<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                   ----------
                                    FORM 10-K
                        FOR ANNUAL AND TRANSITION REPORTS
                     PURSUANT TO SECTIONS 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

(MARK ONE)
            [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2002
                                       OR

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

           FOR THE TRANSITION PERIOD FROM ____________ TO ____________

                           Commission File No. 1-13772

                                   ----------

                              PLANVISTA CORPORATION
             (Exact Name of Registrant as Specified in its Charter)

                 DELAWARE                               13-3787901
       (State or Other Jurisdiction of               (I.R.S. Employer
        Incorporation or Organization)              Identification No.)

     4010 Boy Scout Boulevard, Suite 200
             Tampa, Florida                                33607
  (Address of Principal Executive Offices)              (Zip Code)

       Registrant's telephone number, including area code: (813) 353-2300
           Securities registered pursuant to Section 12(b) of the Act:

                                                      NAME OF EXCHANGE
      TITLE OF EACH CLASS                           ON WHICH REGISTERED
      -------------------                           -------------------
    Common Stock $.01 par value                            OTCBB

                                   ----------

        Securities registered pursuant to Section 12(g) 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 ninety (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 the 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. [X]

        Indicate by check mark whether the registrant is an accelerated filer
(as defined in Exchange Act Rule 12b-2). Yes [ ] No [X]

        The aggregate market value of the registrant's Common Stock, $.01 par
value, held by non-affiliates of the registrant, computed by reference to the
last reported price at which the stock was sold on June 28, 2002, was
$36,870,406.

        The number of shares of the registrant's Common Stock, $.01 par value,
outstanding as of March 24, 2003 was 16,790,256.86.

                       DOCUMENTS INCORPORATED BY REFERENCE

        Proxy Statement for the Annual Meeting of Stockholders
         scheduled to be held on May 22, 2003...........................Part III

<PAGE>

                                     PART I

FORWARD-LOOKING STATEMENTS

        The statements contained in this report or incorporated by reference
herein that are not purely historical, including statements regarding our
objectives, expectations, hopes, intentions, beliefs, or strategies, are
"forward-looking" statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements are necessarily based on estimates and assumptions
that are inherently subject to significant business, economic, and competitive
uncertainties and contingencies, many of which, with respect to future business
decisions, are subject to change. These uncertainties and contingencies can
affect actual results and could cause actual results to differ materially from
those expressed in any forward-looking statements made by us, or on our behalf.

        In particular, the words "expect," "estimate," "plan," "anticipate,"
"predict," "intend," "believe," and similar expressions are intended to identify
forward-looking statements. It is important to note that actual results could
differ materially from those in such forward-looking statements, and undue
reliance should not be placed on such statements. Stockholders and prospective
investors should exercise caution since these statements involve known and
unknown risks, uncertainties, and other factors, which are, in some cases,
beyond our control and could adversely affect our actual results, performance,
or achievements. Numerous factors could cause such actual results to differ
materially from those in the forward-looking statements, including our ability
to expand our client base; the success of our new products and services; our
ability to maintain our current preferred provider organization network
arrangements; our ability to manage costs; our failure to comply with the
financial covenants of our restructured debt agreements; changes in law; risk of
material adverse outcome in litigation; fluctuations in business conditions and
the economy; our ability to attract and retain key management personnel; changes
in accounting and reporting practices; and our ability to obtain additional debt
or equity financing on terms favorable to us to facilitate our long-term growth.

        The factors above should not be construed as exhaustive. Except as
required to comply with applicable law, we undertake no obligation to release
publicly the results of any future revisions we may make to forward-looking
statements to reflect events or circumstances after the date of this report or
to reflect the occurrence of unanticipated events.

ITEM 1.  BUSINESS

GENERAL

        Through PlanVista Solutions, Inc., our operating subsidiary, we provide
medical cost containment and business process outsourcing solutions for the
medical insurance and managed care industries. Our customers include healthcare
payers such as insurance carriers, self-insured employers, third party
administrators, health maintenance organizations (sometimes referred to as
HMOs), and other entities that pay claims on behalf of health plans. We also
provide services for health care providers, including individual providers,
preferred provider organizations (sometimes referred to as PPOs), and other
provider groups.

        We provide healthcare payers with access to our preferred provider
network, known as the National Preferred Provider Network (sometimes referred to
as our NPPN network), which offers payers discounts on participating provider
medical services. Our NPPN network is a "network of networks," comprised of more
than 30 local PPO networks and independent physician associations with which we
contract, as well as directly contracted independent physicians in some cases.
Our NPPN network includes approximately 400,000 physicians, 4,000 acute care
hospitals, and 55,000 ancillary care providers. In addition to offering payers
in-network discounts, we have added medical bill review and negotiation and
advance funding options through key strategic alliances. Our cost containment
customers also benefit from our advanced claims repricing and network and data
management services.

        We have leveraged our leading edge technology and management expertise
to offer our clients network and data management outsourcing services that are
independent of our NPPN network access business. In late 2001, we launched our
PayerServ business, which helps payers manage all of their network
relationships, whether or not the payers also access our NPPN network. PlanServ,
the other business initiative we implemented in late 2001, provides

                                       2

<PAGE>

claims repricing and network and data management services that help PPOs support
all of their payer relationships, not simply payer relationships that they
maintain through NPPN.

        Prior to 2002, our NPPN network access business accounted for all of our
operating revenue. Our new business process outsourcing products, PayerServ and
PlanServ, secured their first customers in November 2001 and February 2002,
respectively, and, together with our other new business initiatives,
collectively generated over 5.0% of our operating revenue for 2002.

BUSINESS STRATEGY

        We plan to grow operating revenue and profits by increasing the market
share of our medical cost containment business, building our existing network
and data management business process outsourcing businesses, and introducing new
medical cost management solutions for our customers. Our strategy is to market
our established NPPN network brand as a leading national preferred provider
network and to provide a broad array of technology-based business process
outsourcing services to existing and new customers. This strategy is designed to
help our customers maximize their total savings on medical claims and
administration through our advanced network and administrative capabilities.

FOCUSED PENETRATION OF PAYER MARKET

        We plan to increase the operating revenue from, and the profitability
of, our NPPN network access business by increasing our payer customer base. We
believe that we can increase our market share by marketing our claims repricing
technology, our ability to capture discounts on a large percentage of claims due
to the size of our NPPN network, and the attractiveness to payer customers of
our percentage of savings revenue model, as discussed in more detail below. We
also plan to cross-sell our PayerServ products to our existing NPPN network
access customers. Additionally, because our NPPN network is a network comprised
in part of a number of regional PPOs, we believe that we will have the ability
to market our PlanServ products to these PPOs. We believe that our ability to
market our products to PPOs is enhanced because, in operating our NPPN network,
we have gained experience in managing the back office, automation, and
technology challenges that most PPOs face.

EMPHASIS ON SUPERIOR TECHNOLOGY

        We intend to continue differentiating ourselves as a technology leader
by using our electronic claims repricing technology to increase our customer
base. In addition, we plan to update and introduce new technology-enabled
services and to improve the speed and accuracy of our existing technology. The
latest version of our Internet claims repricing system, ClaimPassXL(R) v. 3.5,
allows us to shift claims repricing submissions from paper or fax to the
Internet, which reduces our claims processing costs from between $0.75 and $0.80
per claim to $0.15 per claim, and reduces our turnaround times from 72 hours to
real-time for most claims. We believe that faster turnaround of claims repricing
will become more important to payers as state insurance regulators increase
their scrutiny of claims payment turnaround times. Since the March 2001 release
of ClaimPassXL(R) v. 3.0, the predecessor to ClaimPassXL(R) v. 3.5, our volume
of internet repriced claims has increased steadily. We processed approximately
138,279 internet claims in the fourth quarter of 2002, up from 84,081 in the
fourth quarter of 2001, a growth rate of over 60.0%. During 2002, approximately
250 customers used our ClaimPassXL(R) system, resulting in more than 528,000
claims processed and more than $10.4 million in operating revenue for the year.

RECENT DEVELOPMENTS

        In June 2000, we initiated a strategic turnaround program designed to
(1) divest our third party administration businesses, (2) reduce our senior
debt, (3) focus our efforts on enhancing our medical cost containment business,
and (4) restructure our balance sheet. We disposed of all of our third party
administration and managing general underwriter businesses in a series of
transactions during 2001 and 2000.

        Upon completion of the disposition of our former business units, we were
left with a capital and debt structure that our remaining medical cost
containment core business was not able to service, and we were unable to pay our
senior secured debt in the principal amount of approximately $69.0 million when
it matured in August 2001. We entered into a forbearance agreement with our
senior lenders under which we operated until we completed a new

                                       3

<PAGE>

credit facility and closed on a debt restructuring transaction in April 2002.
Pursuant to this restructuring, we obtained a revised term loan for $40.0
million, which is collateralized by all of our assets, and exchanged $29.0
million of senior secured debt for 29,000 shares of our newly authorized Series
C convertible preferred stock and an additional note for $184,872, which has a
maturity date of July 1, 2003.

        On March 13, 2003, PVC Funding Partners LLC, an affiliate of
Commonwealth Associates, LP and Comvest Venture Partners, filed a form 13D with
the Securities and Exchange Commission in which they indicated that on March 7,
2003, they acquired 29,851, or 96.0%, of our outstanding Series C convertible
preferred stock from our senior lenders. These Series C convertible preferred
shares were purchased from the senior lenders on a prorata basis at a price of
$33.50 per share. The selling lenders continue to hold the remaining 4.0% of the
Series C convertible preferred stock. In connection with the transaction, PVC
Funding Partners also acquired $20.5 million in principal amount of our
outstanding bank debt from our senior lenders.

        On March 31, 2003, we renegotiated approximately $4.3 million in
convertible notes that were originally issued to Centra Benefit Services, Inc.
(sometimes referred to as Centra). Pursuant to the renegotiated terms, we have
extended the maturity date of the notes from December 1, 2004 to April 1, 2006,
reduced the interest rate from 12.0% per annum to 6.0% per annum, and fixed the
conversion price at $1.00, subject to adjustment in accordance with
anti-dilution protections. The previous conversion price was based on the
trading price of our common stock. Immediately upon completion of this
restructuring, PVC Funding Partners acquired slightly more than 50% of the face
value of the notes from Centra. The remaining interest is held by Centra.

        The terms of the restructured credit arrangements, the Series C
convertible preferred stock, the PVC Funding Partners transaction, and the
Centra convertible notes are discussed in more detail below in "Business - Our
History" and in "Management's Discussion and Analysis of Financial Conditions
and Results of Operations - Liquidity and Capital Resources."

OUR SERVICES

MEDICAL COST CONTAINMENT SERVICES

        Network Access

        Our NPPN network is comprised of PPOs, independent physician
associations, and individually contracted physicians that offer discounts on
medical services. These providers and provider groups participate in our NPPN
network to increase patient flow and benefit from our NPPN network's prompt,
efficient claims repricing services. Healthcare payers access our NPPN network
to benefit from the discounts offered by our participating providers. The size
of our NPPN network and the level of our NPPN network discounts provide our
payer customers with significant reductions in medical claims costs.

        Our NPPN network access agreements generally require our customers to
pay us a percentage of the cost savings generated by our NPPN network discounts.
In our industry, this payment arrangement is called a "percentage of savings"
revenue model. A typical percentage of savings customer maintains arrangements
with more than one PPO network. Most of these payer customers utilize our NPPN
network as an additional network to contain costs when a covered person obtains
medical services from a provider outside of the payer's primary PPO network.
When a provider bills a payer for medical services that are covered by our NPPN
network discount arrangements, we electronically review the bill and reprice it
to conform to the negotiated discounted rate, which is typically lower than the
invoiced amount. We charge payers an average of 18.0% of the savings that the
payer realizes from the discount. For 2002, our NPPN network access operating
revenue was $31.3 million, including $27.8 million of operating revenue from
percentage of savings contracts. We derive the balance of our NPPN network
operating revenue from payer customers that pay us a flat fee per month based on
the number of enrolled members. These customers generally access our NPPN
network as their primary PPO network.

                                       4

<PAGE>

        As of December 31, 2002, we had approximately 750 network access
customers located throughout the country, with approximately 2.0 million
estimated members. Our network access customer agreements are generally
terminable upon 90 days notice. During 2002, three network access clients and
their affiliates accounted for an aggregate of 19.6% of our net operating
revenues. The loss of any of these client groups could have a material adverse
effect on our financial results.

        Contracts with our PPO participants and other participating providers
generally have renewable terms ranging from one to two years, but in most cases
are terminable by either party without cause on 90 days' notice. The termination
of any PPO contracts would render us unable to provide our customers with access
to the PPO's provider discounts, and therefore would eliminate our ability to
reprice claims and derive operating revenue accordingly. More than 80.0% of our
participating providers have been part of the NPPN network for more than three
years, with some relationships spanning nine years, since the beginning of the
NPPN network's inception in 1994. Since the majority of our provider
arrangements are through other networks, we depend on our contracted networks to
maintain provider relationships and ensure provider compliance with the terms of
the network arrangements.

        Electronic Claims Repricing

        In connection with our NPPN network access business, we provide
electronic claims repricing services that benefit both our payer clients and our
participating providers. A participating provider submits a claim at the full,
undiscounted provider rate. The provider sends the claim directly to us or to
the payer, which then forwards the bill to us. Because there are a wide variety
of provider systems for submitting claims, we accept claims by traditional
methods such as mail and fax, as well as through the Internet and by electronic
data interchange. We convert paper and faxed claims to an electronic format, and
then electronically reprice the claims by calculating the reduced price based on
our NPPN network's negotiated discount. We return the repriced claims file to
the payer electronically, in most cases within a 72-hour period.

        Our ClaimPassXL(R) internet and electronic data interchange services
speed the claims repricing process for our customers. By logging onto our
ClaimPassXL(R) internet site, a payer can input claims information directly into
our claims system. We electronically reprice the claim and deliver the repriced
claim information to the payer customer through the Internet. Our electronic
data interchange (sometimes referred to as EDI) system further simplifies the
process for our customers. EDI customers do not have to key claims information
into our internet site. Instead, our EDI system interfaces directly with the
payer's claims file configuration, which allows the payer to send us its claims
file in its existing electronic format. After we electronically reprice the
claims, we send the customer an electronic file of claims information that the
payer can incorporate into its claims database automatically.

        Although we do not charge our network access customers a separate fee
for claims repricing, we believe that our advanced repricing system provides
significant benefits that make our network access services more attractive to
payers. It is time-consuming and expensive for a payer to load PPO rates and
demographic information into its claims system and to create a system that
accepts the various forms in which claims information is submitted. We offer a
turnkey solution that requires only a limited number of payer personnel. We can
reduce claims turnaround times and provide efficient claims transmission
options. Our system also can reduce lost claims, reduce the number of
undiscounted claims, support high claim volume customers, and improve accuracy
over manually processed claims. Our customers also are relieved of some of the
burden of complying with the Health Insurance Portability and Accountability Act
(sometimes referred to as HIPAA), which imposes privacy and data configuration
requirements that apply to claims repricing. We believe that our claims
processing procedures are in compliance with current HIPAA requirements and will
be compliant with future requirements. Providers also benefit from our
streamlined claims system, which helps increase the speed with which they get
paid and the accuracy of the claim payments.

        Network and Data Management

        We use our information system capabilities to provide network and data
management services for the payers that access our NPPN network. We prepare
detailed reports regarding repricing turnaround times and the savings that each
payer realizes, itemized by the total number of claims incurred, the number of
claims discounted, and the average discount. Payers can use this information to
help design health plans that effectively control costs,

                                       5

<PAGE>

enhance member benefits, and yield a more favorable loss ratio, which is the
ratio of paid medical claims compared to collected premiums. As a provider of
data management services, we maintain provider demographics and fee schedules
and update provider directories. We integrate several components of certain
licensed reporting software to provide both our payer clients and our
participating PPOs with quick access to claims data, allowing them to produce a
variety of analytical reports. We generally do not charge our NPPN network
access customers any additional fee for our standard network and data management
services.

        Bill Review and Negotiation

        In April 2002, we began offering optional medical bill review and
negotiation services to our payer clients. Many of our percentage of savings
clients send us all claims that fall outside their primary PPO network
arrangements. Traditionally, we identified and repriced the claims that were
subject to our NPPN discount arrangements and returned the non-NPPN claims to
the payer without applying any discount. We now offer our payer customers the
opportunity to realize cost savings on these out-of-network claims through our
affiliation with a bill review and negotiation company. We can electronically
transmit our non-NPPN network claims to the company's experienced professionals,
who use proprietary medical software to analyze each claim to detect any
incorrect charges or billing irregularities. Once that phase of the analysis is
completed, the detailed charges are compared to a proprietary database to
determine the competitiveness of the charges in the provider's geographic area.
The bill negotiator then contacts the provider to discuss our findings, and in
many cases is able to reduce the claim amount. The reviewer obtains signed
agreements from each provider to prevent the provider from later contesting the
reduction or billing the patient for the balance. The company then returns the
electronic file to us, and we forward it to the payer along with the payer's
other repriced claims. Payers pay us a percentage of the savings that are
generated by the bill review and negotiation service. Our 2002 operating revenue
for this service was approximately $335,000.

        Advance Funding

        In 2002, we launched a program to provide advance funding services for
payers and providers. Through our arrangement with established advance funding
companies, we offer participating providers the opportunity to receive claim
payments in advance of the due date. In exchange, the providers agree to accept
a discount of the original billed amount. This service provides both a reduction
in claim costs for payers and rapid payment for providers. The payer pays us a
percentage of the discount agreed to by the provider.

BUSINESS PROCESS OUTSOURCING

        We traditionally provided claims repricing and network management
services only with respect to claims that our NPPN participating providers
submitted to one of our network access payer customers. Through our network and
data management business process outsourcing business, we have expanded our
scope to offer payers and providers services that are independent of our network
access business.

        PayerServ

        Healthcare payers typically contract with more than one PPO network.
While historically most payers' information systems and applications could
handle simple percentage discount repricing calculations for a single network,
we believe that most are not well suited for current PPO contract terms
requiring detailed, often complex, repricing calculations. Each of the networks
with which a payer contracts may have different discount methodologies and
rates, greatly adding to a payer's administrative burden and increasing the
complexities of processing and repricing claims.

        Through PayerServ, we use our existing technology and management
expertise to help payers manage all of their network relationships, whether or
not they also access our NPPN network. A payer can outsource its network and
data management obligations to us, and we will assume the responsibility for
moving, tracking, and repricing healthcare claims among all of the PPO networks
with which it has contracts. By maintaining provider fee schedule and
demographic information for all of the providers in a payer's provider
configuration, we eliminate bottlenecks in the payer's claim work flow, expedite
claims repricing, and improve accuracy.

                                       6

<PAGE>

        Our PayerServ services may include acting as the payer's mailroom for
receipt of all provider claims, converting paper and fax claims to an electronic
format, identifying the correct network fee schedule applicable to each claim,
and electronically repricing the claim accordingly. We also can provide
reporting and other network management services with respect to all of the
payer's networks. We can prepare customized reports for payers that capture
information regarding repricing turnaround time, cost management, demographics,
case management, provider services, diagnoses, and procedures. We believe that
our PayerServ customers benefit from reduced operating expenses, streamlined
network management, HIPAA-compliant procedures, and electronic repricing with
rapid turnaround times. We do not require customers to pay upfront network
loading fees and monthly maintenance fees, which are features of many of our
competitors' systems.

        Our PayerServ customers typically pay us for claims repricing and claims
and network and data management services on a per-claim basis. For each
PayerServ customer, we analyze the customer's service requirements, including
claims work flow, claims volume and types, and PPO network configurations. Then,
based on our proprietary pricing model, we determine the pricing for each claim
transaction.

        PlanServ

        PlanServ uses the same technology and management expertise that supports
our PayerServ business to offer claims repricing and network and data management
services to PPOs. Our PPO participants generally maintain relationships with
payers that are independent from the PPOs' affiliation with our NPPN network.
Many of these PPOs are seeking cost-efficient ways to develop their own
automated claims handling and repricing systems and to manage the provider data
necessary to update their provider directories efficiently and otherwise support
network access. By outsourcing repricing functions to PlanServ, a PPO can
achieve advanced electronic capabilities for its payer clients without incurring
the high cost of systems development. We can serve as a mailroom for PlanServ
clients, receiving paper and fax claims and converting them to an electronic
form for repricing, so that the PPO never touches the claims. PPOs that take
advantage of our PlanServ offerings do not have to distribute their rates to
their payers, manually reprice claims, or be concerned with HIPAA requirements
related to claims repricing. The PPO's payer clients benefit from reduced
turnaround times on repriced claims and escape the burden of loading the PPO's
rates. PlanServ products also include web hosting capabilities, featuring
customized, private label web access that enables a participating PPO's
customers to reprice claims electronically through the Internet. Each PPO's
website includes the PPO's logo and other material chosen by the PPO.

        PlanServ also offers our PPO customers management reporting products
that capture important claims data, including repricing turnaround times, claim
volume, and savings amounts. Our PPO customers can use this information to
negotiate better physician and facility discounts. We believe that obtaining and
analyzing information is increasingly important to PPOs because this information
is necessary for them to properly establish their discount levels. We also
provide PlanServ customers with database administration, including provider
directory updates and maintenance of provider demographics and fee schedules.

        Like PayerServ, PlanServ generally charges customers a per-claim fee,
which is calculated based on the extent of the customer's service requirements,
including claims work flow and number of payers.

OUR INTELLECTUAL PROPERTY AND TECHNOLOGY

        Our proprietary technology offers customers the benefits of an open
architecture, which means that it is compatible with other operating systems and
applications. Using a combination of electronic data interchange and internet
systems, customers can interface with our claims repricing system without
incurring significant incremental capital expenditures for hardware or software
or having to adopt a specific claims format. The open architecture of our system
also improves reliability and facilitates the cross-selling of other
technology-based services to our customers, in part because of the following
characteristics:

        Scalability

        Our systems are designed to be highly scalable or adaptable to levels of
use. Using TCP/IP in a Unix and Windows NT environment with a 10/100/1000 Mhz
backbone, we have designed our systems to accommodate additional servers and
disk space as needed with little or no interruption in processing. Using Oracle,
our database

                                       7

<PAGE>

technology gives us the flexibility to design web-enabled customer applications
that do not require the installation of proprietary software. We also are able
to design new internal systems using the languages of our choice, which are
currently Visual Basic and Visual FoxPro.

