4,693,000              --
   Claims reserves ...............              11,786,000      13,013,000
                                              ------------    ------------
   Total current liabilities .....              72,659,000      73,343,000



 Long-Term Debt...................             100,000,000     127,500,000
 Claims Reserves..................              27,398,000      28,215,000
 Deferred Taxes...................              64,876,000      58,621,000
 Other Non-Current Liabilities....              22,563,000      22,504,000
                                              ------------    ------------
   Total liabilities .............             287,496,000     310,183,000
                                              ------------    ------------

 Commitments and Contingencies....                      --              --

 Stockholders' Equity:

   Common stock ..................                 799,000         795,000
   Additional paid-in capital ....             261,615,000     252,092,000
   Retained earnings .............             558,828,000     534,428,000
   Accumulated comprehensive loss                 (500,000)     (1,509,000)
   Treasury stock, at cost .......            (604,393,000)   (604,393,000)
                                              ------------    ------------
   Total stockholders' equity ....             216,349,000     181,413,000
                                              ------------    ------------
                                             $ 503,845,000   $ 491,596,000
                                              ============    ============

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


 First Health Group Corp. and Subsidiaries
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (Unaudited)
 ----------------------------------------------------------------------------

                                              Three Months Ended March 31,
                                              ----------------------------
                                                  2001            2000
                                              ------------    ------------
 <S>                                         <C>             <C>
 Revenues............................        $ 136,984,000   $ 122,475,000
                                              ------------    ------------
 Operating expenses:

   Cost of services .................           59,737,000      55,435,000
   Selling and marketing ............           12,944,000      11,473,000
   General and administrative .......            8,370,000       8,725,000
   Healthcare benefits ..............            3,703,000       2,359,000
   Depreciation and amortization ....           10,602,000       9,113,000
                                              ------------    ------------
                                                95,356,000      87,105,000
                                              ------------    ------------

 Income from operations..............           41,628,000      35,370,000

 Other (income) expense:
   Interest expense .................            2,471,000       3,966,000
   Interest income ..................           (1,851,000)     (1,557,000)
                                              ------------    ------------
 Income before income taxes..........           41,008,000      32,961,000

 Income taxes........................          (16,608,000)    (13,349,000)
                                              ------------    ------------
 Net income..........................        $  24,400,000   $  19,612,000
                                              ============    ============

 Weighted average shares
   outstanding - basic                          48,363,000      47,712,000
                                              ============    ============
 Net income per common share - basic.        $         .50   $         .41
                                              ============    ============
 Weighted average shares
   outstanding - diluted                        50,849,000      49,531,000
                                              ============    ============
 Net income per common share - diluted       $         .48   $         .40
                                              ============    ============

</TABLE>
<PAGE>
<TABLE>


 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

 (Unaudited)
 ----------------------------------------------------------------------------

                                              Three Months Ended March 31,
                                              ----------------------------
                                                  2001            2000
                                              ------------    ------------
 <S>                                         <C>             <C>
 Net income..........................        $  24,400,000   $  19,612,000
                                              ------------    ------------

 Unrealized gains on securities,
   before tax........................            1,594,000       1,818,000
 Income tax expense related to items
   of other comprehensive income.....             (585,000)       (736,000)
                                              ------------    ------------
 Other comprehensive income..........            1,009,000       1,082,000
                                              ------------    ------------
 Comprehensive income................        $  25,409,000   $  20,694,000
                                              ============    ============


                See Notes to Consolidated Financial Statements

</TABLE>
<PAGE>
<TABLE>


 First Health Group Corp. and Subsidiaries
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited)
 ----------------------------------------------------------------------------

                                              Three Months Ended March 31,
                                              ----------------------------
                                                2001             2000
                                              ------------    ------------
 <S>                                         <C>             <C>
 Cash flows from operating activities:
   Cash received from customers .........    $ 135,802,000   $ 112,788,000
   Cash paid to suppliers and employees .      (85,246,000)    (78,135,000)
   Healthcare benefits paid .............       (6,643,000)     (1,320,000)
   Interest income received .............          790,000       1,208,000
   Interest expense paid ................       (2,488,000)     (3,813,000)
   Income taxes (paid) received, net ....       (1,757,000)      1,386,000
                                              ------------    ------------
   Net cash provided by operating activities    40,458,000      32,114,000
                                              ------------    ------------

 Cash flows from investing activities:
   Purchases of investments .............       (8,223,000)     (2,464,000)
   Sales of investments .................        4,611,000       2,456,000
   Purchase of property and equipment ...      (19,492,000)     (9,868,000)
                                              ------------    ------------
   Net cash used in investing activities       (23,104,000)     (9,876,000)
                                              ------------    ------------

