SECURITIES AND EXCHANGE COMMISSION
                                 Washington, D.C. 20549
                                       FORM 10-K


                 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                           SECURITIES EXCHANGE ACT OF 1934

                     For the fiscal year ended December 31, 2000

                            Commission File No. 000-21684


                          THE WELLCARE MANAGEMENT GROUP, INC.
                         -------------------------------------
                (Exact name of registrant as specified in its charter.)


                New York                               14-1647239
            ----------------                     ----------------------
        (State of Incorporation)            (IRS Employer Identification No.)

                 ParkWest/Hurley Avenue Extension, Kingston, NY  12401
                        (Address of principal executive office)

                                    (845) 338-4110
                  (Registrant's telephone number, including area code)

             Securities registered pursuant to section 12(b) of the act:  None

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 by check mark if disclosure of delinquent filers pursuant to Item 405
of regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K.        Yes        No X

The aggregate market value of the voting stock (Common Stock, $.01 par value)
held by non-affiliates of the Registrant on March 13, 2001 was $8,925,826 based
on the closing sales price of the Common Stock.

There were 38,807,940 shares of the Registrant's Common Stock and 313,555
Shares of the Registrant's Class A Common Stock outstanding on May 4, 2001.

Documents incorporated by reference:  None





<PAGE>  2
FORWARD LOOKING STATEMENTS

     Certain statements in this Annual Report on Form 10-K are "forward-looking
statements" within the meaning of the securities laws.  These "forward looking
statements" are not based on historical facts but represent current
expectations and projections regarding future events based on best estimates
from information currently available to management.

     Actual results may differ from these projections due to risks,
uncertainties and assumptions that may affect certain aspects of operations,
performance and development.  The risks, uncertainties and assumptions include,
but are not limited to the following:

* The Company's ability to continue as a going concern;
* The inability to consistently meet HMO statutory net worth requirement for
  WCNY and/or WCCT;
* That increased regulation will inflate health care expenses;
* That increased competition in the Company's markets or change in product mix
  will unexpectedly reduce premium revenue;
* That the Company will not be successful in increasing membership growth;
* That there may be adverse changes in Medicare and Medicaid premium rates set
  by federal and state governmental agencies;
* That health care cost in any given period may be greater than expected due to
  unexpected incidence of major cases, natural disasters, epidemics, changes in
  physician practices, and new technologies;
* That the Company will be unable to successfully expand its operations into
  additional counties in the State of New York and the State of Connecticut;
* That major health care providers will be unable to maintain their operations
  and reduce or eliminate their accumulated deficits; and,
* That the Company will not have the ability to obtain and retain key
  executives and employees.

     The Company bears no obligation to publicly update or revise any forward
looking statements, whether as a result of new information, future events or
any other reason.  In light of these risks, uncertainties and assumptions, the
forward-looking events in this report may not occur.

                                     PART I

ITEM 1.  BUSINESS

     The WellCare Management Group, Inc., a New York corporation incorporated
in 1983, ("WellCare" or the "Company") is a health care management company,
whose wholly owned subsidiaries, WellCare of New York, Inc. ("WCNY") and
FirstChoice HealthPlans of Connecticut, Inc. ("FirstChoice", formerly WellCare
of Connecticut, Inc.), are health maintenance organizations ("HMOs").  As of
December 31, 2000, the Company's primary focus is to strengthen and grow its
governmental business (Medicare, Medicaid, and Child Health Plus products).  In
1999, the Company entered into a number of transactions, which significantly
changed its structure and operations.

     In June 1999, Kiran C. Patel, M.D. ("Dr. Patel"), the principal owner of
Well Care HMO, Inc., a Florida corporation, an entity unrelated to WellCare,
purchased a fifty-five (55%) percent ownership interest in the Company for $5.0
million.  As part of the purchase transaction, Dr. Patel received 100,000
shares (the "Shares") of a newly authorized series of senior convertible
preferred stock ("Series A Convertible Preferred Stock"), which provided Dr.
Patel with 55% of WellCare's voting power.  The preferred stock was subject to
mandatory conversion into common stock upon the amendment of WellCare's
certificate of incorporation to increase the number of authorized shares of
common stock from 20 million shares to 75 million shares.  The shares are
subject to anti-dilution rights, whereby upon conversion Dr. Patel will
generally preserve his 55% interest in WellCare until there are 75 million
shares of common stock issued and outstanding.  In order to preserve his 55%
interest, Dr. Patel will be required to pay the par value ($0.01 per share) for
each common share subsequently purchased.





<PAGE>  3
     In June 1999, Group Health Incorporated ("GHI" or "GHI Transaction")
purchased WCNY's commercial business for approximately $5.0 million.  As
stipulated and agreed upon in the GHI transaction, WellCare and WCNY will not
engage in commercial HMO business in New York for a period of one year from the
June 1, 1999 closing date.

     In June 1999, various hospitals, physicians and other health care
providers entered into settlement agreements to settle claims for services
provided to WCNY HMO members through April 30, 1999.  The various hospitals,
physicians and other health care providers agreed to accept a payment of 30% of
the balance owed by the Company to the provider in the year of settlement, plus
5% of the balance owed by the Company, payable on February 1 of the three years
subsequent to the year of settlement if they continue to be participating WCNY
providers. These claims are settled from a provider pool consisting of all the
proceeds from the Patel and GHI transactions in addition to 80% of WCNY's
premium receivables at April 30, 1999.  As a result of the settlements, the
Company recorded an extraordinary gain of $18.3 million for the year ended
December 31, 1999.

     In June 1999, the Company reached a settlement with Key Bank ("Key") and
Premier National Bank ("Premier"), whereby the Company transferred ownership of
the real properties securing two mortgages to Key and two mortgages to Premier,
in lieu of foreclosure.  A loss of $0.1 million was charged to operations in
1999 as a result of this transaction.  During 1998, the Company recorded an
impairment charge in general and administrative expenses of $2.8 million to
reduce the carrying value of the mortgaged properties to its estimated fair
value.

     In June 1999, The 1818 Fund II, L.P. ("Fund"), the general partner of
which is Brown Brothers Harriman & Co., converted $15.0 million in subordinated
note, plus accrued interest (8%) of approximately $0.8 million into 100,000
shares of senior convertible preferred stock ("Series" B) of the Company, which
was then converted into 10.0 million shares of Common Stock.   As a result of
the conversion, the Company recorded interest expense of approximately $3.0
million in the results of operations for the year ended December 31, 1999.

     Also in June 1999, the holders of 680,747 shares of Class A common stock,
which had ten votes per share, agreed to convert their shares into Common Stock
on a share-for-share basis.  Mr. Robert W. Morey, the holder of the remaining
281,956 shares of Class A common stock outstanding, has given a two year proxy
in favor of Dr. Patel to vote Mr. Morey's shares of Class A common stock.

     In July 1999, the Company entered into an agreement (the "Settlement
Agreement") with Primergy, Promedco of the Hudson Valley, Inc., and Promedco
Management Company to settle outstanding indebtedness to the Company from
Primergy.  Primergy's indebtedness to the Company pertains to an acquisition by
Primergy of a former subsidiary of the Company's during 1995.  Promedco of the
Hudson Valley, Inc., and Promedco Management Company are affiliates of
Primergy.  Due to uncertainty surrounding the financial condition of Primergy,
the indebtedness from Primergy was fully reserved for during the years 1995
through 1998, and was written off completely in 1999.   The Settlement
Agreement stipulated a $425,000 cash payment to the Company at closing, and
required a release to the Company from Primergy for approximately $325,000 in
past payments due to Primergy.





<PAGE>  4
     The Company is a party to service agreements with five IPA's owned by
Primergy (the "Primergy IPA's").  Accordingly, the Settlement Agreement further
required Primergy to pay $2 per member per month for the period commencing from
August 31, 2000 to July 31, 2002 for members assigned to the Primergy IPA's.
Such payment is guaranteed by Promedco Management Company.  The Primergy IPA's
contract period was reduced and currently will terminate on July 31, 2002.  In
2000, the Company recognized approximately $118,000 in income pertaining to
this settlement.  Such amount is included in "Other Income - Net" in the 2000
financial statements.

     As a result of these transactions, the Company reduced it's working
capital deficit by approximately $18.0 million, developed the ability to bring
WCNY within the 50% to 100% contingent reserve requirement as permitted by the
New York State Insurance Department, retired most of the Company's long-term
debt, and provided a significant reduction of WCNY's obligations to providers.

THE MANAGED CARE INDUSTRY

     Health care costs in the United States have continued to escalate
dramatically over the past year.  As a result, employers, insurers,
governmental entities and health care providers have sought more effective cost
containment measures, contributing to the development of the managed care
industry.  The inability of a significant portion of the population to obtain
health care coverage has resulted in health care reform measures proposed both
at the federal and state levels.  Many of these measures are focused on managed
care, as a means for providing quality health care services on a cost-effective
basis for this segment of the population.

     An HMO provides or arranges for the provision of comprehensive health care
services, including physician and hospital care, to an enrolled population for
a fixed, prepaid premium.  Except in the case of a medical emergency, the
member receives care from participating primary care physicians who, in turn,
refer the members to participating specialists and hospitals as required.  HMOs
provide medical management controls designed to encourage efficient and
economic utilization of health care services.  These controls include
monitoring physician services, the level of hospital admissions and the length
of hospital stays, and promoting the use of non-hospital based medical
services.

     Initially, managed care was provided primarily through HMOs, but has
expanded to the provision of an increasing variety of products and services,
including preferred provider organizations ("PPO"), utilization review
services, third-party claims administrators and specialty benefit programs,
which are marketed to self-insured employer plans, unions, indemnity insurers
and other groups.

     A number of government-sponsored health care programs have begun to
encourage the enrollment of their beneficiaries into managed care plans,
particularly HMOs, as a means of controlling escalating health care costs.  The
largest of these programs are Medicare and Medicaid, which service the elderly
and low income individuals, respectively.

MEDICARE

     Medicare is a federal government-sponsored entitlement program
administered by the Health Care Financing Administration ("HCFA"), providing
health care coverage to individuals, primarily over 65 years of age.
Substantial growth in aged and disabled enrollees has been realized each year
reflecting increases in beneficiary enrollment, service utilization and medical
inflation.




<PAGE>  5
     The federal government, through HCFA, has contracted with HMOs since 1985.
The majority of Medicare beneficiaries enrolled in managed care are covered
under plans that assume risk in the delivery of health care services to
Medicare beneficiaries ("Medicare Risk Contracts").  In contracting with HMOs
pursuant to Medicare Risk Contracts, for the year 2000 HCFA reimbursement rates
were based on 90% of the average Medicare medical costs, determined by county
and adjusted for age, sex, and institutional status and 10% of risk
adjustments.  The financial risk and most of the administrative burdens of
health care service delivery are shifted to the HMO, and the administrative
efficiency practices of managed care are integrated into the Medicare program.

     The Company's contract with the HCFA is a Medicare+Choice contract under
provisions enacted by the Balanced Budget Act of 1997.  The contracted HMOs
receive a fixed monthly payment from the HCFA for each qualified enrolled
individual.  The HMO must provide at least the benefits that would be provided
through traditional Medicare.  Significantly higher levels of coverage are
provided under the WellCare plans and members are charged an additional monthly
premium for greater benefits if they choose it.

MEDICAID

     The Medicaid program, sponsored by individual state governments, provides
health care services to low income individuals in the United States, receives
significant financial support from the federal government.  Each state has the
option to develop a Medicaid managed care initiative, through a state specific
regulatory agency.  The initiative must be approved by the HCFA.  The HCFA
requires that federal standards are met and cost does not exceed the amount of
a comparable fee-for-service basis.  State governments have increasingly
contracted with managed care companies, including HMOs, to provide health care
services to their Medicaid recipients.  In contracting with private managed
care companies, Medicaid shifts most of the financial risk of covered health
care services delivery to the HMO and allows the Medicaid program to benefit
from the cost-efficiency practices of the managed care industry.  Several
states, including New York and Connecticut, have received federal approval to
mandate that all Medicaid beneficiaries enroll with managed care companies to
receive medical services.

CHILD HEALTH PLUS

     Child Health Plus, an expanded subsidized program, provides comprehensive
primary and preventive health coverage to uninsured and underinsured children
under the age of 19.  The program covers children in low-income families that
do not have similar coverage through the workplace and who are not eligible for
Medicaid.  For most families, the program is currently free or requires a low
monthly contribution.  Each year, a significant portion of qualified children
is uninsured in the State of New York.  The Company has developed a program to
inform and educate parents to enroll their children in the program.

THE WELLCARE HMOs

     WCNY and FirstChoice (the "WellCare HMOs") provide comprehensive health
care services to their members for a fixed monthly premium, plus a co-payment
as applicable, by the member to the physician for each office visit, and a
dispensing fee or co-payment to the pharmacy for each prescription filled.  The
basic benefits consist of primary and specialty physician care, inpatient and
outpatient hospital services, emergency and preventive health care, laboratory
and radiology services, ambulance services, eye care, physical and
rehabilitative therapy services, chiropractic services, mental health care, and
alcohol and substance abuse counseling.  For an increased monthly premium,
members have the option to receive prescription drugs and vision care and other
supplemental benefits.




<PAGE>  6
     The WellCare HMOs arrange for the provision of inpatient and outpatient
hospital health care services by contracting with hospitals.  Prior to 1997,
New York hospitals were paid primarily on a diagnostic related group ("DRG")
basis under New York State law rather than by length of hospital stays
(although New York HMOs were permitted to negotiate lower DRG or per diem rates
with regulatory approval).  Effective January 1, 1997, the New York State
regulated DRG rate setting system expired and was replaced by a largely
unregulated free market system whereby insurers and hospitals are free to
negotiate the best rates possible.  WCNY's contracting efforts are focused on
converting DRG and risk bearing arrangements to a per diem methodology, and
most of WCNY's significant contracts with NY hospitals are based on a
negotiated per diem rates across all product lines.  To the extent DRG rates
apply, a member's length of hospital stay does not affect the WellCare HMOs
costs.  Hospital costs can best be controlled through managing hospital
admissions and utilizing the most effective treatment methods.  When a per diem
contract is in effect, utilization management reduces medical costs to the
WellCare HMOs by minimizing length of hospital stay as well as maximizing the
utilization of the most effective treatment methods.

     FirstChoice contracts with its network of hospitals using various payment
methodologies, including per diem, case rates, and discounts from charges.
Currently, efforts are underway to convert discount contracts to per diem
rates.  Hospital costs are controlled when medical management assures that
hospital care is appropriate, proceeds in an efficient manner, and hospitalized
members are moved to more appropriate care settings as soon as clinically
sound.  New contracts have been developed for home care and skilled nursing
facilities, and competitive skilled nursing facility level rates have been
included in hospital contracts for use when members do not require hospital-
level care.

     The WellCare HMOs also arrange for the provision of health care services
in the case of primary care services, on a capitated fee basis, and with other
health care providers, generally on a discounted fee-for-service basis.

     Members are allowed to select any primary care physician or group practice
participating in the WellCare HMO provider network and are allowed to switch
from one primary care physician or practice to another within the network.  All
medical care received by the member, which can include specialist and hospital
care, is coordinated by the primary care physician.  Hospitalization for
members requiring non-emergency treatment generally takes place in hospitals,
which either are under contract or have arrangements with the WellCare HMOs.
Emergency treatment may be obtained in any hospital.

     Premiums for FisrtChoice's commercial line of business are generally fixed
for a twelve-month period under contracts with each subscriber group.
FirstChoice considers a variety of factors in determining HMO community rated
premiums, including anticipated health care utilization rates, projected
medical expenses, community rating requirements (applicable in both New York
and Connecticut) and competitive conditions.  Premiums are subject to state
regulation (See "Business - Government Regulation").




<PAGE>  7
MEMBERSHIP

     The following table reflects membership for plans owned, managed or
administered by the WellCare HMOs during the past five years:

<TABLE>
<CAPTION>
                                              At December 31
                          ----------------------------------------------------------
                             2000        1999        1998        1997        1996
                          ----------  -----------  ---------  ----------  ----------
<S>                       <C>         <C>          <C>        <C>         <C>
Medicaid Members            35,680      18,700      20,700      20,800      18,300
Medicare Members             4,580       5,100      10,600      10,000       5,500
Commercial Members           7,418      18,200      46,700      48,400      69,700
                          ----------  -----------  ---------  ----------  ----------
Total                       47,678      42,000      78,000      79,200      93,500
</TABLE>

     Individuals may be enrolled as Medicaid members in WCNY through its
Healthy Choice product ("Healthy Choice") only if they are eligible recipients
of Medicaid.  Medicaid members are enrolled on an individual basis pursuant to
agreements with county social services departments and approval by the New York
State Department of Health ("DOH") and must be enrolled regardless of health
status.  The premiums for Medicaid members are funded 25% by the applicable
county, 25% by the State of New York and the balance by the federal government.
In the event the contracts are terminated or not renewed, the Company's
operating results would be adversely affected.  Medicaid Managed Care
legislation was enacted in 1996 authorizing New York State, pursuant to federal
waiver, to require most Medicaid recipients to enroll in managed care plans.
The Company believes that it is well positioned in the marketplace to enroll
and provide services to these individuals under New York State's federally
approved mandatory waiver.

     FirstChoice's Medicaid line of business serves primarily enrollees of the
State of Connecticut's Healthcare for UninSured Kids and Youth ("HUSKY") Plans,
which provide comprehensive health insurance for youngsters up to age 19.  The
HUSKY Plan is administered by the Connecticut Department of Social Services
("CDSS") and is 50% funded by the state and 50% by the federal government.
There are no premiums or co-payments associated with the HUSKY Part A Plan.
With HUSKY Part B Plans, there are premiums and/or co-payments depending on the
family's income level.  In the event that the contracts with CDSS are
terminated or not renewed, the Company's operating results would be adversely
affected.

     Medicare beneficiaries are enrolled pursuant to annual contracts with the
federal government under which WCNY provides health care services.  These
contracts provide for the federal government to pay WCNY a fixed monthly
premium per member equal to approximately 95% of the average medical costs by
county adjusted for age, sex, and institutional status.  Premiums are subject
to periodic unilateral revision by the federal government. Under the basic
plan, beneficiaries pay no monthly premiums or deductibles, although there are
co-payments for office visits, prescriptions, and certain other services and
there are annual limits on prescription benefits received per member.  Medicare
members are able to dis-enroll for any reason effective the first of any month
with prior written notice.

     Medicare supplement members may enroll in WCNY on a group basis through
their present or past employers to supplement medical coverage received from
Medicare.  Under the supplemental coverage, in return for a fixed monthly
premium, WCNY pays the cost of most medical services not covered by Medicare,
provided the Medicare beneficiary uses the HMO provider network for such
services, other than for emergency care there are also co-payments for certain
services received by members.




<PAGE>  8
MEDICAL COST CONTROL

     The Company's success depends to a significant degree upon its ability to
control health care costs.  WellCare use's the following methods of cost
control:
(i)   capitation arrangements with the independent practice associations
      ("IPAs") and with non-IPA primary care physicians,
(ii)  discounted fee-for-service arrangements with specialists and other health
      care providers,
(iii) capitation arrangements with providers of certain specialty services,
(iv)  medical management review programs, and
(v)   co-payments by members for office visits and other services.

     Notwithstanding such cost control measures, health care costs in any given
period may be greater than expected due to unexpected incidence of major cases,
legislative changes, broadening member entitlements, natural disasters,
epidemics, changes in physician practices and new technologies.  These factors
which impact health care costs are beyond the Company's control and may
adversely affect its operations.

PHYSICIAN ARRANGEMENTS

     WCNY has contractual arrangements with many of its primary care physicians
("PCP") and specialists.  The arrangements are formed through contracts with
regional health care delivery networks, formerly referred to as "Alliances".
These Alliances were converted into independent practice associations ("IPA").

     Agreements with each of the IPAs generally, provide for a fixed per-
member-per-month ("PMPM") fee, called a "capitation" payment.  The fixed rates
are designed to cover the cost of all professional health care services
provided to the HMO members by the PCPs. This format is designed to shift a
portion of the financial risk from the HMO, to the IPA.  Capitated rates were
not applicable to physician services in the areas regarding certain diagnostics
and mental health substance abuse, which WCNY capitates through contracts with
certain other regional integrated delivery systems.

     Each IPA, in turn, capitates a majority of it's IPA primary care physician
from the monthly payments received from WCNY with a fixed monthly payment for
each HMO member designating the IPA physician as their primary care provider,
retaining and allocating the balance to a group risk pool for payment to
specialists.  Each IPA compensates specialists on a fee-for-service basis.  To
the extent the risk pools are insufficient to cover the specialists' fees, the
amounts paid to the contracted specialists as a group can be proportionately
reduced, up to a maximum of 15%.  To the extent the risk pools are still
insufficient to cover the specialists' fee after a maximum reduction, a portion
of the capitation payments to primary care physicians can be withheld to cover
the specialists' fees after the reduction.  Primary care physicians and
specialists are furnished with periodic utilization reports and the IPAs'
accounts are reconciled periodically.