        Modularity

        Our systems have been developed with discrete or specific functionality
that we can replicate and utilize with additional hardware so that we can
reorganize the discrete functions and adapt the system to service different
situations. We believe that this modularity enables us to optimize application
and hardware performance, and take immediate advantage of improvements in
hardware and software.

        Redundancy

        All of our production servers are designed with a redundant array of
inexpensive disks, which provides protection in the event a disk fails. Our
hardware is replicated to provide redundancy in the event of a total system
failure. We document and review our disaster recovery plans quarterly in order
to reduce the risk of business interruption.

        Industry Standards

        Through the adoption and active use of standard formats for healthcare
electronic data interchange processing, we can support payer and provider
processing requirements and provide standard interfaces to other electronic data
interchange processing organizations.

        Ease of Use

        Our products utilize a 32 bit graphical user interface. Our web-based
products are written in Java and function in any operating system capable of
using a web browser, thereby enhancing ease of use by our customers.

        Remote Connectivity Offerings

        We were an early adopter of the emerging internet technology that
enables us to provide quick connectivity through file transfer protocol,
web-enabled applications, and virtual private networking. We believe that these
features allow us to provide improved service levels and lower pricing. We have
established relationships with multiple telecommunications vendors to ensure
reliable and redundant connectivity over T1 and frame relay circuits.

        We do not have patent protection for our proprietary technology, which
includes primarily software and software applications. Until we obtain this
protection, we must rely on trade secret and copyright protection provided under
common law. We also have implemented certain security measures to protect our
systems from access by unauthorized parties that might want to copy or otherwise
use our technologies. These security measures include firewall protection,
corporate antivirus programs, and email and facility security. We rely on
technology licensed from third parties to perform key functions, and may be
required to license additional technology in the future. We have obtained
federal trademark protection for the marks PlanVista Solutions(R) and
ClaimPassXL(R).

COMPETITION

PREFERRED PROVIDER NETWORK ACCESS

        The PPO industry is highly fragmented. According to the American
Association of Preferred Provider Organizations, as of March 2003 there were
more than 1,000 PPOs in the United States. A few companies, such as First Health
Group Corporation, BCE Emergis/eHealth Solutions Group, Concentra, Inc., Beech
Street Corporation, Coalition America, Inc., and Multiplan, Inc., offer provider
networks and claim volumes of meaningful size. The remainder of the competitive
landscape is diverse, with major insurance companies and managed care
organizations such as Blue Cross Blue Shield, Aetna US Healthcare, WellPoint
Health Networks, Inc., United Health Group,

                                       8

<PAGE>

Humana Health Care Plans, Private Healthcare Systems (PHCS), and Cigna
Healthcare also offering proprietary preferred provider networks and services.
In addition, the number of independent PPOs has decreased as managed care
organizations and large hospital chains have acquired PPOs to administer their
managed care business and increase enrollment. We expect consolidation to
continue as the participants in the industry seek to acquire additional volume
and access to PPO contracts in key geographic markets. This consolidation may
give our customers greater bargaining power and lead to more intense price
compensation.

ELECTRONIC CLAIMS REPRICING

        The claims repricing service market is also fragmented. Our repricing
competitors provide some or all of the services we currently provide. Our
competitors can be categorized as follows:

            .   Large managed care organizations and third party administrators
                with in-house claim processing and repricing systems, such as
                Blue Cross Blue Shield, UnitedHealth Group, and Wellpoint Health
                Networks, Inc.;

            .   Healthcare information technology companies providing
                enterprise-wide systems to the payer market, such as
                McKesson/HBOC (NYSE: MCK), Eclipsys Corp (NASDAQ: ECLP), and
                Perot Systems Corporation (NYSE: PER); and

            .   Healthcare information software vendors selling claim processing
                products to the provider market, such as The TriZetto Group
                (NASDAQ: TZIX), HealthAxis (NASDAQ: HAXS), Avidyn/ppoOne
                (NASDAQ: ADYN), and several private companies.

The market for claims repricing services is competitive, rapidly evolving, and
subject to rapid technological change. We believe that competitive conditions in
the healthcare information industry in general will lead to continued
consolidation as larger, more diversified organizations are able to reduce costs
and offer an integrated package of services to payers and providers.

        We compete on the basis of the strength of our electronic claims
repricing technology, the size of our network and the level of our network
discounts, our percentage of savings pricing model, and the diversity of
services we offer through our business processing outsourcing products and other
new initiatives. Many of our current and potential competitors have greater
financial and marketing resources than we have. Furthermore, we believe that the
increasing acceptance of managed care in the marketplace, the adoption of more
sophisticated technology, legislative reform, and the consolidation of the
industry will result in increased competition. There can be no assurance that we
will continue to maintain our existing customer base, or that we will be
successful with any new products that we have introduced or will introduce.

OUR HISTORY

        We were incorporated in Delaware in 1994 and completed our initial
public offering in May 1995 under the name HealthPlan Services Corporation. We
changed our name to PlanVista Corporation in April 2001. Our original core
business, which we purchased from Dun & Bradstreet Corporation in 1994, provided
third party administration of healthcare claims for large and small group
employers. After our 1995 initial public offering, we initiated a series of
acquisitions designed to grow our business. We spent more than $170.0 million in
cash to acquire seven businesses between 1995 and 1998, including the purchase
of a managing general underwriter business and the May 1998 purchase of our NPPN
network business for $31.6 million. We used funds from our senior credit
facility to help finance these acquisitions. By 1999, a number of our
businesses, other than our NPPN network business that is part of our core
business today, had become unprofitable. We were burdened with more than $100.0
million of senior debt, more than $10.0 million of subordinated debt, and
approximately $25.0 million of working capital deficit.

        Divestiture

        In June 2000, we initiated a strategic turnaround program designed to
(1) divest our third party administration businesses, (2) reduce our senior
debt, (3) focus our efforts on enhancing our medical cost containment business,
and (4) restructure our balance sheet. We disposed of all of our third party
administration and managing

                                       9

<PAGE>

general underwriter businesses in a series of transactions during 2001 and 2000.
In the 2000 transactions, we received a total of $35.1 million and, in one of
the transactions, the buyer assumed $1.5 million of additional current
liabilities. Of the cash proceeds, we used $29.5 million to reduce our
outstanding indebtedness to our senior lenders.

        We completed the disposition of our former business units in June 2001
with the sale of our subsidiary, HealthPlan Services, Inc., which contained our
remaining third party administration business and our managing general
underwriter business. In connection with this non-cash transaction, the buyer,
HealthPlan Holdings, Inc., assumed approximately $40.0 million in working
capital deficit of the acquired businesses, and acquired assets having a fair
market value of approximately $30.0 million. At the closing of this transaction,
we issued 709,757 shares of our common stock to offset $5.0 million of the
assumed deficit. We offset the remaining $5.0 million of this deficit with a
long-term convertible subordinated note, which automatically converted into
813,273 shares of our common stock on April 12, 2002 in connection with the
restructuring of our credit facility, as described below. During 2001 and 2002,
in connection with the HealthPlan Holdings transaction, we issued a total of
343,521 additional shares of our common stock in settlement of certain
post-closing disputes and to meet certain obligations under the terms of the
subordinated note and a registration rights agreement we entered into at
closing. See "Management's Discussion and Analysis of Operations - Liquidity and
Capital Resources" for a more detailed discussion of the HealthPlan Holdings
transactions.

        Our current business consists of our core medical cost containment
business, which includes our NPPN network, as well as our new network and data
management business process outsourcing businesses, which we introduced in 2001
and which began earning operating revenue in the first quarter of 2002.

        Debt Restructure

        Upon completion of the disposition of our former business units, we were
left with a capital and debt structure that our remaining medical cost
containment core business was not able to service, and we were unable to pay our
senior secured debt in the principal amount of approximately $69.0 million when
it matured in August 2001. We entered into a forbearance agreement with our
senior lenders under which we operated until we completed a new credit facility
and closed on a debt restructuring transaction in April 2002. Pursuant to this
restructuring, we obtained a revised term loan for $40.0 million, which is
secured by all of our assets, and exchanged $29.0 million of senior secured debt
for 29,000 shares of our newly authorized Series C convertible preferred stock
and an additional note for $184,872 with a maturity date of July 1, 2003.

        Series C Convertible Preferred Stock

        The Series C convertible preferred stock issued to our senior lenders in
connection with our restructured credit facility accrues dividends at 10.0% per
annum during the first twelve months from issuance and at 12.0% per annum
thereafter. Dividends are payable quarterly in additional shares of Series C
convertible preferred stock or, at our option, in cash. We have chosen to pay
dividends in the form of additional shares, and to date we have issued to the
Series C shareholders an aggregate of 2,092 additional shares of Series C
convertible preferred stock. In addition, while at least 12,000 shares of Series
C convertible preferred stock are outstanding, the Series C convertible
preferred stockholders are entitled to elect three out of seven members of our
board of directors. Upon the occurrence of a Board Shift Event, as defined
below, the board composition would change so as to allow the holders of Series C
convertible preferred stock to elect four out of seven directors, thereby
shifting control of the board to the directors elected by the holders of Series
C convertible preferred stock. A "Board Shift Event" is defined as (1) our
failure to achieve certain specified net operating cash flow requirements, (2)
any default in connection with the payment of principal or interest under our
restructured credit facility, after the lapse of any applicable grace periods,
or (3) our failure to redeem all of the Series C convertible preferred stock by
October 12, 2003. We may redeem the Series C convertible preferred stock at any
time at our option at a redemption price of $1,000 per share plus accrued
dividends. Until the March 2003 closing of the PVC Funding Partners transaction,
as described below, the senior lenders under our restructured credit facility
were the sole holders of the Series C convertible preferred stock.

        In addition to their voting rights with respect to directors, the
holders of the Series C convertible preferred stock will have the right in
certain circumstances to vote as a single class with the common stockholders on
all matters other than the election of directors on an "as-converted" basis,
with each share of Series C convertible

                                       10

<PAGE>

preferred stock having a number of votes equal to the number of shares of common
stock into which it would be converted. The "as-converted" rights take effect
upon the earliest to occur of (1) any default in connection with the payment of
principal or interest under our restructured credit facility, after the lapse of
any applicable grace period, (2) our failure to redeem all of the Series C
convertible preferred stock by October 12, 2003, or (3) the date on which fewer
than 12,000 shares of Series C convertible preferred stock are outstanding.
There are 31,092 shares of Series C convertible preferred stock outstanding. In
connection with the issuance of the Series C convertible preferred stock, the
senior lenders entered into a stockholders agreement with us, which provides,
among other things, for registration rights in connection with the sale of any
shares of common stock that are issuable upon conversion of the Series C
convertible preferred stock. The registration rights include shelf and
piggy-back registration rights.

        At any time after October 12, 2003, the Series C convertible preferred
stock may be converted into shares of our common stock at the rate of 703.37
shares of common stock for each preferred share, or a total of 20,996,398 shares
(or 55.6%) of our common stock upon full conversion, subject to adjustment. The
Series C convertible preferred stock has weighted-average anti-dilution
protection and a provision that in no event will the Series C convertible
preferred stock convert into less than 51.0% of our outstanding shares of common
stock.

        Offering

        On July 19, 2002, we filed an Amended Registration Statement with the
Securities and Exchange Commission, wherein we offered for sale an aggregate of
5,174,979 shares of our common stock (the "Offering"). During the fourth quarter
of 2002, we decided to postpone the Offering indefinitely. We subsequently filed
an application to withdraw the Registration Statement.

        PVC Funding Partners Transaction

        On March 13, 2003, PVC Funding Partners LLC, an affiliate of
Commonwealth Associates, LP and Comvest Venture Partners, filed a form 13D with
the Securities and Exchange Commission in which it indicated that on March 7,
2003, it acquired 29,851, or 96.0%, of our outstanding Series C convertible
preferred stock from our senior lenders. These preferred shares were purchased
from the lenders on a prorata basis at a price of $33.50 per share. The selling
lenders continue to hold the remaining 4.0% of the Series C convertible
preferred stock. In connection with the transaction, PVC Funding Partners also
acquired $20.5 million in principal amount of our outstanding bank debt from our
senior lenders. In connection with the closing of the transaction, the three
members of our board of directors theretofore designated by the holders of the
Series C convertible preferred stockholders voluntarily relinquished their board
positions, and were replaced by three directors selected by PVC Funding
Partners.

        There is an intercreditor agreement between PVC Funding Partners and
Wachovia Bank, National Association, dated March 7, 2003. The intercreditor
agreement provides that, until the occurrence of a Board Shift Event, PVC
Funding Partners has all of the rights of the original lenders under the
restructured credit agreements, except that (1) PVC Funding Partners' rights to
mandatory prepayments and other principal payments prior to the maturity date
are subordinated to the original lenders' rights to those payments, and (2) PVC
Funding Partners' notes will be voted consistently with and on the same
percentage basis as the original lenders with respect to all matters required to
be submitted to a vote or consent of the lenders, except for matters related
to certain fundamental changes in the loan terms. Upon the first occurrence of a
Board Shift Event, which would allow PVC Funding Partners to appoint an
additional board member and thus obtain control of our board of directors, PVC
Funding Partners has the option of not exercising their right to obtain such
control. If, within fifteen days of a first Board Shift Event, PVC Funding
Partners notifies the original lenders that they will not exercise their right
to control our board, then the original lenders will have the option to
repurchase 14,304 of the Series C convertible preferred stock, at a price of
$33.50 per share. If PVC Funding Partners exercises their right to obtain
control of our board, or fails to timely notify the original lenders that they
will not exercise this right, then the debt held by PVC Funding Partners will
automatically be subordinated to the debt held by the original lenders.

                                       11

<PAGE>

        Restructured Centra Notes

        On March 31, 2003, we renegotiated approximately $4.3 million in
convertible notes that were originally issued to Centra Benefit Services, Inc.
(sometimes referred to as Centra). Pursuant to the renegotiated terms, we have
extended the maturity date of the notes from December 1, 2004 to April 1, 2006,
reduced the interest rate from 12% per annum to 6% per annum, and fixed the
conversion price at $1.00, subject to adjustment in accordance with
anti-dilution protections. The previous conversion price was based on the
trading price of our common stock. Immediately upon completion of this
restructuring, PVC Funding Partners acquired slightly more than 50% of the face
value of the notes from Centra. The remaining interest is held by Centra.

        See "Management's Discussion and Analysis of Financial Condition and
Reports of Operations - Liquidity and Capital Resources."

GOVERNMENT REGULATION

        Regulation in the healthcare industry is constantly evolving. Federal,
state, and local governments continue their efforts to reduce the rate of
increases in healthcare expenditures and to regulate the adjudication of
healthcare claims for the protection of patients as well as providers. Many of
these policy initiatives have contributed to the complex and time-consuming
nature of obtaining healthcare reimbursement for medical services. The impact of
regulatory developments in the healthcare industry is complex and difficult to
predict, and our business could be adversely affected by new healthcare
regulatory requirements or new interpretations of existing requirements. We
believe, however, that the increasing complexity of healthcare transactions and
the resulting additional information management requirements placed on providers
and payers should increase the demand for our services. At the same time, these
requirements may dramatically increase our cost of providing services.

PRIVACY REGULATION

        As participants in the healthcare industry, we and our payer and
provider customers are subject to laws and regulations relating to the
confidential treatment and secure transmission of patient medical records and
other healthcare information. The Health Insurance Portability and
Accountability Act of 1996, as amended (sometimes referred to as HIPAA), has
had, and will continue to have, a significant effect on developers and users of
healthcare information systems. On December 28, 2000, the Department of Health
and Human Services (sometimes referred to as HHS) issued final regulations, in
the form of a Privacy Rule, relating to patient information privacy and
electronic healthcare transactions. On August 14, 2002, HHS adopted
modifications to the Privacy Rule. The Privacy Rule affects certain health
plans, healthcare clearinghouses, and health care providers. These "covered
entities" must implement standards to protect and guard against the misuse of
individually identifiable health information. In many instances, we are merely
deemed to be a business associate of our health plan and provider customers. We
are deemed to be a clearinghouse when we convert nonstandard data content, or
data in a nonstandard format, into standard data elements or a standard
transaction, or vice versa. Among other things, the Rule requires us to adopt
written privacy procedures and provide employee training with respect to
compliance. We must be in compliance with these regulations by April 14, 2003.
We expect to be compliant with the regulations on or before that date.

        In October 2003, we will become subject to HIPAA regulations related to
electronic transactions. These regulations require us to use standard data
content and formats for the submission of electronic claims and other
administrative and healthcare transactions. Additionally, HHS has adopted
regulations relating to security of individual health information and a national
employer identifier. We expect to be in compliance with these regulations on or
before their effective dates.

        Many healthcare payers and providers have sought assistance from outside
vendors to facilitate implementation and/or to provide clearinghouse translation
capabilities as a method to reduce those costs and meet the required mandatory
implementation dates. While HIPAA could continue to have an adverse effect on
the operations of providers and payers and consequently reduce our revenue, we
believe we possess technical and managerial knowledge and skills that could
benefit healthcare organizations seeking to establish compliance with

                                       12

<PAGE>

HIPAA requirements. We have analyzed the extent to which we may need to alter
our systems to comply with current and proposed HIPAA regulations and do not
believe that there will be significant additional costs to us in complying with
such regulations. Because some HIPAA regulations have yet to be issued and
because even final HIPAA regulations may be subject to additional modification
or amendment, our products may require modification in the future. If we fail to
offer solutions that permit compliance with applicable laws and regulations, our
business could suffer.

        Many of our customers will also be subject to state laws implementing
the federal Gramm-Leach-Bliley Act, relating to certain disclosures of nonpublic
personal health information and nonpublic personal financial information by
insurers and health plans. We also may be subject to state privacy laws, which
may be more stringent than HIPAA in some cases.

PROVIDER CONTRACTING AND CLAIMS REGULATION

        Some state legislatures have enacted statutes that govern the terms of
provider network discount arrangements or restrict unauthorized disclosure of
such arrangements. Legislatures in other states are considering adoption of
similar laws. Although we believe that we operate in a manner consistent with
applicable provider contracting laws, there can be no assurance that we will be
in compliance with laws or regulations to be promulgated in the future, or with
new interpretations of existing laws.

        Our customers perform services that are governed by numerous other
federal and state civil and criminal laws, and in recent years have been subject
to heightened scrutiny of claims practices, including fraudulent billing and
paying practices. Many states also have enacted regulations requiring prompt
claims payment. To the extent that our customers' reliance on any of the
services we provide contribute to any alledged violation of these laws or
regulations, then we could be subject to indemnification claims from our
customers or be included as part of an investigation of our customers'
practices. Federal and state consumer laws and regulations may apply to us when
we provide claims services and a violation of any of these laws could subject us
to fines or penalties.

LICENSING REGULATION

        While we are currently not subject to licensing requirements for the
services we provide, some states require us, as a non-risk-bearing PPO, to
formally register and file an annual or one-time accounting of networks and
providers with which we contract. Given the rapid evolution of healthcare
regulation, it is possible that we will be subject to future licensing
requirements in any of the states where we currently perform services, or that
one or more states may deem our activities to be analogous to those engaged in
by other participants in the healthcare industry that are now subject to
licensing and other requirements, such as third party administrator or
insurance regulations. Moreover, laws governing participants in the healthcare
industry are not uniform among states. As a result, we may have to undertake the
expense and difficulty of obtaining any required licenses, and there is a risk
that we would not be able to meet the licensing requirements imposed by a
particular state. It also means that we may have to tailor our products on a
state-by-state basis in order for our customers to be in compliance with
applicable state and local laws and regulations.

INTERNET REGULATION

        We offer a number of internet-related products. The Internet and its
associated technologies are subject to increasing government regulation. A
number of legislative and regulatory proposals are under consideration by
federal, state, local, and foreign governments and agencies. We cannot be
assured that we will be able to comply with requirements that may be adopted in
the future.

PATIENT PROTECTION INITIATIVES

        State and federal legislators and regulators have proposed initiatives
to protect consumers covered by managed care plans and other health coverage.
These initiatives may result in the adoption of laws related to timely claims
payment and review of claims determinations. These laws may impact the manner in
which we perform services for our clients.

                                       13

<PAGE>

        While we believe our operations are in material compliance with
applicable laws as currently interpreted, the regulatory environment in which we
operate may change significantly in the future, which could restrict our
existing operations, expansion, financial condition, or opportunities for
success.

EMPLOYEES

        On March 24, 2003, we employed 155 persons. Our employees are not
represented by a labor union or a collective bargaining agreement. We regard our
relationship with our employees as good.

AVAILABLE INFORMATION

        We are headquartered in Tampa, Florida and have an operations and
technology center in Middletown, New York. Our Tampa headquarters' mailing
address is 4010 Boy Scout Boulevard, Suite 200, Tampa, Florida 33607, and our
principal telephone number at that location is 813-353-2300. Our website address
is www.planvista.com. Our annual reports on Form 10-K, our quarterly reports on
Form 10-Q, current reports on Form 8-K, and amendments to those reports are
available free of charge through our website at "About Us/Investor
Information/SEC Filings." We make this information available via a hyperlink to
a third party Securities and Exchange Commission (sometimes referred to as SEC)
filings website. We do not maintain or provide information directly to this
site. Although the third party that maintains the website has endeavored to make
our SEC filings available as soon as reasonably practicable after we file them
electronically with the SEC, we make no representations or warranties with
respect to the timeliness or content of any postings on the website.

ITEM 2. PROPERTIES

        We conduct our operations from our headquarters in Tampa, Florida and
our data processing facility in Middletown, New York. We lease both of these
facilities. We believe that our facilities are adequate for our present and
foreseeable business requirements.

ITEM 3. LEGAL PROCEEDINGS

        In the ordinary course of business, we may be a party to a variety of
legal actions that affect many businesses, including employment and employment
discrimination-related suits, employee benefit claims, breach of contract
actions, and tort claims. In addition, we have a number of indemnification
obligations related to certain of the businesses we sold during 2000 and 2001,
and we could be subject to a variety of legal and other actions as a result of
such indemnification obligations. We currently have insurance coverage for some
of these potential liabilities. Other potential liabilities may not be covered
by insurance, insurers may dispute coverage, or the amount of insurance may not
cover the damages awarded. We cannot fully determine the ultimate financial
effect of these claims and indemnification obligations at this time.