 Cash flows from financing activities:
   Purchase of treasury stock ...........               --     (10,938,000)
   Repayment of long-term debt ..........      (27,500,000)    (25,000,000)
   Stock option loans to employees ......               --      (3,050,000)
   Stock option loan repayments .........               --         633,000
   Proceeds from issuance of common stock        7,104,000       6,608,000
                                              ------------    ------------
   Net cash used in financing activities       (20,396,000)    (31,747,000)
                                              ------------    ------------

 Net decrease in cash and cash equivalents      (3,042,000)     (9,509,000)
 Cash and cash equivalents,
   beginning of period...................       23,538,000      35,639,000
                                              ------------    ------------
 Cash and cash equivalents, end of period    $  20,496,000   $  26,130,000
                                              ============    ============
 Non-cash financing activity:
   Stock options exercised in exchange
     for stock shares...............         $          --   $   8,433,000
                                              ============    ============

                See Notes to Consolidated Financial Statements

</TABLE>
<PAGE>
<TABLE>


 First Health Group Corp. and Subsidiaries
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited)
 ----------------------------------------------------------------------------
                                            Three Months Ended March 31,

                                                2001             2000
                                              ------------    ------------
 <S>                                         <C>             <C>
 Reconciliation of Net Income to Net Cash
   Provided by Operating Activities:

 Net Income................................. $  24,400,000   $  19,612,000
                                              ------------    ------------
 Adjustments to Reconcile Net Income to Net
   Cash Provided by Operating Activities:

     Depreciation and amortization ..........   10,602,000       9,113,000

     Change in provision for uncollectible
       receivables...........................        2,000          17,000

     Tax benefit from stock options exercised    2,423,000       2,680,000

     Deferred income taxes ..................    5,670,000        (742,000)

     Other, net .............................     (653,000)        527,000

     Changes in Assets and Liabilities:

     Accounts receivable ....................   (1,469,000)    (10,104,000)

     Other current assets ...................      (22,000)     (3,898,000)

     Reinsurance recoverable ................      817,000         646,000

     Accounts payable and accrued expenses...   (4,150,000)      1,847,000

     Claims reserves ........................   (2,044,000)        141,000

     Income taxes payable ...................    4,693,000      12,055,000

     Non-current assets and liabilities .....      189,000         220,000
                                              ------------    ------------


   Total adjustments ........................   16,058,000      12,502,000
                                              ------------    ------------


   Net cash provided by operating activities $  40,458,000    $ 32,114,000
                                              ============    ============

                 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.  The Company's investments in marketable securities which are classified
     as available  for sale  had a net  unrealized gain  in market  value of
     $1,009,000, net  of deferred income  taxes, for the  three months ended
     March 31, 2001.  The net unrealized loss as of March 31, 2001, included
     as a component of  stockholders' equity, was $500,000,  net of deferred
     income taxes.  The  Company has five separate investments  in a limited
     partnership  which  invests  in  equipment  which is  leased  to  third
     parties.  The total  investment as of March 31, 2001  was $39.4 million
     and  is accounted  for  on 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 $690,000  and $573,000  for the  three months
     ended  March  31, 2001  and  2000,  respectively,  and  is included  in
     interest income.

 3.  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 March
     31,  2001,  approximately  5.2  million  shares  remain  available  for
     repurchase under the Company's current  repurchase authorization.

 4.  Weighted average shares outstanding  increased for diluted earnings per
     share by  2,486,000 and  1,819,000 respectively,  for the  three months
     ended  March 31,  2001 and  2000 due  to  the effect  of  stock options
     outstanding.  Diluted net income per share  was $.02 and $.01 less than
     basic net income  per share for the  three months ended  March 31, 2001
     and  2000,  respectively, also  due  to  the  effect  of stock  options
     outstanding.

 5.  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.

 6. 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.


 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).