     WCNY amended the service agreements with the IPAs owned by Primergy (see
"Primergy Transaction" at Business Developments) in January 1999.  The
amendment added Medicare risk as a product for which the IPAs would arrange for
the provision of primary care physician and specialty services and certain
other agreed upon health care services.

     After the GHI transaction (see "GHI Transaction" at Business under Item
1), the existing IPA service agreements, between Primergy and WCNY no longer
encompassed WCNY commercial members.  WCNY intends to remain integrally
involved in assisting PCPs to efficiently manage their practices.




<PAGE>  9
     During 2000, IPA primary care physicians provided medical care to
approximately 52% of WCNY's commercial and Medicaid members, the balance of
WCNY's members were provided services through contracts directly with PCPs and
specialists.  A portion of the PCPs, are capitated with a fixed monthly payment
for each HMO member selecting the physician.  Specialists are generally paid on
a discounted fee-for-service basis.

     FirstChoice contracts directly with some of its physician network.  A
significant number of all the primary care physicians and specialists are
contracted through an IPA or a physician hospital organization ("PHO") that
contracts directly with FirstChoice.

HOSPITAL AND OTHER PROVIDER ARRANGEMENTS

     New York HMOs have been permitted, subject to regulatory approval, to
negotiate lower DRG (diagnostic related group) or per diem rates with
hospitals.  To the extent DRG rates apply, a member's length of hospital stay
does not affect an HMO's costs.  Hospital costs appear to be best controlled
through managing hospital admissions and utilizing the most effective treatment
methods.  When a per diem contract is in effect, utilization management reduces
medical costs to the HMO by minimizing length of hospital stay as well as
maximizing the utilization of the most effective treatment methods.  Currently,
most of WCNY's significant contracts with NY hospitals are based on per diem
rates across all product lines.

     Subsequent changes to the DRG rate-setting system now provide for a
largely unregulated free market system, whereby, insurers and hospitals are
free to negotiate the best possible rates.  Additionally, changes affected
various public goods and Graduate Medical Education, eliminating directly built
in add on costs into rates set by the state.  Responsibility for public goods
and Graduate Medical Education has shifted from the hospitals to the insurers.
In order to remain on a cost neutral basis, insurers have been renegotiating
their hospital contracts in order to provide accountability for this new cost.

     In Connecticut, FirstChoice initially developed a network of hospitals
using various payment methods, including per diem, case rates, and discount
from charges.  Currently, efforts are underway to convert discount contracts to
per diem rates, and to contract with non-participating hospitals.  Hospital
costs appear to be best  controlled when medical management assures that
hospital care is appropriate, proceeds in an efficient manner, and hospitalized
members are moved to more appropriate care settings as soon as clinically
sound.  New contracts have been developed for home care and skilled nursing
facilities, and competitive skilled nursing facility level rates have been
included in hospital contracts for use when members do not require hospital-
level care.

     In order to obtain high quality services at cost-effective rates, the
WellCare HMOs are continually contracting with other providers for, among other
things, mental health, diagnostic services, physical therapy, outpatient
surgery, laboratory services and home health care, on either a capitated or
negotiated fee basis.  The Company also has an agreement with an unrelated
pharmacy benefits manager who covers all of the service areas of the WellCare
HMOs.




<PAGE>  10
CLAIMS RESERVES AND IBNR

     The development of the claims management system that tracks claims on a
current basis has been an ongoing priority of the Company.  The results of
operations depend on the Company's ability to predict, quantify, and manage
medical expenses.  The Company's use of claims management procedures has proven
to be an effective means to measure and project incurred medical costs on a
timely basis throughout 2000.  The expense is based in part on estimates,
including an accrual for medical services incurred but not yet reported
("IBNR").  A daily inventory of hospital days and patient stays by product line
is maintained and reviewed by medical management.  Claims are entered and
scanned to the claims system and are then available for examiners to either
process, review and approve for payment, hold for additional information from
the provider or deny.  All claims are entered into the system as charges and
evaluated.  Ongoing studies conducted for all product lines, provide the
Company with the tools to estimate the percentage of pending claims to be paid
relative to submitted charges.  All claims paid, payable and pending are
evaluated weekly and a projection of the ultimate claims liability is
identified.  Moreover, procedures are in place whereby the actual runoff of
claims for each of the last twelve months versus the reserve for IBNR and the
paid, pending, and payable claims are reviewed for accuracy as compared to the
original projections.  This procedure is intended to allow the Company to
estimate its IBNR more effectively.

     The Company believes that the process of trending the ultimate resolution
of paid, pending and payable claims allows the Company to effectively and
efficiently analyze trends, changes in payments and utilization patterns
allowing the Company to respond to medical costs on a proactive versus a
reactive basis.  Although the Company continues its efforts to make this
estimating process more accurate, there can be no assurance that IBNR reserves
currently recorded will be sufficient to cover medical expenses ultimately
incurred.

UTILIZATION MANAGEMENT

     Utilization of health care services by members and physicians is monitored
under WellCare's health care utilization management programs.  In cases of
excessive utilization, WellCare counsels the provider with respect to possible
unnecessary or duplicate services or medications.  In addition, under the
direction of local physicians and the WellCare HMOs medical directors, health
care service utilization data are analyzed to help indicate where improvements
are needed.

CO-PAYMENTS

     To promote member participation in controlling health care costs, the
WellCare HMOs require co-payments by its non-governmental program members for
most office visits and some other services.  The members make these co-payments
directly to physicians or other providers ranging from $5 to $20 per office
visit, and $35 to $50 for emergency room treatment. Certain contracts also
require members to pay co-payments for inpatient hospital services.

POINT-OF-SERVICE AND PPO PRODUCT

     FirstChoice offers a point-of-service ("POS") product to its commercial
members, allowing them to select providers outside of the HMOs' provider
network.  When a member uses a POS product, the member is required to make a
higher co-payment and satisfy a deductible.

MARKETING

     At December 31, 2000, WellCare had a marketing staff of approximately 70
full time equivalent staff ("FTEs") dedicated to its Medicaid and Child Health
Plus products.  Currently, the Company is not marketing its commercial
business.




<PAGE>  11
     Medicaid managed care marketing has become a highly regulated and
supervised activity.  All Healthy Choice marketing must be conducted consistent
with a pre-approved marketing plan and, all Healthy Choice marketing materials
must receive approval prior to their use, from both the County Departments of
Social Services and the New York Department of Health. Additionally, the
Company monitors its marketing staff to insure that all marketing is performed
consistent with applicable rules and guidelines.

     Healthy Choice utilizes a variety of marketing approaches including:
direct marketing at County Social Services offices, direct mail when approved
and supervised by the Counties; provider-assisted outreach; community-based
organization partnerships; and advertising in targeted community publications.

     The Child Health Plus program is a state-subsidized commercial product
regulated and supervised by both the State Departments of Health and Insurance.
Marketing plans, including enrollment activities and all materials must be
approved by the Department of Health prior to their use.  Marketing activities,
consistent with applicable rules and guidelines, include direct mail, provider
assisted outreach, community-based organization partnerships, health fairs, and
media campaigns.

     Marketing of WCNY's Full Risk Medicare program involves a labor-intensive
one-on-one process.  Marketing efforts focus on informational
presentations/seminars, community outreach programs, direct mail and
telemarketing activities.  Currently, WCNY voluntarily ceased marketing as per
agreement with Health Care Finance Agency ("HCFA").

     WCNY also offers a supplemental coverage plan for Medicare beneficiaries
through existing employer groups who provide contributed benefit programs to
retirees.  Marketing, when conducted, takes place through on-site meetings and
direct mailings to such retirees.

     FirstChoice is currently not marketing its commercial line of business.
Additionally, due to the recent acquisition of the Medicaid line of business
from HealthChoice of Connecticut, Inc., FirstChoice has not yet begun to market
its Medicaid line of business.

QUALITY IMPROVEMENT

     All physicians in the WellCare HMOs' provider network are required to
participate in quality improvement and utilization review programs.  The
quality improvement program is designed to maintain and continually improve the
delivery of proper medical care and includes:

*  Utilization reviews, management programs and outcome studies, which evaluate
   statistical information with respect to services used by members and
   prescribed by participating physicians and include such topics as preventive
   care services, prescription drugs, physician visits, emergency room use,
   hospital admissions and referrals made by primary care physicians to
   specialists;

*  Quality of care reviews, which identify issues affecting HMO members,
   including physician availability, physician treatment patterns and the
   structure and content of medical records;

*  Periodic peer reviews, which evaluate the quality and appropriateness of
   medical care provided by a particular physician and review, among other
   things, diagnoses, tests, prescription drug usage and the utilization level
   of the physician by the HMO members;

*  A physician committee infrastructure to oversee medical policy and the
   quality improvement program.




<PAGE>  12
     The quality improvement program utilizes computerized claims information
as well as medical records, which are maintained by the physicians and to which
the Company has access.  In addition, participating hospitals maintain quality
improvement programs. As required by various state laws, the Company has an
established complaint procedure for HMO members and providers to formally
register concerns with the HMO.  These concerns are then investigated and
resolved pursuant to the procedures established by the HMO.

COMPETITION

     The Company operates in a highly competitive industry.  The HMO
environment is under constant change from market consolidation, strategic
alliances, and legislative reforms at both the State and Federal levels.
WellCare's markets consisted of the following regions in the New York State:
Greater Hudson Valley, Capital District, Southern Tier and New York
City/Westchester County; and the entire state of Connecticut. WellCare's Child
Health Plus and Medicare products are sold exclusively in the State of New
York.  The Company's Medicaid products are offered in both New York and
Connecticut.  The Company currently does not market its Commercial products in
either state.

     Each of these markets presents distinct challenges and opportunities for
the Company to create revenue growth through expanded and creative marketing
campaigns.  WellCare's markets encompass over 300,000 businesses, 15 million
people and more than 40 managed-healthcare competitors.  These competitors
range in size from 5,000 covered member plans to large market leaders like
Cigna, Aetna and Blue Cross & Blue Shield with millions of covered lives.  Each
market has different primary competitors for WellCare and, therefore, requires
a different strategic approach relative to price, network and product in order
to succeed.

MANAGEMENT INFORMATION SYSTEMS

     In connection with the "Patel" and "GHI" transactions, the Company sold or
assigned substantially all of its computer hardware and software to GHI.  Under
the terms of the GHI transaction, the Company will have access to historical
data for reporting purposes for a period of three years.  The company has
transitioned to the Diamond 950 C/S system for all data processing/MIS
requirements under the terms of the management agreements with Comprehensive
Health Management, Inc. ("Comprehensive"), an affiliate of Dr. Patel.

     Management is confident that the Company's computer operations, systems
and related operating procedures are adequate to meet its business needs.  The
Company's information processing and backup systems, as well as security
policies, practices and procedures are evaluated by management on a regular
basis and revised as required.

GOVERNMENT REGULATION

     Federal and State governments continue to enact new laws effecting the
healthcare industry.  Legislative and regulatory proposals are also under
consideration.  The laws and proposals may have a material impact concerning
various features of the health care system.  Some of these measures may have an
adverse effect on the Company's health care business; however, at this time
WellCare can not predict the extent of this impact, if any.




<PAGE>  13
STATE REGULATION

     The WellCare HMOs are subject to extensive state regulation.  Applicable
state statutes and regulations require an HMO to file periodic reports with the
relevant state agencies, and contain requirements relating to the operation of
the HMO, the HMO's rates and benefits applicable to its products and the its
financial condition and practices.  In addition, state regulations require each
of the WellCare HMOs to maintain restricted cash or available cash reserves, a
minimum net worth and impose restrictions on the WellCare HMOs abilities to
make dividend payments, loans or other transfers of cash to the Company.  State
regulatory authorities exercise oversight responsibilities over the HMOs'
provider networks, medical care delivery and quality assurance programs,
contract forms and financial condition of the WellCare HMOs.  The WellCare HMOs
are also subject to periodic examination by the relevant state regulatory
authorities.

     New York State certified HMOs are required to maintain a cash reserve
equal to the greater of 5% of expected annual medical costs or $100,000.
Additionally, except as described in the following paragraph, WCNY is required
to maintain a contingent reserve. This reserve must be increased annually by an
amount equal to at least 1% of statutory premiums earned limited, in total, to
a maximum of 5% of statutory premiums earned for the most recent calendar year
and which may be offset by the cash reserve.  The cash reserve is calculated at
December 31 of each year and is maintained throughout the following calendar
year.  At December 31, 2000, WCNY had required cash reserves of approximately
$2.5 million and a contingent reserve of approximately $2.8 million.  In the
event the contingent reserve exceeds the required cash reserve, the excess of
the contingent reserve over the required cash reserve is required to be
maintained.

     Notwithstanding the above, NYSID has the authority to allow WCNY to
maintain a net worth of 50% to 100% of the contingent reserve.  At December 31,
2000, WCNY had a statutory net worth of approximately $68,000. In March 2001,
$750,000 in Surplus Notes was infused into WCNY from Comprehensive Health
Management of Florida, L.C., an affiliate of the majority shareholder.  Failure
to come into compliance with the reserve requirement could cause NYSID to take
action, which could include restriction or revocation of WCNY's license.

     FirstChoice is subject to similar regulatory requirements with respect to
its HMO operations in Connecticut.  The Connecticut Department of Insurance
requires that FirstChoice maintain a statutory reserve of $2.2 million based on
Regulatory Action Level Risk Based Capital criteria defined by the NAIC.  At
December 31, 2000, FirstChoice had a statutory net worth of approximately $1.7
million, which is not in compliance with the Risk Based Capital requirements
for statutory net worth.  Management has been working with the Connecticut
State Department of Insurance to develop a mutually agreeable plan to bring
FirstChoice into compliance with its Risk-Based Capital requirement.  In April
2001, $250,000 in Surplus Notes was infused into FirstChoice from its parent
WCNY.

     Legislation by both New York and Connecticut requires HMOs to pay
undisputed claims within 45 days of receipt.  New York and Connecticut have
passed legislation to impose stringent penalties for "clean" claims not paid
within 45 days in the form of interest payments calculated based on the number
of days the claim is late.  On an ongoing basis, the HMOs strive to be in
compliance.  There have been no material interest payments that were not
properly included in the Company's December 31, 2000 consolidated financial
statements.

     Applicable New York statutes and regulations require the prior approval of
the New York Commissioner of Health and the New York Superintendent of
Insurance for any change of control of WCNY or the Company.  A similar law in
Connecticut requires the approval of the Insurance Commissioner of Connecticut
for any change in control of FirstChoice or the Company.  Effective February 2,
1999, the Company transferred all of the outstanding capital stock of
FirstChoice to WCNY.  The Insurance Commissioner of Connecticut granted an
exemption to this requirement because the ultimate control of FirstChoice
remains with WellCare through its wholly-owned subsidiary, WCNY, and WellCare
asserted its intention to fund and maintain FirstChoice's statutory net worth
at a level equal or greater than the minimum levels currently required.  The
approval of the acquisition of control of FirstChoice by Dr. Patel, in June
1999 received regulatory approval on September 30, 1999.



<PAGE>  14
     Under New York State law, transactions between a holding company and a
controlled HMO must be fair and equitable.  Any transaction that involves 5% or
more of WCNY's assets requires prior approval.  Dr. Patel's equity investment
in WellCare, received approval from the New York State regulators, on June 11,
1999.

RECENT STATE LEGISLATION

     New York enacted a new law establishing a right for health care consumers
to obtain an external review of determinations made by HMOs and insurers when
coverage of health care has been denied on the grounds that the service is not
medically necessary or that such service is experimental or investigational.
Additionally, New York has established standards for the certification of the
external review agents. The law requires provider contracts to include an
explanation of provider payment methodologies; the time periods for provider
payments; the information to be relied upon to calculate payments and
adjustments; and the process to be employed to resolve disputes concerning
provider payments.  The law became effective July 1, 1999.

     New York also enacted a law expanding the Child Health Plus program for
eligible children up to age 19.  The law increased covered services, beginning
early in 1999 with provisions for: emergency, preventive and routine dental
care; speech and hearing services; emergency, preventive and routine vision
care including eyeglasses; inpatient mental health, alcohol and substance abuse
services; and durable medical equipment, hearing devices, wheelchairs and leg
braces.  The measure also provides free coverage for children in families with
incomes less than 160% of the federal poverty level; lowers monthly premium
contributions for families between 160% and 222% of the federal poverty level;
eliminates co-payments for services; and provides for the development of local
public education and outreach.  The legislation expands Medicaid coverage by
increasing Medicaid coverage for children from birth through age 18 with a
family income of up to 133% of the net federal poverty level.  It also provides
Medicaid eligible children with 12 months of continuous coverage; and increases
income eligibility for children from 100% to 133% of the net federal poverty
level.

     The measure also includes fraud and abuse provisions for Medicaid and
Child Health Plus by providing for a tax refund intercept to collect
adjudicated overpayments. Furthermore, it increases the penalties for repeat
violations for filing false Medicaid claims; and the expansion of anti-kickback
provisions to include individuals as well as Medicaid providers.   Lastly, the
law requires HMOs with more than 60,000 members including Child Health Plus or
Medicaid members to implement a compliance program (State Public Health Law -
Section 4414) to prevent, detect and address instances of fraud and abuse.  The
legislation provides a waiver of this requirement if the HMO has established an
anti-fraud compliance program pursuant to the State Insurance Law Section 409.

FEDERAL REGULATION

     The WellCare HMOs are not federally qualified and neither they nor
WellCare's managed health care operations currently are subject to federal
regulation other than those operations relating to Medicaid and Medicare
products and as otherwise described below.

     The potential for federal legislation and regulations, which may be
subject to adoption, may have an adverse affect on the Company's business.  The
Company is unable to discern the impact of enactment of legislative and
regulatory changes to its health care product environment at this time.
However, an adverse affect may be realized through:

   * reduced premiums,
   * the company's ability to manage its medical costs,
   * increased medical costs and operating expenses,
   * regulation of levels and permitted lines of business,
   * business practice regulation,
   * imposed financial assessments, and
   * exposure to lawsuits.





<PAGE>  15
     WCNY's Full Risk Medicare product is subject to regulation by the Health
Care Financing Administration ("HCFA").  Regulations also cover, among other
things, quality care; limitations on enrollment and compliance with
requirements established by peer review organizations contracting with HCFA.

     Medicare+Choice (Part C) Legislation and the Balanced Budget Act of 1997
have impacted current Risk contractors.  Beginning in 1999, Medicare
beneficiaries will have more options for health care coverage (PSO, PPO, MSAs),
and HCFA is continuing to undertake an educational effort paid for by Medicare
managed care plans.  Another major impact will be realized through the changes
to the rate methodology, and new time frames for submitting rate and benefit
filings.

RECENT FEDERAL LEGISLATION

     Federal legislation was newly passed pertaining to the Health Insurance
Portability and Accounting Act ("HIPAA") relating to the privacy of health
information and other related matters concerning the Company's administration
of health and associated benefit plans.  These regulations are under current
review, to assess any expense impact in connection with compliance to the final
adopted regulations.

     In 1999, the federal government stated plans to phase in risk adjustments
to its premium payments commencing over a five-year period starting January 1,
2000.  Full assessment regarding this plan, has not been determined by the
Company at this time.  Consideration of offsets must be reviewed, particularly
in the areas applicable to premium reductions, user fees and risk adjustments
as they relate to supplemental premiums and benefit provisions included in the
Company's products. Management continues to monitor these changes in
reimbursement levels and has made no provisions to the financial statements for
these contingencies.

ITEM 2.  PROPERTIES

     The following table sets forth certain information as of December 31,
2000, relating to the Company's principal facilities:

                                                         APPROXIMATE
FACILITY                          LOCATION               SQUARE FEET
--------                          --------               -----------
Executive Offices - Leased (1)    Kingston, New York         27,000
Sales Office - Leased (2)         Albany, New York            1,800
Sales Office - Leased (2)         Bronx, New York            10,000
Sales Office - Leased (3)         New Haven, Connecticut      3,800

(1)  Used by WCNY and WCMG.
(2)  Used by WCNY.
(3)  Used by FirstChoice.


<PAGE>  16
ITEM 3.  LEGAL PROCEEDINGS

     The Company is not a party to any material pending legal proceedings.  The
Company at times does have routine litigation incidental to its business.  In
the opinion of the Company's management, such proceedings should not,
individually or in the aggregate, have a material adverse effect on the
Company's consolidated results of operations or consolidated financial
condition.

     The Company is currently in negotiations with a former provider group
regarding a number of outstanding and disputed claims. The total amount in
dispute is estimated by Management to be less than $25,000.  A formal response
along with the detail of all disputed claims and their resolution have been
submitted to the provider group. During 2000, the Company established an escrow
account of $450,000 relating to this matter, which is included in restricted
cash in the financial statements.