        In November 2001, we filed a complaint for breach of contract and unjust
enrichment in the Circuit Court of the Thirteenth Judicial Circuit, Hillsborough
County, Florida, against Trewit, Inc. and Harrington Benefit Services, Inc., our
former subsidiary. The complaint, which we amended in February 2002, sought in
excess of $3.5 million in damages arising primarily out of a settlement entered
into in connection with a dispute that arose after Trewit's acquisition of
Harrington Benefit Services from us in 2000. In April 2002, we again amended the
complaint to include claims of fraudulent misrepresentation, negligent
misrepresentation, and promissory estoppel, seeking additional damages for these
causes of action in excess of $1.4 million. On June 28, 2002, Trewit filed a
complaint against us in the Circuit Court of the Thirteenth Judicial Circuit,
Hillsborough County, Florida, alleging breach of contract and fraud in
connection with their acquisition of Harrington Benefit Services. The complaint
sought damages in excess of $2.0 million. In February 2003, we resolved our
litigation with Trewit, Inc. and Harrington Benefit Services, Inc. without
payment by us, and the parties signed mutual releases.

        In November 2001, Paid Prescriptions, LLC initiated a breach of contract
action in the United States District Court for the District of New Jersey
against HealthPlan Services, our former subsidiary that we sold to HealthPlan
Holdings. Paid Prescriptions seeks $1.6 million to $2.0 million in compensation
arising from HealthPlan Services' alleged failure to meet certain performance
goals under a contract requiring HealthPlan Services to enroll

                                       14

<PAGE>

a certain number of customers for Paid Prescriptions' services. The events
giving rise to this claim allegedly occurred prior to our sale of the HealthPlan
Services business to HealthPlan Holdings. Accordingly, we are vigorously
defending the action on behalf of HealthPlan Services, in accordance with our
indemnification obligations to HealthPlan Holdings.

        We are currently in discussions with HealthPlan Holdings to finalize any
purchase price adjustments associated with the HealthPlan Services transaction.
These adjustments relate primarily to the amount of accrued liabilities and
trade accounts receivable reserves, and the classification of investments at the
transaction date. HealthPlan Holdings believes it is due approximately $1.7
million from us related to the transaction, while we believe we have claims
against HealthPlan Holdings amounting to approximately $4.5 million (which would
be partially offset against other post-closing payments that we have agreed to
pay, subject to certain limitations as provided in the transaction documents).
In the event that we are unable to resolve these matters directly with
HealthPlan Holdings, we will seek to resolve them through binding arbitration as
provided for in the purchase agreement.

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

NONE.

                                     PART II

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

        Since October 4, 2002, our common stock has been traded on the
Over-The-Counter Bulletin Board under the symbol PVST. Prior to that time, our
stock was traded on the New York Stock Exchange. Our New York Stock Exchange
symbol was HPS From May 1995 until April 2001, when we changed our symbol to PVC
in connection with the change of our name from HealthPlan Services Corporation
to PlanVista Corporation. The following table sets forth the high and low sales
prices of our common stock for each quarter during 2001 and 2002, as reported by
the New York Stock Exchange or the Over-The-Counter Bulletin Board, as
applicable.

        2002                                             HIGH          LOW
        ----                                          ----------    ----------
        Fourth quarter ...........................    $     2.50    $     0.73
        Third quarter ............................    $     3.50    $     1.06
        Second quarter ...........................    $     6.30    $     3.40
        First quarter ............................    $     6.40    $     4.25

        2001                                             HIGH          LOW
        ----                                          ----------    ----------
        Fourth quarter............................    $     5.83    $     4.14
        Third quarter.............................    $     7.97    $     4.20
        Second quarter............................    $     8.35    $     6.60
        First quarter.............................    $     9.44    $     6.20

        There were 152 holders of record of our common stock as of March 24,
2003. We believe that there are a greater number of beneficial owners that hold
our common stock in street name. We have not paid dividends since October 1999,
and our current credit agreement prohibits the payment of dividends. We have no
present plans to pay any dividends on our common stock because we currently
intend to retain all earnings, if any, in order to expand our operations and pay
down debt. In the future, depending upon our financial condition, earnings,
capital requirements, results of operations, contractual limitations and any
other factors deemed relevant by our board of directors, our board of directors
may at any time consider the payment of dividends.

                                       15

<PAGE>

        The following table sets forth our equity compensation plan information
as of December 31, 2002.

<TABLE>
<CAPTION>
                                                                                  NUMBER OF SECURITIES
                                               NUMBER OF                           REMAINING AVAILABLE
                                              SECURITIES           WEIGHTED-              FOR
                                             TO BE ISSUED          AVERAGE        FUTURE ISSUANCE UNDER
                                           UPON EXERCISE OF   EXERCISE PRICE OF    EQUITY COMPENSATION
                                             OUTSTANDING         OUTSTANDING             PLANS
                                               OPTIONS,            OPTIONS,       (EXCLUDING SECURITIES
                                             WARRANTS AND        WARRANTS AND      REFLECTED IN COLUMN
            PLAN CATEGORY                       RIGHTS             RIGHTS                  (a))
----------------------------------------   ----------------   -----------------   ---------------------
                                                (a)                 (b)                    (c)
<S>                                           <C>                 <C>                      <C>
Equity compensation plans approved
 by security holders (1)................      1,810,137           $    6.72                558,913(2)

Equity compensation plans not
 approved by security holders ..........             --                  --                     --
                                           ----------------   -----------------   ---------------------
        Total ..........................      1,810,137           $    6.72                558,913
                                           ================   =================   =====================
</TABLE>

----------

(1)  These plans consist of the 1995 Directors Stock Option Plan, the 1995
     Incentive Equity Plan, the 1995 Consultants Stock Option Plan, the Amended
     and Restated 1996 Employee Stock Option Plan, the Amended and Restated 1997
     Directors Equity Plan, and the 1996 Employee Stock Purchase Plan.

(2)  This number includes 19,781 shares available for issuance under the Amended
     and Restated 1997 Directors Equity Plan and 23,569 shares available for
     issuance under the 1996 Employee Stock Purchase Plan. This number does not
     include 3.0 million shares issuable under the 2002 Employee Stock Option
     Plan, which was approved by our stockholders at our 2002 Annual Meeting of
     Stockholders, subject to completion of a proposed public offering of our
     stock. During the fourth quarter of 2002, we decided to postpone the
     offering indefinitely. At our 2003 annual meeting, we expect to request
     stockholder approval for issuance of options to purchase an aggregate of
     3.5 million shares of our common stock, without any condition related to
     the conclusion of an offering.

                                       16

<PAGE>

ITEM 6.  SELECTED FINANCIAL DATA

                      SELECTED CONSOLIDATED FINANCIAL DATA
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)

        We have derived the following selected historical consolidated financial
data from our audited consolidated financial statements at December 31, 2002 and
2001 and for the years ended December 31, 2002, 2001, 2000, 1999, and 1998,
which are included in this Form 10-K. The report of PricewaterhouseCoopers LLP,
our independent accountants, on our consolidated financial statements at
December 31, 2002 and 2001 and for the years ended December 31, 2002, 2001 and
2000 appears elsewhere in this Form 10-K. Our selected consolidated financial
data should be read in conjunction with the related consolidated financial
statements and notes thereto appearing elsewhere in this Form 10-K.

<TABLE>
<CAPTION>
                                                                          YEAR ENDED DECEMBER 31,
                                                      --------------------------------------------------------------
                                                      2002        2001(1)       2000(1)       1999(1)      1998(1)
                                                      ---------   -----------   -----------   ----------   ---------
   <S>                                                <C>         <C>           <C>           <C>          <C>
   STATEMENT OF OPERATIONS DATA:
   (In thousands, except per share amounts)
   Operating revenue ..............................   $  33,141   $    32,918   $    26,964   $   18,691   $  10,024
                                                      ---------   -----------   -----------   ----------   ---------
   Cost of operating revenue:
      Marketing allowances ........................         559           308           295          110          30
      Personnel expense ...........................       8,474         9,137         8,301        8,189       4,937
      Network access fees .........................       5,122         5,343         3,896        2,521       1,894
      Other .......................................       5,267         6,213         3,993        3,903       4,028
      Depreciation ................................         528           467           303          723         247
                                                      ---------   -----------   -----------   ----------   ---------
         Total cost of operating revenue ..........      19,950        21,468        16,788       15,446      11,136
   Bad debt expense ...............................       3,356         3,348           649          624           -
   Offering costs .................................       1,213             -             -            -           -
   Amortization of goodwill .......................           -         1,378         1,380        1,388         967
   Loss on impairment of intangible assets ........           -             -         5,513            -           -
   Loss (gain) on sale of investments, net ........           -         2,503          (332)      (4,630)    (33,240)
   Interest expense ...............................       5,628        12,098        10,489        7,737       5,540
   Other  (income) expense ........................           -          (175)          868         (373)     11,921
   Equity in loss of joint venture ................           -             -             -          208           -
                                                      ---------   -----------   -----------   ----------   ---------
   Income (loss) before (benefit) provision for
    income taxes, minority interest, discontinued
    operations, loss on sale of discontinued
    operations, extraordinary loss, and cumulative
    effect of change in accounting principle ......       2,994        (7,702)       (8,391)      (1,709)     13,700
   Net income (loss) ..............................       4,185       (45,221)     (104,477)         104       9,698
   Basic and diluted net income (loss) per
    share from continuing operations before
    minority interest, discontinued operations,
    loss on sale of assets, extraordinary item,
    and cumulative effect of change in
    accounting principle ..........................   $    0.25   $     (2.37)  $      0.37   $    (0.08)  $    0.55
   Basic and diluted net income (loss)
    per share .....................................   $    0.25   $     (3.11)  $     (7.64)  $     0.01   $    0.67
   Dividends declared per share
    of common stock ...............................           -             -             -   $   0.4125           -
   Average common shares outstanding
      Basic .......................................      16,427        14,558        13,679       13,742      14,353
      Diluted .....................................      16,523        14,558        13,679       13,922      14,584

   BALANCE SHEET DATA:                                                        As of December 31,
                                                      --------------------------------------------------------------
   Working capital (deficit) ......................   $   1,178   $    (7,901)  $  (104,859)  $  (44,329)  $ (93,903)
   Total assets ...................................      42,585        40,125       104,668      236,683     217,002
   Total debt .....................................      45,544        76,086        66,038       95,762      97,322
   Stockholders' equity (deficit) .................     (18,389)      (53,290)      (20,340)      86,281      91,652
</TABLE>

----------
(1)     We have reclassified the business units sold in 2001 and 2000 as
discontinued operations in the Consolidated Statements of Operations. During
2000, we sold our unemployment compensation, workers' compensation, workers'
compensation managed care organization, and self-funded businesses. In 2001, we
sold our third party administration and managing general underwriter business
units.

                                       17

<PAGE>

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

        The following discussion should be read together with our consolidated
financial statements and related notes, which appear elsewhere in this Form
10-K. To the extent that this discussion is more limited than the information in
the consolidated financial statements, you should rely on the consolidated
financial statements. We caution you that, while forward-looking statements
reflect our good faith beliefs, these statements are not guarantees of future
performance. In addition, except as required by law, we disclaim any obligation
to publicly update or revise any forward-looking statement, whether as a result
of new information, future events, or otherwise. See Forward-Looking Statements.

INTRODUCTION

        The following is a discussion of changes in the consolidated results of
our operations for the years ended December 31, 2002, 2001, and 2000.

        We provide medical cost containment and business process outsourcing
solutions for the medical insurance and managed care industries. We provide
national PPO network access, electronic claims repricing, and claims and data
management services to health care payers such as insurance carriers, HMOs,
self-insured employers, third party administrators, and other entities that pay
claims on behalf of health plans. We also provide services for health care
providers, including individual providers, PPOs, and other provider groups.

        We earn most of our operating revenue in the form of fees generated from
the discounts we provide for the payers that access our NPPN network. We
generally enter into agreements with our healthcare payer customers under which
they pay to us a percentage of the cost savings generated from our NPPN network
discounts with PPOs and providers. We recognize this operating revenue when
claims processing and administrative services have been performed. Operating
revenue from customers with certain contingent contractual rights is not
recognized until the corresponding cash is collected. A portion of our operating
revenue is generated from customers that pay us a monthly fee based on eligible
employees enrolled in a benefit plan covered by our health benefits payer
customers. We recognize our monthly fee operating revenue at the time the
services are provided. Operating revenue related to our business process
outsourcing services is earned on a per claim basis at the time the associated
services are provided.

        Our expenses generally consist of fees incurred to provide access to
participating PPO networks for our customers, compensation and benefits costs
for our employees, occupancy and related costs, general and administrative
expenses associated with operating our business, taxes, and debt service
obligations.

RESULTS OF OPERATIONS

        The following table sets forth, for the periods indicated, the
percentages that certain items of income and expense bear to our operating
revenue for the periods indicated.

<TABLE>
<CAPTION>
                                                                FOR THE YEAR ENDED DECEMBER 31,
                                                                -------------------------------
                                                                   2002         2001       2000
<S>                                                                <C>         <C>        <C>
Operating revenue ..........................................        100%       100.0%     100.0%
Cost of operating revenue:
   Marketing allowances ....................................        1.7%         1.0%       1.0%
   Personnel expense .......................................       25.6%        27.8%      30.8%
   Network access fees .....................................       15.5%        16.2%      14.4%
   Other ...................................................       15.8%        18.9%      14.8%
   Depreciation ............................................        1.6%         1.3%       1.3%
                                                                -------      -------    -------
        Total cost of operating revenue ....................       60.2%        65.2%      62.3%
Offering costs .............................................        3.7%           -          -
Bad debt expense ...........................................       10.1%        10.1%       2.4%
Amortization of goodwill ...................................          -          4.2%       5.1%
</TABLE>

                                       18

<PAGE>

<TABLE>
<S>                                                                <C>        <C>         <C>
Loss on impairment of intangible assets ....................          -            -       20.4%
(Gain) loss on sale of investments, net ....................          -          7.6%      (1.2)%
Other income (expense) .....................................          -         (0.1)%      3.2%
Interest expense ...........................................       16.9%        36.3%      38.9%
                                                                -------      -------    -------
Income (loss) before (benefit) provision for income
 taxes, discontinued operations, and cumulative
 effect of change in accounting principle ..................        9.1%       (23.3)%    (31.1)%

(Benefit) provision for income taxes .......................       (3.6)%       81.4%     (12.1)%
                                                                -------      -------    -------
Income (loss) before minority interest, discontinued,
 operations loss on sale of assets, extraordinary item,
 and cumulative effect of change in accounting
 principle .................................................       12.7%      (104.7)%    (19.0)%
                                                                =======      =======    =======
</TABLE>

Year Ended December 31, 2002 Compared to Year Ended December 31, 2001

        Operating Revenue

        Operating revenue for the year ended December 31, 2002 increased $0.2
million, or 1.0%, to $33.1 million from $32.9 million in 2001. During 2002, we
added over 45 new accounts and generated operating revenue from those customers
totaling $4.5 million. The increase in operating revenue from this new business
was partially offset by a decrease in operating revenue from customers that no
longer use our services or that have significantly reduced their utilization.
Claims volume increased 0.7 million, or 24.1%, to 3.6 million claims repriced in
2002 compared to 2.9 million claims repriced in 2001. The percentage increase in
operating revenue in 2002 was less than the percentage increase in claims volume
because we repriced a higher percentage of generally lower dollar value
physician claims in 2002 compared to 2001, resulting in a decrease in average
operating revenue per claim.

        Personnel Expense

        Personnel expense for the year ended December 31, 2002 decreased $0.6
million, or 6.6%, to $8.5 million from $9.1 million in 2001. Personnel expense
as a percentage of revenues decreased to 25.6% in 2002 compared to 27.8% in
2001. During 2002, we reduced our total employee count from 152 at January 1,
2002 to 144 at December 21, 2002. We continued to benefit from efficiencies in
our claim repricing operations through increased use of our technology, which
allowed us to increase the number of claims processed per person in 2002
compared to the same period in 2001.

        Network Access Fees and Other Cost of Operating Revenue

        Network access fees and other cost of operating revenue for the year
ended December 31, 2002 decreased $1.2 million, or 10.3%, to $10.4 million from
$11.6 million in 2001. Network access fees and other cost of operating revenue
as a percentage of operating revenue were 31.3% in 2002 compared to 35.1% in
2001. This decrease was attributable to decreases in network access fees of $0.2
million, due to contracts with certain of our newer networks that are on more
favorable terms and the migration of certain networks to a flat fee contract
basis. Additionally, our electronic imaging costs decreased by approximately
$0.2 million as more of our repricing is done through either EDI or internet
connections.

        Depreciation and Amortization of Goodwill

        Depreciation for the year ended December 31, 2002 increased an
immaterial amount compared to 2001. This small increase in depreciation was due
to purchases of fixed assets in the latter part of 2001 and during 2002.
Amortization of intangibles was $1.4 million for the year ended December 31,
2001. No amortization of goodwill was recorded in 2002 due to the adoption of
Statement of Financial Accounting Standard ("SFAS") No. 142, "Goodwill and
Intangible Assets," under which goodwill is no longer amortized but instead is
subject to impairment tests at least annually. No impairment of goodwill was
determined to have occurred during 2002.

                                       19

<PAGE>

        Bad Debt Expense

        Bad debt expense for the year ended December 31, 2002 increased an
immaterial amount from the same period in 2001. Bad debt expense is recorded
based on our estimate of uncollectible accounts receivable.

        Offering Costs

        During 2002, we pursued a secondary offering of our common stock (the
"Offering"), and in connection therewith incurred legal, accounting, and
printing fees. However, due to market conditions, the Offering was indefinitely
postponed and, accordingly, in the fourth quarter, we expensed approximately
$1.2 million associated with the Offering.

        Interest Expense

        Interest expense for the year ended December 31, 2002 decreased to $5.6
million from $12.1 million during the same period in 2001. During 2001, we
incurred higher interest rates on our credit facility that increased from prime
plus 1.0% (10.50%) on January 1, 2001, to prime plus 6.0% (10.75%) through April
12, 2002, the date we restructured our credit facility. As a result of this
restructuring, we reduced the debt balance owed to our Senior Lenders from $64.8
million at December 31, 2001 to $40.0 million at December 31, 2002. Our senior
lenders currently charge interest at a rate of prime plus 1.0% (5.25% at
December 31, 2002). The decrease resulting from the lower average principal
balance and lower interest rates was partially offset by the bank charges and
other financing costs incurred to restructure the credit facility, which are
included in interest expense for the year ended December 31, 2002.

        Loss (gain) on Sale of Investments, Net

        Loss on sale of investments for the year ended December 31, 2002
decreased $2.5 million, to $0.0 from $2.5 million for the same period in 2001.
The loss on sale of investments in 2001 was due to our sale of our investment in
HealthAxis, Inc.

        Income Taxes

        The benefit for income taxes for the year ended December 31, 2002 was
$1.2 million compared to a provision for income taxes of $26.8 million during
the same period in 2001. Effective January 1, 2002, a new federal law was
enacted allowing corporations to increase the period for which they may obtain
refunds on past income taxes paid due to net operating losses. The prior law
allowed companies to use their net operating losses for the preceding three
fiscal years while the new law allows companies to use their net operating
losses for the preceding five fiscal years.

Year Ended December 31, 2001 Compared to Year Ended December 31, 2000

        Operating Revenue

        Operating revenue for the year ended December 31, 2001 increased $6.0
million, or 22.3%, to $32.9 million from $26.9 million in 2000. During 2001, we
added more than 177 new accounts and generated revenue from those customers
totaling $6.2 million. Operating revenue from existing customers was flat in
2001 compared to 2000. Claims volume increased 0.8 million, or 38.1%, to 2.9
million claims repriced in 2001 compared to 2.1 million claims repriced in 2000.
The percentage increase in operating revenue in 2001 was less than the
percentage increase in claims volume because we repriced a higher percentage of
generally lower dollar value physician claims in 2001 compared to 2000,
resulting in a decrease in average operating revenue per claim.

        Personnel Expense

        Personnel expense for the year ended December 31, 2001 increased $0.8
million, or 9.6%, to $9.1 million from $8.3 million in 2000. Personnel expense
increased as salaries and wages increased to meet increased volume

                                       20

<PAGE>

of claims received and commissions earned from the increase in operating
revenue. Personnel expense as a percentage of operating revenue decreased to
27.8% in 2001 compared to 30.8% in 2000, primarily because we were able to
increase efficiencies in our claims repricing operations through increased use
of our technology, which allowed us to increase the number of claims processed
per person in 2001.

        Network Access Fees and Other Costs of Operating Revenue

        Network access fees and other costs of operating revenue for the year
ended December 31, 2001 increased $3.7 million, or 46.8%, to $11.6 million from
$7.9 million in 2000. This increase was primarily attributable to increases in
network access fees, electronic imaging, postage, computer software and
maintenance cost, and printing cost supporting our increased operating revenue.
Network access fees and other costs of operating revenue as a percentage of
operating revenue were 35.1% in 2001 compared to 29.4% in 2000. Additionally, we
incurred increased legal and other costs associated with our divestitures and
credit facility restructuring activities during 2001 totaling $0.7 million.
During 2000, we received proceeds from a key-man life insurance policy totaling
$0.5 million, which reduced overall cost of operating revenue during such
period.

        Depreciation and Amortization of Goodwill

        Depreciation for the year ended December 31, 2001 increased $0.2
million, or 66.7%, to $0.5 million from $0.3 million in 2000. Amortization of
intangibles was $1.4 million for each of the years ended December 31, 2001 and
2000. The increase in depreciation was primarily attributable to the
amortization of internally developed software costs that were capitalized in
2001 and the depreciation of new property and equipment acquired in 2001.

        Bad Debt Expense

        Bad debt expense for the year ended December 31, 2001 increased $2.7
million, or 450.0%, to $3.3 million from $0.6 million in 2000 due to the related
increase in operating revenue, an overall increase in the estimated allowance
for doubtful accounts based on historical collection rates, and a $1.2 million
additional reserve against certain accounts resulting from customer
negotiations.

        Loss on Sale of Investments, Net

        Loss on sale of investments, net for the year ended December 31, 2001
was $2.5 million compared to gain on sale of investments of $0.3 million in
2000. During the second quarter of 2001, we sold all of our shares of
HealthAxis, Inc. stock and realized a net pretax loss on the sale of
approximately $2.5 million. During the second quarter of 2000, we sold all
109,732 of our shares of Caredata.com, Inc. stock and realized a net pretax gain
on the sale of $0.3 million.

        Interest Expense

        Interest expense for the year ended December 31, 2001 increased $1.6
million, or 15.2%, to $12.1 million from $10.5 million in 2000. This increase
resulted from increased interest rates on our credit facility from prime plus
1.0%, or 10.5%, at January 1, 2001 to prime plus 6.0%, or 10.75%, at December
31, 2001. In addition, we incurred significant bank charges that were included
in interest expense associated with amendments to our credit facility during
2001.