 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 months ended  March 31, 2001 and 2000,
 respectively:

                                           Sources of Revenue

                                            ($ in thousands)
                                        Three Months Ended March 31,
                                       ------------------------------
                                        2001      %      2000      %
                                       -------  ----    -------  ----
      Sources of Revenue:
        PPO Services                  $ 75,711   55%   $ 64,917   53%
        Claims Administration           41,545   30      37,545   31
        Clinical Management Services     7,087    5       7,711    6
        Fee Schedule Services            8,754    7       8,958    7
        Premiums, Net                    3,887    3       2,908    2
        Service                             --   --         436    1
                                       -------  ----    -------  ----
      Total Revenue                   $136,984  100%   $122,475  100%
                                       =======  ====    =======  ====


   Revenue for the  three months ended March 31,  2001 increased $14,509,000
 (12%) from  the  same  period of  2000  due  to  strong  PPO revenue  which
 increased 17% from the first quarter of 2000.   The increase in PPO revenue
 for the  three  months ended  March  31, is  due  to  new client  activity,
 existing clients utilizing  more PPO services  and the overall  increase in
 PPO providers.   Claims administration  revenue increased  $4,000,000 (11%)
 from the same period last  year due primarily to  new business particularly
 in the commercial sector.   Revenue from clinical  cost management services
 decreased $624,000 (8%) for the three months ended  March 31, 2001 from the
 comparable period  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 $204,000
 (2%) from the comparable period in 2000 due to a loss of business primarily
 from General  Motors.   Premium revenue  increased $979,000  (34%)  for the
 three months ended March 31, 2001 due primarily to the addition of new stop
 loss insurance clients.   Risk-related  service revenue  decreased $436,000
 (100%) from the comparable period of  2000 as the Company  no longer offers
 this product.

   Cost of  services increased  $4,302,000 (8%)  for the three  months ended
 March 31,  2001 from  the  comparable period  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 44% from 45% in the  comparable period 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  months ended March  31, 2001
 increased  $1,471,000  (13%)  from  the  comparable  period  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 months ended  March 31,
 2001 decreased  $355,000 (4%)  from the  comparable period  of 2000.   This
 decrease  is  the  result   of  increased  efficiencies   achieved  in  the
 administrative operations.

   Healthcare benefits represent medical losses  incurred by insureds of the
 Company's insurance  entities.   Healthcare  benefits  increased $1,344,000
 (57%) for the three months ended March 31,  2001 from the comparable period
 of 2000.  This increase is due primarily to new  client activity.  The loss
 ratio (losses as a percent of premiums) was 95%  for the three months ended
 March 31,  2001  compared  to  81%  for  the  comparable  period  of  2000.
 Management has  reviewed  the book  of  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 $1,489,000 (16%) for the
 three months ended March  31, 2001 from  the comparable period  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.   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  months  ended March  31,  2001 increased
 $294,000 (19%)  from  the  same  period  in  2000  due  primarily  to  more
 investable funds being available  due to debt repayment  occurring later in
 the quarter.

   Interest expense decreased $1,495,000 (38%) from the comparable period of
 2000 as the outstanding debt has  decreased from $215 million  at March 31,
 2000 to $100  million at March  31, 2001.   The interest rate  at March 31,
 2001 was approximately 5.75% per annum.

   Net  income  for  the  three  months  ended  March  31,  2001,  increased
 $4,788,000 (24%) from the comparable period 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 months ended March 31,
 2001 increased 20%  to $.48  per share from the comparable  period of 2000.
 For  the  three  months  ended  March   31,  2001,  diluted  common  shares
 outstanding increased 3% from the comparable period of 2000.


 Liquidity and Capital Resources

   The Company had $39,588,000 in working capital at March 31, 2001 compared
 with working  capital of  $40,270,000 at  December 31,  2000.   Through the
 first three months of  the year, operating  activities provided $40,458,000
 of cash.    Investment activities  used  $23,104,000  of cash  representing
 purchases of fixed assets  of $19,492,000 and net  purchases of investments
 of $3,612,000.  Financing activities used  $20,396,000 of cash representing
 $27,500,000 in repayment of  long-term debt partially  offset by $7,104,000
 in proceeds from issuance of common stock.

 The Company has a revolving credit agreement in the amount of $350 million.
 As of March 31, 2001, $100 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.  Diluted earnings  per  share  (EPS)
 percentage growth is currently estimated to be in  the 19%-20% area up from
 our previous estimates of 18% growth.

   Revenue growth  is anticipated  to be  led by our  PPO business  which is
 expected to grow  in the mid  to high teen  area.  The  Company anticipates
 that our claims administration business will grow in the double digits area
 and that fee  schedule revenue will  be flat or  slightly decline due  to a
 loss of business from General Motors.  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.


 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 March  31, 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 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:

           None

<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:    May 11, 2001             /s/James C. Smith
                                    ------------------------------------
                                    James C. Smith
                                    Chairman and Chief Executive Officer


 Dated:    May 11, 2001             /s/Joseph E. Whitters
                                    ------------------------------------
                                    Joseph E. Whitters
                                    Chief Financial Officer
                                    (Principal Financial Officer)