     The Company and certain of its subsidiaries, including WCNY have responded
to subpoenas issued in April and August 1997 from the United States District
Court for the Northern District of New York through the office of the United
States Attorney for that District.  These subpoenas sought the production of
various documents concerning financial and accounting systems, corporate
records, press releases and other external communications.  While the United
States Attorney has not disclosed the purposes of its inquiry, the Company has
reason to believe that neither its current management nor its current directors
are subjects or targets of the investigation.  The Company has, however,
informed the government that it will continue to cooperate fully in any way
that it can in connection with the ongoing investigation.

     On July 31, 1996 and October 3, 1996 the Securities and Exchange
Commission ("SEC") issued subpoenas to the Company for the production of
various financial and medical claims information.  The Company fully complied
with both of these subpoenas on August 21, 1996 and October 31, 1996, and with
subsequent requests for supplementation.  The current management is unaware of
any ongoing investigation by the SEC.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         NONE




<PAGE>  17
                                   PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
        STOCKHOLDER MATTERS

     The Company's common stock began trading on the NASDAQ Bulletin Board
system, effective September 9, 1998, under the symbol "WELL".  Previously, the
common stock had been listed on the NASDAQ Small Cap Market, since October 30,
1997, and prior to that on the NASDAQ National Market.  The following table
sets forth the closing high and low sale prices for the common stock for each
quarter of the last two calendar years.  There is no trading market for the
Company's Class A common stock.

                                   High           Low
                                ----------    -----------
2000
----
First Quarter                      2.88           1.22
Second Quarter                     1.50           0.50
Third Quarter                      1.13           0.56
Fourth Quarter                     1.03           0.28

1999
----
First Quarter                      2.03           0.56
Second Quarter                     1.00           0.19
Third Quarter                      0.94           0.25
Fourth Quarter                     4.63           0.34

     On May 4, 2001, there were approximately 521 and 3 holders of record of
the Company's common stock and Class A common stock, respectively, which did
not include beneficial owners of shares registered in nominee or street name.

     WellCare has never paid cash dividends on its capital stock. The Company
does not anticipate paying any cash dividends on its common stock or Class A
common stock in the foreseeable future (See "Business - Government Regulation"
for restrictions on the payment of dividends by the WellCare HMOs, wholly-owned
subsidiaries of the Company).





<PAGE>  18
ITEM 6.  SELECTED CONSOLIDATED FINANCIAL DATA

<TABLE>
<CAPTION>
                      SELECTED CONSOLIDATED FINANCIAL DATA
                      (In Millions, Except Per Share Data)
                            Year Ended December 31,

                                           2000      1999      1998      1997      1996
                                         --------  --------  --------  --------  --------
<S>                                      <C>       <C>       <C>       <C>       <C>
Statement of Operations Data:
  Premiums earned                        $  76.2   $ 110.5   $ 142.7   $ 142.1   $ 157.2
  Medical expenses                          69.6     101.8     129.5     126.3     136.0
  Net loss before extraordinary gain        (4.9)    (14.5)    (30.9)    (22.1)    (11.8)
  Extraordinary gain                           -      16.1         -         -         -
  Net loss available to
    common shareholders                     (4.9)     (1.4)    (30.9)    (22.1)    (11.8)

Net Loss Before
 Extraordinary Gain Per Share:
  Basic                                  $ (0.13)  $ (1.13)  $ (4.36)  $ (3.52)  $ (1.87)
  Diluted                                  (0.13)    (1.13)    (4.36)    (3.52)    (1.87)

Extraordinary Gain Per Share:
  Basic                                  $     -   $  1.04   $     -   $     -   $     -
  Diluted                                      -      1.04         -         -         -

Net Loss Available to
 Common Shareholders Per Share:
  Basic                                  $ (0.13)  $ (0.09)  $ (4.36)  $ (3.52)  $ (1.87)
  Diluted                                  (0.13)    (0.09)    (4.36)    (3.52)    (1.87)

Weighted Average Number of
 Common Shares Outstanding:

  Basic                                   38,795    15,489     7,081     6,299     6,296
  Diluted                                 38,795    15,489     7,081     6,299     6,296

Balance Sheet Data:
  Working (capital deficiency) capital   $ (10.5)  $  (4.5)  $ (26.1)  $  (5.1)  $  11.2
  Total assets                              20.1      20.3      29.9      52.5      71.3
  Long-term debt                             1.0       3.0      15.1      25.9      26.5
  Total liabilities                         27.7      23.1      57.6      54.4      51.1
  Shareholders' equity (deficiency)         (7.6)     (2.8)    (27.7)     (1.9)     20.3
</TABLE>

Note:  Significant transactions occurred in 1999, which materially changed the
       Company's structure and operations.  See discussion in Item 1.

ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS

     The following discussion and analysis should be read in conjunction with
the Consolidated Financial Statements and Notes thereto included elsewhere
herein.






<PAGE>  19
     The Company's consolidated financial statements have been prepared
assuming that the Company will continue as a going concern.  The auditors'
report states, "the Company's recurring losses from operations, cash used in
operations, shareholders' deficiency, failure to achieve the minimum statutory
equity requirements of the State of New York Insurance Department and failure to
maintain the minimum risk based capital requirements of the State of Connecticut
Insurance Department raise substantial doubt about its ability to continue as a
going concern." (See Consolidated Financial Statements).

     Certain statements in this Annual Report on Form 10-K are forward-looking
statements and are not based on historical facts but are management's
projections or best estimates.  Actual results may differ from these
projections due to risks and uncertainties.

GENERAL OVERVIEW

     WellCare's principal source of revenue is premiums earned from the
WellCare HMOs.  Other revenue consists principally of interest income.
Premiums earned represented 97.0% of the Company's total revenue for the year
ended December 31, 2000.

     The results of operations depend significantly on the Company's ability to
predict, quantify and manage medical costs.  Medical expenses consist of
hospital charges, physician fees and related health care costs for its members.
Medical expenses also include estimates for medical services incurred but not
yet reported ("IBNR") to the Company, based on a number of factors, including
hospital admission data and prior claims experience; adjustments, if necessary,
are made to medical expenses in the period the actual claims costs are
ultimately determined.  A daily inventory of hospital days and patient stays by
product line is maintained by medical management.

     Ongoing studies for the Company's Medicaid, Medicare, and commercial lines
of businesses provide the Company with the tools to estimate the percentage of
pended claims to be paid relative to submitted charges.  All claims paid,
payable and pended are evaluated weekly and a projection of ultimate payables
is estimated.  Moreover, procedures are in place whereby the actual runoff of
claims for each of the last twelve months versus the reserve for IBNR and the
paid, pended, payable claims are reviewed for accuracy as compared to the
original projections.  This procedure is intended to allow the Company to
continually estimate its unknown claims reserves more effectively.

     The Company believes that the process of trending the ultimate resolution
of paid, payable, and pended claims allows the Company to analyze trends and
changes in payments and utilization patterns and, therefore, react to medical
costs on a proactive versus a reactive basis.  Although the Company continues
to improve the  IBNR reserve process, and believes the IBNR estimates at the
December 31, 2000 are adequate, there can be no assurance that IBNR reserve
currently recorded will be sufficient to cover medical expenses ultimately
incurred.

     The Company seeks to control medical expenses through capitation
arrangements with the Alliances/IPAs and with non-Alliance/IPA primary care
physicians, capitation arrangements with certain specialty providers, and,
through its quality improvement programs, utilization management. The Company
also conducts reviews of hospital inpatient and outpatient services, and
educational programs on effective managed care for its providers.







<PAGE>  20
RESULTS OF OPERATIONS

     The following table provides certain Statement of Operations data
expressed as a percentage of total revenue and other statistical data for the
years indicated:

                                                 Year Ended December 31,
                                          ------------------------------------
                                              2000        1999        1998
                                            --------    --------    --------
Revenue:
  Premiums earned                             97.0%       98.2%       98.8%
  Interest and other income                    3.0         1.8         1.2
                                            --------    --------    --------
     Total revenue                           100.0       100.0       100.0

Expenses:
  Hospital services                           30.9        33.6        29.2
  Physician services                          42.9        52.5        57.9
  Other medical services                      14.7         4.4         2.6
                                            --------    --------    --------
Total medical expenses                        88.5        90.5        89.7

General and administrative expenses           15.5        18.2        20.8
Depreciation and amortization expenses         0.5         1.0         4.1
Bad debt expense                               1.5         1.9         1.8
Interest and other expenses                    0.2         3.2         1.2
                                            --------    --------    --------
     Total expenses                          106.2       114.8       117.6
                                            --------    --------    --------
Loss before extraordinary item and
 income taxes                                 (6.2)      (14.8)      (17.6)
(Benefit) provision for income taxes             -        (2.0)        3.8
                                            --------    --------    --------
Net loss before extraordinary item            (6.2)      (12.8)      (21.4)
Extraordinary gain, net of tax                   -        14.2           -
                                            --------    --------    --------
Net (loss) income                             (6.2)        1.4       (21.4)
Preferred stock deemed dividend                  -        (2.6)          -
                                            --------    --------    --------
Net loss available to common shareholders     (6.2)%      (1.2)%     (21.4)%
                                            ========    ========    ========

Unaudited Statistical Data:
   Member months enrollment                 441,886     655,985     854,909
   Medical loss ratio (1)                     91.2%       92.1%       90.7%
   General and administrative
    expense ratio (2)                         17.0%       20.1%       22.6%

(1) Total medical expenses as a percentage of premiums earned; reflects the
    combined rates of Commercial, Medicaid, Full Risk Medicare and Medicare
    supplemental members.  Medical expenses in 1998 include $730,216 of
    interest expense relating to "Prompt Pay" payments.
(2) General and administrative expenses as a percentage of total revenue.






<PAGE>  21
YEAR ENDED DECEMBER 31, 2000 COMPARED TO YEAR ENDED DECEMBER 31, 1999

     PREMIUMS EARNED.  Premiums earned decreased $34.3 million to $76.2 million
in 2000 from $110.5 million in 1999, a decrease of 31.0%.  The decrease in
premiums earned was primarily due to the overall decrease in membership from
prior year.  WCNY's commercial business was sold to GHI in June 1999, which
accounted for approximately $20.0 million of the decrease.  In April 2000, WCNY
ceased marketing and enrollment of its Medicaid and Child Health Plus products,
which resulted in a decrease in of approximately 5,500 members and $2.9
million.  WCNY's Medicare premiums earned decreased approximately $3.0 million,
as the Company did not market this product line.  FirstChoice's net decrease in
premiums earned was approximately $8.7 million, which consisted of a decrease
of approximately $18.4 million in the commercial line of business as membership
decreased from 13,300 members in 1999 to 2,800 in 2000 and an increase of
approximately $9.7 million from the acquisition of the Medicaid line of
business in October 2000.  The acquired Medicaid book of business contributed
approximately 24,000 members.

     INTEREST AND OTHER INCOME.  Interest and other income increased $0.4
million to $2.4 million in 2000 from $2.0 million in 1999, an increase of
20.0%.  The increase was attributed principally to an insurance reimbursement
of $776,000 relating to the Securities Litigation against the Company's former
Chief Executive Officer and Vice President of Finance and Chief Financial
Officer (see Note 13 of Notes to Consolidated Financial Statements), net of a
decrease in interest income of $347,000.

     MEDICAL EXPENSES.  Medical expenses decreased $32.2 million from $101.8
million in 1999 to $69.6 million in 2000, a decrease of 31.6%.  This decrease
was primarily the result of a decrease in membership. Medical expenses as a
percentage of premiums earned (medical expense ratio), decreased slightly from
92.1% in 1999 to 91.2% in 2000.

     GENERAL AND ADMINISTRATIVE (G&A) EXPENSES.  G&A expenses decreased $9.4
million to $13.3 million in 2000 from $22.7 million in 1999.  G&A expenses as a
percentage of total revenues (G&A expense ratio), decreased from 20.1% in 1999
to 17.0% in 2000.  The decrease in G&A expenses and the G&A expense ratio was
primarily the result of the management agreement with Comprehensive Health
Management, Inc., which resulted in savings of approximately $5.3 million, the
reduction in administrative costs associated with FirstChoice's Commercial
operation which resulted in savings of approximately $2.1 million, and a
decrease in legal fees of approximately $1.0 million.

     DEPRECIATION AND AMORTIZATION.  Depreciation and amortization decreased
$0.7 million from $1.1 million in 1999 to $0.4 million in 2000.  The decrease
was primarily a result of the Patel Transaction in 1999.  At which time, the
Company transferred ownership of the two real properties securing two mortgages
to their respective lenders in lieu of foreclosure.  Additionally, included in
GHI's purchase of the Company's commercial line of business in New York, were
certain equipment and furniture and fixtures.

     INTEREST EXPENSE.  Interest expenses decrease $3.4 million to $0.2 million
in 2000 from $3.6 million in 1999.  The decrease in interest expense was
attributed to the subordinated convertible debt inducement as a result of the
Patel Transaction in 1999.  At which time, the Company transferred ownership of
the two real properties securing two mortgages to their respective lenders in
lieu of foreclosure.

YEAR ENDED DECEMBER 31, 1999 COMPARED TO YEAR ENDED DECEMBER 31, 1998

     PREMIUMS EARNED.  Premiums earned in 1999 decreased by 22.6%, or $32.2
million, to $110.5 from $142.7 million in 1998.  Commercial premium revenue
decreased 29.6%, or $20.6 million primarily resulting from the sale of WCNY's
commercial line of business.  The decrease in commercial premium revenue in
WCNY exceeded the annual average membership and corresponding premium revenue
in FirstChoice's commercial line of business. Medicare premium revenue
decreased 7.9%, or $2.5 million, because of 11.0% decrease in member months.
Medicaid premium revenue decreased 21.4% or $9.1 million, because of an
approximate 50% decrease in member months.  Interest income remained relatively
consistent, and is primarily on float balance at the Company's operating
accounts.





<PAGE>  22
     MEDICAL EXPENSES.  Medical expenses decreased 21.4%, or $27.7 million, to
$101.8 million in 1999. This decrease was primarily the result of a decrease in
membership due to the sale of the WCNY's Commercial line of business.  Medical
expenses increased as a percentage of premiums earned (the "medical loss
ratio") from 90.7% in 1998 to 92.1% in 1999.

     GENERAL AND ADMINISTRATIVE ("G&A") EXPENSES.  G&A expenses decreased 31.0%
or $10.0 million, to $22.7 million in 1999 from $32.6 million in 1998, and
decreased as a percentage of total revenue (the "G&A ratio") to 20.1% in 1999
from 22.6% in 1998.  Included in G&A in 1998 is an expense of $2.8 million to
reduce Property & Equipment to its net realizable value.  The decrease resulted
primarily from reductions in the provision for doubtful receivables ($3.1
million), marketing related costs ($1.9 million), and payroll and payroll
related costs resulting from staff reductions and associated operating costs
brought about by consummation of the Comprehensive and GHI Transactions (see
Business-Business Developments).

     DEPRECIATION AND AMORTIZATION.  Depreciation and amortization decreased
approximately $4.9 million, or 80.9%, primarily because the Company has
disposed the majority of its fixed assets and sold its WCNY's Commercial books
of business to GHI.  Interest expense increased 106.1% to $3.6 million due to
the subordinated convertible debt inducement (see Business-Business
Developments).

     EXTRAORDINARY GAIN.  Extraordinary gain of approximately $18.3 million
consists of claims settlement income.  The claims settlement income resulted
from settlement of commercial claims at forty-five percent of the accrued
settlement amounts incurred prior to May 1, 1999.

INFLATION

     Despite the relatively stable inflation rate in the general economy, the
health care industry has experienced significantly a higher rate of inflation
associated with providing health care services in recent years.  The Company
utilizes various cost control measures as well as increasing premiums as
appropriate to reduce the negative effects of inflation.  The company has
significantly increased premiums for its FirstChoice commercial line of
business as well as member premiums for its WCNY Medicare line of business.
There is no assurance that the Company will be successful in reducing the
negative effects of inflation associated with providing health care services.

LIQUIDITY AND CAPITAL RESOURCES

     Cash Flows.  For the year ended December 31, 2000, operating activities
utilized $5.4 million of cash.  The net loss adjusted for non-cash items such
as depreciation, amortization, and other non-cash charges utilized $3.3 million
of cash.  Net increase in operating assets utilized $2.1 million of cash.
Investing activities utilized $0.3 million of cash, principally consisting of
capital expenditures.  Financing activities provided $4.5 million of cash
principally from proceeds of notes payable to affiliate.





<PAGE>  23
     As part of the Company's plan to bring its net worth into compliance with
the State of New York's and the State of Connecticut's requirements, $0.8
million and $4.4 million was infused into the Company during 2000 as notes
payable from WellCare Management Group, Inc. and Comprehensive Health
Management, Inc., ("CHMI") an affiliate of the majority shareholder,
respectively.  An additional $750,000 note payable from Comprehensive Health
Management of Florida, L.C., an affiliate of the majority shareholder, was
infused in March 2001.  The Company's consolidated financial statements have
been prepared assuming that the Company will continue as a going concern.  The
auditors' report on the Company's 2000 consolidated financial statements states
that "the Company's recurring losses from operations, working capital deficit,
shareholders' deficiency, failure to achieve the minimum statutory equity
requirements of the State of New York Insurance Department and failure to
maintain the minimum risk based capital requirements of the State of
Connecticut Insurance Department raise substantial doubt about its ability to
continue as a going concern."  The Company continues to explore the possibility
of raising funds through available sources including but not limited to the
equity and debt markets.  It is uncertain that the Company will be successful
at raising funds through these sources.

NEW ACCOUNTING PRONOUNCEMENTS

     In June 1998, the Financial Accounting Standards Board ("FASB") issued
SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities.
SFAS No. 133 establishes accounting and reporting standards for derivative
instruments and hedging activities.  It requires that an entity recognize all
derivatives as either assets or liabilities in the statement of financial
position and measure those instruments at fair value.  The accounting for
changes in the fair value of a derivative (that is, gains and losses) depends
upon the intended use of the derivative and resulting designation.  In July
1999, FASB issued SFAS No. 137, Accounting for Derivative Instruments and
Hedging Activities - Deferral of the Effective Date of SFAS No. 133, which
postponed the effective date of the SFAS No. 133 for one year.  In June 2000,
FASB issued SFAS No. 138, Accounting for Certain Derivative Instruments and
Certain Hedging Activities, and amendment to SFAS No. 133.  The Company adopted
SFAS 133 on January 1, 2001.  The adoption of SFAS No. 133 did not have a
material impact on the Company's financial position or results of operations.

     In December 1999, the Securities and Exchange Commission ("SEC") issued
Staff Accounting Bulletin ("SAB") No. 101, "Revenue Recognition in Financial
Statements", which provided guidance related to revenue recognition based on
interpretations and practices followed by the SEC.  SAB No. 101 was effective
for the Company'' fourth quarter 2000, and required the Company to report any
changes in revenue recognition as a cumulative change in accounting principle
at the time of implementation.  The Company is in compliance with the
provisions of SAB No. 101, and adoption of the provisions did not have an
impact on the Company's consolidated financial statements.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

     The Company is subject to market risk from exposure to changes in interest
rates based upon its financing, investing and cash management activities.
Interest rates did not have a material adverse effect on the Company's income
or its cash flows in fiscal years 2000, 1999, and 1998.  However, there can be
no assurances that interest rates will not significantly change in 2001.



<PAGE>  24
ITEM 8.  CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Independent Auditors' Report                                                 25
Consolidated Balance Sheets - December 31, 2000 and 1999                     28
Consolidated Statements of Operations for the years ended
  December 31, 2000, 1999, and 1998                                          29
Consolidated Statements of Shareholders' Deficiency for the years ended
  December 31, 2000, 1999, and 1998                                          30
Consolidated Statements of Cash Flows for the years ended
  December 31, 2000, 1999, and 1998                                          32
Notes to Consolidated Financial Statements                                   33

     CONSOLIDATED SUPLLEMENTAL SCHEDULES

Schedule I - Condensed Financial Information of the Registrant               55
Schedule II - Valuation and Qualifying Accounts                              58




<PAGE>  25
INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Shareholders of
  WellCare Management Group, Inc.

We have audited the accompanying consolidated balance sheet of WellCare
Management Group, Inc. and subsidiaries (the "Company") as of December 31,
2000, and the related consolidated statements of operations, shareholders'
deficiency, and cash flows for the year ended December 31, 2000.  Our audit
also included the financial statement schedules for the year ended December 31,
2000 listed in the Index at Item 14 (a) 2.  These financial statements and
financial statement schedules are the responsibility of the Company's
management.  Our responsibility is to express an opinion on the financial
statements and financial statement schedules based on our audit.  The financial
statements of the Company for the year ended December 31, 1999 were audited by
other auditors whose report, dated April 12, 2000, on those statements included
an explanatory paragraph that expressed a going concern opinion.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America.  Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation.  We believe that our audit provides a
reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of the Company as of December 31,
2000, and the results of their operations and their cash flows for the year
ended December 31, 2000 in conformity with accounting principles generally
accepted in the United States of America.  Also, in our opinion, such financial
statement schedules, when considered in relation to the basic consolidated
financial statements taken as a whole, present fairly in all material respects
the information set forth therein.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern.  As discussed in Note 16 to
the consolidated financial statements, the Company's recurring losses from
operations, working capital deficit, shareholders' deficiency, failure
to achieve the minimum statutory equity requirements of the State of New York
Insurance Department, and failure to maintain the minimum risk based capital
requirements of the State of Connecticut Insurance Department raise substantial
doubt about its ability to continue as a going concern.  Management's plans
concerning these matters are also described in Note 16.  The consolidated
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.