        Other Income and Expense

        Other income for the year ended December 31, 2001 was immaterial. Other
expense for the year ended December 31, 2000 was $0.9 million. During the second
quarter of 2000, we expensed legal, financial advisory, and other fees
associated with the termination of our merger agreement with UICI, a Texas-based
financial services firm. We entered into a contract to be acquired by them in
October 1999. The transaction was mutually terminated in April 2000.

                                       21

<PAGE>

        Income Taxes

        Provision for income taxes for the year ended December 31, 2001 was
$26.8 million compared to a benefit for income taxes of $3.3 million in 2000.
During 2001, we were required to establish a $36.5 million valuation allowance
on our net deferred tax assets as a result of cumulative losses in recent years,
as required by SFAS No. 109, "Income Taxes."

        Discontinued Operations

        Loss from discontinued operations, net of taxes for the year ended
December 31, 2001 decreased $58.2 million, or 99.0%, to $0.6 million from $58.8
million in 2000. Loss on sale of discontinued operations, net of taxes for the
year ended December 31, 2001 decreased $29.2 million, or 74.3%, to $10.1 million
from $39.3 million in 2000. During 2000, these operations were adversely
affected by the write-off of $80.3 million of goodwill and contract rights
related to the business units sold determined by the selling price of the
unemployment compensation and workers' compensation, Ohio workers' compensation
managed care organization and self-funded business units sold in 2000, and the
definitive agreement signed in April 2001 to sell our third party administration
and managing general underwriter business units. The additional losses in 2001
were incurred based on actual results of operations and the terms of the final
sale, which occurred in June 2001.

        Extraordinary Loss

        During the second quarter of 2000, we recorded an extraordinary loss of
$1.0 million, net of taxes, related to our credit facility. This loss
represented $1.5 million of pretax non-interest fees and expenses connected with
the prior facility, which were previously subject to amortization over five
years. No such gains or losses were recognized during 2001.

LIQUIDITY AND CAPITAL RESOURCES

        Liquidity is our ability to generate adequate amounts of cash to meet
our financial commitments. Our primary sources of cash are fees generated from
the healthcare provider discounts that we make available to our network access
customers. Our uses of cash consist of payments to PPOs to provide access to
their networks for our customers, payments for compensation and benefits for our
employees, occupancy and related costs, general and administrative expenses
associated with operating our business, debt service obligations, and taxes. We
had cash and cash equivalents totaling $1.2 million at December 31, 2002. Net
cash flow provided by (used in) operating activities was $1.4 million, $(9.5)
million, and $3.2 million during the years ended December 31, 2002, 2001, and
2000, respectively. During 2001, cash flow provided by operating activities was
affected by negative cash flows from our discontinued operations.

        HealthPlan Holdings Transaction

        On June 18, 2001, we completed the disposition of our third party
administration and managing general underwriter business units with the sale of
our subsidiary, HealthPlan Services, Inc. In connection with this non-cash
transaction, the buyer, HealthPlan Holdings, Inc., assumed approximately $40.0
million in working capital deficit of the acquired businesses and acquired
assets having a fair market value of approximately $30.0 million. At the closing
of this transaction, we issued 709,757 shares of our common stock to offset $5.0
million of the assumed deficit. We offset the remaining $5.0 million of this
deficit with a long-term convertible subordinated note, which automatically
converted into 813,273 shares of common stock on April 12, 2002 in connection
with the restructuring of our credit facilities. The note accrued interest prior
to its conversion, which we elected to pay through the issuance of 41,552 shares
of our common stock. Our agreement with HealthPlan Holdings states that if
HealthPlan Holdings does not receive gross proceeds of at least $5.0 million
upon the sale of the conversion shares, then we must issue and distribute to
them additional shares of our common stock, based on a ten-day trading average
price, to compensate HealthPlan Holdings for the difference, if any, between
$5.0 million and the amount of proceeds they realize from the sale of the
conversion shares. Our agreement with HealthPlan Holdings also requires that we
register the conversion shares upon demand. To date, HealthPlan Holdings has
made no demand for registration of these conversion shares.

        We entered into a registration rights agreement in favor of HealthPlan
Holdings with respect to the 709,757 shares we issued to them at closing. This
Registration Rights Agreement required that we file a registration

                                       22

<PAGE>

statement covering the issued shares as soon as practicable after the closing of
their purchase of such shares. The Agreement also contained provisions requiring
redemption of such shares or the issuance of certain additional penalty shares
(in the event that our lenders prohibited redemption), if such registration
statement did not become effective by certain specified time periods. Because
the registration statement we filed with the Securities and Exchange Commission
covering such shares was not declared effective within the required time
periods, we issued to HealthPlan Holdings the maximum number of penalty shares
specified by the registration rights agreement, which was 200,000 shares of our
common stock. As of this date, we still have not registered the 709,757
purchased shares.

        Following the sale of HealthPlan Services, we reimbursed HealthPlan
Services approximately $4.3 million for pre-closing liabilities that HealthPlan
Services settled on our behalf and issued to HealthPlan Holdings 101,969 shares
of our common stock as penalty shares relating to certain post closing disputes
with respect to those pre-closing liabilities. The primary source of the funds
for the reimbursement to HealthPlan Services was the proceeds of July 2001
private placements of our common stock to certain investment accounts managed by
DePrince, Race & Zollo, an investment firm. John Race, who was our director at
the time, is one of the principals of DePrince, Race & Zollo. In connection
with the private placements, which were ratified by our stockholders at our
annual meeting in July 2002, we issued an aggregate of 553,500 shares of our
common stock in exchange for $3.8 million, which represented a 15.0% discount
from the ten-day trading average of our common stock prior to the dates of
issuance.

        We are currently in discussions with HealthPlan Holdings to finalize any
purchase price adjustments associated with the HealthPlan Services transaction.
These adjustments relate primarily to the amount of accrued liabilities and
trade accounts receivable reserves, and the classification of investments at the
transaction date. HealthPlan Holdings believes it is due approximately $1.7
million from us related to the transaction, while we believe we have claims
against HealthPlan Holdings amounting to approximately $4.5 million (which would
be partially offset against other post-closing payments that we have agreed to
pay, subject to certain limitations as provided in the transaction documents).
In the event that we are unable to resolve these matters directly with
HealthPlan Holdings, we will seek to resolve them through binding arbitration as
provided for in the purchase agreement.

        Restructured Credit Facility

        On April 12, 2002, we closed a transaction to restructure and refinance
our bank debt, which was $69.0 million prior to the closing. Under the terms of
the restructured agreement, we entered into a $40.0 million term loan that
accrues interest at a variable rate, generally prime plus 1.0%, with interest
payments due monthly beginning on April 30, 2002. Quarterly principal payments
of $50,000 became due beginning September 30, 2002, and the term loan is payable
in full on May 31, 2004. The term loan is collateralized by all of our assets.
The restructured credit facility does not include a line of credit or the
ability to borrow any additional funds. In exchange for retirement of the
remaining amounts due to the lenders, we issued 29,000 shares of our newly
authorized Series C convertible preferred stock and an additional note in the
amount of $184,872. The Series C convertible preferred stock accrues dividends
at 10.0% per annum during the first twelve months from issuance and at 12.0% per
annum thereafter. Dividends are payable quarterly in additional shares of Series
C convertible preferred stock or, at our option, in cash. We have chosen to pay
dividends in the form of additional shares, and to date we have issued to the
Series C shareholders an aggregate of 2,092 additional shares of Series C
convertible preferred stock. In connection with the restructuring, we issued an
additional note to Wachovia Bank, National Association (referred to as
Wachovia), the administrative agent for our lending group, in the amount of
$64,000 for administrative agent fees. The restructured credit agreement
contains certain financial covenants, including minimum monthly EBITDA levels
(defined as earnings before interest, taxes, depreciation, and amortization and
adjusted for non-cash items deducted in calculating net income and severance, if
any, paid to certain of our officers), maximum quarterly and annual capital
expenditures, a minimum quarterly fixed charge ratio that is based primarily on
our operating cash flows, and maximum quarterly and annual extraordinary
expenses (excluding certain pending and threatened litigation, indemnification
agreements, and certain other matters as defined in the restructured agreement).
The required monthly minimum EBITDA levels for the third quarter of 2002
averaged approximately $808,000. The required monthly minimum EBITDA level was
$1.0 million from October 2002 through January 2003, and decreased to $700,000
in February 2003. For March 2003 through July 2003, the monthly minimum EBITDA
will be $800,000, and it will increase to $1.0 million per month thereafter.
From April 12, 2002 through November 30, 2002, we were in compliance with these
financial covenants for each reporting period required under the terms of the
restructured agreement. During December 2002, we were not in compliance with our
EBITDA covenant and we subsequently obtained a waiver from our senior lenders
for this non-compliance.

                                       23

<PAGE>

        The accounting treatment for the restructured credit facility complies
with the requirements of SFAS No.15, "Accounting by Debtors and Creditors for
Troubled Debt Restructurings," which requires that a comparison be made between
the future cash outflows associated with the restructured facility (including
principal, interest and related costs), and the carrying value related to the
previous credit facility. The carrying value of the restructured credit facility
would be the same as the carrying value of the previous obligations, less the
fair value of the preferred stock issued. We obtained an appraisal to determine
the fair value of the stock and warrants issued, which indicated the fair value
was approximately $29.0 million. No gain or loss was recognized for accounting
purposes in connection with the debt restructuring. We recorded a charge during
the second quarter of 2002 of $0.4 million upon closing of our debt
restructuring for various investment advisory and legal fees incurred in
connection with the arrangement of the restructured credit facility.

        In connection with our new credit facility and debt restructuring, we
were required to adopt the accounting principles prescribed by Emerging Issues
Task Force ("EITF") 00-27. In accordance with the accounting requirements of
EITF 00-27, we have reflected approximately $46.7 million as an increase to the
carrying value of our Series C convertible preferred stock with a comparable
reduction to additional paid-in capital. The amount accreted to the Series C
convertible preferred stock is calculated based on (a) the difference between
the closing price of our common stock on April 12, 2002 and the conversion price
per share available to the holders of our Series C convertible preferred stock,
multiplied by (b) our estimate of the number of shares of common stock that will
be issued if the shares of our Series C convertible preferred stock are ever
converted. Such shares are not convertible until October 12, 2003. This amount
is accreted over the contractual life of the Series C convertible preferred
stock. This non-cash entry did not affect our net income but did impact the net
income deemed available to our common stockholders for reporting purposes during
2002. Net income per share applicable to common stockholders during 2002 was
further reduced by preferred stock dividends totaling $2.1 million, paid in
2,092 shares of our Series C convertible preferred stock to the holders of our
Series C convertible preferred stock.

        In connection with the closing of the transactions contemplated by the
restructured credit agreement, we entered into a letter agreement, as amended,
with the lenders and Wachovia, as administrative agent for the lenders and for
the holders of the Series C convertible preferred stock. Pursuant to the letter
agreement, the lenders, in their capacity as such and as holders of the Series C
convertible preferred stock, granted to us an option to consider the entire
indebtedness under the credit facility paid in full and to redeem the Series C
convertible preferred stock in exchange for payment of $40.0 million plus
accrued and unpaid interest under the credit facility and other specified terms.
The option expired on September 9, 2002.

        Offering

        On July 19, 2002, we filed an Amended Registration Statement with the
Securities and Exchange Commission wherein we offered for sale an aggregate of
5,174,979 shares of our common stock (sometimes referred to as the Offering).
During the fourth quarter of 2002, we decided to postpone the Offering
indefinitely. Accordingly, during the fourth quarter of 2002 we expensed $1.2
million of costs associated with the Offering. We subsequently filed an
application to withdraw the Registration Statement.

        PVC Funding Partners Transaction

        On March 13, 2003, PVC Funding Partners LLC, an affiliate of
Commonwealth Associates, LP and Comvest Venture Partners, filed a form 13D with
the Securities and Exchange Commission in which they indicated that on March 7,
2003, they acquired from our senior lenders 29,651, or 96.0%, of our outstanding
Series C convertible preferred stock. This Series C convertible preferred stock
was purchased from the lenders on a prorata basis at a price of $33.50 per
share. The original lenders continue to hold the remaining 4.0% of the Series C
convertible preferred stock. In connection with the transaction, PVC Funding
Partners also acquired $20.5 million in principal amount of our outstanding bank
debt from the original lenders.

        There is an intercreditor agreement between PVC Funding Partners and
Wachovia Bank, National Association, dated March 7, 2003. The intercreditor
agreement provides that, until the occurrence of a Board Shift Event, PVC
Funding Partners has all of the rights of the original lenders under the
restructured credit agreements, except that (1) PVC Funding Partners' rights to
mandatory prepayments and other principal payments prior to the maturity date
are subordinated to the original lenders' rights to those payments, and (2) PVC
Funding Partners' notes

                                       24

<PAGE>

will be voted consistently with and on the same percentage basis as the original
lenders with respect to all matters required to be submitted to a vote or
consent of the lenders, except for matters related to certain fundamental
changes in the loan terms. Upon the first occurrence of a Board Shift Event,
which would allow PVC Funding Partners to appoint an additional board member and
thus obtain control of our board of directors, PVC Funding Partners has the
option of not exercising their right to obtain such control. If, within fifteen
days of a first Board Shift Event, PVC Funding Partners notifies the original
lenders that they will not exercise their right to control our board, then the
original lenders will have the option to repurchase 14,304 of the Series C
convertible preferred stock, at a price of $33.50 per share. If PVC Funding
Partners exercises their right to obtain control of our board, or fails to
timely notify the original lenders that they will not exercise this right, then
the debt held by PVC Funding Partners will automatically be subordinated to the
debt held by the original lenders.

        Centra Convertible Notes

        As of December 31, 2001, we were in payment default with respect to
interest payments due under notes aggregating $4.0 million payable to CENTRA
Benefits, Inc. (sometimes referred to as Centra). We originally issued these
notes in connection with our 1998 acquisition of a third party administration
business from Centra. On April 12, 2002, we restructured these notes in
connection with the closing of our restructured credit facility, which required
that the maturity date of the notes be extended beyond the maturity date of the
restructured facility. Under the restructured terms, we retired the original
notes and issued new notes totaling $4.3 million, with a maturity date of
December 1, 2004. The restructure notes accrued interest monthly at a compound
rate of 12.0% per annum. Interest was payable quarterly in shares of our common
stock, as calculated based on the average trading price over the last ten
trading days of the quarter, unless Centra elected to receive any quarterly
payment in cash on a deferred basis. Centra elected a deferred cash payment,
which required us to make the cash interest payment either (1) within 90 days
after the end of the fiscal year, to the extent that payment can be paid from
available excess cash flow, as permitted by the terms of our restructured credit
facility, or (2) on December 1, 2004, the date on which the convertible notes
matured. At any time, Centra had the right to convert some or all of the notes
to shares of our common stock, based on the lesser of (1) $6.40, (2) the average
trading price of our common stock for the ten-day period immediately preceding
notice of conversion, or (3) if any shares of the Series C convertible preferred
stock have been converted into common stock, then the price at which such shares
were converted. These notes were subordinated to the term loan with our senior
lenders. In connection with the restructuring of the Centra notes, we issued to
Centra warrants for the purchase of an aggregate of 200,000 shares of our common
stock at an exercise price of $6.398 per share, subject to adjustment in
accordance with the terms of the warrants.

        On March 31, 2003, we renegotiated the terms of the Centra notes.
Pursuant to the renegotiated terms, we have extended the maturity date of the
notes from December 1, 2004 to April 1, 2006, reduced the interest rate from
12.0% per annum to 6.0% per annum, and fixed the conversion price at $1.00,
subject to adjustment in accordance with anti-dilution protections. The previous
conversion price was based on the trading price of our common stock. Immediately
upon completion of this restructuring, PVC Funding Partners acquired slightly
more than 50% of the face value of the notes from Centra. The remaining interest
is held by Centra.

        Other Obligations

        In connection with a 1993 acquisition by our former subsidiary,
HealthPlan Services, Inc., we assumed a note payable to Cal Group, Inc. As of
December 31, 2002, the outstanding balance of the note was approximately
$751,000.

        As of March 27, 2002, we retired a subordinated note payable to New
England Financial, including accrued interest, totaling approximately $2.5
million, by issuing 274,369 shares of our common stock, based on the closing
price of our common stock one day immediately prior to the retirement date of
the note, and by issuing a credit for $950,000 payable with in-kind claims
repricing services. New England Financial subsequently assigned the 274,369
shares to New England Financial Distributors. We have agreed to register these
shares.

                                       25

<PAGE>

        On April 12, 2002, in connection with the restructuring of our credit
facility, the maturity date of notes totaling $500,000 was extended to December
1, 2004. The notes are due to William Bennett, a member of our board of
directors, and John Race, who was a member of the board at the time that the
notes were issued and at the time of the April restructuring. These notes bear
interest at prime plus 4.0% per annum, but payment of interest is subordinated
and deferred until all senior obligations are paid.

        In 1994, we obtained a letter of credit in connection with a third party
administration contract entered into by HealthPlan Services, our former
subsidiary. The letter of credit remained outstanding due to multi-party
litigation related to the business administered. In July 2002, we entered into a
settlement agreement with respect to the litigation. The letter of credit, which
was then in the amount of $4.6 million, was subsequently returned to our senior
lenders and canceled. In January 2003, in compliance with the indemnification
obligations arising out of our sale of the HealthPlan Services business, we paid
$250,000 in connection with the final settlement of the multi-party litigation.

        Capital Expenditures

        We spent $0.3 million and $0.5 million on capital expenditures during
the twelve months ended December 31, 2002 and 2001, respectively.

        Liquidity

        We believe that all consolidated operating and financing obligations
for the next twelve months will be met from internally generated cash flow from
operations, and available cash. Although there can be no assurances, management
believes based on available information, it will be able to maintain compliance
with the terms of its restructured credit facility, including the financial
covenants, for the foreseeable future. Our ability to fund our operations, make
scheduled payments of interest and principal on our indebtedness, and maintain
compliance with the terms of our restructured credit facility, including our
financial covenants, depends on our future performance, which is subject to
economic, financial, competitive, and other factors beyond our control. If we
are unable to generate sufficient cash flows from operations to meet our
financial obligations and achieve the restrictive debt covenants as required
under the restructured credit facility, there may be a material adverse effect
on our business, financial condition, and results of operations. Management is
continuing to explore alternatives to reduce our obligations, recapitalize our
company, and provide additional liquidity. There can be no assurances that we
will be successful in these endeavors.

INFLATION

        We do not believe that inflation had a material effect on our results of
operations for the twelve months ended December 31, 2002 and 2001. There can be
no assurance, however, that our business will not be affected by inflation in
the future.

CRITICAL ACCOUNTING POLICIES

        The preparation of our consolidated financial statements requires that
we adopt and follow certain accounting policies. Certain amounts presented in
our condensed consolidated financial statements have been determined in
accordance with such policies, based upon estimates and assumptions. Although we
believe that our estimates and assumptions are reasonable, actual results may
differ.

        We have included below a discussion of the accounting policies that we
believe are affected by the more significant judgments and estimates used in the
preparation of our condensed consolidated financial statements, how we apply
such policies, and how results differing from our estimates and assumptions
would affect the amounts presented in our condensed consolidated financial
statements. Other accounting policies also have a significant effect on our
condensed consolidated financial statements, and some of these policies also
require the use of estimates and assumptions.

        REVENUE RECOGNITION

                                       26

<PAGE>

        We earn operating revenues in the form of fees generated from the
repricing of medical claims. We generally enter into agreements with our health
benefit payer clients that require them to pay a percentage of the cost savings
generated from our network discounts with participating providers. These
agreements are generally terminable upon 90 days notice. Operating revenues from
percentage of savings contracts are generally recognized when claims processing
and administrative services have been performed. Operating revenues from
customers with certain contingent contractual rights are generally not
recognized until the corresponding cash is collected. The remainder of our
operating revenues is generated from customers that pay us a monthly fee based
on eligible employees enrolled in a benefit plan covered by our health benefits
payers clients. Operating revenues under such agreements are recognized when the
network access services are provided.

        ACCOUNTS RECEIVABLE

        We generate our operating revenue and related accounts receivable from
services provided to healthcare payers, such as self-insured employers, medical
insurance carriers, third party administrators, HMOs, and other entities that
pay claims on behalf of health plans. We also generate operating revenue from
services that we provide to participating health care services providers, such
as individual providers and provider networks.

        We evaluate the collectibility of our accounts receivable based on a
combination of factors. In circumstances where we are aware of a specific
customer's inability to meet its financial obligations to us, we record a
specific reserve for bad debts against amounts due to reduce the net recognized
receivable to the amount we reasonably believe will be collected. For all other
customers, we recognize reserves for bad debts based on past write-off history,
average percentage of receivables written off historically, and the length of
time the receivables are past due. To the extent historical credit experience is
not indicative of future performance or other assumptions used by management do
not prevail, loss experience could differ significantly, resulting in either
higher or lower future provision for losses.

        IMPAIRMENT OF INTANGIBLE AND LONG-LIVED ASSETS

        In July 2001, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standard ("SFAS"), SFAS No. 141, "Business
Combinations" and SFAS No. 142, "Goodwill and Other Intangible Assets." SFAS No.
141 requires business combinations initiated after June 30, 2001 to be accounted
for using the purchase method of accounting, and broadens the criteria for
recording intangible assets separate from goodwill. Recorded goodwill and
intangibles will be evaluated against these new criteria and may result in
certain intangibles being subsumed into goodwill, or alternatively, amounts
initially recorded as goodwill may be separately identified and recognized apart
from goodwill. SFAS No. 142 requires the use of a nonamortization approach to
account for purchased goodwill and certain intangibles. Under a nonamortization
approach, goodwill and certain intangibles will not be amortized into results of
operations, but instead would be reviewed for impairment and written down and
charged to results of operations only in the period in which the recorded value
of goodwill and certain intangibles is more than its fair value. On January 1,
2002, we adopted the provisions of each statement applying to goodwill and
intangible assets acquired prior to June 30, 2001. These new requirements will
impact future period net income by an amount equal to the discontinued goodwill
amortization offset by goodwill impairment charges, if any, and adjusted for any
differences between the old and new rules for defining intangible assets on
future business combinations. We completed our impairment tests for 2002 and
determined that our goodwill was not impaired.

        INCOME TAXES

        We recognize deferred assets and liabilities for the expected future tax
consequences of temporary differences between the carrying amounts and the tax
bases of assets and liabilities. A valuation allowance is provided when it is
more likely than not that some portion of the deferred tax asset will not be
realized.

        NEW ACCOUNTING PRONOUNCEMENTS

        On April 30, 2002, the FASB issued SFAS No. 145, "Rescission of FASB
Statements Nos. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections." SFAS No. 145 eliminates the requirement that gains and losses from
the extinguishment of debt be aggregated and, if material, classified as an
extraordinary item,

                                       27

<PAGE>

net of the related income tax effect. SFAS No. 145 also eliminates an
inconsistency between the accounting for sale-leaseback transactions and certain
lease modifications that have economic effects that are similar to
sale-leaseback transactions. Generally, SFAS No. 145 is effective for
transactions occurring after May 15, 2002. We do not expect the adoption of the
standard to have any impact on us.

        In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities," which addresses accounting for
restructuring and similar costs. SFAS No. 146 supersedes previous accounting
guidance, principally Emerging Issues Task Force Issue No. 94-3. We will adopt
the provisions of SFAS No. 146 for restructuring activities initiated after
December 31, 2002. SFAS No. 146 requires that the liability for costs associated
with an exit or disposal activity be recognized when the liability is incurred.
Under Issue 94-3, a liability for an exit cost was recognized at the date of our
commitment to an exit plan. SFAS No. 146 also establishes that the liability
should initially be measured and recorded at fair value. Accordingly, SFAS No.
146 may affect the timing of recognizing future restructuring costs as well as
the amounts recognized. The adoption of SFAS No. 146 will not have an impact on
us.

        In November 2002, the FASB issued Financial Interpretation ("FIN") No.
45, "Guarantor's Accounting and Disclosure Requirements for Guarantees,
Including Guarantees of Indebtedness of Others (an interpretation of FAS No. 5,
57 and 107 and rescission of SFAS Interpretation No. 34)," which modifies the
accounting and enhances the disclosure of certain types of guarantees. FIN 45
requires that upon issuance of certain guarantees, the guarantor must recognize
a liability for the fair value of the obligation it assumes under the guarantee.
FIN 45's provisions for the initial recognition and measurement are to be
applied to guarantees issued or modified after December 31, 2002. The disclosure
requirements are effective for financial statements of annual periods that end
after December 15, 2002. We do not believe FIN 45 will have an impact on us.

        In December 2002, the FASB issued SFAS No. 148, "Accounting for
Stock-Based Compensation - Transition and Disclosure - an Amendment of FASB
Statement No. 123," and is effective for fiscal years ending after December 15,
2002. SFAS No. 148 provides for alternative methods of transition for a
voluntary change to the fair value based method of accounting for stock-based
employee compensation. Additionally, SFAS No. 148 requires prominent disclosures
in both annual and interim financial statements about the method of accounting
for stock-based employee compensation. The adoption of SFAS No. 148 will not
have a material impact on us.

        On January 17, 2003, the FASB issued FIN No. 46, "Consolidation of
Variable Interest Entities, an interpretation of ARB No. 51," which imposes a
new approach in determining if a reporting entity should consolidate certain
legal entities, including partnerships, limited liability companies, or trusts,
among others, collectively defined as variable interest entities or VIEs. A
legal entity is considered a VIE if it does not have sufficient equity at risk
to finance its own activities without relying on financial support from other
parties. Additional criteria must be applied to determine if this condition is
met or if the equity holders, as a group, lack any one of three stipulated
characteristics of a controlling financial interest. If the legal entity is a
VIE, then the reporting entity determined to be the primary beneficiary must
consolidate it. Even if a reporting entity is not obligated to consolidate a
VIE, then certain disclosures must be made about the VIE if the reporting entity
has a significant variable interest. Certain transition disclosures are required
for all financial statements issued after January 31, 2003. The ongoing
disclosure and consolidation requirements are effective for all interim
financial periods beginning after June 15, 2003. We do not believe that FIN 46
will currently have an impact on us.

RISK FACTORS

        Any investor in our stock, and any party considering an investment in
our stock, should carefully consider the following factors and cautionary
statements, as well as the other information set forth in this Form 10-K. If any
of the following risks were to actually occur, our business, financial
condition, or results of operations could be materially harmed. As a result, the
value of our stock could decline and you could lose all or part of your
investment in our stock.

                                       28

<PAGE>

RISKS RELATED TO OUR FINANCIAL OBLIGATIONS AND CAPITAL STRUCTURE

        Failure to comply with financial covenants will cause default under our
term loan and, in some cases, may allow Series C preferred stockholders to
control our board.

        We completed a restructuring of our credit facilities with our lenders
in April 2002. We replaced approximately $69.0 million of indebtedness to our
lenders, including outstanding principal and accrued and unpaid interest and
bank fees, with a $40.0 million term loan, collateralized by all of our assets.
The term loan requires us to achieve financial covenants, including minimum
monthly EBITDA levels, maximum quarterly and annual capital expenditures, a
minimum quarterly fixed charge ratio, and maximum quarterly and annual
extraordinary expenses. Failure to comply with the term loan's financial
covenants is an event of default and would permit the lenders to immediately
require us to repay the term loan. This may have a material adverse effect on
our business, operating results and financial condition, and could require us to
seek protection under available bankruptcy laws. From April 12, 2002 through
November 30, 2002, we were in compliance with these financial covenants for each
reporting period required under the terms of the restructured agreement. During
December 2002, we were not in compliance with our EBITDA covenant and we
subsequently obtained a waiver from our senior lenders for this non-compliance.

        In exchange for retirement of the remaining amounts due to the lenders,
we issued to the lenders 29,000 shares of our newly authorized Series C
convertible preferred stock. The Series C convertible preferred stockholders are
entitled to elect three out of seven members of our board of directors. In
addition, the Series C holders may immediately elect one additional member to
our board, and thereby gain control of our board, upon the occurrence of
specified events. These events include a default of any of our payment
obligations or our failure to achieve mandated minimum cash levels.

        On March 7, 2003, PVC Funding Partners, LLC, an affiliate of
Commonwealth Associates, LP and Comvest Venture Partners, acquired 29,851
shares, or 96.0%, of our Series C convertible preferred stock, and also acquired
$20.5 million in principal amount of our outstanding debt from our senior
lenders. In connection with its acquisition of a portion of our debt, PVC
Funding Partners has agreed that, subject to certain exceptions for fundamental
changes in loan terms, it will vote its debt consistently with and on the same
percentage basis as the other senior lenders with respect to all matters
submitted or required to be submitted to a vote or consent of senior lenders
under our credit agreement.

        Our obligations to issue additional shares of our common stock and to
register outstanding and issuable shares may result in substantial dilution of
stockholder value.

        We have issued an aggregate of 1,866,551 shares of our common stock in
connection with the HealthPlan Holdings transaction. At the closing, we issued
to HealthPlan Holdings 709,757 shares of our common stock and a convertible
subordinated note, which automatically converted into 813,273 shares of our
common stock in April 2002. The number of conversion shares is equal to $5.0
million, divided by $6.14, which was the average closing price of the stock on
the New York Stock Exchange during the ten trading days immediately prior to the
conversion. Our agreement with HealthPlan Holdings requires that we issue and
distribute to them additional shares of our common stock to compensate them to
the extent that the amount of proceeds it realizes from the sale of the
conversion shares is less than $5.0 million. We have granted HealthPlan Holdings
registration rights with respect to these additional shares. During 2001 and
2002, we issued a total of 343,521 additional shares of our common stock in
settlement of certain post-closing disputes and to meet certain obligations
under the terms of the subordinated note and a registration rights agreement we
entered into at closing. We have granted HealthPlan Holding registration rights
with respect to their outstanding shares of our common stock, except for 100,000
shares issued as penalty shares under HealthPlan Holdings' registration rights
agreement.

        In connection with the restructuring of our credit facility in April
2002, we issued to our senior lenders 29,000 shares of our newly authorized
Series C convertible preferred stock, and have issued an additional 2,092 Series
C shares as dividends on the stock. On March 7, 2003, PVC Funding Partners, LLC,
an affiliate of Commonwealth Associates, LP and Comvest Venture Partners,
acquired 29,851 shares of our Series C convertible preferred stock, representing
96.0% of the outstanding Series C convertible preferred stock. At any time after
October 12, 2003, the Series C convertible preferred stock may be converted into
shares of our common stock at the rate of 703.37 shares of common stock for each
preferred share, or a total of 20,996,298 shares (or 55.6%) of our common stock
upon full conversion, subject to adjustment. The Series C convertible preferred
stock has weighted-average anti-dilution protection and a provision that in no
event will the Series C convertible preferred stock convert into less than 51.0%
of our outstanding shares of common stock. We granted the Series C

                                       29

<PAGE>

convertible preferred stockholders registration rights with respect to the
shares of common stock that are issuable upon conversion.

        On March 31, 2003, we renegotiated approximately $4.3 million in
convertible notes that were originally issued to Centra Benefit Services, Inc.
(sometimes referred to as Centra). In connection with the restructuring, PVC
Funding Partners acquired slightly more than 50% of the value of the notes. The
remaining interest is held by Centra. At any time, Centra or PVC Funding
Partners may convert the notes into shares of our common stock, at a price of
$1.00 per share, subject to adjustment in accordance with anti-dilution
protections. In connection with the previous restructuring of the convertible
notes, we also issued to Centra warrants for the purchase of an aggregate of
200,000 shares of our common stock at an exercise price of $6.398 per share.
Centra and PVC Funding Partners have registration rights with respect to all
shares of our common stock that are issuable pursuant to the convertible notes
and warrants.

        We also have reserved an aggregate of 2,369,050 shares of common stock
for future issuance to our officers, non-employee directors, employees, and
consultants pursuant to our existing stock incentive plans. We have outstanding
options with respect to 1,810,137 of these shares. These shares are all
registered pursuant to the Securities and Exchange Act of 1933. At our 2002
Annual Meeting of Stockholders, our stockholders approved the issuance of
options to purchase 3.0 million shares of our common stock, subject to
completion of a proposed public offering of our stock. During the fourth quarter
of 2002, we decided to postpone the offering indefinitely. At our 2003 annual
meeting, we expect to request stockholder approval for issuance of options to
purchase an aggregate of 3.5 million shares of our common stock, without any
condition related to the conclusion of an offering.

        As of March 27, 2002, we retired a subordinated note payable to New
England Financial, including accrued interest, totaling approximately $2.5
million, by issuing 274,369 shares of our common stock, based on a per share
price of $5.54, which was the closing price of our common stock one day
immediately prior to the retirement date of the note. New England Financial
subsequently assigned the 274,369 shares to New England Financial Distributors.
We have agreed to register these shares.

        In connection with the HealthPlan Holdings transaction and the
restructuring of our credit facility, we issued a total of 150,000 shares of our
common stock to our senior lenders in 2001 and 2002. We have granted the senior
lenders registration rights with respect to these shares.

        On July 9, 2001, we completed a $3.8 million private placement of
553,500 shares of our common stock to certain investment accounts managed by
DePrince, Race & Zollo. We have agreed to register these shares.

        Future issuances of substantial amounts of common stock, or the
perception that such sales could occur, and the registration of currently
unregistered shares, could have a material adverse effect on the value of our
common stock. See "Business-Our History" and "Management's Discussion and
Analysis of Operations - Liquidity and Capital Resources" for more information
regarding the transactions described above.

        Certain of our existing stockholders have significant voting control
over matters requiring stockholder approval.

        The holders of our Series C convertible preferred stock may have the
right in certain circumstances to vote as a single class with the common
stockholders on all matters other than the election of directors on an
"as-converted" basis, with each share of Series C convertible preferred stock
having a number of votes equal to the number of shares of common stock into
which it would be converted. The "as-converted" rights take effect upon the
earliest to occur of (1) any default in connection with the payment of principal
or interest under our restructured credit facility, after the lapse of any
applicable grace period, (2) our failure to redeem all of the Series C
convertible preferred stock by October 12, 2003, or (3) the date on which fewer
than 12,000 shares of Series C convertible preferred stock are outstanding. In
addition to the rights of Series C convertible preferred stockholders, certain
holders of our common stock also have significant voting control over matters
requiring stockholder approval. As of March 24, 2003, our executive officers,
directors, and their affiliates beneficially owned, in the aggregate,
approximately 4.2% of our outstanding common stock, and our other existing 5.0%
or greater stockholders beneficially owned, in the aggregate, approximately
60.0% of our outstanding common stock. In the event that the Series C
convertible preferred stock is converted as described above, based on the number
of shares of our common stock outstanding as of March 24, 2003, our executive
officers, directors and their affiliates, in the aggregate, would beneficially
own approximately 55.5% of our outstanding common stock, and our other existing
5.0% or greater stockholders would beneficially own, in the aggregate,
approximately 20.4% of our outstanding common stock.

        We may lack funds for future requirements.

        We may not be able to fund expansion, develop or enhance our products or
services, or respond to competitive pressures if we lack adequate funds, which
would hurt our business. We do not currently have an available line of credit
with a lender, and we manage our business from existing cash flow. We may need
to raise

                                       30

<PAGE>

additional funds to operate our business, to develop new or enhanced services,
or to respond to competitive pressures. Although we are not currently planning
to engage in any acquisitions and expect that all our growth will be internally
generated, we also may need to raise additional funds in the event that an
attractive expansion opportunity were to arise. If we were to raise additional
funds by issuing debt securities, we would be required to pay interest on those
securities, reducing our earnings and decreasing our available cash. In
addition, the interests of holders of our common stock would be subordinated to
those of our debt holders if we were to be liquidated. If we were to raise
additional funds by issuing equity or convertible debt securities, the
percentage ownership of our stockholders would be diluted. Any new securities
could have rights, preferences, and privileges senior to those of our common
stock. In addition, we cannot assure you that we would be able to issue and sell
new securities to meet our additional funding needs.

        We have contingent obligations from the sale of our third party
administration and managing general underwriter businesses.

        In connection with the sale of our third party administration and
managing general underwriter businesses in 2001 and 2000, we incurred
indemnification obligations for representations, warranties, and covenants, and
for liabilities arising prior to the sale of these businesses. Consequently, we
have assumed the defense of a number of claims for liabilities arising prior to
the sale of these businesses. In November 2001, Paid Prescriptions LLC initiated
a breach of contract action against HealthPlan Services, Inc., one of our former
subsidiaries, seeking $1.6 million to $2.0 million in compensation. We are
vigorously defending the action, as required by the terms of our sale of the
HealthPlan Services business to HealthPlan Holdings, Inc. in June 2001. We also
are currently negotiating certain disputes with HealthPlan Holdings, Inc.
regarding the HealthPlan Services sale, including a dispute regarding the
closing balance sheet of HealthPlan Services. We have accrued approximately $1.2
million in reserves for potential or contingent liabilities. There may be
unknown liabilities arising from our contingent obligations for which we have
not established reserves or there may be liabilities for which we have not
accrued adequate reserves and, if these liabilities were to occur, we might have
to reorganize or liquidate under the bankruptcy laws in order to discharge them.
We cannot assure you of the outcome of any matter arising under our contingent
obligations, and if the outcome is adverse, these obligations could have a
material adverse effect on our operating results and financial condition.

RISKS RELATED TO OUR BUSINESS

        A small number of customers account for a significant portion of our
operative revenue.

        The loss of one or more of our significant customers could cause our
business to suffer. Our top three customers accounted for 19.6% of our operating
revenue for the year ended December 31, 2002. These customers may account for a
significant portion of our operating revenue throughout 2003, depending upon our
ability to grow our business by and with similarly-sized customers in the
foreseeable future. Since our customer contracts generally are terminable within
90 days, any of these customers could terminate their relationship with us at
any time. In addition, companies in the healthcare industry generally have been
consolidating, resulting in a limited number of payers and PPOs controlling an
increasing portion of claims. Therefore, we believe that our operating revenue
will be largely dependent upon product acceptance by a smaller number of payers
and PPOs. If we lose any one of our major customers or any of our major
customers negotiate less favorable terms with us, then we will lose operating
revenue, which would adversely affect our financial condition and results of
operations.

        The terms of our customer contracts provide no guarantee of long-term
relationships or payments.

        Our payer customers generally can terminate our NPPN network access
contracts for any reason on 90 days' notice. In 2002, we had a customer turnover
rate of 3.1%, representing the loss of 23 customer contracts. In addition, the
majority of our contracts contain payment terms that are based on a percentage
of savings to the customer or on the number of covered employees. In 2002, we
experienced a decline in percentage of savings revenue from existing customers
due to a decrease in the amount of high dollar claims we received from these
customers. Although 2002 revenue from new clients offset revenue lost from
departing clients and from decreases in large claim submissions, the termination
of additional customer contracts, or our inability to generate significant
savings with respect to customer claims, could adversely affect our financial
condition and results of operations.

                                       31

<PAGE>

        Our provider arrangements provide no guarantee of long-term
relationships.

        All of our contracts with PPOs and providers can be terminated without
cause, generally on 90 days' notice. The termination of any PPO contract would
render us unable to provide our customers with network access to that PPO, and
therefore would adversely affect our ability to reprice claims and derive
revenues. Furthermore, as a "network of networks," we rely on our participating
PPOs and provider groups to ensure participation by our participating providers.
Our PPO contracts generally do not provide us with a direct recourse against a
participating provider that chooses not to honor its obligation to provide a
discount, or chooses to discontinue its participation in our NPPN network. In
2002, our contracts with three former networks terminated, representing a loss
of 138 hospitals and 31,034 physicians. Although we replaced the terminated
networks with new network arrangements that in each instance substantially
offset these hospital and physician losses, termination of provider contracts or
other changes in the manner in which these parties conduct their business are
outside of our control and could negatively affect our ability to provide
services to our customers.

        Providers have historically been reluctant to participate in secondary
networks.

        Our percentage of savings business model sometimes allows a payer to
utilize our network discounts in circumstances where our NPPN network is not the
payer's primary network. In these circumstances, our NPPN network participating
providers are not traditionally given the same assurances of patient flow that
they receive when they are part of a primary network. Historically, some
providers have been reluctant to participate in network arrangements that do not
guarantee a high degree of patient steerage. Although we think that the steerage
provided by our payers as a whole and the speed and efficiency with which we
provide claims repricing services make NPPN network affiliation an attractive
option for providers, there can be no assurance that our business model will not
discourage providers from commencing or maintaining an affiliation with our NPPN
network.

        Our operating history is not indicative of our future performance.

        We sold several units of our third party administration business in 2000
and sold the balance of that segment, as well as our managing general
underwriter business, in June 2001. Revenue from discontinued operations was $0
in 2002, $36.4 million in 2001, and $157.9 million in 2000, which significantly
exceeded operating revenue from continuing operations for 2001 and 2000.
Operating revenue from continuing operations was $33.1 million, $32.9 million
and $27.0 million in 2002, 2001 and 2000, respectively. Accordingly, our
operating history is not indicative of our future performance under our new
business strategy of increasing the market share of our medical cost containment
business and building our business process outsourcing unit. This change in
focus has resulted in a significant reduction in the size of our management and
support operations. While our network access business historically operated as
an independent part of our larger business, this change in focus requires it to
operate with less support than was previously available and this may affect its
performance. We are also facing new risks and challenges, including a lack of
meaningful historical financial data upon which to plan future budgets.

        In addition, our growth rate is partially attributable to healthcare
expenditures nationally and the related growth of claims we process. We may not
continue to grow in the future, and if we do grow, our growth may not be at or
near historical levels.

        Our business model is unproven.

        Although our NPPN network business unit began doing business in 1994,
the increasing popularity and use of electronic claims and data processing tools
and the Internet have occurred only recently and, as a result, the focus of our
business has changed significantly. We did not begin our current focus on being
a technology enabled service provider until 2001, when we completed our sale of
our third party administration and managing general underwriter businesses to
HealthPlan Holdings and began concentrating exclusively on medical cost
management. At that time, we also began to build our network and data management
business process outsourcing businesses, including our PayerServ and PlanServ
products, which did not begin earning revenue until the first quarter of 2002.
As new ventures in 2002, PayerServ and PlanServ currently have 24 and 8
customers, respectively. There can be no guarantee that these businesses will
acquire new customers or will generate significant operating revenue in the
future. Because our business has changed, it is difficult to evaluate due to the
new risks and challenges we are

                                       32

<PAGE>

facing. You should evaluate our prospects in light of the risks and
uncertainties encountered by companies in the early stages of development,
particularly companies in new and rapidly evolving markets. These risks include:

            .   a concentration on relatively few customers;
            .   unproven market acceptance of our new products;
            .   dependence on healthcare payers, provider networks, strategic
                relationships, and technology solutions;
            .   industry consolidation and increased in-house performance of the
                services we offer;
            .   unpredictability of operating results and future revenues;
            .   increased competition; and
            .   general economic and market conditions.

        We may not be successful in addressing any or all of these risks. Any
failure to address these risks could have a material adverse effect on our
business, operating results, and financial condition.

        Our quarterly operating results may be volatile.

        We will have difficulty predicting future revenues because we are
implementing a new business strategy with our new network and data management
business process outsourcing business. We also will have difficulty in
accurately forecasting operating revenues from sales of our services because we
do not know the sales cycle involved in selling our new services, and we cannot
predict customer claims experience. This makes it difficult to predict the
quarter in which sales will occur. Any significant shortfall of operating
revenues in relation to our expectations could cause significant declines in our
quarterly operating results or cause us to not meet certain financial covenants
with our senior lenders.

        We may be unable to adjust fixed expenses to compensate for operating
revenue shortfalls.

        Our expense levels are based, in part, on our expectations regarding
future operating revenues, and our expenses are generally fixed, particularly in
the short term. We may be unable to adjust spending in a timely manner to
compensate for unexpected revenue shortfalls. A shortfall in operating revenues
or a delay in the collection of outstanding accounts receivable could have an
adverse impact on our ability to meet payment obligations or meet financial
covenants to our senior lenders and vendors, and could have a material adverse
effect on our business, operating results, and financial condition.

        We have many competitors.

        We face competition from HMOs, PPOs, third party administrators, and
other managed healthcare companies, such as Blue Cross Blue Shield,
McKesson/HBOC, The TriZetto Group, Inc., HealthAxis, Avidyn/ppoOne, Inc., BCE
Emergis/eHealth Solutions Group, Concentra, Inc., Beech Street Corporation,
MultiPlan, Inc., Private Healthcare Systems (PHCS), and Coalition America, Inc.
We believe that, as managed care continues to gain acceptance in the marketplace
and more sophisticated technology is adopted, our competition will increase. In
addition, legislative reform may intensify competition in the markets we serve.
Many of our current and potential competitors have greater financial and
marketing resources than we have. We cannot assure you that we will continue to
maintain our existing customers or our past level of operating performance. We
also cannot assure you that we will be successful with any new products or in
any new markets that we may enter.