Deloitte & Touche, LLP
Tampa, Florida
May 25, 2001





<PAGE>  26
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS REPORT

To the Board of Directors and Shareholders of
  The WellCare Management Group, Inc.
Tampa, Florida

We have audited the accompanying consolidated balance sheet of the WellCare
Management Group, Inc. and subsidiaries (the "Company") as of December 31,
1999, and the related consolidated statements of operations, shareholders'
deficiency and cash flows for the year ended December 31, 1999.  We have also
audited the financial statement schedules for the year ended December 31, 1999
listed in the accompanying index.  These consolidated financial statements and
financial statement schedules are the responsibility of the Company's
management.  Our responsibility is to express an opinion on these consolidated
financial statements and financial statement schedules based on our audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America.  Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the consolidated
financial statements and schedules are free of material misstatement.  An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated financial statements.  An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement and schedules
presentation.  We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of the Company, as of December
31, 1999, and the results of their operations and their cash flows for the year
ended December 31, 1999 in conformity with accounting principles generally
accepted in the United States of America.  Also, in our opinion, the financial
statement schedules for the year ended December 31, 1999, when considered in
relation to the basic consolidated financial statements taken as a whole,
present fairly in all material respects the information set forth therein.

The accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern.  As discussed in
Note 16 to the consolidated financial statements, the Company's recurring
losses from operations, working capital deficit, shareholders' deficiency and
failure to maintain 100% of the contingent reserve requirement of the New York
State and Connecticut State Departments of Insurance raise substantial doubt
about its ability to continue as a going concern.  Management's plans
concerning these matters are also described in Note 16.  The consolidated
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.


BDO Seidman, LLP
Miami, Florida
April 12, 2000





<PAGE>  27
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS REPORT

To the Board of Directors and Shareholders of
  The WellCare Management Group, Inc.
Kingston, New York

We have audited the accompanying consolidated statement of operations,
shareholders' deficiency and cash flows of The WellCare Management Group, Inc.
and subsidiaries (the "Company") for the year ended December 31, 1998.  Our
audit also included the financial statement schedules for the year ended
December 31, 1998 listed in the index at Item 14.  These consolidated financial
statements and financial statement schedules are the responsibility of the
Company's management.  Our responsibility is to express an opinion on these
consolidated financial statements and financial statement schedules based on
our audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America.  Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the consolidated
financial statements are free of material misstatement.  An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the consolidated financial statements.  An audit also includes assessing the
accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation.  We believe
that our audit provides a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in
all material respects, the Company's results of operations and cash flows for
the year ended December 31, 1998 in conformity with accounting principles
generally accepted in the United States of America.  Also, in our opinion, the
financial statement schedules for the year ended December 31, 1998, when
considered in relation to the basic consolidated financial statements taken as
a whole, present fairly in all material respects the information set forth
therein.

The accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern.  As discussed in
Note 16 to the consolidated financial statements, the Company's recurring
losses from operations, working capital deficit, shareholders' deficiency and
failure to maintain 100% of the contingent reserve requirement of the New York
State and Connecticut State Departments of Insurance raise substantial doubt
about its ability to continue as a going concern.  Management's plans
concerning these matters are also described in Note 16.  The consolidated
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.


Deloitte and Touche, LLP
Kingston, New York
May 11, 1999






<PAGE>  28
                THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
                             CONSOLIDATED BALANCE SHEETS
                                  (In $ Thousands)
<TABLE>
<CAPTION>
                                                                     December 31,
                                                            ------------------------------
                                                                 2000            1999
                                                            --------------  --------------
<S>                                                         <C>             <C>
ASSETS
Current Assets:
  Cash and cash equivalents                                  $     6,025     $     7,240
  Accounts receivable (net of allowance for doubtful
   accounts of $200 in 2000 and $434 in 1999)                      8,247           4,385
  Advances to participating providers                                555             586
  Due from affiliate, net                                              -             799
  Other receivables (net of allowance for doubtful
   accounts of $0 in 2000 and $500 in 1999)                          791           1,615
  Prepaid expenses and other current assets                          510           1,066
                                                            --------------  --------------
          Total current assets                                    16,128          15,691
Property and equipment (net of accumulated depreciation
  And amortization of $4,271 in 2000 and $4,613 in 1999)             640             756
Other Assets:
  Restricted cash                                                  3,352           3,773
  Other non-current assets (net of allowance for
   doubtful accounts of $1,376 in 1999)                                -             103
                                                            --------------  --------------
          Total assets                                       $    20,120     $    20,323
                                                            ==============  ==============

LIABILITIES AND SHAREHOLDERS' DEFICIENCY
Current Liabilities:
  Medical costs payable                                      $    15,686     $    14,386
  Accrued provider settlement - current portion                    1,052           1,456
  Due to affiliate, net                                              223               -
  Accounts payable and accrued expenses                            2,544           1,268
  Notes payable to affiliate                                       5,206             850
  Unearned revenue                                                 1,919           2,258
                                                            --------------  --------------
          Total current liabilities                               26,630          20,218
Other Liabilities:
  Accrued provider settlement - non-current portion                1,052           2,913
                                                            --------------  --------------
          Total liabilities                                       27,682          23,131

Commitments and Contingencies (Note 13 and 15)

 Shareholders' Deficiency:
  Class A common stock - $0.01 par value;
    1,109,292 shares authorized; 313,555 shares
    issued and outstanding in 2000 and 1999                            3               3
  Common stock - $0.01 par value; 75,000,000 shares
     authorized; 38,807,940 and 38,697,940 shares
     issued in 2000 and 1999, respectively                           388             386
  Additional paid-in capital                                      54,709          54,585
  Accumulated deficit                                            (62,460)        (57,581)
  Accumulated other comprehensive income                               -               1
                                                            --------------  --------------
                                                                  (7,360)         (2,606)
   Treasury stock at cost - 12,850 shares in 2000 and 1999          (202)           (202)
                                                            --------------  --------------
          Total shareholders' deficiency                          (7,562)         (2,808)
                                                            --------------  --------------
          Total liabilities and shareholders' deficiency     $    20,120     $    20,323
                                                            ==============  ==============
</TABLE>

                  See Notes to Consolidated Financial Statements




<PAGE>  29
            THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                  (In $ Thousands, Except Per Share Amounts)
<TABLE>
<CAPTION>
                                                             Year Ended December 31,
                                                      ------------------------------------
                                                         2000         1999         1998
                                                      ----------   ----------   ----------
<S>                                                   <C>          <C>          <C>
Revenue:
  Premiums earned                                     $  76,231    $ 110,516    $ 142,742
  Interest income                                           346          693        1,189
  Insurance reimbursement                                   776            -            -
  Other Income - net                                      1,251        1,300          518
                                                      ----------   ----------   ----------
Total revenue                                            78,604      112,509      144,449
Expenses:
  Medical expenses                                       69,554      101,798      129,494
  General and administrative expenses                    12,163       20,569       30,066
  Depreciation and amortization                             420        1,147        6,001
  Bad debt expense                                        1,172        2,090        2,575
  Interest expense                                          174        3,565        1,730
                                                      ----------   ----------   ----------
Total expenses                                           83,483      129,169      169,866
                                                      ----------   ----------   ----------
Net loss before income taxes and extraordinary gain      (4,879)     (16,660)     (25,417)
(Benefit) provision for income taxes                          -       (2,152)       5,441
                                                      ----------   ----------   ----------
Net loss before extraordinary item                       (4,879)     (14,508)     (30,858)
Extraordinary gain, net of tax of $2,152 for 1999             -       16,116            -
                                                      ----------   ----------   ----------
Net (loss) income                                        (4,879)       1,608      (30,858)
Preferred stock deemed dividend                               -       (3,043)           -
                                                      ----------   ----------   ----------
Net loss available to common shareholders              $ (4,879)    $ (1,435)    $(30,858)
                                                      ==========   ==========   ==========

Earnings per share:
  Net loss before income taxes &
   extraordinary gain - basic and diluted              $  (0.13)    $  (1.13)    $  (4.36)

  Extraordinary gain - basic and diluted               $      -     $   1.04     $      -

  Net loss available to common
   shareholders - basic and diluted                    $  (0.13)    $  (0.09)    $  (4.36)

Weighted average shares outstanding -
  basic and diluted                                      38,795       15,489        7,081

</TABLE>
                 See Notes to Consolidated Financial Statements




<PAGE>  30
               THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIENCY
                                (In $ Thousands)
<TABLE>
<CAPTION>
                                     Class A and B   Class A            Additional
                                       Preferred     Common    Common    Paid-in      Accumulated
                                         Stock        Stock     Stock    Capital        Deficit
                                     -------------   -------   ------   ----------    ------------
<S>                                   <C>            <C>       <C>      <C>           <C>
Balance, December 31, 1997             $      -      $   11    $   52   $  26,624      $  (28,331)
Conversion of subordinated
 convertible note into common shares          -           -        12       4,988               -
Conversion of Class A common
 shares to common shares                      -          (1)        1           -               -

Net loss                                      -           -         -           -         (30,858)
Other comprehensive income -
 unrealized holding gains                     -           -         -           -               -
Comprehensive loss                            -           -         -           -               -
                                     -------------   -------   ------   ----------    ------------
Balance, December 31, 1998                    -          10        65      31,612         (59,189)
Conversion of subordinated
 convertible note and accrued
 interest into preferred stock                1           -         -      15,240               -
Subordinated convertible
 debt inducement                              -           -         -       3,043               -
Preferred stock issued for cash               1           -         -       5,002               -
Conversion of preferred stock
 to common stock                             (2)          -       314        (312)              -
Conversion of Class A common
 stock to common stock                        -          (7)        7           -               -
Net income                                    -           -         -           -           1,608
Other comprehensive income -
 unrealized Holding gains                     -           -         -           -               -
Comprehensive income                          -           -         -           -               -
Repayment of loan receivable                  -           -         -           -               -
                                     -------------   -------   ------   ----------    ------------
Balance, December 31, 1999                    -           3       386      54,585         (57,581)
Net loss                                      -           -         -           -          (4,879)
Other comprehensive income -
 unrealized holding gains                     -           -         -           -               -
Comprehensive income                          -           -         -           -               -
Issuance of common stock                      -           -         2         124               -
                                     -------------   -------   ------   ----------    ------------
Balance, December 31, 2000             $      -      $    3    $  388   $  54,709      $  (62,460)
                                     =============   =======   ======   ==========    ============
 </TABLE>
                 See Notes to Consolidated Financial Statements



<PAGE>  31
              THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIENCY
                              (In $ Thousands)
<TABLE>
<CAPTION>
                                 Accumulated                                Total (Capital
                                   Compre-           Notes                   Deficiency)
                                   Hensive        Receivables    Treasury   Shareholders'
                                Income/(Loss)    Shareholders     Stock       Equity
                                -------------    ------------    --------   --------------
<S>                              <C>             <C>             <C>        <C>
Balance, December 31, 1997       $        -       $      (5)     $  (202)    $    (1,851)
Conversion of subordinated
 convertible note into
 common shares                            -               -            -           5,000
Conversion of Class A common
 shares to common shares                  -               -            -               -
Net loss                                  -               -            -         (30,858)
Other comprehensive income -
 unrealized holding gains                 1               -            -               1
Comprehensive loss                        -               -            -         (30,857)
                                -------------    ------------    --------   --------------
Balance, December 31, 1998                1              (5)        (202)        (27,708)
Conversion of subordinated
 convertible note and accrued
 interest into preferred stock            -               -            -          15,241
Subordinated convertible
 debt inducement                          -               -            -           3,043
Preferred stock issued for cash           -               -            -           5,003
Conversion of preferred stock
 to common stock                          -               -            -               -
Conversion of Class A common
 stock to common stock                    -               -            -               -
Net income                                -               -            -           1,608
Other comprehensive income -
 unrealized Holding gains                 -               -            -               -
Comprehensive income                      -               -            -           1,608
Repayment of loan receivable              -               5            -               5
                                -------------    ------------    --------   --------------
Balance, December 31, 1999                1               -         (202)         (2,808)
Net loss                                  -               -            -          (4,879)
Other comprehensive income -
 unrealized Holding gains                (1)              -            -              (1)
Comprehensive income                      -               -            -               -
Issuance of common stock                  -               -            -             126
                                -------------    ------------    --------   --------------
Balance, December 31, 2000                -               -         (202)         (7,562)
                                =============    ============    ========   ==============
</TABLE>
                 See Notes to Consolidated Financial Statements




<PAGE>  32
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                               (In $ Thousands)
<TABLE>
<CAPTION>
                                                              Year Ended December 31,
                                                       --------------------------------------
                                                          2000          1999          1998
                                                       ----------    ----------    ----------
<S>                                                    <C>           <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income                                      $  (4,879)    $   1,608     $ (30,858)
Adjustments to reconcile net (loss) income
 to net cash used in operating activities:
  Depreciation and amortization                              420         1,147         6,001
  Bad debt expense                                         1,172         2,090         2,575
  Decrease in deferred taxes                                   -             -         5,441
  Interest expense on inducement                               -         3,043             -
  Loss on impaired assets                                      -             -         2,812
  (Gain) loss on sale of assets and other                      -          (218)            1
  Extraordinary gain on claim settlements                      -       (18,268)            -
  Changes in assets and liabilities:
    (Increase) decrease in accounts receivable            (4,971)       (3,667)        1,987
    Decrease in accounts receivable -
     non-current - net                                         -             -           225
    Decrease (increase) in advances to
     participating providers                                  31          (531)        2,804
    Decrease (increase) in due from affiliate, net         1,022          (574)            -
    Decrease (increase) in other receivables - net           864        (1,024)        3,328
    Decrease (increase) in prepaid expenses and
     other current assets and other assets                   556           590           (19)
    Decrease in restricted cash                              421         1,513           485
    Increase in other non-current assets -
     excluding other receivables                               -             -          (205)
    Increase in medical cost payable                       1,300         5,776         9,083
    Increase (decrease) in accounts payable and
     accrued expenses                                      1,275        (1,370)       (1,303)
    (Decrease) increase in provider settlement            (2,265)        4,369             -
    (Decrease) increase in unearned revenue                 (339)       (4,509)        1,083
                                                       ----------    ----------    ----------
      Net cash (used in) provided by
       operating activities                               (5,393)      (10,025)        3,440

CASH FLOWS FROM INVESTING ACTIVITIES:
    Proceeds from sale of assets                               -         5,015             -
    Purchase of property and equipment                      (304)          (56)         (656)
    Decrease in notes receivable                               -            61           745
    Sale of investments                                        -             -           101
                                                       ----------    ----------    ----------
      Net cash (used in) provided by
       investing activities                                 (304)        5,020           190

CASH FLOW FROM FINANCING ACTIVITIES:
    Proceeds from notes payable to affiliate               4,356           850             -
    Issuance of common stock                                 126             -             -
    Principal payments of long-term debt                       -             -          (605)
    Issuance of series A preferred stock                       -         5,002             -
                                                       ----------    ----------    ----------
      Net cash provided by  (used in)
       financing activities                                4,482         5,852          (605)
                                                       ----------    ----------    ----------
      Net (decrease) increase in cash and
       cash equivalents                                   (1,215)          847         3,025
Cash and cash equivalents, beginning of period             7,240         6,393         3,368
                                                       ----------    ----------    ----------
Cash and cash equivalents, end of period               $   6,025     $   7,240     $   6,393
                                                       ==========    ==========    ==========

Supplemental Cash Flow Information:
  Cash paid for interest                               $       -     $     502     $   1,131
</TABLE>
                   See Notes to Consolidated Financial Statements



<PAGE>  33
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
                  Notes to Consolidated Financial Statements

1.     ORGANIZATION

     The Wellcare Management Group, Inc. ("WellCare" or the "Company"), a New
York corporation, owns, operates and provides management services to health
maintenance organizations ("HMO").  An HMO is an organization that accepts
contractual responsibility for the delivery of a stated range of health care
services to its members for a predetermined, prepaid fee.

     Well Care of New York, Inc. ("WCNY"), a wholly-owned subsidiary, operates
as an HMO in New York State. WCNY has a certificate of authority under Article
44 of the New York State Public Health Law to operate in 25 counties in the
Greater Hudson River Valley, Capital District, Southern Tier and New
York/Westchester County. WCNY is a mixed IPA/Direct Contract model HMO. Under
this type of arrangement, agreements are entered into with regional health care
delivery networks currently organized as independent practice associations
("IPAs" or "Alliances") which in turn contract with providers to render health
care services to HMO enrollees.  The HMO also contracts directly with
individual primary care physicians or physician groups for health care services
not contracted through the IPAs.

     FirstChoice HealthPlans of Connecticut, Inc. ("FirstChoice", formerly
WellCare of Connecticut, Inc.), a wholly-owned subsidiary of WCNY, operates as
an IPA model HMO in the state of Connecticut.  Under this type of arrangement,
agreements are entered into with IPAs and Physician Hospital Organizations
("PHOs") and individual physicians for the provision of all medical care to
FirstChoice's enrollees for a specified fee for services rendered.  FirstChoice
is approved to operate State-wide in Connecticut.  Effective October 1, 2000,
FirstChoice closed on its transaction with HealthChoice of Connecticut, Inc.,
("HealthChoice") to acquire the assets of HealthChoice's Medicaid line of
business, known as PreferredOne for a purchase price of $1.00 (one dollar).
FirstChoice, which was licensed solely as a commercial health maintenance
organization in the State of Connecticut, covering about 4,200 members,
received all necessary regulatory approval effective October 1, 2000 to assume
the responsibility for approximately 24,000 adult and child members of
HealthChoice's Medicaid and HUSKY Plans.

     Well Care Administration, Inc. ("WCA") (formerly Agente Benefit
Consultants, Inc. ("ABC")) is a wholly-owned subsidiary that administered the
Company's pharmacy, vision care, dental care and other specialty care benefit
programs as stand-alone products to self-insured employer and other groups
until June 1999.  WCA was rendered inactive after June 1999 as the Company's
pharmacy, vision care, dental care and other specialty care benefit programs
were contracted with third party venders and was subsequently dissolved in
October 2000.

     Well Care Development, Inc. ("WCD") is a wholly-owned subsidiary formed to
acquire, own and develop real estate.  WCD was rendered inactive as of June
1999 and was subsequently dissolved in October 2000.




<PAGE>  34
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

1.     ORGANIZATION - CONTINUED

     In June 1999, Kiran C. Patel, M.D. ("Dr. Patel"), the principal owner of
Well Care HMO, Inc., a Florida corporation, an entity unrelated to WellCare,
purchased a fifty-five (55%) percent ownership interest in the Company for $5.0
million (the "Patel Transaction").  As part of the purchase transaction, Dr.
Patel received 100,000 shares (the "Shares") of a newly authorized series of
senior convertible preferred stock ("Series A Convertible Preferred Stock"),
which provided Dr. Patel with 55% of WellCare's voting power.  The preferred
stock was subject to mandatory conversion into common stock upon the amendment
of WellCare's certificate of incorporation to increase the number of authorized
shares of common stock from 20 million shares to 75 million shares.  Due to the
excess of the fair value of the underlying common stock, which totaled
approximately $8 million over the purchase price, the Company recorded a deemed
dividend on the preferred stock totaling approximately $3 million.  For
financial statement purposes, the issuance of the common stock in exchange for
the preferred stock has been reflected as of December 31, 1999, however, the
physical transfer took place in April 2000.  The shares are subject to anti-
dilution rights, whereby upon conversion Dr. Patel will generally preserve his
55% interest in WellCare until there are 75 million shares of common stock
issued and outstanding.  In order to preserve his 55% interest, Dr. Patel will
be required to pay the par value ($0.01 per share) for each common share
subsequently purchased.

     As a condition to the closing of the Patel transaction, the holders of
680,747 shares of Class A common stock, which has ten votes per share, agreed
to convert their shares into shares of common stock on a share-for-share basis.
Mr. Robert W. Morey, the holder of 313,555 share of Class A common stock
outstanding, gave a two year proxy in favor of Dr. Patel to vote Mr. Morey's
shares of Class A common stock.

     In June 1999, Group Health Incorporated ("GHI") purchased WCNY's
commercial business, consisting mainly of other assets and goodwill associated
with member lives, for approximately $5.0 million (the "GHI Transaction").
During 1999, the Company  recorded a gain of $352,000 in connection with the
sale.  As stipulated and agreed upon in the GHI transaction, WellCare and WCNY
will not engage in commercial HMO business in New York for a period of one year
from the June 1, 1999 closing date.