                                       33

<PAGE>

        We may not be able to successfully manage our growth.

        Our strategy is to expand through internal growth. Expenses arising from
efforts to increase our market penetration may have a negative impact on
operating results. As a result, we are subject to certain growth-related risks,
including the risk that we will be unable to retain personnel or acquire the
resources necessary to service our internal growth adequately. While we are
pursuing an internal growth strategy, it is possible that we would consider an
attractive opportunity for expansion by acquiring another company in our core
business, assuming that our resources would permit us to make such an
acquisition. If we seek to acquire another company, we may not be able to
integrate the acquired business effectively.

        We are highly dependent on our senior management.

        We are highly dependent on our senior management, particularly our
Chairman and Chief Executive Officer Phillip S. Dingle and our President and
Chief Operating Officer Jeffrey L. Markle. The loss of these members of our
senior management team could harm us and our prospects significantly. We have
employment agreements with each of Mr. Dingle and Mr. Markle, but these
employment agreements do not obligate the executive officers to remain in our
employ.

        The inability of our customers to pay for our services could decrease
our revenue.

        Our health insurance and HMO payer customers may be required to maintain
restricted cash reserves and satisfy strict balance sheet ratios promulgated by
state regulatory agencies. In addition, the financial stability of our payer
customers may be adversely affected by physician groups or associations within
their organizations that become subject to costly litigation or become
insolvent. Our ability to collect fees for our services may become impaired if
our payer customers are unable to pay for our services because they need to
maintain cash reserves, if they fail to maintain required balance sheet ratios,
or if they become insolvent. Although we have not experienced any material
problems with collecting fees for our services to date, any financial
instability of our customers in the future could adversely affect our revenues.

RISKS RELATED TO OUR TECHNOLOGY

        Problems with our computers or other technology could negatively affect
our business.

        Aspects of our business depend upon our ability to store, retrieve,
process, and manage data and to maintain and upgrade our data processing
capabilities. If our data processing capabilities were to be interrupted for any
extended period of time, or if we were to lose stored data, experience failures
in our backup operations, or experience programming errors, or if other computer
problems were to arise, we could lose customers and revenue. We expect that our
future growth will depend on our ability to process and manage claims data more
efficiently, and to provide more meaningful healthcare information to our
customers, than our competitors. We may not be able to efficiently upgrade our
systems to meet future demands, and we may not be able to develop, license, or
otherwise acquire software to address these market demands as well or as readily
as our competitors.

        We are dependent on the growth of the internet and electronic healthcare
information markets.

        Many of our products and services, such as ClaimPassXL v. 3.5, our
internet repricing system, are geared toward the Internet and electronic
healthcare information markets. These markets are in the early stages of
development and are rapidly evolving. A number of market entrants have
introduced or developed products and services that are competitive with our
products and services. We expect that additional companies will continue to
enter these markets. In new and rapidly evolving industries, there is
significant uncertainty and risk as to the demand for, and market acceptance of,
recently introduced products and services. Because the markets for certain of
our products and services are new and evolving, we are not able to predict the
size and growth rate of those markets with any certainty. We cannot assure you
that markets for our products and services will develop or that, if they do,
they will be strong and continue to grow at a sufficient pace. If markets fail
to develop, develop more slowly than expected, or become saturated with
competitors, our business prospects will be impaired.

        Lack of internet security could discourage users of our services.

                                       34

<PAGE>

        The difficulty of securely transmitting confidential information over
the Internet has been a significant barrier to conducting e-commerce and
engaging in sensitive communications over the Internet. Our strategy relies in
part on the use of the Internet to transmit confidential information. We believe
that any well-publicized compromise of Internet security may deter people from
using the Internet to conduct transactions that involve transmitting
confidential healthcare information. We rely largely on our security systems,
confidentiality procedures, and employee non-disclosure agreements to maintain
the confidentiality and security of confidential information. It is possible
that third parties could penetrate our network security or otherwise
misappropriate patient information and other data. If this happens, our
operations could be interrupted, and we could be subject to liability. We may
have to devote significant financial and other resources to protecting against
security breaches or to alleviating problems caused by breaches. We could face
financial loss, litigation, and other liabilities to the extent that our
activities or the activities of third party contractors involving the storage
and transmission of confidential information like patient records or credit
information are compromised. In addition, we could incur additional expenses if
new regulations regarding the use of personal information are introduced.

        Our intellectual property needs constant protection.

        We rely largely on our own security systems, confidentiality procedures,
and employee nondisclosure agreements to maintain the confidentiality and
security of our proprietary information, including our trade secrets and
internally developed computer applications. If third parties gain unauthorized
access to our information systems, or if anyone misappropriates our proprietary
information, this may have a material adverse effect on our business and results
of operations. In addition, our technology has not been patented nor have we
registered any copyrights with respect to such technology. Trade secrets laws
offer limited protection against third party development of competitive products
or services. Lacking the protection of patents or registered copyrights for our
internally-developed software and software applications, we are more vulnerable
to misappropriation of our proprietary technology by third parties or
competitors. Because we believe that our software and software applications are
valuable to us, the failure to adequately protect our technology could adversely
affect our business.

        We may be subject to trademark and service mark infringement claims in
the future.

        As our competitors' healthcare information systems increase in
complexity and overall capabilities, and the functionality of these systems
further overlap, we could be subject to claims that our technology infringes on
the proprietary rights of third parties. These claims, even if without merit,
could subject us to costly litigation and could require the resources, time, and
attention of our technical, legal, and management personnel to defend. The
failure to develop non-infringing technology or trade names, or to obtain a
license on commercially reasonable terms, could adversely affect our operations
and revenues.

        If our ability to expand our network infrastructure is constrained in
any way, we could lose customers and damage our operating results.

        We must continue to expand and adapt our network and technology
infrastructure to accommodate additional users, increased transaction volumes,
and changing customer requirements. We may not be able to accurately project the
rate or timing of increases, if any, in the volume of transactions we reprice or
otherwise service or be able to expand and upgrade our systems and
infrastructure to accommodate such increases. We may be unable to expand or
adapt our network infrastructure to meet additional demand or our customers'
changing needs on a timely basis, at a commercially reasonable cost or at all.
Our current information systems, procedures, and controls may not continue to
support our operations while maintaining acceptable overall performance and may
hinder our ability to exploit the market for healthcare applications and
services. Service lapses could cause our users to switch to the services of our
competitors.

RISKS RELATED TO OUR INDUSTRY

        Government regulation of the healthcare industry may change and
adversely affect our business.

        As a participant in the healthcare industry, we are affected by or may
be affected by regulations related to privacy of patient information, provider
contracting, claims adjudication procedures, licensing, and the Internet.

                                       35

<PAGE>

During the past several years, the healthcare industry has been subject to
increasing levels of government regulation of reimbursement rates and certain
capital expenditures, among other things. In addition, federal and state
governments have considered proposals to reform the healthcare system. These
proposals, if enacted, may further increase government involvement in
healthcare, lower reimbursement rates, and otherwise adversely affect the
healthcare industry, which could adversely affect our business. The impact of
regulatory developments in the healthcare industry is complex and difficult to
predict, and our business could be adversely affected by existing or new
healthcare regulatory requirements or interpretations. While we believe our
operations are in material compliance with the applicable laws as currently
interpreted, the regulatory environment in which we operate may change
significantly in the future, which could restrict our existing operations,
expansion, financial condition, or opportunities for success. See "Business -
Government Regulation."

        Consolidation in the healthcare industry may give our customers greater
bargaining power and lead us to reduce our prices.

        Many healthcare industry participants are consolidating to create
integrated healthcare delivery systems with greater market power. As provider
networks and managed care organizations consolidate, competition to provide
products and services such as those we provide will become more intense, and the
importance of establishing and maintaining relationships with key industry
participants will become greater. These industry participants may try to use
their market power to negotiate price reductions for our products and services.
If we are forced to reduce our prices, our margins will decrease, unless we are
able to achieve corresponding reductions in expenses.

RISKS RELATED TO OUR COMMON STOCK

        Our stock price has been volatile and may continue to fluctuate.

        Our common stock has experienced significant price and volume
fluctuations. Our stock price ranged from a high of $6.40 per share to a low of
$0.73 per share during the year ended December 31, 2002. On March 24, 2003, our
closing common stock price was $0.99 per share. These fluctuations are not
necessarily directly related to our operating performance. Our common stock may
not continue to trade at the current price level. See "Market for Registrant's
Common Equity and Related Stockholder Matters" for more information on the
trading price of our common stock. The market price for our common stock may
continue to fluctuate widely in response to factors such as the following:

            .   failure to meet our product development and sales milestones;
            .   failure to comply with our debt and Series C convertible
                preferred stock covenants;
            .   demand for our common stock;
            .   technological innovations by us or our competitors or in
                competing technologies;
            .   new product announcements by us or by our competitors;
            .   timeliness in introduction of new products;
            .   announcements by us or our competitors of significant contracts,
                acquisitions, partnerships, joint ventures, or capital
                commitments;
            .   failure to successfully build our new outsourcing business
                units;
            .   operating revenues and operating results failing to meet the
                expectations of securities analysts or investors in any quarter;
            .   announcements by third parties of significant claims or
                proceedings against us;
            .   disclosure of unsuccessful results in our efforts to expand our
                ability to market, sell and provide our services or in our
                ability to enhance our existing products or develop new
                products;
            .   changes in financial estimates by securities analysts;
            .   investor perception of our industry or its prospects; and
            .   general technological or economic trends.

Many of these factors are beyond our control. In addition, the stock market has
in the past experienced price and volume fluctuations that have particularly
affected companies in the healthcare and managed care markets, resulting

                                       36

<PAGE>

in changes in the market price of the stock of many companies that may not have
been directly related to the operating performance of those companies.

        The volatility of our common stock or substantial dilution to our
stockholders could subject us to costly litigation.

        Some companies that have experienced volatility in the market price of
their stock or have had their stock subject to substantial dilution have been
sued in securities class action litigation. In light of the fluctuations in our
stock price and dilution to our stockholders, it is possible that we may be the
subject of securities class action litigation in the future. This type of
litigation is generally costly and often results in a diversion of management's
attention and resources and could harm our business, prospects, results of
operations, and financial condition.

        Provisions contained in Delaware law, our charter, and our bylaws may
restrict the ability of a third party to take over our company, prevent
investors from receiving a "control premium" for their shares, and prevent or
frustrate any attempt to replace or remove the current management of our company
by our stockholders.

        Provisions contained in our amended and restated certificate of
incorporation and bylaws, as well as Delaware corporate law, may delay, defer,
or prevent an attempt by a third party to take over our company, which may
prevent our stockholders from receiving a "control premium" for their shares.
For example, these provisions may defer or prevent tender offers for our common
stock or purchases of large blocks of our common stock, thereby limiting the
opportunities of our stockholders to receive a premium over then-prevailing
market prices for their common stock. In addition, such provisions may prevent
or frustrate our stockholders from replacing or removing our current management.

ITEM 7a. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

        We are exposed to certain market risks inherent in our financial
instruments. These instruments arise from transactions entered into in the
normal course of business. We are subject to interest rate risk on our existing
Agreements. Our fixed rate debt consists primarily of outstanding balances on
our notes issued to C G Insurance Services, Inc., and the former owner of CENTRA
HealthPlan LLC. Our variable rate debt relates to borrowings under our Term Loan
Agreement effective April 12, 2002 and notes issued to certain of our board of
directors. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations --Liquidity and Capital Resources."

        The following table presents the future minimum operating lease
obligations and the future principal payment obligations, and the
weighted-average interest rates associated with our long-term debt instruments
as of December 31, 2002 (in thousands). These amounts have been adjusted to
reflect our restructured debt arrangements:

<TABLE>
<CAPTION>
                                              2003      2004        2005       2006        2007    THEREAFTER
                                            -------   --------   --------   ---------   --------   ----------
   <S>                                      <C>       <C>        <C>        <C>         <C>        <C>
   Operating leases .....................   $   698   $    665   $    631   $     624   $    622   $     582
   Long-term debt fixed
    rate (interest rates ranging
    from 5.75% to 12.0%) ................   $     -   $  5,039   $      -   $       -   $      -   $       -
   Long-term debt variable rate
    (interest at prime plus 1%
    and prime plus 4%) ..................   $   356   $ 40,149   $      -   $       -   $      -   $       -
</TABLE>

        Our primary market risk exposure relates to (i) the interest rate risk
on long-term and short-term borrowings, (ii) the impact of interest rate
movements on our ability to meet interest expense requirements and exceed
financial covenants, and (iii) the impact of interest rate movements on our
ability to obtain adequate financing to fund future acquisitions.

        During 2001, we managed interest rate risk on our variable rate debt by
using two separate interest rate swap agreements. The agreements, which expired
in September and December 2001, effectively converted $40.0 million of variable
rate debt under our prior line of credit to fixed rate debt at a weighted
average interest rate of 6.18%. As of December 31, 2002 and 2001, we did not
have any outstanding interest rate swap arrangements.

                                       37

<PAGE>

        A 1.0% increase in interest rates due to increased rates nationwide
would result in additional annual interest expense of approximately $0.4
million.

        While we cannot predict our ability to refinance existing debt or the
impact interest rate movements will have on our existing debt, our management
continues to evaluate our financial position on an ongoing basis.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

        The financial statements required by this item are listed in Item
14(a)(1) and are submitted at the end of this Annual Report on Form 10-K.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

None.

                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

        The response to this item will be included in our definitive Proxy
Statement for the Annual Meeting of Stockholders scheduled to be held on May 22,
2003, under "Proposal 1: Election of Directors," "Additional Information
Concerning Directors," "Executive Officers," and "Section 16(a) Beneficial
Ownership Reporting Compliance," and is incorporated herein by reference.

ITEM 11. EXECUTIVE COMPENSATION

        The response to this item will be included in our definitive Proxy
Statement for the Annual Meeting of Stockholders scheduled to be held on May 22,
2003, under "Compensation of Executive Officers," "Compensation Committee
Interlocks and Insider Participation," and "Additional Information Concerning
Directors," and is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS

        The response to this item will be included in our definitive Proxy
Statement for the Annual Meeting of Stockholders scheduled to be held on May 22,
2003, under "Security Ownership of Certain Beneficial Owners and Management,"
and is incorporated herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

        The response to this item will be included in our definitive Proxy
Statement for the Annual Meeting of Stockholders scheduled to be held on May 22,
2003, under "Compensation Committee Interlocks and Insider Participation" and
"Certain Relationships and Related Transactions," and is incorporated herein by
reference.

ITEM 14. CONTROLS AND PROCEDURES

        Based on their most recent review, which was completed within 90 days of
the filing of this report, our principal executive officer and principal
financial officer have concluded that our disclosure controls and procedures are
effective to ensure that information required to be disclosed by us in the
reports that we file or submit under the Securities Exchange Act of 1934, as
amended, is accumulated and communicated to our management, including our
principal executive officer and principal financial officer, as appropriate to
allow timely decisions regarding required disclosure and are effective to ensure
that such information is recorded, processed, summarized and reported within the
time periods specified in the SEC's rules and forms. There were no significant
changes in our internal controls or in other factors that could significantly
affect those controls subsequent to the date of their evaluation.

                                       38

<PAGE>

                                     PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)     (1)     The following consolidated financial statements of PlanVista
                Corporation and its subsidiaries are filed as part of this Form
                10-K starting at page F-1:

                Report of Independent Certified Public Accountants

                Consolidated Balance Sheets -- December 31, 2002 and 2001

                Consolidated Statements of Operations -- Years ended December
                31, 2002, 2001, and 2000

                Consolidated Statements of Changes in Stockholders' Equity --
                Years ended December 31, 2002, 2001, and 2000

                Consolidated Statements of Cash Flows -- Years ended December
                31, 2002, 2001, and 2000

                Notes to Consolidated Financial Statements

        (2)     Report of Independent Accountants on Financial Statement
                Schedule

                Schedule II -- Valuation and Qualifying Accounts for each of the
                Years ended December 31, 2002, 2001, and 2000

        (3)     Exhibits included or incorporated herein:

EXHIBIT
NUMBER          DESCRIPTION OF EXHIBITS
--------        -----------------------

2.1             Acquisition Agreement dated May 17, 1996 between HealthPlan
                Services Corporation, Consolidated Group, Inc., Consolidated
                Group Claims, Inc., Consolidated Health Coalition, Inc., and
                Group Benefit Administrators Insurance Agency, Inc., the named
                Shareholders, and Holyoke L. Whitney as shareholders'
                Representative (incorporated by reference to Exhibit 2 to the
                HealthPlan Services Corporation Form 8-K Current Report, SEC
                file number 1-13772, filed on July 15, 1996).

2.2             Plan and Agreement of Merger dated May 28, 1996 between
                HealthPlan Services Corporation, HealthPlan Services Alpha
                Corporation, Harrington Services Corporation, and Robert Chefitz
                as Shareholders' Representative (incorporated by reference to
                the HealthPlan Services Corporation Form 8-K Current Report, SEC
                file number 1-13772, filed on July 16, 1996).

2.3             Stock Purchase Agreement dated December 18, 1996 by and among
                Noel Group, Inc., Automatic Data Processing, Inc., and
                HealthPlan Services Corporation (incorporated by reference to
                Exhibit 2.1 to the Noel Group, Inc.'s Current Report on Form
                8-K, SEC file number 000-19737, filed on February 21, 1997).

2.4             Amended and Restated Acquisition Agreement dated May 15, 1998
                by and among HealthPlan Services Corporation, National Preferred
                Provider Network, Inc., and other parties named therein
                (incorporated by reference to Exhibit 2.8 to the HealthPlan
                Services Corporation Annual Report on Form 10-K filed on March
                30, 1999).

2.5             Subscription and Asset Contribution Agreement dated June 16,
                1998 by and between CENTRA HealthPlan LLC, and its prospective
                members: HealthPlan Services, Inc., and CENTRA Benefit Services,
                Inc. (incorporated by reference to Exhibit 2.8 to the HealthPlan
                Services Corporation 1998 Annual Report and Form 10-K filed on
                March 30, 1999).

                                       39

<PAGE>

2.6             Asset Purchase Agreement effective July 5, 2000, by and between
                HealthPlan Services, Inc. and Sheakley-Uniservice, Inc.
                (incorporated by reference to Exhibit 2.12 to the PlanVista
                Corporation Annual Report on Form 10-K, filed on April 11,
                2001).

2.7             Asset Purchase Agreement dated as of August 28, 2000, by and
                between Trewit, Inc., HealthPlan Services, Inc., Montgomery
                Management Corporation, and HealthPlan Services Corporation;
                Amendment to Asset Purchase Agreement effective as of October
                25, 2000, by and between HealthPlan Services, Inc., Montgomery
                Management Corporation, HealthPlan Services Corporation, Trewit,
                Inc., and Harrington Benefit Services, Inc.; Post-Closing
                Amendment to Asset Purchase Agreement and Escrow Agreement dated
                as of January 12, 2001, by and between HealthPlan Services,
                Inc., HealthPlan Services Corporation, Trewit, Inc., and
                Harrington Benefit Services, Inc., and for purposes of the
                Escrow Agreement Amendment, Wells Fargo Bank Minnesota
                (incorporated by reference to Exhibit 2.13 to the PlanVista
                Corporation Annual Report on Form 10-K, filed on April 11,
                2001).

2.8             Asset Purchase Agreement dated September 15, 2000, by and among
                ProHealth, Inc., Sheakley Unicomp, Inc., and HealthPlan
                Services, Inc. (incorporated by reference to Exhibit 2.14 to the
                PlanVista Corporation Annual Report on Form 10-K, filed on April
                11, 2001).

2.9             Stock Purchase Agreement dated as of April 1, 2001, by and
                between HealthPlan Holdings, Inc. and HealthPlan Services
                Corporation (incorporated by reference to Exhibit 2.15 to the
                PlanVista Corporation Annual Report on Form 10-K, filed on April
                11, 2001); First Amendment to Stock Purchase Agreement dated as
                of June 18, 2001 (incorporated by reference to Exhibit 2.3 to
                the PlanVista Corporation Registration Statement #333-66540 on
                Form S-1 filed on August 1, 2001).

2.10            Certificate of Ownership and Merger merging PlanVista
                Corporation and HealthPlan Services Corporation effective April
                13, 2001 (incorporated by reference to Exhibit 99.2 to the
                HealthPlan Services Corporation Form 8-K Current Report filed on
                April 20, 2001).

3.1             Certificate of Incorporation, as amended (incorporated by
                reference to Exhibit 3.1 to the PlanVista Corporation Amendment
                No. 1 to Registration Statement #333-66540 on Form S-1/A filed
                on May 24, 2002).

3.2             By-laws, as amended (incorporated by reference to Exhibit 3.2 to
                the PlanVista Corporation Amendment No. 1 to Registration
                Statement #333-66540 on Form S-1/A filed on May 24, 2002).

4.1             Excerpts from the Certificate of Incorporation, as amended
                (included in Exhibit 3.1).

4.2             Excerpts from the By-laws, as amended (included in Exhibit 3.2).

4.3             Specimen common stock certificate (incorporated by reference to
                Exhibit 4.3 to the HealthPlan Services Corporation Form S-1
                Registration Statement #33-90472, filed on May 18, 1995).

4.4             Specimen Series C convertible preferred stock certificate.

4.5             (a)     Forbearance Agreement dated as of September 1, 2001 by
                        and among PlanVista Corporation, First Union National
                        Bank, and the other lenders named therein (incorporated
                        by reference to the PlanVista Corporation Form 8-K,
                        filed on September 17, 2001).

                (b)     First Amendment to Forbearance Agreement dated as of
                        September 30, 2001, by and among PlanVista Corporation,
                        First Union National Bank, and the other lenders named
                        therein; Second Amendment and Limited Waiver to
                        Forbearance Agreement dated as of October 19, 2001, by
                        and among PlanVista Corporation, First Union National
                        Bank, and the other lenders named therein; Third
                        Amendment and Limited Waiver to Forbearance

                                       40

<PAGE>

                        Agreement dated as of November 11, 2001, by and among
                        PlanVista Corporation, First Union National Bank, and
                        the other lenders named therein (incorporated by
                        reference to Exhibit 10.12(e) to the PlanVista
                        Corporation Quarterly Report on Form 10-Q/A, filed on
                        November 14, 2001).

                (c)     Fifth Amendment and Limited Waiver to Forbearance
                        Agreement dated as of January 31, 2002, by and among
                        PlanVista Corporation, First Union National bank, and
                        the other lenders named therein; Sixth Amendment to
                        Forbearance Agreement dated as of March 15, 2002, by and
                        among PlanVista Corporation, First Union National Bank,
                        and the other lenders named therein (incorporated by
                        reference to Exhibit 10.12(h) to the PlanVista
                        Corporation 2001 Annual Report on Form 10-K filed on
                        April 16, 2002).

                (d)     Third Amended and Restated Credit Agreement dated as of
                        April 12, 2002, by and among PlanVista Corporation,
                        Wachovia Bank, National Association (f/k/a First Union
                        National Bank), and the other lenders named therein
                        (incorporated by reference to Exhibit 10.12(i) to the
                        PlanVista Corporation 2001 Annual Report on Form 10-K
                        filed on April 16, 2002).

                (e)     Series C Convertible Preferred Stock Issuance and
                        Restructuring Agreement dated as of April 12, 2002, by
                        and among PlanVista Corporation, Wachovia Bank, National
                        Association (f/k/a First Union National Bank), as
                        administrative agent, and the other lenders named
                        therein (incorporated by reference to Exhibit 10.12(j)
                        to the PlanVista Corporation 2001 Annual Report on Form
                        10-K, filed on April 16, 2002).

                (f)     Stockholders Agreement dated as of April 12, 2002, by
                        and among PlanVista Corporation and the Series C
                        Stockholders named therein (incorporated by reference to
                        Exhibit 10.12(k) to the PlanVista Corporation 2001
                        Annual Report on Form 10-K, filed on April 16, 2002).

                (g)     Certificate of Designation of Series and Determination
                        of Rights and Preferences of Series C Convertible
                        Preferred Stock of PlanVista Corporation as filed with
                        the Secretary of State of Delaware on April 8, 2002
                        (included in Exhibit 3.1).

                (h)     Letter Agreement dated April 12, 2002, by and among
                        PlanVista Corporation, Wachovia Bank, National
                        Association (f/k/a First Union National Bank), as
                        administrative agent, and the other lenders named
                        therein (incorporated by reference to Exhibit 10.12(m)
                        to the PlanVista Corporation 2001 annual Report on Form
                        10-K, filed on April 16, 2002), as amended and restated
                        by the Letter Agreement dated as of June 28, 2002, by
                        and among PlanVista Corporation, Wachovia National
                        Association, as administrative agent, and the other
                        lenders named therein (incorporated by reference to
                        Exhibit 10.12(m) to the PlanVista Corporation 2001
                        Annual Report on Form 10-K, filed on April 16, 2002).

                (i)     Promissory Note dated April 12, 2002, by and among
                        PlanVista Corporation, Wachovia Bank, National
                        Association (f/k/a First Union National Bank), as
                        administrative agent, and the other lenders noted
                        therein (incorporated by reference to Exhibit 10.12(m)
                        to the PlanVista Corporation 2001 Annual Report on Form
                        10-K, filed on April 16, 2002).

                (j)     First Amendment and Limited Waiver to Third Amended and
                        Restated Credit Agreement dated February 25, 2003 by and
                        among PlanVista Corporation, PlanVista Solutions, Inc.,
                        the Lenders listed on the signature pages thereto,
                        Wachovia Bank, as administrative agent and for purposes
                        of Section 5 thereof, the Credit Parties listed on the
                        signature pages thereto.

                (k)     Limited Waiver to Third Amended and Restated Credit
                        Agreement dated March 6, 2003 by and among PlanVista
                        Corporation, PlanVista Solutions, Inc., the lenders
                        listed on the

                                       41

<PAGE>

                        signature pages thereto and Wachovia Bank, National
                        Association, as administrative agent.

4.6             Intercreditor Agreement dated March 7, 2003, by and between PVC
                Funding Partners, LLC and Wachovia Bank, National Association,
                as administrative agent under the credit agreement and the
                Series C issuance agreement described therein (incorporated by
                reference to Exhibit 1 to Schedule 13D filed jointly by PVC
                Funding Partners, LLC, Comvest Venture Partners, L.P.,
                Commonwealth Associates, L.P., Michael S. Falk an Harold S.
                Blue, on March 13, 2003).

4.7             Amended and Restated Convertible Promissory Notes of HealthPlan
                Services Corporation (n/k/a PlanVista Corporation) dated June
                16, 1998, payable to Centra Benefit Services, Inc. in the
                principal amounts listed therein.

4.8             Amended and Restated Subordinated Promissory Note of PlanVista
                Corporation dated April 12, 2002, payable to William L. Bennett
                in the principal amount of $250,000.

4.9             Amended and Restated Subordinated Promissory Note of PlanVista
                Corporation dated April 12, 2002, payable to John D. Race in the
                principal amount of $250,000.

4.10            Asset Sale Agreement dated May 27, 1993, by and among Plan
                Services, Inc. (n/k/a PlanVista Corporation), CG Insurance
                Services, Inc. and Renny V. Thomas.

10.1            HealthPlan Services Corporation 1996 Employee Stock Option Plan
                (compensatory plan) (incorporated by reference to Exhibit 10.6
                to the HealthPlan Services Corporation 1996 Annual Report on
                Form 10-K, SEC filed number 1-13772, filed on March 31, 1997).

10.2            Amended and Restated HealthPlan Services Corporation 1996
                Employee Stock Option Plan (compensatory plan) (incorporated by
                reference to Exhibit 4.3 to the HealthPlan Services Corporation
                Form S-8 Registration Statement #333-31913, filed on July 23,
                1997).

10.3            HealthPlan Services Corporation 1995 Incentive Equity Plan
                (compensatory plan) (incorporated by reference to Exhibit 10.7
                to the HealthPlan Services Corporation Form S-1 Registration
                Statement #33-90472, filed on May 18, 1995).

10.4            1995 HealthPlan Services Corporation Directors Stock Option Plan
                (compensatory plan) (incorporated by reference to Exhibit 10.10
                to the HealthPlan Services Corporation Form S-1 Registration
                Statement #33-90472, filed on May 18, 1995); Amendment adopted
                as of October 10, 2000 (incorporated by reference to Exhibit
                10.6 to the PlanVista Corporation Annual Report on Form 10-K/A,
                filed on April 20, 2001).

10.5            Amended and Restated HealthPlan Services Corporation 1997
                Directors Equity Plan (compensatory plan) (incorporated by
                reference to Exhibit 4.3 to the HealthPlan Services Corporation
                Form S-8 Registration Statement #333-31915, filed on July 23,
                1997).

10.6            HealthPlan Services Corporation 1998 Officer Bonus Plan Summary
                (compensatory plan) (substantially similar to 1999, 2000, and
                2001 plans) (incorporated by reference to Exhibit 10.17 to the
                HealthPlan Services Corporation Annual Report on Form 10-K filed
                on March 30, 1999).

10.7            Employment and Noncompetition Agreement dated as of June 1,
                2000, by and between HealthPlan Services Corporation and Phillip
                S. Dingle, including Amendment thereto dated January 30, 2001
                (management contract) (incorporated by reference to Exhibit
                10.24 to the PlanVista Corporation Annual Report on Form 10-K,
                filed on April 11, 2001).

10.8            Employment and Noncompetition Agreement dated as of June 1,
                2001, by and between PlanVista Corporation and Jeffrey L. Markle
                (incorporated by reference to Exhibit 10.10 to the PlanVista
                Corporation Registration Statement #333-66540 on Form S-1 filed
                on August 1, 2001).

                                       42

<PAGE>

10.9            Registration Rights Agreement dated as of June 18, 2001, by and
                between PlanVista Corporation and HealthPlan Holdings, Inc,
                (incorporated by reference to Exhibit 4.1 to the PlanVista
                Corporation Registration Statement #333-66540 on Form S-1 filed
                on August 1, 2001).

10.10           Registration Rights Agreement dated as of July 2, 2001, by and
                between PlanVista Corporation, First Union National Bank and the
                Holders listed on the signature pages thereof (incorporated by
                reference to Exhibit 4.2 to the PlanVista Corporation
                Registration Statement #333-66540 on Form S-1 filed on August 1,
                2001).

10.11           Stock Purchase and Registration Rights Agreement dated as of
                July 5, 2001, by and between PlanVista Corporation and DePrince,
                Race & Zollo, Inc. on behalf of the Purchasers named therein
                (incorporated by reference to Exhibit 4.3 to the PlanVista
                Corporation Registration Statement #333-66540 on Form S-1 filed
                on August 1, 2001).

10.12           Letter Agreement dated as of March 8, 2002, by and between New
                England Financial and PlanVista Corporation; Clarification of
                Letter Agreement dated as of March 18, 2002, by and between New
                England Financial and PlanVista Corporation (incorporated by
                reference to Exhibit 4.6 to Amendment No. 1 to the PlanVista
                Corporation Registration Statement #333-66540 on Form S-1/A
                filed on May 24, 2002).

10.13           Letter Agreement dated as of July 26, 2002, by and between
                HealthPlan Holdings, Inc. and PlanVista Corporation; Letter
                Agreement dated as of July 1, 2002, by and between HealthPlan
                Holdings, Inc. and PlanVista Corporation (incorporated by
                reference to Exhibit 4.7(b) to Amendment No. 4 to the PlanVista
                Corporation Registration Statement #333-66540 on Form S-1/A
                filed on August 6, 2002).

10.14           Letter Agreement dated as of July 22, 2002, by and among
                PlanVista Corporation, Wachovia Bank, National Association, as
                administrative agent, and the other lenders listed on the
                signature pages thereto (incorporated by reference to Exhibit
                4.8(b) to Amendment No. 4 to the PlanVista Corporation
                Registration Statement #333-66540 on Form S-1/A filed on August
                6, 2002).

10.15           Letter Agreement dated as of June 28, 2002, by and between
                PlanVista Corporation, Wachovia Bank, National Association, as
                administrative agent, and the other lenders listed on the
                signature pages thereto (Incorporated by reference to Exhibit
                4.8 to Amendment No. 3to the PlanVista Corporation Registration
                Statement 333-66540 on Form S-1/A filed on July 19, 2002).

10.16           Lease Agreement dated as of July 14, 1994, by and between D. K.
                Third Party Administrators, Inc. (n/k/a PlanVista Solutions,
                Inc.) and Wisner Professional Building, Inc., as amended on
                December 7, 1995, April 3, 1997, and February 5, 1998, by
                Addendum to Lease between Wisner Professional Building, Inc. and
                D. K. Third Party Administrators, Inc. (n/k/a PlanVista
                Solutions, Inc.) (incorporated by reference to Exhibit 10.14 to
                the PlanVista Corporation Registration Statement #333-66540 on
                Form S-1 filed on August 1, 2001).

10.17           Lease Agreement dated as of January 9, 2002, by and between
                PlanVista Corporation and Metropolitan Life Insurance Company
                (incorporated by reference to the PlanVista Corporation
                Registration Statement #333-66540 on Form S-1 filed on August 1,
                2001).

10.18           Letter Agreement dated March 5, 2003 between Commonwealth Group
                Holdings, LLC and PlanVista Corporation.

11.1            Statement regarding computation of per share earnings: not
                required because the relevant computations can be clearly
                determined from the material contained in the financial
                statements included herein.

21.1            Subsidiaries of the registrant.

                                       43

<PAGE>

23.1            Consent of PricewaterhouseCoopers LLP.

(b)             We filed the following Current Reports on Form 8-K during the
                twelve months ended December 31, 2002:

                Form 8-K Current Report, filed on January 25, 2002, with respect
                to our agreement with our senior lenders to certain key terms
                and conditions to restructure our credit facilities and replace
                our existing credit facilities.

                Form 8-K Current Report, filed on July 24, 2002, with respect to
                our earnings announcement for the quarter ended June 30, 2002
                and the filing of our Amendment No. 3 to our registration
                statement on form S-1.

                Form 8-K Current Report, filed on August 8, 2002, with respect
                to a press release that was released on August 8, 2002.

                                       44

<PAGE>

SIGNATURES

        Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, PlanVista Corporation has duly caused this Annual Report
on Form 10-K to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Tampa, State of Florida, on the 31st day of March,
2003.

                                       PLANVISTA CORPORATION

                                       By: /s/ Phillip S. Dingle
                                       -----------------------------------------
                                       Phillip S. Dingle
                                       Chairman and Chief Executive Officer
                                       (Principal Executive Officer)

                                       By: /s/ Donald W. Schmeling
                                       ----------------------------------------
                                       Donald W. Schmeling
                                       Chief Financial Officer
                                       (Principal Financial Officer and
                                       Principal Accounting Officer)

        KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints William L. Bennett, Phillip S. Dingle,
and Donald W. Schmeling his or her true and lawful attorneys-in-fact and agents,
each acting alone, with full power of substitution and resubstitution, for him
or her in his or her name, place, and stead, in any and all capacities, to sign
any or all amendments to this Annual Report on Form 10-K, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he or she might or could do in person, and hereby
ratifies and confirms all that said attorneys-in-fact and agents, each acting
alone, or his or her substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.

        Pursuant to the requirements of the Securities Exchange Act of 1934,
this Annual Report on Form 10-K has been signed by the following persons in the
capacities and on the dates indicated.

SIGNATURE                   TITLE                              DATE
---------                   -----                              ----

/s/ Phillip S. Dingle       Chairman of the Board and Chief    March 31, 2003
------------------------    Executive Officer
    Phillip S. Dingle

/s/ William L. Bennett      Vice Chairman of the Board         March 31, 2003
------------------------
    William L. Bennett

/s/ Harold S. Blue          Director                           March 31, 2003
------------------------
    Harold S. Blue

/s/ Dr. Richard Corbin      Director                           March 31, 2003
------------------------
    Dr. Richard Corbin

/s/ Michael S. Falk         Director                           March 31, 2003
------------------------
    Michael S. Falk

/s/ Martin L. Garcia        Director                           March 31, 2003
------------------------
    Martin L. Garcia

/s/ James K. Murray III     Director                           March 31, 2003
------------------------
    James K. Murray III

                                       45

<PAGE>

                                 CERTIFICATIONS

        I, Phillip S. Dingle, certify that:

        1.      I have reviewed this annual report on Form 10-K of the
registrant, PlanVista Corporation;

        2.      Based on my knowledge, this annual report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
annual report;

        3.      Based on my knowledge, the financial statements, and other
financial information included in this annual report, fairly present in all
material respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this annual report;

        4.      The registrant's other certifying officers and I are responsible
for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

                (a)     designed such disclosure controls and procedures to
        ensure that material information relating to the registrant, including
        its consolidated subsidiaries, is made known to us by others within
        those entities, particularly during the period in which this annual
        report is being prepared;

                (b)     evaluated the effectiveness of the registrant's
        disclosure controls and procedures as of a date within 90 days prior to
        the filing date of this annual report (the "Evaluation Date"); and

                (c)     presented in this annual report our conclusions about
        the effectiveness of the disclosure controls and procedures based on our
        evaluation as of the Evaluation Date;

        5.      The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent functions):

                (a)     all significant deficiencies in the design or operation
        of internal controls which could adversely affect the registrant's
        ability to record, process, summarize and report financial data and have
        identified for the registrant's auditors any material weaknesses in
        internal controls; and

                (b)     any fraud, whether or not material, that involves
        management or other employees who have a significant role in the
        registrant's internal controls; and

        6.      The registrant's other certifying officers and I have indicated
in this annual report whether there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date:   March 31, 2003                     /s/ Phillip S. Dingle
                                            ------------------------------------
                                            Phillip S. Dingle
                                            Chairman and Chief Executive Officer

                                       46

<PAGE>

                                 CERTIFICATIONS

        I, Donald W. Schmeling, certify that:

        1.      I have reviewed this annual report on Form 10-K of the
registrant, PlanVista Corporation;

        2.      Based on my knowledge, this annual report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
annual report;

        3.      Based on my knowledge, the financial statements, and other
financial information included in this annual report, fairly present in all
material respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this annual report;

        4.      The registrant's other certifying officers and I are responsible
for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

                (a)     designed such disclosure controls and procedures to
        ensure that material information relating to the registrant, including
        its consolidated subsidiaries, is made known to us by others within
        those entities, particularly during the period in which this annual
        report is being prepared;

                (b)     evaluated the effectiveness of the registrant's
        disclosure controls and procedures as of a date within 90 days prior to
        the filing date of this annual report (the "Evaluation Date"); and

                (c)     presented in this annual report our conclusions about
        the effectiveness of the disclosure controls and procedures based on our
        evaluation as of the Evaluation Date;

        5.      The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent functions):

                (a)     all significant deficiencies in the design or operation
        of internal controls which could adversely affect the registrant's
        ability to record, process, summarize and report financial data and have
        identified for the registrant's auditors any material weaknesses in
        internal controls; and

                (b)     any fraud, whether or not material, that involves
        management or other employees who have a significant role in the
        registrant's internal controls; and

        6.      The registrant's other certifying officers and I have indicated
in this annual report whether there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date:    March 31, 2003                /s/ Donald W. Schmeling
                                       -----------------------------------------
                                       Donald W. Schmeling
                                       Chief Financial Officer

                                       47

<PAGE>

               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholders of PlanVista Corporation

In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of operations, of changes in stockholders' equity
(deficit) and comprehensive income and of cash flows present fairly, in all
material respects, the financial position of PlanVista Corporation and its
subsidiaries (PlanVista or the Company) at December 31, 2002 and 2001, and the
results of their operations and their cash flows for each of the three years in
the period ended December 31, 2002, in conformity with accounting principles
generally accepted in the United States of America. These financial statements
are the responsibility of PlanVista's management; our responsibility is to
express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with auditing standards
generally accepted in the United States of America, which 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, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 8, the Company changed its method of accounting for
amortization of goodwill in accordance with Statement of Financial Accounting
Standards No. 142, "Goodwill and Other Intangible Asset", effective January 1,
2002.


/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
March 20, 2003
Tampa, Florida

                                       F-1

<PAGE>


                              PLANVISTA CORPORATION
                           CONSOLIDATED BALANCE SHEETS
                       (IN THOUSANDS EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                                                               DECEMBER 31,
                                                                                   --------------------------------------
                                                                                         2002                 2001
                                                                                   -----------------    -----------------
<S>                                                                                <C>                  <C>
                                     ASSETS
Current assets:
  Cash and cash equivalents .................................................      $           1,198    $             395
  Accounts receivable, net of allowance for doubtful
   accounts of $1,985 and $6,236 at December 31,
   2002 and 2001, respectively ..............................................                  7,989                7,319
  Prepaid expenses and other current assets .................................                    174                  327
  Refundable income taxes ...................................................                  1,600                  608
                                                                                   -----------------    -----------------
          Total current assets ..............................................                 10,961                8,649
Property and equipment, net .................................................                  1,541                1,804
Other assets, net ...........................................................                    678                  267
Goodwill, net ...............................................................                 29,405               29,405
                                                                                   -----------------    -----------------
          Total assets ......................................................      $          42,585    $          40,125
                                                                                   =================    =================
                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
  Accounts payable ..........................................................      $           2,903    $           3,308
  Accrued liabilities .......................................................                  5,574               12,934
  Deferred revenue ..........................................................                    950                    -
  Current portion of long-term debt .........................................                    356                  308
                                                                                   -----------------    -----------------
          Total current liabilities .........................................                  9,783               16,550
Long-term debt and notes payable ............................................                 45,188               75,778
Other long-term liabilities .................................................                  1,003                1,087
                                                                                   -----------------    -----------------
          Total liabilities .................................................                 55,974               93,415
                                                                                   -----------------    -----------------
Commitments and contingencies

Common stock with make-whole provision (813,273 shares) .....................                  5,000                    -

Stockholders' equity (deficit):
  Series C convertible preferred stock, $0.01 par value, 40,000 shares
   authorized, 31,092 shares issued and outstanding at December 31, 2002 ....                 77,217                    -
  Common stock, $0.01 par value, 100,000,000 authorized, 15,956,021 shares
    issued at December 31, 2002 and, 15,445,880 at December 31, 2001 ........                    159                  154
  Additional paid-in capital ................................................                 45,602               92,335
  Treasury stock at cost, 1,944 shares at December 31, 2002 and 13,597 at
   December 31, 2001 ........................................................                    (38)                (265)
  Deficit ...................................................................               (141,329)            (145,514)
                                                                                   -----------------    -----------------
          Total stockholders' equity  (deficit) .............................                (18,389)             (53,290)
                                                                                   -----------------    -----------------
          Total liabilities and stockholders' equity ........................      $          42,585    $          40,125
                                                                                   =================    =================
</TABLE>

              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                       F-2

<PAGE>

                              PLANVISTA CORPORATION
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                     (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)


<TABLE>
<CAPTION>
                                                                                      YEAR ENDED DECEMBER 31,
                                                                       ------------------------------------------------------
                                                                              2002                2001              2000
                                                                       ----------------    ---------------   ----------------
<S>                                                                    <C>                 <C>               <C>
Operating revenue ..................................................   $         33,141    $        32,918   $         26,964
                                                                       ----------------    ---------------   ----------------
Cost of operating revenue:
  Marketing allowances .............................................                559                308                295
  Personnel expense ................................................              8,474              9,137              8,301
  Network access fees ..............................................              5,122              5,343              3,896
  Other ............................................................              5,267              6,213              3,993
  Depreciation .....................................................                528                467                303
                                                                       ----------------    ---------------   ----------------
       Total cost of operating revenue .............................             19,950             21,468             16,788
                                                                       ----------------    ---------------   ----------------
  Bad debt expense .................................................              3,356              3,348                649
  Offering costs ...................................................              1,213                  -                  -
  Amortization of goodwill .........................................                  -              1,378              1,380
  Loss on impairment of intangible assets ..........................                  -                  -              5,513
  Loss (gain) on sale of investments, net ..........................                  -              2,503               (332)
  Interest expense .................................................              5,628             12,098             10,489
  Other (income) expense ...........................................                  -               (175)               868
                                                                       ----------------    ---------------   ----------------
       Total expenses ..............................................             30,147             40,620             35,355
                                                                       ----------------    ---------------   ----------------

Income (loss) before (benefit) provision for income taxes,
 discontinued operations, loss on sale of discontinued operations,
 extraordinary loss, and cumulative effect of change in accounting
 principle .........................................................              2,994             (7,702)            (8,391)
(Benefit) provision for income taxes ...............................             (1,191)            26,811             (3,263)
                                                                       ----------------    ---------------   ----------------