     In June 1999, as a condition to the successful closing of the Patel and
the GHI transactions, various hospitals, physicians and other health care
providers entered into settlement agreements to settle claims for services
provided to WCNY HMO members through April 30, 1999.  The various hospitals,
physicians and other health care providers agreed to accept a payment of 30% of
the balance owed by the Company to the provider in the year of settlement, plus
5% of the balance owed by the Company, payable on February 1 of the three years
subsequent to the year of settlement if they continue to be participating WCNY
providers. These claims are settled from a provider pool consisting of all the
proceeds from the Patel and GHI transactions in addition to 80% of WCNY's
premium receivables at April 30, 1999. For the year ended December 31, 1999,
the Company recognized an extraordinary gain of $18.3 million due to the
results of the completed provider settlements.  At December 31, 2000 and 1999,
the Company maintained accruals of $2.1 million and $4.4 million respectively,
pertaining to this transaction, of which $1.1 million and $2.9 million,
respectively was included in non-current liabilities.




<PAGE>  35
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

1.     ORGANIZATION - CONTINUED

     As a further condition to the successful closing of the Patel transaction,
in June 1999, The 1818 Fund II, L.P. (the "Fund"), the general partner of which
is Brown Brothers Harriman & Co., converted $15.0 million in subordinated note,
plus accrued interest (8%) of approximately $0.8 million into 100,000 shares of
senior convertible preferred stock ("Series" B) of the Company, which was then
converted into 10.0 million shares of Common Stock.  In connection with the
conversion of the Series B preferred stock, the Company recorded interest
expense of approximately $3.0 million relating to the fair value of the shares
received in excess of the shares issuable at a conversion price of $8.00 per
share.

2.     SIGNIFICANT ACCOUNTING POLICIES

     PRINCIPLES OF CONSOLIDATION - The accompanying consolidated financial
statements include its wholly owned subsidiaries, Wellcare of New York, Inc.
("WCNY") and Wellcare of Connecticut, Inc. ("FirstChoice").  All significant
intercompany accounts and transactions have been eliminated.

     CASH AND CASH EQUIVALENTS - The Company considers all demand deposits,
overnight investments, and highly liquid investments with a maturity of three
months or less to be cash equivalents.  The Company includes all cash
overdrafts in accounts payable.

     RESTRICTED CASH - Restricted cash includes amounts in escrow with a
provider and statutory cash reserve requirement of the State of New York
Insurance Department.

     ADVANCES TO PROVIDERS - Advances to providers consist principally of
amounts advanced hospitals which are under contract with the WellCare HMOs to
provide medical services to plan members.  Such advances provide funding to
these providers for claims incurred but not yet reported or claims in the
process of adjudication.  The WellCare HMOs have the right to offset such
advances against future claims payments.

     PROPERTY AND EQUIPMENT - Property and equipment is stated at cost net of
accumulated depreciation.  Depreciation is computed by the straight-line method
over the estimated useful lives of the assets, which range from 5 to 10 years.
During 2000, the Company changed the estimated useful life of certain property
and equipment from five years to a range of three to ten years.  The Company
believes that estimated useful lives ranging from three to ten years more
appropriately reflects the timing of the economic benefits to be received from
such assets.  During 2000, the impact to operations due to the change in
estimated useful lives was a decrease in depreciation expense by approximately
$521,000.

     GOODWILL - Goodwill represents the excess of the purchase price over the
fair value of the net assets of acquired entities.  As a result of its
evaluation, and in light of the June 1999 transaction with an unrelated party,
the Company wrote off in 1998 approximately  $2,323,000 to reduce the remaining
unamortized goodwill to its net realizable value.  The remaining balance was
sold as part of one of the June 1999 transactions (see GHI Transaction in Note
1).



<PAGE>  36
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

2.     SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

     IMPAIRMENT OF LONG-LIVED ASSETS - The Company evaluates the recoverability
of the net carrying value of its property and equipment, and other long-lived
assets by comparing the carrying values to the estimated future undiscounted
cash flows.  A deficiency in these cash flows relative to the carrying amounts
is an indication of the need for a write-down due to impairment.  The
impairment write-down would be the difference between the carrying amounts and
the fair value of these assets.  Impairment would be recognized by a charge to
operations.

     FAIR VALUE OF FINANCIAL INSTRUMENTS - The estimated fair value of amounts
reported in the consolidated financial statements have been determined by using
available market information and appropriate valuation methodologies.  The
carrying value of all current assets and current liabilities approximate their
fair value because of their short-term nature.

     CONCENTRATIONS OF CREDIT RISK - Financial instruments, which potentially
subject the Company to concentration of credit risk consist principally of cash
equivalents and receivables. The Company limits the amount of credit exposure
to each individual financial institution and places its temporary cash into
investments of high credit quality. Concentrations of credit risk with respect
to premium receivables are limited, as the majority of the Company's business
is generated from government sponsored programs.  As of December 31, 2000 and
1999, management believes that the Company had no significant concentrations of
credit risk.

     USE OF ESTIMATES - The preparation of the consolidated financial
statements, in conformity with accounting principles generally accepted in the
United States of America, requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the consolidated financial
statements and the reported amounts of revenues and expenses during the
reporting period.  Actual results could differ from those estimates.

     REVENUE RECOGNITION - Premiums from subscribers are recorded as income in
the period that subscribers are entitled to service.  Premiums received in
advance are deferred.

     MEDICAL EXPENSES - Medical expenses include estimates for physician
services, hospital services, pharmacy expenses, and other medical expenses
incurred but not yet reported ("IBNR") based on a number of factors, including
hospital admissions data and prior claims experience; adjustments, if
necessary, are made to medical expenses in the period the actual claims costs
are ultimately determined.  The Company believes the IBNR estimates in the
consolidated financial statements are adequate; however, there can be no
assurances that actual health care claims will not exceed such estimates.

     REINSURANCE - The WellCare HMOs insure excess loss for health care claims
under policies with a reinsurance company.  Under the excess loss reinsurance
policies, recoveries are made for annual claims of each member in excess of the
deductible established in the policies subject to certain limitations.  The
Company's deductibles were $85,000 for the FirstChoice lines of business and
$115,000 and $100,000 for WCNY's Medicaid and Medicare lines of business,
respectively, during fiscal years 2000, 1999, and 1998.



<PAGE>  37
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

2.     SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

     PROVISION FOR LOSS CONTRACTS - It is the Company's policy to evaluate all
contracts and recognize losses on contracts when estimated future health care
costs and maintenance costs under a group of existing contracts will exceed
anticipated future premiums and stop-loss insurance recoveries.  Management has
evaluated the contracts currently in place and determined that no accrual was
necessary at December 31, 2000, 1999, and 1998.

     STOCK-BASED COMPENSATION - As permitted by SFAS No. 123, Accounting for
Stock-Based Compensation, the Company has elected to recognize stock-based
compensation under Accounting Principles Board Opinion No. 25, Accounting for
Stock Issued to Employees, and to disclose in the notes to consolidated
financial statements the effects of SFAS No. 123 as if its fair value
recognition provisions were adopted.  See Note 9.

     ADVERTISING COSTS - Advertising costs, which include costs for certain
marketing materials and development/implementation of public relations and
marketing campaigns, are expensed as incurred.

     INCOME TAXES - The Company accounts for income taxes under the asset and
liability method as required by Statement of Financial Accounting Standard
("SFAS') No. 109, Accounting for Income Taxes.  Under this method, deferred
income taxes are recognized for the tax consequences of "temporary differences"
by applying enacted statutory tax rates applicable to future years to
differences between the financial statement carrying amounts and the tax basis
of existing assets and liabilities.  The effect of a tax rate change on
deferred taxes is recognized in operations in the period that the change in the
rate is enacted.

     EARNINGS PER SHARE - Basic net income (loss) per share is computed using
weighted average number of common shares outstanding for the applicable period.
Diluted net income (loss) per share reflects the potential dilutive effect of
securities (which consist of stock options) that could share in earnings of the
Company, unless the inclusion of these potential dilutive effects results in
antidilution.

     RECLASSIFICATION - Certain amounts in the 1999 and 1998 consolidated
financial statements have been reclassified to conform to the 2000 presentation.

     NEW ACCOUNTING PRONOUNCEMENTS - In June 1998, the Financial Accounting
Standards Board ("FASB") issued SFAS No. 133, Accounting for Derivative
Instruments and Hedging Activities.  SFAS No. 133 establishes accounting and
reporting standards for derivative instruments and hedging activities.  It
requires that an entity recognize all derivatives as either assets or
liabilities in the statement of financial position and measure those
instruments at fair value.  The accounting for changes in the fair value of a
derivative (that is, gains and losses) depends upon the intended use of the
derivative and resulting designation.  In July 1999, FASB issued SFAS No. 137,
Accounting for Derivative Instruments and Hedging Activities - Deferral of the
Effective Date of SFAS No. 133, which postponed the effective date of the SFAS
No. 133 for one year.  In June 2000, FASB issued SFAS No. 138, Accounting for
Certain Derivative Instruments and Certain Hedging Activities, and amendment to
SFAS No. 133.  The Company adopted SFAS 133 on January 1, 2001.  The adoption
of SFAS No. 133 did not have a material impact on the Company's financial
position or results of operations.



<PAGE>  38
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

2.     SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

     In December 1999, the Securities and Exchange Commission ("SEC") issued
Staff Accounting Bulletin ("SAB") No. 101, "Revenue Recognition in Financial
Statements", which provided guidance related to revenue recognition based on
interpretations and practices followed by the SEC.  SAB No. 101 was effective
for the Company'' fourth quarter 2000, and required the Company to report any
changes in revenue recognition as a cumulative change in accounting principle
at the time of implementation.  The Company is in compliance with the
provisions of SAB No. 101, and adoption of the provisions did not have an
impact on the Company's consolidated financial statements.

3.     OTHER RECEIVABLES

     Other receivables consisted of the following (in thousands):

                                                      December 31,
                                               --------------------------
                                                   2000          1999
                                               ------------  ------------
Receivable from third-party insurers            $      40     $     120
Reinsurance receivable                                102           245

New York State Pools receivable                         -           543
Pharmacy rebate receivable                            125             -
Insurance claims receivable                             -           218
Other                                                 524           489
                                               ------------  ------------
Total other receivable                          $     791     $   1,615
                                               ============  ============

4.     Notes Receivable

     In prior years, the Company made advances to certain medical providers to
enhance WCNY's provider network. The advances were recorded as notes receivable
of approximately $2,997,000 at December 31, 1999.  As no payments have been
received since March 1997, the notes receivable were fully reserved in 1999.
Due to the significant uncertainty of collectibility of these advances, the
Company wrote off the notes receivable and valuation allowances in 2000.

5.     PROPERTY AND EQUIPMENT

     Property and equipment consisted of the following (in thousands):

                                                        December 31,
                                                 --------------------------
                                                     2000          1999
                                                 ------------  ------------
Computer hardware and software                    $   3,461     $   3,486
Furniture, fixtures, and equipment                    1,450         1,883
                                                 ------------  ------------
Total                                                 4,911         5,369
Less accumulated depreciation and amortization        4,271         4,613
                                                 ------------  ------------
Property and equipment, net                       $     640     $     756
                                                 ============  ============

     Depreciation expense for the years ended December 31, 2000, 1999, and 1998
were $420,000, $1,147,000, and $3,624,000, respectively.


<PAGE>  39
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

5.     PROPERTY AND EQUIPMENT - CONTINUED

     In June 1999, the Company agreed to transfer ownership of certain real
property to the mortgagee of those properties in consideration of the
mortgagees relieving the Company of any liability for any deficiency between
the amount of the mortgage balances and the value of the property. A loss of
approximately $100,000 was recorded in connection with this transaction.  In
1998, the Company recorded a loss on impairment of assets of approximately $2.8
million, with a corresponding reduction in buildings and building improvements,
to adjust the net carrying value of the assets to the amount of the mortgage
balances.

     Included in computer equipment and furniture, fixtures and equipment is
equipment financed through capital leases aggregating approximately $2,574,000
at December 31, 1999.  As part of the Patel and GHI transactions, the leased
equipment was either returned to the lessors or was assumed by GHI.
Accumulated amortization relating to assets financed through capital leases was
approximately $2,574,000 and $2,272,000 at December 31, 1999 and 1998,
respectively.

6.     MEDICAL COSTS PAYABLE

     The following table summarizes the activities of medical costs payable
(in thousands):

                                          December 31,
                                   --------------------------
                                       2000          1999
                                   ------------  ------------
Balance, beginning of year          $  14,386     $  26,404
Total incurred related to:
  Current year                         69,840        97,429
  Prior year                             (286)        4,369
                                   ------------  ------------
 Total incurred                        69,554       101,798
Paid and settled related to:

  Current year                        (55,472)     (112,506)
  Prior year                          (12,782)       (1,310)
                                   ------------  ------------
Total paid                            (68,254)     (113,816)
                                   ------------  ------------
Balance, end of year                $  15,686     $  14,386
                                   ============  ============

     The liability for accrued medical costs payable includes management's
estimate of amounts required to settle known claims, claims in the process of
adjudication, and estimated claims incurred but not reported.

     During 2000, the Company experienced favorable claims expense related to
its estimated reserves for claims payable at December 31, 1999.  The
accompanying financial statements reflect a $286,000 decrease in medical
expenses for 2000 relating to a change in estimate on prior year claims
liabilities.




<PAGE>  40
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

7.     NOTES PAYABLE TO AFFILIATE

     Notes payable to affiliate consisted of the following (in thousands):
<TABLE>
<CAPTION>
                                                                      December 31,
                                                               --------------------------
                                                                   2000          1999
                                                               ------------  ------------
<S>                                                             <C>           <C>
Subordinated note payable to a related party; principle due
 on demand; interest at 8 1/2 percent per annum                 $     850     $     850

Subordinated note payable to a related party; principle due
 on demand; interest at 8 1/2 percent per annum                     2,200             -

Subordinated note payable to a related party; principle due
 on demand; interest at 8 1/2 percent per annum                     1,356             -

Subordinated note payable to a related party; principle due
 on demand; interest at 8 1/2 percent per annum                       800             -
                                                               ------------  ------------
Notes payable to affiliate                                      $   5,206     $     850
                                                               ============  ============
</TABLE>

8.     INCOME TAXES

     A reconciliation of the federal statutory rate to the Company's effective
income tax rate is as follows:
<TABLE>
<CAPTION>
                                                                       December 31,
                                                              ----------------------------
                                                                2000      1999      1998
                                                              --------  --------  --------
<S>                                                           <C>       <C>       <C>
Federal statutory rate                                           34.0%     34.0%     34.0%
State income taxes - net of federal benefit                       6.4       6.4       6.4
Expense on debt inducement                                          -      64.5         -
Income on claims settlement                                         -    (105.2)        -
Limitation of NOL carryforward due to change in ownership           -      69.0         -
Other                                                               -     113.3         -
Change in valuation allowance                                   (40.4)   (182.0)        -
                                                              --------  --------  --------
Effective rate                                                      -%        -%     40.4%
                                                              ========  ========  ========
</TABLE>

The significant components of deferred taxes were as follow (in $ thousands):

                                                            December 31,
                                                     --------------------------
                                                         2000          1999
                                                     ------------  ------------
Deferred tax assets:
  Accounts receivable and other receivables -

    allowance for bad debt                           $       81    $    2,144
  Other                                                   6,546           538
  Net operating loss carry forward                       13,013         3,893
                                                    ------------  ------------
Total deferred tax asset before valuation allowance      19,640         6,575
Less valuation allowance                                 19,640         6,575
                                                    ------------  ------------
Net deferred tax asset                               $        -    $        -
                                                    ============  ============




<PAGE>  41
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

8.     INCOME TAXES - CONTINUED

     The Company has net operating loss ("NOL") carryforwards in the amount of
approximately $70,000,000 expiring through 2020.  Of this amount, approximately
$37,900,000 of NOL carryforward has been limited by imposition of Section 382
of the Internal Revenue Code due to a change in the Company's ownership in
1999. The ability to realize the tax benefits associated with deferred tax
assets and NOLs is reliant upon the Company's ability to generate future
taxable income from operations and/or to effectuate successful tax planning
strategies.  Although management believes that profitable operations may be
achieved in the future, in view of their size and length of the expected recoup
period, the Company provided a 100% valuation allowance in both 2000 and 1999
with respect to the deferred tax assets for 2000 and 1999 respectively.

9.     STOCK OPTIONS

     In March 1993, the Company created the 1993 Incentive and Non-Incentive
Stock Option Plan (the "1993 Stock Option Plan") to encourage selected
employees, directors, and other persons who contribute materially to the
Company's success.  The 1993 Stock Option Plan was amended in October 1999,
which allowed for an aggregate of 5,000,000 shares of the Company's common
stock, par value $0.01 per share, to be reserved for issuance upon the exercise
of options which may be granted from time to time in accordance with the 1993
Stock Option Plan.  The options shall have a term of no more than ten years
from the date of grant but shall terminate, lapse and expire at such earlier
time or times as provided in the Option Agreement governing such option.
Options granted are not subject to review and are conclusive, although in no
event shall such purchase price be less than (i) 100% of the fair market value
of the Company's common stock on the date of grant for Incentive Options (110%
of the fair market value of the Company's common stock on the date of grant is
made to a 10% owner) and (ii) 75% of the fair market value of the Company's
common stock on the date of grant for Non-Incentive Options.  The following is
a summary of the transactions under the 1993 Stock Option Plan:

     The following table summarizes the activities related to options during
2000, 1999, and 1998:

                                         2000          1999          1998
                                     ------------  ------------  ------------
Outstanding, beginning of year         4,009,535       598,741       650,179
Exercised during the year                      -             -             -
Terminated during the year                (7,535)     (589,206)     (275,438)
Granted during the year                        -     4,000,000       224,000
                                     ------------  ------------  ------------
Outstanding, end of year               4,002,000     4,009,535       598,741
                                     ============  ============  ============

Options exercisable at year end          573,429       580,964       463,005
Weighted average fair value of
 Options granted during the year      $        -    $     0.25    $        -

     At December 31, 2000, there were 4,002,000 options outstanding, of which
573,429 options were exercisable, with a weighted average exercise price of
$0.375 per share and a weighted average remaining contractual life of nine
years.

     During, 1999 the Company granted 4,000,000 options to purchase common
stock at an exercise price of $0.375 per share.  The options expire in ten
years and vest over a period of seven years.



<PAGE>  42
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

9.     STOCK OPTIONS - CONTINUED

     In December 1997, the Company amended the exercise price on the 200,000
options previously granted to the President in 1996, from $10.125 to $3.01 per
share.  In September 1997, the Company granted the President options for 30,000
shares, at an exercise price of $15.00 per share.  In February 1998, the
Company amended the exercise price for the 30,000 options to $4.51 per share,
and granted additional options for 100,000 shares, at an exercise price of
$5.02 per share.  The President resigned, effective January 15, 1999, and his
qualified options terminated April 15, 1999.

     In December 1996, the Company created the 1996 Non-Incentive Executive
Stock Option Plan (the "NIE Plan") to acknowledge exceptional services to the
Company by senior executives and to provide an added incentive for such senior
executives to continue to provide such services and to promote the best
interests of the Company.  An aggregate of 650,000 shares, all of which are
available for grant as of December 31, 2000, of the Company's common stock, par
value $0.01 per share, are reserved under this plan with options to purchase
granted to any one senior executive limited to 600,000 shares or less.  All
options have a term of five years from the date of grant but shall terminate,
lapse and expire at such earlier time or times as provided in the Option
Agreement governing such option.  Options granted are not subject to review and
are conclusive, although in no event shall such purchase price be less than the
fair market value (as defined in the Agreement).  The following is a summary of
the transactions under the NIE Plan:

                                               1999          1998
                                           ------------  ------------
Outstanding, beginning of year                 600,000       600,000
Exercised during the year                            -             -
Terminated during the year                    (600,000)            -
Granted during the year                              -             -
                                           ------------  ------------
Outstanding, end of year                             -       600,000
                                           ============  ============

Options exercisable at year end                      -       200,000
Option price per share                               -    $4.00-$6.25

     The Company has adopted the disclosure only provisions SFAS No. 123.
Accordingly, no compensation cost has been recognized for the options in the
accompanying consolidated statements of operations.  Had compensation cost for
grants made under the Company's stock option plan and non-incentive executive
stock option plan been determined based on the fair value at the grant date in
a manner consistent with SFAS No. 123, the Company's pro forma net loss and pro
forma net loss per share would be as follows ($ in thousands, except per share
amounts):



<PAGE>  43
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

9.     STOCK OPTIONS - CONTINUED

                                                          December 31,
                                                  ----------------------------
                                                    2000      1999      1998
                                                  --------  --------  --------
Net loss available to common shareholders:
  As reported                                     $ (4,879) $ (1,435) $(30,858)
  Pro forma                                         (4,928)   (1,695)  (33,272)

Net loss available to common shareholders
 per share - basic and diluted:
  As reported                                     $  (0.13) $  (0.09) $  (4.36)
  Pro forma                                          (0.13)    (0.11)    (4.70)

     The fair value of each option granted is estimated on the date of grant
using the Black-Scholes option-pricing model with the following weighted-
average assumptions used for grants in 2000, 1999, 1998, respectively: expected
volatility of 131.0%, 45.8%, and 144.1%; expected lives of 7.0, 3.0, and 3.7
years; and risk-free interest rate of 4.0%, 6.0%, and 7.0%.  Additionally, in
each year, the dividend yield was 0%.

10.     EARNINGS PER SHARE

     Options to purchase 4,002,000, 4,009,535, and 598,741 shares of common
stock were outstanding, but were not included in the computation of diluted
Earnings Per Share ("EPS") at December 31, 2000, 1999, and 1998 respectively,
due to their anti-dilutive effect.

     The 8% subordinated convertible note amounting to $15,000,000 is not
included in the computation of 1999 diluted EPS prior to its conversion due to
its anti-dilutive effect.  The note was converted during 1999.

     The Company's common stock shares are subject to anti-dilution rights
whereby upon conversion the majority shareholder will generally preserve his
55% interest in Wellcare until there are 75 million shares of common stock
issued and outstanding. Accordingly, during a year when the Company is in a net
income position, earnings per share could potentially be diluted by common
stock shares totaling as much as 55% of 75 million shares less the number of
shares outstanding at any given point in time.

11.     RETIREMENT SAVINGS PLAN

     The Company sponsored a retirement plan (the "Plan") designed to qualify
under Section 401(k) of the Internal Revenue Code of 1986, as amended.  All
employees over age twenty-one (21) who have been employed by the Company for at
least one year with one thousand  (1,000) hours of service are eligible to
participate in the plan.  Employees may contribute to the plan on a tax -
deferred basis generally up to 18% of their total annual salary. Under the
plan, the Company makes matching contributions at the rate of 50% of the amount
contributed by the employees up to a maximum of 2% of the  employee's total
annual compensation. The employer contributions are vested after five (5) years
of service.  The Company contributed approximately $0, $0, and $58,000 for
2000, 1999, and 1998, respectively.  The Plan was terminated in May 2000 as all
employees are paid by Comprehensive Health Management, Inc. ("CHM"), an
affiliate of the majority shareholder, in accordance with contract
specifications.  Payroll expenses related to the Company's marketing employees
are reimbursed to CHM and administrative employee payroll expenses are the
responsibility of CHM.





<PAGE>  44
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

12.     RELATED PARTY TRANSACTIONS

MANAGEMENT AGREEMENT

     WCNY and FirstChoice have entered into management agreements with
Comprehensive Health Management, Inc. ("CHM"), a Company that was established
by the majority shareholder to provide management, administrative services, and
claims processing services to health maintenance organizations.  During
September 1999, WCNY and FirstChoice each executed a five-year management
agreement with CHM to perform claims processing services, utilization review,
payroll services, and most all of the administrative functions of the Company,
excluding certain marketing functions.  CHM is responsible for all the
administrative employees' payroll and business expenses.  Additionally, CHM is
responsible for maintaining the claims related data processing equipment and
software.

     The management fee for each Company ranges from 9.5% of premium revenue
earned when there are less than 40,000 members to 7.5% of premium revenue
earned when there are more than 80,000 members.  In June 2000, the agreements
were amended to generally provide CHM with enough revenue to cover its own
costs related to the provision of management services to the Company and other
affiliated HMOs.  As a result of the amended agreements, the management fee was
revised to reflect ranges of 11.5% of premium revenue earned when there are
less than 40,000 members and 9.5% of premium revenue earned when there are more
than 80,000 members.  During 2000, CHM operated at a deficit of approximately
$4.0 million and CHM is currently evaluating the adequacy of the current fee
structure.  Management anticipates that adjustments to the fee structure will
occur during the next fiscal year to improve the cost recovery at CHM.

     Management fees, net of asset purchases and excluded membership groups,
for the years ended December 31, 2000 and 1999 were approximately $7,799,000
and $3,046,000, respectively, which were included in general and administrative
expenses.  At December 31, 2000, the Company owed CHM approximately $223,000.
At December 31, 1999, CHM owed the Company approximately $799,000.  As a result
of the CHM management agreement, the Company's general and administrative
expenses as a percentage of total revenue decreased from 20.1% in 1999, and to
17.0% in 2000.


OTHER

     The Company has entered into various lease agreements for office space.
As part of the management agreement, CHM makes payments to the lessors on
behalf of the Company.  The payments for leased space are an integral part of
the management fee, and lease payments made by CHM to lessors amounted to
approximately $619,000 and $332,000 during 2000 and 1999, respectively.

     Under the management services agreement, the Company is responsible for
the direct salary cost of their marketing personnel.  During 2000, CHM
processed and paid the payroll for the Company's marketing personnel.  The
Company reimbursed CHM approximately $1,620,000 and $660,000 during 2000 and
1999, respectively related to these direct salary costs during the current
year.




<PAGE>  45
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

12.     RELATED PARTY TRANSACTIONS - CONTINUED

     Well Care HMO, Inc., an affiliate of the majority shareholder, paid for
director and officers and errors and omissions insurance policies and allocates
the expense proportionately to various related entities.  As of December 31,
2000, WCNY owes Well Care HMO, Inc. approximately $123,000 for its
proportionate share of the policy premiums.

NOTES PAYABLE

     The Company's majority shareholder has provided financing to the Company
through various cash infusions from related enterprises.  During 2000,
approximately $4.4 million in surplus notes were provided to the Company from
enterprises controlled by the majority shareholder, which are due upon demand
with interest accruing at 8.5% per annum.  The cash infusions were primarily
used by the Company to increase the statutory net equity of WCNY and
FirstChoice during the year.  See Note 7 for details.

13.     COMMITMENTS AND CONTINGENCIES

CONTRACTUAL OBLIGATION WITH IPAS

     WCNY has entered into various contractual arrangements with a majority of
its primary care physicians and specialists through contracts with regional
health care delivery networks.  These agreements call for capitating IPAs
comprised of specialists and primary care physicians.  Under the agreements,
the Company pays the IPAs for medical services provided by primary care
physicians and specialists.  The IPAs in turn reimburse those providers for the
services that are provided by each physician.  ProMedco Hudson Valley
("ProMedco"), an IPA group that WCNY had contracted with filed bankruptcy in
April 2001.  Based on the executed contracts with the IPAs, WCNY is not liable
for the IPAs' liabilities, however, in the event the IPAs default on their
financial obligations, the provider network could be materially affected.
Management is currently evaluating its options on restructuring the physician
network and various contingency plans with respect to individual physicians
within the ProMedco IPAs.

OPERATING LEASES

     Pursuant to management agreements with CHM, rental expenses are the
responsibility of CHM.  At December 31, 2000, the Company is the named lessee
on certain non-cancelable operating lease obligations.  Accordingly, future
minimum lease payments under such non-cancelable operating leases are as
follows:

     2001         $ 184,117
     2002           148,583
     2003           137,003
     2004           142,483
     2005            97,488
     Thereafter           -
                  ---------
                  $ 709,674
                  =========



<PAGE>  46
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements - Continued

13.     COMMITMENTS AND CONTINGENCIES - CONTINUED

     The Company is not a party to any material pending legal proceedings.  The
Company at times does have routine litigation incidental to its business.  In
the opinion of the Company's management, such proceedings should not,
individually or in the aggregate, have a material adverse effect on the
Company's consolidated results of operations or consolidated financial
condition.

     The Company is currently in negotiations with a former provider group
regarding a number of outstanding and disputed claims. The total amount in
dispute is estimated by Management to be less than $25,000.  A formal response
along with the detail of all disputed claims and their resolution have been
submitted to the provider group. During 2000, the Company established an escrow
account of $450,000 relating to this matter, which is included in restricted
cash in the financial statements.

     The Company and certain of its subsidiaries, including WCNY have responded
to subpoenas issued in April and August 1997 from the United States District
Court for the Northern District of New York through the office of the United
States Attorney for that District.  These subpoenas sought the production of
various documents concerning financial and accounting systems, corporate
records, press releases and other external communications.  While the United
States Attorney has not disclosed the purposes of its inquiry, the Company has
reason to believe that neither its current management nor its current directors
are subjects or targets of the investigation.  The Company has, however,
informed the government that it will continue to cooperate fully in any way
that it can in connection with the ongoing investigation.  As of December 31,
2000, 1999, and 1998, no amounts have been accrued to the consolidated
financial statements regarding the resolution of this investigation.

     On July 31, 1996 and October 3, 1996 the Securities and Exchange
Commission ("SEC") issued subpoenas to the Company for the production of
various financial and medical claims information.  The Company fully complied
with both of these subpoenas on August 21, 1996 and October 31, 1996, and with
subsequent requests for supplementation.  The current management is unaware of
any ongoing investigation by the SEC.  As of December 31, 2000, 1999, and 1998,
no amounts have been accrued to the consolidated financial statements regarding
the resolution of this investigation.

     Between April and June 1996, the Company, its former President and Chief
Executive Officer (Edward A. Ullmann), and its former Vice President of Finance
and Chief Financial Officer (Marystephanie Corsones) were named as defendants
in twelve separate actions filed in Federal Court (the "Securities
Litigations").  Additionally, three directors were also named in one of these
actions.  Plaintiffs sought to recover damages allegedly caused by the
Company's defendants' violations of federal securities laws with regard to the
preparation and dissemination to the investing public of false and misleading
information concerning the Company's financial condition.



<PAGE>  47
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

13.     COMMITMENTS AND CONTINGENCIES - CONTINUED

     In July 1996, the Securities Litigations were consolidated in the United
States District Court for the Northern District of New York, and an amended
consolidating complaint (the "Complaint") was served in August 1996.  The
Complaint did not name the three additional directors.  Deloitte and Touche
LLP, the Company's independent auditors during that period, however, was named
as an additional defendant.  In October 1996, the Company filed a motion to
dismiss the consolidated amended complaint against the Company as well as the
individual defendants.  The Company's auditor likewise filed its own motion to
dismiss.  By Memorandum Decision and Order (the "Order"), entered in April
1997, the Court (i) granted the auditor's motion to dismiss and ordered that
the claims against the auditors be dismissed with prejudice; and (ii) denied
the motion to dismiss brought by the individual defendants.  Because the Order
did not specifically address the Company's motion to dismiss, in May 1997, the
Company moved for reconsideration of its motion to dismiss and dismissal of all
claims asserted against it.  On reconsideration, the judge clarified his
previous ruling expanding it to include a denial of the Company's motion as
well.  Following the Court's decision, the Company filed its answer and defense
to the Complaint.  In September 1997, the plaintiffs' class was certified and
the parties thereafter commenced the discovery process of the litigation.  The
actions were dismissed pursuant to a court-approved settlement agreement.  The
time for appealing the approval order has not elapsed as of the date of this
report.

     In May 1999, the Company entered into a settlement agreement for $2.5
million, all of which is being funded by the insurance carrier, which provided
coverage to the individual defendants.  The settlement agreement received
Federal Court approval in January 2000.  The Company was reimbursed by the
insurance carrier of approximately $776,000 for expenses related to fees paid
to the attorneys representing the individual defendants, less the Company's
insurance deductible.  The reimbursement was included in other revenue in
fiscal year 2000.

     The WellCare HMOs are subject to assessments from various high-risk
insurance pools administered by the State of New York and Connecticut.  The
liabilities related to these pools are not estimable at December 31, 2000 with
the exception of an assessment made by the Connecticut Small Employer Health
Reinsurance Pool (the "Small Employer Pool").  During 2000, the Small Employer
Pool assessed the Company approximately $500,000 relating to 1999 and 1998.
This change in estimate was accrued in "accounts payable and accrued expenses"
and was recorded as a decrease to net income of $500,000 in the 2000 financial
statements.

     The Company conducts a significant portion of its HMO business with
Federal and State sponsored  programs.  As part  of their participation, the
Company is subject to legislative and regulatory change which is beyond
management's control.  Management continues to monitor these changes in
reimbursement levels and has made no provisions to the financial statements for
these contingencies.



<PAGE>  48
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

14.     PRIMERGY SETTLEMENT

     In July 1999, the Company entered into an agreement (the "Settlement
Agreement") with Primergy, Promedco of the Hudson Valley, Inc., and Promedco
Management Company to settle outstanding indebtedness to the Company from
Primergy.  Primergy's indebtedness to the Company pertains to an acquisition by
Primergy of a former subsidiary of the Company's during 1995.  Promedco of the
Hudson Valley, Inc., and Promedco Management Company are affiliates of
Primergy.  Due to uncertainty surrounding the financial condition of Primergy,
the indebtedness from Primergy was fully reserved for during the years 1995
through 1998, and was written off completely in 1999.   The Settlement
Agreement stipulated a $425,000 cash payment to the Company at closing, and
required a release to the Company from Primergy for approximately $325,000 in
past payments due to Primergy.

     The Company is a party to service agreements with five IPA's owned by
Primergy (the "Primergy IPA's").  Accordingly, the Settlement Agreement further
required Primergy to pay $2 per member per month for the period commencing from
August 31, 2000 to July 31, 2002 for members assigned to the Primergy IPA's.
Such payment is guaranteed by Promedco Management Company.  The Primergy IPA's
contract period was reduced and currently will terminate on July 31, 2002.  In
2000, the Company recognized approximately $118,000 in income pertaining to
this settlement.  Such amount is included in "Other Income - Net" in the 2000
financial statements.

15.     STATUTORY SURPLUS REQUIREMENTS

     The State of Connecticut Insurance Department requires that stipulated
amounts of surplus be maintained at all times.  FirstChoice must maintain a
minimum net worth equal to the greater of:  (A) $1,000,000; or (B) 2% of its
annual premium revenues as reported on the most recent annual financial
statement filed with the State of Connecticut Insurance Department on the first
$150,000,000 of premium revenues plus 1% of annual premium revenues in excess
of $150,000,000.  At December 31, 2000 FirstChoice's statutory net worth was
approximately $1.7 million, which was in compliance with the net worth
requirement.

     The Risk-Based Capital ("RBC") requirements for health care centers were
adopted through a regulation promulgated by the Department effective January
31, 2000.  The main purpose of the Regulation is to provide a tool for
insurance regulators to evaluate the capital of insurers.  FirstChoice filed a
RBC report as of December 31, 2000 on March 1, 2001.  This report disclosed
that FirstChoice did not meet the minimum RBC requirements and triggered an
Authorized Control Level ("ACL") event as defined in the regulation.  An ACL
event occurred since the Company's total adjusted capital was above the
Mandatory Control Level ("MCL") but less than ACL RBC.  The State of
Connecticut Insurance Department may take regulatory action against the Company
as a result of filing this RBC report, including but not limited to, placing
the Company under regulatory control.  As of May 25, 2001, the State of
Connecticut Insurance Department has not taken any action.



<PAGE>  49
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

15.     STATUTORY SURPLUS REQUIREMENTS - CONTINUED

     FirstChoice underwent an examination for the period from March 1, 1995 to
December 31, 1999 conducted by the State of Connecticut Insurance Department.
The State of Connecticut Insurance Department issued a final report of
examination on January 16, 2001, which resulted in an adjustment to statutory
surplus of $1,659,447.  These adjustments were comprised of approximately
$1,000,000 relating to non-admitting various premium receivables and
approximately $600,000 relating to the need for additional IBNR reserves.
FirstChoice has reflected approximately $554,000 of additional medical expenses
at December 31, 2000 for claims incurred prior to December 31, 1999.  As a
result of this, management believes that appropriate corrective action has been
taken to address the findings of the examination report.

     WCNY is required to accumulate and maintain a contingent reserve fund,
which shall be increased in an amount equal to at least 5% of the net premium
income of the Company during the calendar year, until such reserve fund is at
least equal to $50,000. The contingent fund at the end of any calendar year
shall not exceed 5% of the net premium income of such calendar year.  WCNY is
also required to establish a deposit in the form of an escrow account for the
protection of enrollees that may consist of cash or be otherwise financed
through bond or other means acceptable to the State of New York Insurance
Department. This deposit shall be equal to the greater of (1) 5% of the
estimated expenditures for health care services for the year; or (2) $100,000.
At December 31, 2000, WCNY had a required cash reserve of approximately $2.5
million and a required contingent equity reserve of approximately $2.8 million.

     Notwithstanding the above, the State of New York Insurance Department
("SNYID") has the authority to allow an HMO to maintain a net worth of 50% to
100% of the contingent reserve.  On June 1, 1999, the majority shareholder
submitted a program to the SNYID to restore the WCNY's contingency reserve to
100% of its required level over a three-year period ending June 1, 2002.  In
the interim, the SNYID has allowed WCNY to maintain a contingency reserve of no
less than 50% of its required level.  At December 31, 2000, the Company's
statutory net worth was approximately $68,000, which was not in compliance with
the SNYID's adjusted minimum statutory net worth requirements.  However, in
March 2001 and May 2001, $750,000 and $590,733, respectively, in surplus notes
was infused into WCNY from Comprehensive Health Management of Florida, L.L.C.,
an affiliate of the majority shareholder.  Management believes the infusion of
these surplus notes has cured the deficiency in meeting its minimum surplus
requirements.  Failure to maintain compliance with the reserve requirement
could cause SNYID to take action, which could include restriction or revocation
of WCNY's license.

     The Risk-Based Capital ("RBC") requirements for health maintenance
organizations have not been adopted by the New York legislature. However, the
SNYID does require that a RBC report be filed with the SNYID for informational
purposes by April 1 of each year.  WCNY filed a RBC report as of December 31,
2000 on March 31, 2001. This report disclosed that WCNY did not meet the
minimum RBC requirements and triggered a mandatory control level ("MCL") event,
as defined in the National Association of Insurance Commissioners ("NAIC")
model law for RBC. An MCL event occurred since the WCNY's total adjusted
capital was below the mandatory control level. The SNYID may take regulatory
action against WCNY as a result of filing this RBC report, including but not
limited to placing the Company under regulatory control. As of May 25, 2001,
the SNYID has not taken any action.



<PAGE>  50
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

15.     STATUTORY SURPLUS REQUIREMENTS - CONTINUED

     WCNY underwent an examination for the period from June 1, 1999 through
September 30, 2000 conducted by the SNYID. The SNYID issued its report of
examination findings on April 13, 2001, which stated that WCNY was insolvent in
the amount of $1,465,680 its statutory minimum net worth requirement was
impaired in the amount of $5,577,278 as of September 30, 2000. The Subsequent
Events section of the report disclosed that $4,897,124 in cash was infused into
the WCNY from October 1, 2000 through May 2, 2001 in the form of Section 1307
loans from Comprehensive Health Management, Inc. and Comprehensive Health
Management of Florida, LLC, affiliated companies of the majority shareholder of
WCMG.  Management believes the cash infusion remedied the insolvency and
capital impairment determined by the examination and reduced that statutory net
worth impairment to $680,154 as of September 30, 2000.  Additionally, during
the exam certain recommendations were made by the SNYID to improve the
Company's business processes.  Management is currently reviewing and planning
the implementation of these recommendations.

     In March 1998, the National Association of Insurance Commissioners adopted
the Codification of Statutory Accounting Principles (the Codification).  The
SNYID has adopted the Codification, with some modifications, through the
adoption of Regulation 172.  The purpose of the Codification is to enhance the
consistency of the accounting treatment of assets, liabilities, reserves,
income, and expenses of insurers, by setting forth the accounting practices and
procedures to be followed in completing annual and quarterly financial
statements required by law.  The applicable modifications that will effect the
preparation of the statutory financial statements for WCNY are as follows: 1)
no limitation with respect to the amount of EDP Equipment to be admitted, with
useful lives being recorded up to 10 years, 2) estimated Pharmaceutical Rebates
may be included as admitted assets, and 3) unsecured Receivables from Health
Care Providers are non-admitted, and include non-admitting deferred income
taxes.  The State of New York will require adoption of the Codification for the
preparation of statutory financial statements effective January 1, 2001.  The
Company estimates that the adoption of the Codification will reduce statutory
capital and surplus as of January 1, 2001 by approximately $1,200,000 for WCNY,
which results in the failure of the Company to comply with statutory reserve
requirements on January 1, 2001.

     Furthermore, SB443, entitled An Act Concerning Statutory Accounting
Procedures, was signed by the Governor of Connecticut on May 1, 2000, which
will require adoption of the Codification by the State of Connecticut for the
preparation of statutory financial statements, effective January 1, 2001.  The
Company estimates the adoption of the Codification will reduce FirstChoice's
statutory capital and surplus as of January 1, 2001, by approximately $300,000.




<PAGE>  51
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

16.     GOING CONCERN

     The Company's consolidated financials are presented on the going concern
basis, which contemplates the realization of assets and the satisfaction of
liabilities in the normal course of business.

     Over the next fiscal year, Management is focusing on its marketing efforts
to increase membership of its Medicaid and Child Health Plus products.  The
Medicaid and Child Health Plus products have proven to be profitable in past
years.  Additionally, over the next fiscal year, Management is focusing on its
newly acquired Medicaid book of business from HealthChoice.  The Company
currently is not marketing its Medicare products and does not intend to market
these products in the near future.  The Company also does not have plans to
market its Commercial products. Additionally, the Company believes that it will
be able to capitalize on the efficiencies in claims processing and
administrative services through its management agreement with CHM.  However,
there is no assurance that the Company will be able to achieve its recovery
plan.

     In the event of a cash shortage, the Company will have to implement
various cost cutting measures, including but not limited to reducing its work
force and reducing commissions to brokers and agents.  The Company may have to
raise financing through external sources.  However, resources for raising
external capital are limited due to the Company's past history and the overall
market sensitivity of the HMO business.  The consolidated financial statements
do not include any adjustments to reflect the possible future effect on the
recoverability of assets and classification of liabilities that may result from
the possible inability of the Company to continue as a going concern.

17.     ACQUISITION

     Effective October 1, 2000, FirstChoice closed on its transaction with
HealthChoice of Connecticut, Inc., ("HealthChoice") to acquire the assets of
HealthChoice's Medicaid line of business, known as PreferredOne for a purchase
price of $1.00 (one dollar).  With this acquisition, the Company increased its
membership by approximately 24,000 members.  The following table illustrates
the proforma result if the Company had acquired this line of business as of
January 1, 1999 (in thousands, except per share data):

                                                             Pro Forma
                                                            (Unaudited)
                                                     -------------------------
                                                       2000 (1)      1999 (2)
                                                     -----------   -----------
Total revenue                                        $  113,842    $  156,304
Total expenses                                          118,728       172,043
Loss before extraordinary gain                           (4,886)      (15,739)
Extraordinary gain                                            -        18,268
Net loss                                                 (4,886)        2,529
Preferred stock deemed dividend                               -        (3,043)
Net loss available to common shareholders                (4,886)         (514)

Net loss before extraordinary gain per share              (0.13)        (1.02)
Net loss available to common shareholders per share       (0.13)        (0.03)

(1) The acquired line of business's general and administrative expenses were
    adjusted using 11.5% of revenue under the management agreement with CHM,
    which resulted in savings of approximately $40,000.

(2) The acquired line of business's general and administrative expenses were
    adjusted using 11.5% of revenue under the management agreement with CHM,
    which resulted in savings of approximately $145,000.




<PAGE>  52
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

18.     SEGMENT REPORTING

     The Company is engaged principally in one line of business, the provision
of health care coverage for enrolled members, which represents more than 97% of
the consolidated revenues for the years ended December 30, 2000, 1999 and 1998.
The Company operates in two geographic areas, the States of New York and
Connecticut.  The Company manages its business geographically, as the laws
governing the HMO industry, which affect its strategy, are state specific.
Included in the other segment in 1998 and partial year 1999, were results of
WellCare Administration, Inc. and WellCare Development, Inc. (see Note 1).
These two entities were rendered inactive as of June 1999 and were dissolved in
October 2000.  Significant transactions occurred in 1999, which materially
changed the Company's structure and operations (see discussion in Note 1).

     The following schedule presents information about the Company's segments
for the years ended December 31 (in thousands):

                                             2000         1999         1998
                                          ----------   ----------   ----------
Total Revenues:
  New York                                $  57,415    $  80,377    $ 133,717
  Connecticut                                20,304       29,003        9,668
  Other                                         885        3,129        1,064
                                          ----------   ----------   ----------
Total                                        78,604      112,509      144,449
                                          ==========   ==========   ==========

Total Expenses:
  New York                                $  59,567    $  91,932    $ 148,460
  Connecticut                                23,622       30,579       10,151
  Other                                         294        6,658       11,255
                                          ----------   ----------   ----------
Total                                        83,483      129,169      169,866
                                          ==========   ==========   ==========

Depreciation and Amortization:
  New York                                $     398    $     968    $   3,646
  Connecticut                                    17           27            7
  Other                                           5          152        2,348
                                          ----------   ----------   ----------
Total                                           420        1,147        6,001
                                          ==========   ==========   ==========

Interest Expense:
  New York                                $     174    $       -    $       -
  Connecticut                                     -            -            -
  Other                                           -        3,565        1,730
                                          ----------   ----------   ----------
Total                                           174        3,565        1,730
                                          ==========   ==========   ==========




<PAGE>  53
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

18.     SEGMENT REPORTING - CONTINUED

                                             2000         1999         1998
                                          ----------   ----------   ----------
Net (Loss) Income:
  New York                                $  (2,152)   $   7,041    $ (17,013)
  Connecticut                                (3,319)      (1,576)        (483)
  Other                                         592       (3,857)     (13,362)
                                          ----------   ----------   ----------
Total                                        (4,879)       1,608      (30,858)
                                          ==========   ==========   ==========

Capital Expenditures:
  New York                                $     264    $      56    $     631
  Connecticut                                    40            -            -
  Other                                           -            -           26
                                          ----------   ----------   ----------
Total                                           304           56          657
                                          ==========   ==========   ==========


Total Assets:
  New York                                $  10,045    $  14,060    $  20,392
  Connecticut                                 9,705        5,731        3,742
  Other                                         370          532        5,805
                                          ----------   ----------   ----------
Total                                        20,120       20,323       29,939
                                          ==========   ==========   ==========

19.     QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

     Selected unaudited date reflecting the Company's consolidated results of
operations for each of the last eight quarters are shown in the following table
(in thousands, except per share amounts):
<TABLE>
<CAPTION>
                                                                   2000
                                           --------------------------------------------------
                                               1st          2nd          3rd          4th
                                           -----------  -----------  -----------  -----------
<S>                                        <C>          <C>          <C>          <C>
Total revenue                              $   19,174   $   19,501   $   16,732   $   23,197
Total expenses                                 18,699       18,938       20,197       25,649
Net income (loss)                                 475          563       (3,465)      (2,452)
Net income (loss) available to
 common shareholders                              475          563       (3,465)      (2,452)

Net income (loss) available to common
 Shareholders per share:
  basic and diluted                        $     0.01   $     0.01   $    (0.09)  $    (0.06)
Weighted average shares of common
 Stock outstanding:
  basic and diluted                            39,011       39,011       39,011       38,795
</TABLE>





<PAGE>  54
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
            Notes to Consolidated Financial Statements - Continued

19.     QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) - CONTINUED
<TABLE>
<CAPTION>
                                                                 1999
                                           --------------------------------------------------
                                               1st          2nd          3rd          4th
                                           -----------  -----------  -----------  -----------
<S>                                        <C>          <C>          <C>          <C>
Total revenue                              $   34,412   $   31,373   $   23,353   $   23,371
Total expenses                                 37,426       40,221       23,429       28,093
Net loss from operations                       (3,014)      (8,848)         (76)      (4,722)
Net (loss) income before
 extraordinary item                            (3,014)      (7,793)         287       (3,988)
Extraordinary item, net of tax                      -        7,905        2,715        5,496
Net income (loss)                              (3,014)         112        3,002        1,508
Preferred stock deemed dividend                     -       (3,043)           -            -
Net income (loss) available
 to common shareholders                        (3,014)      (2,931)       3,002        1,508

Net (loss) income per share before
 extraordinary item - basic and diluted    $    (0.40)  $    (1.43)  $     0.04   $    (0.10)
Extraordinary item per share -
 basic and diluted                                  -         1.05         0.34         0.14

Net income (loss) available to
 common shareholders per share -
 basic and diluted                              (0.40)       (0.39)        0.38         0.04
Weighted average shares of common
 Stock outstanding - basic and diluted          7,562        7,562        7,904       39,011
</TABLE>





<PAGE>  55
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
                               Schedule I
                Condensed Financial Information of Registrant
                        Condensed Balance Sheets
                             (In Thousands)
<TABLE>
<CAPTION>
                                                                  December 31,
                                                             ----------------------
                                                                2000        1999
                                                             ----------  ----------
<S>                                                          <C>         <C>
ASSETS
Current Assets:
  Cash and cash equivalents                                  $     155   $      94
  Other current assets                                             215         419
                                                             ----------  ----------
          Total current assets                                     370         513
  Other assets, net                                                  -      19,496
                                                             ----------  ----------
          Total assets                                       $     370   $  20,009
                                                             ==========  ==========

LIABILITIES AND SHAREHOLDERS' DEFICIENCY
Current Liabilities:
  Accounts payable, accrued expenses                         $     166   $   1,447
  Other                                                          7,766      21,370
                                                             ----------  ----------
          Total liabilities                                      7,932      22,817

 Shareholders' Deficiency:
  Preferred stock                                                    3           3
  Common stock                                                     388         386
  Additional paid-in capital                                    54,709      54,585
  Accumulated deficit                                          (62,460)    (57,580)
                                                             ----------  ----------
                                                                (7,360)     (2,606)
   Treasury stock at cost - 12,850 shares in 2000 and 1999        (202)       (202)
                                                             ----------  ----------
          Total deficiency in assets                            (7,562)     (2,808)
                                                             ----------  ----------
          Total liabilities and shareholders'
           deficiency in assets                              $     370   $  20,009
                                                             ==========  ==========
</TABLE>




<PAGE>  56
            THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
                                 Schedule I
                Condensed Financial Information of Registrant
                     Condensed Statements of Operations
                                (In Thousands)
<TABLE>
<CAPTION>
                                                               Year Ended December 31,
                                                         ----------------------------------
                                                            2000        1999        1998
                                                         ----------  ----------  ----------
<S>                                                      <C>         <C>         <C>
Revenue:
  Fee income                                             $       -   $   6,748   $  11,896
  Interest income                                            1,282       1,521       1,697
  Other income - net                                           899         186          52
                                                         ----------  ----------  ----------
Total revenue                                                2,181       8,455      13,645
Expenses:
  General and administrative expenses                          294       5,750      17,842
  Interest expense and other expenses                            -       3,548       1,222
                                                         ----------  ----------  ----------
Total expenses                                                 294       9,298      19,064
                                                         ----------  ----------  ----------
Income (loss) from operations                                1,887        (843)     (5,419)
Provision for income tax                                         -           -       2,961
                                                         ----------  ----------  ----------
Loss before equity in income (loss) of subsidiaries          1,887        (843)     (8,380)
Equity in income (loss) of subsidiaries - net of tax        (6,766)      2,451     (22,478)
                                                         ----------  ----------  ----------
Net income (loss)                                           (4,879)      1,608     (30,858)

Preferred stock deemed dividend                                  -      (3,043)          -
                                                         ----------  ----------  ----------
Net income (loss) available to common shareholders       $  (4,879)  $  (1,435)  $ (30,858)
                                                         ==========  ==========  ==========
</TABLE>




<PAGE>  57
             THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
                                 Schedule I
                 Condensed Financial Information of Registrant
                      Condensed Statements of Cash Flows
                               (In Thousands)
<TABLE>
<CAPTION>
                                                               Year Ended December 31,
                                                         ----------------------------------
                                                            2000        1999        1998
                                                         ----------  ----------  ----------
<S>                                                      <C>         <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                                        $   1,887   $    (843)  $  (8,380)
Adjustments to reconcile net income (loss) to net
 cash used in operating activities:
  Depreciation and amortization                                  5         128       1,671
  Interest on debt inducement                                    -       3,043           -
  Other - net                                              (19,240)     (2,289)      4,302
                                                         ----------  ----------  ----------
      Net cash used in operating activities                (17,348)          39      (2,407)

CASH FLOWS FROM INVESTING ACTIVITIES:
  (Increase) decrease in notes receivable                   17,283      (5,006)        730
  Other - net                                                    -           -        (272)
                                                         ----------  ----------  ----------
      Net cash (used in) provided by
       investing activities                                 17,283      (5,006)        458

CASH FLOW FROM FINANCING ACTIVITIES:
  Increase in notes payable                                      -           -       1,651
  Issuance of common stock                                     126           -           -
  Issuance of series A preferred stock                           -       5,003           -
                                                         ----------  ----------  ----------
      Net cash provided by  financing activities               126       5,003       1,651
                                                         ----------  ----------  ----------
      Net (decrease) increase in cash
       and cash equivalents                                     61          36        (298)
Cash and cash equivalents, beginning of period                  94          58         356
                                                         ----------  ----------  ----------
Cash and cash equivalents, end of period                 $     155   $      94   $      58
                                                         ==========  ==========  ==========
</TABLE>





<PAGE>  58
              THE WELLCARE MANAGEMENT GROUP, INC. AND SUBSIDIARIES
                                 Schedule II
                       Valuation and Qualifying Accounts
              For the years ended December 31, 2000, 1999, and 1998
                                (In Thousands)
<TABLE>
<CAPTION>
                                   Balance at                              Balance at
                                   Beginning                   Less:         End of
                                   of Period    Additions    Deductions      Period
                                   ----------   ---------    ----------    ----------
<S>                                <C>          <C>          <C>           <C>
Year ended December 31, 1998
Allowance for doubtful accounts:
  Trade receivable                 $   3,555    $    795     $     166     $   4,184
  Other receivable                     1,137         987           167         1,957
  Notes receivable                     8,096         793             7         8,882
                                   ----------   ---------    ----------    ----------
Total                                 12,788       2,575           340        15,023

Year ended December 31, 1999
Allowance for doubtful accounts:
  Trade receivable                     4,184       1,522         3,896         1,810
  Other receivable                     1,957           -         1,457           500
  Notes receivable                     8,882         568         6,453         2,997
                                   ----------   ---------    ----------    ----------
Total                                 15,023       2,090        11,806         5,307

Year ended December 31, 2000
Allowance for doubtful accounts:
  Trade receivable                     1,810       1,109         2,719           200
  Other receivable                       500          63           563             -
  Notes receivable                     2,997           -         2,997             -
                                   ----------   ---------    ----------    ----------
Total                              $   5,307    $  1,172     $   6,279     $     200
                                   ==========   =========    ==========    ==========
</TABLE>




<PAGE>  59
ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

     On February 8, 2001 the Company filed Form 8-K, Current Report, pursuant
to section 13 or 15(d) of the Securities Exchange Act of 1934.  The purpose of
this filing was to report the dismissal of the registrant's certifying
accountant, effective February 2, 2001, in accordance to Item 304 of Regulation
S-K (Sec. 229.304) of the Securities Act of 1933.


     BDO Seidman LLP ("BDO") was previously the independent auditor for The
WellCare Management Group, Inc.  Effective February 2, 2001, BDO was dismissed
from such capacity.

     BDO's report on the Company's consolidated financial statements for the
years ended December 31, 1999 did state substantial concern for the Company's
ability to continue as a going concern.  The auditor's statement was based upon
the Company's recurring, losses from operations, working capital deficit,
deficiency in assets and failure to maintain 100% of the contingent reserve
requirements of the New York State Department of Insurance.  Other than this
noted concern, BDO's report on the Company's consolidated financial statements
for the last fiscal year did not contain an adverse opinion or disclaimer of
opinion, and was neither qualified nor modified as to uncertainty, audit scope,
or accounting principles.

     There were no disagreements with BDO concerning the company's most recent
fiscal year and any subsequent period preceding their dismissal on any matter
of accounting principles or practices, financial statement disclosure, or
auditing scope or procedure, where the noted disagreement(s), if not resolved
to the satisfaction of BDO, would have caused them to make reference to the
subject matter of disagreement(s) in connection with their opinion.

     The Company's decision to dismiss BDO as its independent auditors was
recommended and approved by its Board of Directors.

     On February 2, 2001, Deloitte and Touche, LLP ("Deloitte") was appointed
as the Company's independent auditors.  The engagement of Deloitte as the
Company's independent auditors was approved by its Board of Directors.

     During the most recent two fiscal years and any subsequent interim periods
prior to the engagement of Deloitte as the Company's independent auditors, the
Company did not consult with Deloitte regarding (i) either the application of
accounting principles to a specified transaction, either completed or proposed;
or the type of audit opinion that might be rendered on the consolidated
financial statements of the Company, or (ii) any matter that was either the
subject of a disagreement (as defined in Item 304 (a)(1)(iv) of Regulation S-K)
or a reportable event (as defined in Item 304 (a)(1)(v) of Regulations S-K).

     On January 5, 2000 the Company filed Form 8-K, Current Report, pursuant to
Section 13 or 15(d) of the Securities and Exchange Act of 1934.  The purpose of
this filing was to report a dismissal of the Registrant's certifying accountant
in accordance to Item 304 of Regulation S-K of the Securities Act of 1933.

     Deloitte & Touche, LLP was previously the independent auditor for the
WellCare Management Group, Inc.  Effective December 30, 1999, Deloitte & Touch
LLP was dismissed from such capacity.



<PAGE>  60
     Deloitte's report on the Company's financial statements for the years
ended December 31, 1997 and 1998 did state that there was substantial doubt
about the Company's ability to continue as a going concern.  The auditor's
statement was based upon the Company's recurring losses from operations,
working capital deficit, deficiency in assets and failure to maintain 100% of
the contingent reserve requirements of the New York State Department of
Insurance.  Other than this, Deloitte's report on the Company's financial
statements for 1998 and 1997 did not contain an adverse opinion or disclaimer
of opinion, and was neither qualified nor modified as to uncertainty, audit
scope, or accounting principles.

     The Company's decision to dismiss Deloitte as its independent auditors was
recommended and approved by its Board of Directors.

     Deloitte had a disagreement with the Company's previous management during
the 1997 audit.  The disagreement concerned the need for a valuation allowance
relating to deferred tax assets of the Company.  The Company adhered to
Deloitte's request that an investment banker's opinion be obtained as to the
valuation of certain assets, which could be sold by the Company.  Pursuant to a
tax planning strategy, the matter was resolved to the satisfaction of Deloitte.
If Deloitte had not been satisfied as to this disagreement, their report on the
Company's financial statements for the year ended December 31, 1997 would have
been made reference to this matter.

     Deloitte discussed the above noted matter with the Company's previous
Board of Directors.  The Company has given authorization to Deloitte to respond
fully to the inquiries of BDO regarding the aforementioned disagreement.

     Other than the resolved matter noted above, there were no other
disagreements with Deloitte concerning the company's two most recent fiscal
years and any subsequent period preceding their dismissal on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedure, where the noted disagreement (s), if not resolved to the
satisfaction of Deloitte, would have caused them to make reference to the
subject matter of disagreement(s) in connection with their opinion.

     During the Company's most recent fiscal years and any subsequent interim
period preceding such dismissal, the Company has had no reportable events as
defined in Item 304 of Regulation S-K of the Securities Act of 1933.

     For the year ending December 31, 1999, BDO was engaged by the Company as
its independent auditor.  The engagement of BDO was approved by the Company's
Board of Directors.

     During fiscal years 1998 and 1997 and any subsequent interim period prior
to engaging BDO, the Company had not consulted BDO regarding: (i) either the
application of accounting principles to a specified transaction, either
completed or proposed; or the type of audit opinion that might be rendered on
the financial statements of the Company, or (ii) any matter that was either the
subject of a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K)
or a reportable event (as defined in Item 304(a)(1)(v) of Regulation S-K).


<PAGE>  61
                                 PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The following table sets forth the names and ages of the Directors,
executive officers and key employees and positions held with the Company.
<TABLE>
<CAPTION>
                                                                               Director
Name                     Age   Position                                         Since
----------------------   ---   ---------------------------------------------   --------
<S>                      <C>   <C>                                             <C>
Kiran C. Patel, M.D.     52    Chairman of the Board, President,
                               Chief Executive Officer, and Secretary (2)        1999
Mark D. Dean, D.D.S      60    Director (1) (2)                                  1984
Pradip C. Patel          49    Director (2)                                      1999
Rupesh R. Shah           39    Director                                          1999
Sandip I. Patel          34    General Counsel
Carol K. McAllister      31    Chief Accounting Officer
</TABLE>
(1) Member, Audit Committee
(2) Member, Compensation Committee

     KIRAN C. PATEL, M.D., was named as the Chairman of the Board, President
and Chief Executive Officer of the Company, and became a director of the
Company effective June 11, 1999.  He was also named as the Chairman of the
Board, Chief Executive Officer and a director of WellCare of New York, Inc.
("WCNY") as of June 11, 1999.  Dr. Patel has been a practicing physician
(cardiologist) since 1982.  Additionally, Dr. Patel is the majority shareholder
of Well Care HMO, Inc., a State of Florida licensed Health Maintenance
Organization since 1988, which was unrelated to the Company until Dr. Patel's
acquisition of 55% ownership interest in the Company.  Dr. Patel is a graduate
of SMT, N.H.L. Municipal Medical College, India, and did his Internal Medicine
Residency and Cardiology Fellowship in the New York, New Jersey area.

     MARK D. DEAN, D.D.S. is a practicing dentist in private practice since
1966.  Dr. Dean is knowledgeable about the health care industry and has been
involved with the Company for fourteen years.  He is a graduate of Cornell
University and New York University College of Dentistry.

     PRADIP C. PATEL became a director of the Company effective June 11, 1999.
He was also named as a director of WCNY as of June 11, 1999.  Mr. Patel has
been in the health care industry for over 10 years and is currently a
shareholder and the President of Well Care HMO, Inc., an unrelated State of
Florida licensed Health Maintenance Organization.  He is a graduate of the
Gujaret University, India and received his MBA from Eastern Michigan
University.  Mr. Patel is the brother of Dr. Kiran C. Patel.

     RUPESH R. SHAH became a director of the Company effective June 11, 1999.
Mr. Shah has been in the health care industry for over 10 years and is
currently a shareholder and is the Chief Executive Officer of Well Care HMO,
Inc., an unrelated State of Florida licensed Health Maintenance Organization.
He is graduate of St. Xavier's College, Gujaret University, India and Rollwala
Computer Science, Gujaret University, India.  Mr. Shah is the brother-in-law of
Dr. Kiran C. Patel.

     SANDIP I. PATEL became the General Counsel of the Company effective June
11, 1999.  He was also named as the General Counsel of WCNY, as of June 11,
1999.  Mr. Patel has been a practicing attorney for the past 8 years, being
employed throughout this time by Patel, Moore & O'Connor, P.A. and currently
Sandip I. Patel, P.A.  He is a graduate of the University of Georgia with a
degree in finance and accounting, and received his Juris Doctorate from Stetson
University College of Law.





<PAGE>  62
     CAROL K. MCALLISTER joined the Company in September 2000 as its Chief
Accounting Officer.  Ms. McAllister is a Certified Public Accountant.  Ms.
McAllister's prior experiences include: Corporate Controller of JLM Industries,
Inc., a chemical company in Tampa, Florida; Corporate Controller of Colonial
Downs Holdings, Inc., a racetrack in Richmond, Virginia; Financial Reporting
Manager of MMI Products, Inc., a fence manufacturer in Houston, Texas; and
Senior Staff Accountant with Coopers & Lybrand L.L.P. in Houston, Texas.

Director Compensation

     During fiscal year 2000, all directors who were not employees of the
Company, received a fee of $100 for each meeting of the Board of Directors
attended, plus reimbursement of their expenses, and an additional $100 for each
meeting of the Audit Committee or Compensation Committee attended.

Section 16(a) Beneficial Ownership Reporting Compliance

     To the Company's knowledge, based upon a review of the forms, reports, and
certificates filed with the Company, by the Company's directors, officers, and
stockholders, all Section 16(a) filing requirements have been complied with by
such persons during 2000.

ITEM 11.  EXECUTIVE COMPENSATION

     Including the Chief Executive Officer, there were no executive officers
whose annual compensation exceeded $100,000.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth certain information with respect to the
beneficial ownership of the Company's Class A Common and Common stocks as of
March 16, 2001 for (i) each shareholder known by the Company to beneficially
own in excess of 5% of the outstanding shares of any such of voting stock, (ii)
each director of the Company, (iii) each of the Named Executive Officers and
(iv) all officers and directors as a group.
<TABLE>
<CAPTION>
                                                                      Percentage of Total
                                                                ------------------------------
                                       Class A                   Class A                Total
                                       Common       Common       Common      Common     Vote
                                      ---------  ------------   ----------  --------  --------
<S>                                   <C>        <C>            <C>         <C>       <C>
Kiran C. Patel (1)                                19,780,111                  51.0%     47.2%
The 1818 Fund II LP (3)                           11,250,000                  29.0%     26.8%
Adhia Investment Advisors Inc. (4)                   389,986                   1.0%        *
Sandip I Patel (1)                                   263,195                     *         *
Pradip C. Patel (1)                                  259,991                     *         *
Rupesh Shah (1)                                      259,991                     *         *
Mark D. Dean (2)                                     147,652                     *         *
Robert W. Morey, Jr. (5)               281,956       463,201       89.9%       1.2%      7.8%
All executive officers and
 Directors as a group                             20,348,706                  52.4%     48.5%
</TABLE>

(1) Address is 6800 North Dale Mabry Highway, Suite 268, Tampa, FL  33614.
(2) Address is 4939B Meadow Drive, Vail, CO  81657.  Includes 19,446 and 4,862
    shares owned by Dr. Dean's wife and son, respectively.
(3) Address is 63 Wall Street, New York, NY  10005.
(4) Address is 1311 N. Westshore Blvd., Suite 111, Tampa, FL  33607.
(5) Box I 134 Lyford Dr., Tiburon, CA  94920.



<PAGE>  63
ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Pradip C. Patel and Rupesh R. Shah, Directors of the Company, are related
to the majority shareholder and CEO, Kiran C. Patel.

MANAGEMENT AGREEMENT

     WCNY and FirstChoice have entered into management agreements with
Comprehensive Health Management, Inc. ("CHM"), a Company that was established
by the majority shareholder to provide management, administrative services, and
claims processing services to health maintenance organizations.  During
September 1999, WCNY and FirstChoice each executed a five-year management
agreement with CHM to perform claims processing services, utilization review,
payroll services, and most all of the administrative functions of the Company,
excluding certain marketing functions.  CHM is responsible for all the
administrative employees' payroll and business expenses.  Additionally, CHM is
responsible for maintaining the claims related data processing equipment and
software.

     The management fee for each Company ranges from 9.5% of premium revenue
earned when there are less than 40,000 members to 7.5% of premium revenue
earned when there are more than 80,000 members.  In June 2000, the agreements
were amended to generally provide CHM with enough revenue to cover its own
costs related to the provision of management services to the Company and other
affiliated HMOs.  As a result of the amended agreements, the management fee was
revised to reflect ranges of 11.5% of premium revenue earned when there are
less than 40,000 members and 9.5% of premium revenue earned when there are more
than 80,000 members.  During 2000, CHM operated at a deficit of approximately
$4.0 million and CHM is currently evaluating the adequacy of the current fee
structure.  Management anticipates that adjustments to the fee structure will
occur during the next fiscal year to improve the cost recovery at CHM.

     Management fees, net of asset purchases and excluded membership groups,
for the years ended December 31, 2000 and 1999 were approximately $7,799,000
and $3,046,000, respectively, which were included in general and administrative
expenses.  At December 31, 2000, the Company owed CHM approximately $223,000.
At December 31, 1999, CHM owed the Company approximately $799,000.  As a result
of the CHM management agreement, the Company's general and administrative
expenses as a percentage of total revenue decreased from 20.1% in 1999, and to
17.0% in 2000.

OTHER

     The Company has entered into various lease agreements for office space.
As part of the management agreement, CHM makes payments to the lessors on
behalf of the Company.  The payments for leased space are an integral part of
the management fee, and lease payments made by CHM to lessors amounted to
approximately $619,000 and $332,000 during 2000 and 1999, respectively.

     Under the management services agreement, the Company is responsible for
the direct salary cost of their marketing personnel.  During 2000, CHM
processed and paid the payroll for the Company's marketing personnel.  The
Company reimbursed CHM approximately $1,620,000 and $660,000 during 2000 and
1999, respectively related to these direct salary costs during the current
year.

<PAGE>  64
                               PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a)     1.  Consolidated Financial Statements, Notes to Consolidated Financial
            Statements and Independent Auditors' Report are found in Item 8,
            "Consolidated Financial Statements and Supplemental Data."

2. Schedules
        Schedule I - Condensed Financial Information of Registrant
        Schedule II - Valuation and Qualifying Accounts

All other schedules are not submitted because they are not applicable or
because the required information is included in the Consolidated Financial
Statements or Notes thereto.

3. Exhibits

3.1      Copy of Registrant's Restated Certificate of Incorporation (1)

3.1a     Certificate of Amendment to Restated Certificate of Incorporation
         filed June 5, 1995 (4)
3.1b     Certificate of Amendment to Restated Certificate of Incorporation (As
         Amended June 10, 1997) (12)
3.1c     Certificate of Amendment of the Certificate of Incorporation of The
         WellCare Management Group, Inc. filed June 20, 1999 (16)
3.1d     Certificate of Amendment of the Certificate of Incorporation of The
         WellCare Management Group, Inc. filed October 11, 1999 (17)
3.2c     Registrant's Amended By-Laws (As Amended June 10, 1997) (11)
10.2d    Voluntary Separation and Release dated October 16, 1996, between
         Registrant and Edward A. Ullmann* (8)
10.2e    Letter agreement, from Robert L. Platz dated June 7, 1999, whereby
         Registrant cancels Promissory Note issued by Edward A. Ullman (16)
10.14    Form of Medicaid Contract between WellCare of New York, Inc. ("WCNY")
         and various counties of the New York State Department of Social
         Services (1)
10.16a   Reinsurance Agreement, effective November 1, 1993, between Registrant
         and Preferred Life Insurance Company of New York (3)
10.16b   Reinsurance Agreement Renewal between Preferred Life Insurance Company
         of New York and WCNY for Commercial and Point of Service Enrollees,
         effective November 1, 1996 (15)
10.16c   Reinsurance Agreement Renewal between Preferred Life Insurance Company
         of New York and WCNY - Medicaid (15)
10.16d   Reinsurance Agreement Renewal between Preferred Life Insurance Company
         of New York and WellCare of Connecticut, Inc. ("FirstChoice"),
         effective Nvember 1, 1996 (15)

10.16e   Reinsurance Agreement Renewal between Preferred Life Insurance Company
         of New York and WCNY - Medicare, effective November 1, 1996
10.16f   Amendment to Reinsurance Agreement Renewal between Preferred Life
         Insurance Company of New York and WCNY for Commercial and Point of
         Service enrollees, effective November 1, 1996 and Reinsurance
         Agreement Renewal between Preferred Life Insurance Company of New York
         and WCNY - Medicare, effective November 1, 1996 (15)



<PAGE>  65
10.16g   Amendment of Reinsurance Agreement Renewal between Preferred Life
         Insurance Company of New York and WCNY - Medicaid (15)
10.16h   Amendment to Reinsurance Agreement Renewal between Preferred Life
         Insurance Company of New York and FirstChoice, effective November 1,
         1996 (15)
10.16I   Letter dated October 29, 1998 terminating coverage under Reinsurance
         Agreement Renewal between Preferred Life Insurance Company of New York
         and WCNY for Commercial and Point of Service Enrollees effective
         November 1, 1996, Reinsurance Agreement Renewal between Preferred Life
         Insurance Company of New York and WCNY - Medicare effective November
         1, 1996 and Reinsurance Agreement Renewal between Preferred Life
         Insurance Company of New York and WCNY - Medicaid (15)

10.16j   Letter dated October 29, 1998 terminating coverage under Reinsurance
         Agreement Renewal between Preferred Life Insurance Company of New York
         and FirstChoice, effective November 1, 1996 (15)
10.16k   Reinsurance Agreement between Reliastar Managing Underwriters, Inc.
         and WellCare of New York, Inc.
10.16l   Reinsurance Agreement between Reliastar Managing Underwriters, Inc.
         and WellCare of Connecticut, Inc.
10.22    Lease dated February 1, 1993, between WCNY, as Tenant, and Huntington
         Associates, as Landlord, relating to lease of office space in Albany,
         New York (1)
10.26a   Full Risk Capitation Agreement between Hudson Valley Family Health,
         P.C. and WCNY dated October 1, 1995 (6)

10.27a   Full Risk Capitation Agreement between Valley Medical Services, P.C.
         and WCNY dated October 1, 1995 (6)
10.27b   Letter of Understanding between WCNY and the contracted Alliances
         (Valley Medical Services, P.C. and Hudson Valley Family Medical
         Health, P.C.) dated September 23, 1996 (9)
10.27c   Letter of Intent between Registrant, WCNY, Primergy, Inc., Valley
         Medical Services, P.C., and Hudson Valley Family Health, P.C. dated
         January 7, 1997 (9)
10.33b   Employment and Consulting Agreement dated March 3, 1997, between
         Registrant and Marystephanie Corsones* (9)
10.37    Lease Agreement dated October 14, 1994, between Richard Bulger and
         WellCare Development, Inc. ("WCD") (3)
10.38    Management Agreement dated July 1, 1994, between Registrant and its
         Wholly-Owned Subsidiary, FirstChoice (3)
10.40    Note Purchase Agreement by and between Registrant and The 1818 Fund
         II, L.P. (5)
10.40a   Letter Agreement dated February 28, 1997, between Registrant and The
         1818 Fund II, L.P. (9)
10.40b   Letter Agreement dated January 14, 1998 between Registrant and The
         1818 Fund II, L.P. (12)
10.40c   Amended and Restated 8% Subordinated Convertible Note, between
         Registrant and The 1818 Fund II, L.P. (14)
10.41    6% Subordinated Convertible Note due December 31, 2002, between
         Registrant and The 1818 Fund II, L.P. (5)
10.41a   Exchange Agreement between the Registrant and The 1818 Fund II, L.P.
         (16)
10.42    Registration Rights Agreement between Registrant and The 1818 Fund II,
         L.P. (5)
10.43    Asset Purchase Agreement between WellCare Medical Management, Inc.
         ("WCMM") and Primergy, Inc. dated June 30, 1995 (6)
10.44    Bill of Sale between WCMM and Primergy, Inc. dated June 30, 1995 (6)



<PAGE>  66
10.45    Promissory Note in the amount of $5,130,000 between WCMM Inc. and
         Primergy, Inc. dated June 30, 1995 (6)
10.45a   Forbearance Agreement on the terms and conditions of a Promissory Note
         in the amount of $5,130,000 between Registrant and Primergy, Inc. dated
         February 26, 1997 (9)
10.46    Note Agreement between WCMM and Primergy, Inc. dated June 30, 1995 (6)
10.49    Quota Share Reinsurance Agreement between Registrant and Allianz Life
         Insurance Company of North America dated September 1, 1995 (6)

10.49a   Amendment to Quota Share Reinsurance Agreement between Registrant and
         Allianz Life Insurance Company of North America dated March 20, 1998
         (13)
10.50    Employment Contract dated May 19, 1996, and Stock Option Agreements
         between Registrant and Douglas A. Hayward* (7)
10.50a   Voluntary Separation Agreement and Release between Douglas A. Hayward
         and the Registrant* (12)
10.51    Employment Contract dated June 1, 1996, and Stock Option Agreements
         between Registrant and John E. Ott, M.D.* (7)
10.51a   Amendment to Employment Agreement dated June 1, 1998, between
         Registrant and John E. Ott, M.D.* (14)
10.51b   Voluntary Separation Agreement and Release effective June 11, 1999,
         between Registrant and John E. Ott, M.D.* (16)
10.52    Employment Agreement dated September 1, 1996, between Registrant and
         Joseph R. Papa* (8)
10.51b   Consulting Agreement dated January 15, 1999, between Registrant and
         Joseph R. Papa Associates* (16)
10.53    Registrant's 1996 Non-Incentive Executive Stock Option Plan* (9)
10.54    Stock Option Agreement dated December 23, 1996, between Registrant and
         Robert W. Morey, Jr.* (9)
10.54a   Amendment dated December 19, 1997, to Stock Option Agreement between
         Registrant and Robert W. Morey, Jr. for options to purchase 450,000
         shares of common stock* (12)

10.55    Promissory Note in the amount of $2,099,083 between Primergy, Inc. and
         Registrant dated February 19, 1997 (9)
10.56    Loan and Security Agreement made by Primergy, Inc. in favor of
         Registrant and WCMM dated as of February 19, 1997 (9)
10.58    Lease Agreement dated July 1, 1996, between Candid Associates, as
         Lessor, and WCD, as Lessee, relating to lease of office space in North
         Haven, Connecticut (9)
10.59    Loan and Security Agreement dated April 1, 1997 between Catskill
         Medical Associates, P.C., WCNY and Registrant (10)
10.60    Letter of Understanding dated June 30, 1997 between Primergy, Inc. and
         Registrant (10)
10.61    Memorandum dated July 23, 1997 between Primergy, Inc. and Registrant
         (10)
10.62    Amendment to Stock Option Agreement between Robert W. Morey, Jr. and
         Registrant for options to purchase 150,000 share of Common Stock* (12)
10.63    Agreement of Lease between Reckson Operating Partnership, LP and WCD
         for the Tarrytown office (12)
10.64    Severance Agreement dated April 3, 1998 between Registrant and Jack
         Sizer, M.D. (14)
10.65    IPA Service Agreement dated April 21, 1998, between WCNY and Columbia-
         Greene Health Care Alliance IPA, Inc. (14)

<PAGE>  67
10.66    IPA Service Agreement dated April 21, 1998, between WCNY and Dutchess
         Health Care Alliance IPA, Inc. (14)
10.67    IPA Service Agreement dated April 21, 1998, between WCNY and Orange-
         Sullivan Health Care Alliance IPA, Inc. (14)
10.68    IPA Service Agreement dated April 21, 1998, between WCNY and Ulster
         Health Care Alliance IPA, Inc. (14)
10.69    Employment Agreement dated January 29, 1997, between Registrant and
         Mary Lee Campbell-Wisely* (16)
10.69a   Amendment to Employment Agreement dated February 16, 1999, between
         Registrant and Mary Lee Campbell-Wisely* (16)
10.70    Employment Agreement dated November 5, 1997, between Registrant and
         Thomas A. Curtis* (16)

10.71    Employment Agreement dated November 17, 1998, between Registrant and
         Adele B. Reiter, Esq.* (16)
10.72    Employment Agreement dated December 1, 1998 between Registrant and
         Alan Bernstein, M.D.* (16)
10.73    Employment Agreement dated December 1, 1998 between Registrant and
         Craig S. Dupont* (16)
10.73a   Amendment to Employment Agreement dated Febr 11, 1999, between
         Registrant and Craig S. Dupont* (16)
10.74    Letter of Settlement dated June 9, 1999 between KeyBank National
         Association and KeyCorp. Leasing Ltd., Registrant, WCNY, WCD and GHI
         HMO Select Inc.
10.76    Stock Purchase Agreement dated May 19, 1999 between Registrant and
         Kiran C. Patel, M.D. (16)
10.76a   Amendment to Stock Purchase Agreement dated May 19, 1999 between
         Registrant and Kiran C. Patel, M.D. (16)
10.77    Form of Hospital Settlement Agreement between Registrant, WCNY, Kiran
         C. Patel, M.D. HealthCare Association of New York State, Northern
         Metropolitan Hospital Association and the member hospital of HANYS
         and/or Normet (16)
10.78    Form of Physician Settlement Agreement between Registrant, WCNY, Kiran
         C. Patel, M.D., and the Provider or Provider Group (16)
10.79    Form of May 27, 1999 letter to Class A Shareholders of Registrant (16)
10.79a   Voting Agreement dated June 9, 1999 between Kiran C. Patel, M.D.,
         and Robert W. Morey (16)
10.79b   Irrevocable Proxy dated June 9, 1999 between Kiran C. Patel, M.D., and
         Robert W. Morey (16)
10.80    Asset Purchase Agreement dated May 20, 1999 between WCNY and Group
         Health Incorporated (16)
10.81    Escrow and Security Agreement dated June 11, 1999 by Registrant, WCNY,
         Garfunkel, Wild & Travis, P.C., Healthcare Association of New York
         State and Northern Metropolitan Hospital Association, The Medical
         Society of the State of New York and United States Trust Company of
         New York (16)
10.82    Copy of Management Agreement dated June 11, 1999 between Comprehensive
         Health Management, Inc. and Wellcare of New York, Inc. (16)
10.83    Management Agreement dated June 11, 1999 between Comprehensive Health
         Management, Inc. and WellCare of Connecticut, Inc. (16)
10.84    Agreement dated July 30, 1999 between Primergy, Inc., Promedco of the
         Hudson Valley, Inc., Promedco Mangement Company and WellCare of New
         York, Inc. and The WellCare Management Group, Inc. (17)



<PAGE>  68
10.85     Agreement For Sale of Assets between HealthChoice of Connecticut,
          Inc. and WellCare of Connecticut, Inc.

(b)     Reports on Form 8-K

     The company did not file any reports on Form 8-K during the fourth quarter
2000.



<PAGE>  69
                                 SIGNATURES

     Pursuant to the requirements of Section 13 or 15 (d) 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.

Dated:  June 6, 2001          /s/ Kiran C. Patel, M.D.
                              ---------------------------------------
                              Kiran C. Patel, M.D.
                              President and Chief Executive Officer
                              (Principal Executive Officer)


Pursuant to the requirements of the Section 13 or 15 (d) of the Securities
Exchange Act of 1934, this report has been signed below by the following persons
on behalf of the Registrant and in the capacities and on the dates indicated.

Dated:  June 6, 2001          /s/ Kiran C. Patel, M.D.
                              ---------------------------------------
                              Kiran C. Patel, M.D.
                              President and Chief Executive Officer
                              (Principal Executive Officer)

Dated:  June 6, 2001          /s/ Carol K. McAllister
                              ---------------------------------------
                              Carol K. McAllister
                              Chief Accounting Officer
                              (Principal Accounting Officer)

Dated:  June 6, 2001          /s/ Pradip C. Patel
                              ---------------------------------------
                              Pradip C. Patel
                              Director

Dated:  June 6, 2001          /s/ Rupesh R. Shah
                              ---------------------------------------
                              Rupesh R. Shah

                              Director

Dated:  June 6, 2001          /s/ Mark D. Dean
                              ---------------------------------------
                              Mark D. Dean
                              Director