Income (loss) before discontinued operations, loss on sale of
 discontinued operations, extraordinary loss and cumulative effect
 of change in accounting principle .................................              4,185            (34,513)            (5,128)
Loss from discontinued operations, net of taxes ....................                  -               (555)           (58,804)
Loss on sale of discontinued operations, net of taxes ..............                  -            (10,077)           (39,333)
Extraordinary loss, net of taxes ...................................                  -                  -               (954)
Cumulative effect of change in accounting principle, net of taxes ..                  -                (76)              (258)
                                                                       ----------------    ---------------   ----------------
Net income (loss) ..................................................              4,185            (45,221)          (104,477)
Preferred stock accretion and preferred stock dividends ............            (48,777)                 -                  -
                                                                       ----------------    ---------------   ----------------
Loss attributable to common stockholders ...........................   $        (44,592)   $       (45,221)  $       (104,477)
                                                                       ================    ===============   ================

Basic loss per share applicable to Common Stockholders:
   Income (loss) from continuing operations ........................   $           0.25    $         (2.37)  $          (0.37)
   Loss from discontinued operations ...............................                  -              (0.04)             (4.30)
   Loss from sale of discontinued operations .......................                  -              (0.70)             (2.88)
   Extraordinary loss ..............................................                  -                  -              (0.07)
   Cumulative effect of change in accounting principle .............                  -                  -              (0.02)
   Preferred stock accretion and preferred stock dividends .........              (2.97)                 -                  -
                                                                       ------------------  ---------------   ----------------
   Loss applicable to common stockholders ..........................   $          (2.72)   $         (3.11)  $          (7.64)
                                                                       ================    ===============   ================
Basic weighted average number of shares outstanding ................             16,427             14,558             13,679
                                                                       ================    ===============   ================

Diluted loss per share applicable to Common Stockholders:
   Income (loss) from continuing operations ........................   $           0.25    $         (2.37)  $          (0.37)
   Income (loss) from discontinued operations ......................                  -              (0.04)             (4.30)
   Loss from sale of discontinued operations .......................                  -              (0.70)             (2.88)
   Extraordinary loss ..............................................                  -                  -              (0.07)
   Cumulative effect of change in accounting principle .............                  -                  -              (0.02)
   Preferred stock accretion and preferred stock dividends .........              (2.95)                 -                  -
                                                                       ----------------    ---------------   ----------------
   Loss applicable to common stockholders ..........................   $          (2.70)   $         (3.11)  $          (7.64)
                                                                       ================    ===============   ================
Diluted weighted average number of shares outstanding ..............             16,523             14,558             13,679
                                                                       ================    ===============   ================
</TABLE>

              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                       F-3

<PAGE>

                              PLANVISTA CORPORATION
               CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS'
                    EQUITY (DEFICIT) AND COMPREHENSIVE INCOME
                       (IN THOUSANDS EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                                            SERIES C
                                                                           CONVERTIBLE     VOTING      ADDITIONAL
                                                          COMPREHENSIVE     PREFERRED      COMMON       PAID-IN       TREASURY
                                                             INCOME          STOCK          STOCK       CAPITAL        STOCK
                                                         --------------   ------------   ----------   -----------   -----------
<S>                                                      <C>              <C>            <C>          <C>           <C>
Balance at December 31, 1999 .......................                      $          -   $      152   $   110,357   $   (30,006)

Issuance of 1,718 shares in connection with the
 directors' compensation plan ......................                                 -            -            20             -
Issuance of 12,708 shares in connection with the
 employee stock purchase plan ......................                                 -            -            37             -
Issuance of 1,100 shares in connection with stock
 option plans ......................................                                 -            -             3             -
Net loss ...........................................     $     (104,477)             -            -             -             -
Unrealized depreciation on investment available
 for sale ..........................................             (2,204)             -            -             -             -
                                                         --------------
Comprehensive loss .................................     $     (106,681)             -
                                                         ==============   ------------   ----------   -----------   -----------
Balance at December 31, 2000 .......................                                            152       110,417       (30,006)

Issuance of 8,725 shares in connection with the
  directors' compensation plan .....................                                 -            -            57             -
Issuance of 2,051 shares in connection with the
  employee stock purchase plan .....................                                 -            -            22             -
Issuance of 189,301 shares in connection with
 stock option plans ................................                                 -            2           480             -
Issuance of 1,011,071 shares in HealthPlan Holdings,
 Inc. ..............................................                                 -            -       (11,905)       19,205
Issuance of 553,500 shares in connection with
 lending activities ................................                                 -            -        (6,736)       10,536
Net loss ...........................................     $      (45,221)             -            -             -             -
Unrealized depreciation on investment available for
 sale ..............................................                610              -            -             -             -
                                                         --------------
Comprehensive loss .................................     $      (44,611)             -
                                                         ==============   ------------   ----------   -----------   -----------
Balance at December 31, 2001 .......................                                 -          154        92,335          (265)

Issuance of 18,701 shares in connection with the
 directors' compensation plan ......................                                 -            -            26             -
Issuance of 298,195 shares in settlement of
 subordinated notes ................................                                 -            4         1,610             -
Issuance of 156,490 shares to HealthPlan Holdings,
 Inc. ..............................................                                 -            1           408           227
Issuance of 29,000 shares in connection with
 settlement of senior notes ........................                            28,440            -             -             -
Net income .........................................     $        4,185              -            -             -             -
Preferred stock accretion and preferred stock
 dividend ..........................................                            48,777            -       (48,777)            -
                                                         --------------
Comprehensive income ...............................     $        4,185              -
                                                         ==============   ------------   ----------   -----------   -----------
Balance at December 31, 2002 .......................                      $     77,217   $      159   $    45,602   $       (38)
                                                                          ============   ==========   ===========   ===========

<CAPTION>
                                                                           UNREALIZED
                                                                          APPRECIATION
                                                                              ON
                                                            RETAINED      INVESTMENTS
                                                            EARNINGS       AVAILABLE
                                                            (DEFICIT)       FOR SALE       TOTAL
                                                         --------------   ------------   ----------
<S>                                                      <C>              <C>            <C>
Balance at December 31, 1999 .......................     $        4,184   $      1,594   $   86,281

Issuance of 1,718 shares in connection with the
 directors' compensation plan ......................                  -              -           20
Issuance of 12,708 shares in connection with the
 employee stock purchase plan ......................                  -              -           37
Issuance of 1,100 shares in connection with stock
 option plans ......................................                  -              -            3
Net loss ...........................................           (104,477)             -     (104,477)
Unrealized depreciation on investment available
 for sale ..........................................                  -         (2,204)      (2,204)

Comprehensive loss .................................
                                                         --------------   ------------   ----------
Balance at December 31, 2000 .......................           (100,293)          (610)     (20,340)

Issuance of 8,725 shares in connection with the
  directors' compensation plan .....................                  -              -           57
Issuance of 2,051 shares in connection with the
  employee stock purchase plan .....................                  -              -           22
Issuance of 189,301 shares in connection with
 stock option plans ................................                  -              -          482
Issuance of 1,011,071 shares in HealthPlan Holdings,
 Inc. ..............................................                  -              -        7,300
Issuance of 553,500 shares in connection with
  lending activities ...............................                  -              -        3,800
Net loss ...........................................            (45,221)             -      (45,221)
Unrealized depreciation on investment available for
 sale ..............................................                  -            610          610

Comprehensive loss .................................
                                                         --------------   ------------   ----------
Balance at December 31, 2001 .......................           (145,514)             -      (53,290)

Issuance of 18,701 shares in connection with the
 directors' compensation plan ......................                  -              -           26
Issuance of 298,195 shares in settlement of
 subordinated notes ................................                  -              -        1,614
Issuance of 156,490 shares to HealthPlan Holdings,
 Inc. ..............................................                  -              -          636
Issuance of 29,000 shares in connection with
 settlement of senior notes ........................                  -              -       28,440
Net income .........................................              4,185              -        4,185
Preferred stock accretion and preferred stock
 dividend ..........................................                  -              -            -

Comprehensive income ...............................
                                                         --------------   ------------   ----------
Balance at December 31, 2002 .......................     $     (141,329)  $          -   $  (18,389)
                                                         ==============   ============   ==========
</TABLE>

                 The accompanying notes are an integral part of
                    these consolidated financial statements.

                                       F-4

<PAGE>

                              PLANVISTA CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                  FOR THE YEAR ENDED DECEMBER 31,
                                                      --------------------------------------------------
                                                           2002             2001              2000
                                                      --------------  ----------------  ----------------
<S>                                                   <C>             <C>               <C>
Cash flows from operating activities:
   Net income (loss) ...............................  $        4,185  $        (45,221) $       (104,477)
   Losses from discontinued operations                                          10,632            98,137
Adjustments to reconcile net income (loss) to net
 cash provided by (used in) operating activities:
   Depreciation ....................................             528               467               303
   Amortization ....................................               -             1,378             1,380
   Loss on impairment of goodwill ..................               -                 -             5,513
   Loss (gain) on sale of investments ..............               -             2,503              (332)
   Deferred taxes ..................................               -            29,418           (24,886)
Changes in assets and liabilities::
   Net liabilities of discontinued operations ......               -                 -            41,877
   Restricted cash .................................               -                 -                 3
   Accounts receivable .............................            (670)             (465)           (3,003)
   Refundable income taxes .........................            (992)            1,643                 -
   Prepaid expenses and other current assets .......             153               644              (241)
   Other assets ....................................            (411)            1,603            (1,182)
   Accounts payable ................................            (405)            2,252            (2,379)
   Accrued liabilities .............................            (902)          (14,312)           (4,504)
   Other long-term liabilities .....................             (84)              (76)           (2,960)
                                                      --------------  ----------------  ----------------
      Net cash provided by (used in) operating
       activities ..................................           1,402            (9,534)            3,249
                                                      --------------  ----------------  ----------------
Cash flows from investing activities:
   Purchases of property and equipment .............            (265)             (480)           (4,789)
   Cash paid for acquisitions, net of cash
    acquired .......................................               -                 -            (3,054)
   Proceeds from sale of business units ............               -                 -            33,656
   Proceeds from sale of investments ...............               -               518               936
                                                      --------------  ----------------  ----------------
          Net cash (used in) provided by
           investing activities ....................            (265)               38            26,749
                                                      --------------  ----------------  ----------------
Cash flows from financing activities:
   Net borrowings (payments) under line of credit ..            (263)            6,143           (29,101)
   Net payments on other debt ......................             (97)           (1,095)             (455)
   Proceeds from common stock issued ...............              26             4,361                40
                                                      --------------  ----------------  ----------------
          Net cash (used in) provided by
           financing activities ....................            (334)            9,409           (29,516)
                                                      --------------  ----------------  ----------------
Net increase (decrease) in cash and cash equivalents             803               (87)              482
Cash and cash equivalents at beginning of year .....             395               482                 -
                                                      --------------  ----------------  ----------------
Cash and cash equivalents at end of year ...........  $        1,198  $            395  $            482
                                                      ==============  ================  ================
Supplemental disclosure of cash flow information:
   Cash paid for interest ..........................  $        4,794  $          4,550  $          9,544
                                                      ==============  ================  ================
   Net (refunds received) cash paid for income taxes  $            -  $         (2,607) $         (1,728)
                                                      ==============  ================  ================
Supplemental noncash investing and
 financing activities:
   Common stock issued in connection with:
    Settlement of $1.0 million of subordinated notes
    and $0.5 million of accrued interest ...........  $        1,521  $              -  $              -
                                                      ==============  ================  ================
      Sale of business units .......................  $            -  $          5,000  $              -
                                                      ==============  ================  ================
      Registration rights agreement.................  $          636  $              -  $              -
                                                      ==============  ================  ================
      Conversion of $5.0 million note ..............  $        5,000  $              -  $              -
                                                      ==============  ================  ================
      Preferred stock issued in connection with debt
       restructure, net ............................  $       28,440  $              -  $              -
                                                      ==============  ================  ================
Preferred stock dividends...........................  $        2,100  $              -  $              -
                                                      ==============  ================  ================
Notes issued .......................................  $            -  $          5,000  $              -
                                                      ==============  ================  ================
Common stock issued ................................  $            -  $          7,300  $              -
                                                      ==============  ================  ================
</TABLE>

        The accompanying notes are an integral part of these consolidated
                              financial statements.

                                       F-5

<PAGE>

                              PLANVISTA CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

1.      DESCRIPTION OF BUSINESS

        PlanVista Corporation (together with its wholly owned subsidiaries,
"PlanVista," "we," "our," or "us"), provides medical cost containment and
business process outsourcing solutions for the medical insurance and managed
care industries. We provide integrated national preferred provider organization
(sometimes called PPO) network access, electronic claims repricing, and claims
and data management business process outsourcing services to health care payers,
such as self-insured employers, medical insurance carriers, third party
administrators (sometimes called TPAs), health maintenance organizations
(sometimes called HMOs), and other entities that pay claims on behalf of health
plans. We also provide network and data management business process outsourcing
services for health care providers, including individual providers, PPOs, and
other provider groups.

2.      BANK RESTRUCTURE AND REORGANIZATION

        In June 2000, we initiated a plan of reorganization designed to divest
certain of our underperforming and non-growth businesses and to reduce and
refinance our credit facility. Effective June 18, 2001, we sold the last of
these non-strategic businesses (as further described below) and, through the
first quarter of 2002, pursued the restructuring of our remaining debt. On April
12, 2002, we completed the restructuring of our debt, whereby we restructured
approximately $69.0 million of outstanding indebtedness to our lenders,
including outstanding principal and accrued and unpaid interest and bank fees.
This indebtedness was restructured with our current lenders whereby we entered
into a $40.0 million term loan with an annual interest rate of prime plus 1.0%
that matures May 31, 2004 and issued $29.0 million of Series C convertible
preferred stock and an additional promissory note in the amount of $184,872.

        The term loan agreement contains certain financial covenants including
minimum monthly EBITDA levels (defined as earnings before interest, taxes,
depreciation and amortization, and adjusted for non-cash items deducted in
calculating net income and severance, if any, paid to certain officers of
PlanVista), maximum quarterly and annual capital expenditures, a minimum
quarterly fixed charge ratio that is based primarily on our operating cash
flows, and maximum quarterly and annual extraordinary expenses (excluding
certain pending and threatened litigation, indemnification agreements, and
certain other matters as defined in the term loan agreement). From April 12,
2002 through November 30, 2002, we were in compliance with these financial
covenants. During December 2002, we were not in compliance with our EBITDA
covenant and we subsequently obtained a waiver for this non-compliance from our
senior lenders. Beginning in 2003, the revised minimum EBITDA levels are $1.0
million in January 2003, $700,000 in February 2003, $800,000 per month beginning
in March 2003 through July 2003, and $1.0 million per month thereafter.

        The Series C convertible preferred stock accrues dividends at 10.0% per
annum during the first 12 months from issuance and at a rate of 12.0% per annum
thereafter. Dividends are payable quarterly in additional shares of Series C
convertible preferred stock or, at our option, in cash. We have chosen to pay
dividends in the form of additonal shares, and to date we have issued an
aggregate of 2,092 additional shares of Series C convertible preferred stock as
dividends. At any time after October 12, 2003, the Series C convertible
preferred stock may be converted into shares of our common stock at the rate of
703.37 shares of common stock for each preferred share, or a total of 20,996,398
shares (or 55.6%) of our common stock upon full conversion, subject to
adjustment. The Series C convertible preferred stock has weighted-average
anti-dilution protection and a provision that in no event will the Series C
convertible preferred stock convert into less than 51.0% of our outstanding
shares of common stock. In addition, the Series C convertible preferred
stockholders are entitled to elect three members to our board of directors. The
certificate of designation for the Series C convertible preferred stock also
contains provisions that permit the Series C convertible preferred stockholders
to immediately elect one additional member to our board of directors to replace
one of the board members elected by our common shareholders if we fail to
achieve certain minimum cash levels as defined under the certificate of
designation or if we fail to make our required principal and interest payments
in accordance with the terms of the Agreement, or fail to redeem the Series C
convertible preferred stock by October 12, 2003. The issuance of the Series C
convertible preferred stock was not put to stockholder approval in reliance on
an applicable exception to the shareholder approval policy of the New York Stock
Exchange (sometimes referred to as the NYSE). Stockholders were notified prior
to the closing of the transaction of our reliance on such exception. In
connection with the issuance of the Series C convertible preferred stock, the
senior lenders entered into a Stockholders' Agreement with us that provides,
among other things, for registration rights in connection with the sale of any
shares of common stock that are issued upon conversion of the Series C
convertible preferred stock. The registration rights include demand and
incidental registration rights. In

                                       F-6

<PAGE>

addition, as described below, $5.0 million of subordinated debt was converted to
common stock, we extended the maturity date of $4.3 million of subordinated debt
by over two years, and approximately $2.5 million of obligations was converted
to $1.5 million of common stock and a $950,000 credit for in-kind services (see
Note 4).

        In connection with our new credit facility and debt restructuring, we
were required to adopt the accounting principles prescribed by Emerging Issues
Task Force No. 00-27, Application of Issue No. 98-5 to Certain Convertible
Instruments ("EITF 00-27"). In accordance with the accounting requirements of
EITF 00-27, we have reflected approximately $46.7 million as an increase to the
carrying value of our Series C convertible preferred stock with a comparable
reduction to additional paid-in capital. The amount accreted to the Series C
convertible preferred stock is calculated based on (a) the difference between
the closing price of our common stock on April 12, 2002 and the conversion price
per share available to the holders of our Series C convertible preferred stock
multiplied by (b) our estimate of the number of shares of common stock that will
be issued if the shares of our Series C convertible preferred stock are ever
converted. Such shares are not convertible until October 12, 2003. This amount
is accreted over the contractual life of the Series C convertible preferred
stock. This non-cash entry does not affect our net income or our cash flow but
does impact the net income deemed available to our common stockholders for the
year ended December 31, 2002. Net income per share available to the holders of
our common stock during the year ended December 31, 2002 was further reduced by
a preferred stock dividend totaling $2.1 million, paid in shares of our Series C
convertible preferred stock to the holders of our Series C convertible preferred
stock.

        Prior to June 18, 2001, we maintained two operating units, one of which
was our PlanVista Solutions segment that included our managing general
underwriter business. The other unit was our third party administration segment,
which was operated primarily through our HealthPlan Services, Inc. ("HPS"),
American Benefit Plan Administrators, Inc. ("ABPA"), and Southern Nevada
Administrators, Inc. ("SNA") subsidiaries, and which provided marketing,
distribution, administration, and technology platform services for health care
plans and other benefit programs. PlanVista functions solely as a service
provider generating fee-based income and does not assume any underwriting risk.

        On June 18, 2001, we completed the sale of our third party
administration and managing general underwriter (sometimes called MGU) business
units to HealthPlan Holdings, Inc. The third party administration business
included the Small Group Business operations and its associated data processing
facilities based in Tampa, Florida, as well as the Taft-Hartley businesses that
operated under the names ABPA and SNA, based in El Monte, California and Las
Vegas, Nevada, respectively. The managing general underwriter business was the
Philadelphia- based Montgomery Management Corporation. The accompanying
unaudited condensed consolidated financial statements have been restated to
reflect the operations of these business units described above as discontinued.

        In connection with this non-cash transaction, the buyer, HealthPlan
Holdings, Inc., assumed approximately $40.0 million in working capital deficit
of the acquired businesses and acquired assets having a fair market value of
approximately $30.0 million. At the closing of this transaction, we issued
709,757 shares of our common stock to offset $5.0 million of the assumed
deficit. We offset the remaining $5.0 million of this deficit with a long-term
convertible subordinated note, which automatically converted into 813,273 shares
of common stock on April 12, 2002 in connection with the restructuring of our
credit facilities. Our agreement with HealthPlan Holdings states that, if
HealthPlan Holdings does not receive gross proceeds of at least $5.0 million
upon the sale of the conversion shares, then we must issue and distribute to
them additional shares of our common stock, based on a ten-day trading average
price, to compensate HealthPlan Holdings for the difference, if any, between
$5.0 million and the amount of proceeds they realize from the sale of the
conversion shares. Our agreement with HealthPlan Holdings also requires that we
register the conversion shares upon demand. To date, HealthPlan Holdings has
made no demand for registration of these conversion shares.

        We entered into a registration rights agreement in favor of HealthPlan
Holdings with respect to the 709,757 shares we issued to them at closing. This
Registration Rights Agreement required that we file a registration statement
covering the issued shares as soon as practicable after the closing of their
purchase of such shares. The Agreement also contained provisions requiring
redemption of such shares or the issuance of certain additional penalty shares
(in the event that our lenders prohibited redemption), if such registration
statement did not become effective by certain specified time periods. Because
the registration statement we filed with the Securities and Exchange Commission
covering such shares was not declared effective within the required time
periods, we issued to HealthPlan Holdings the maximum number of penalty shares
specified by the registration rights agreement, which

                                       F-7

<PAGE>

was 200,000 shares of our common stock. As of this date, we still have not
registered the 709,757 purchased shares.

        Following the sale of HealthPlan Services, we reimbursed HealthPlan
Services approximately $4.3 million for pre-closing liabilities that HealthPlan
Services settled on our behalf and issued to HealthPlan Holdings 101,969 shares
of our common stock as penalty shares relating to certain post closing disputes
with respect to those pre-closing liabilities. The primary source of the funds
for the reimbursement to HealthPlan Services was the proceeds of July 2001
private placements of our common stock to certain investment accounts managed by
DePrince, Race & Zollo, an investment firm. John Race, who was our director at
the time, was one of the principals of DePrince, Race & Zollo. In connection
with the private placements, which were ratified by our stockholders at our
annual meeting in July 2002, we issued an aggregate of 553,500 shares of our
common stock in exchange for $3.8 million, which represented a 15.0% discount
from the ten-day trading average of our common stock prior to the dates of
issuance.

        We are currently in discussions with HealthPlan Holdings to finalize any
purchase price adjustments associated with the HealthPlan Services sale. These
adjustments relate primarily to the amount of accrued liabilities and trade
accounts receivable reserves, and the classification of investments at the
transaction date. HealthPlan Holdings believes it is due approximately $1.7
million from us related to this transaction, while we believe we have claims
against HealthPlan Holdings amounting to approximately $4.5 million (which would
be partially offset against other post-closing payments we have agreed to pay,
subject to certain limitations). In the event we are unable to resolve these
matters directly with HealthPlan Holdings, we will seek to resolve them through
binding arbitration as provided for in the purchase agreement. We believe the
resolution of this matter will not have a material adverse effect on our
financial condition, results of operations, or cash flows.

        Also, as part of the transaction noted above, we leased office space for
our Tampa headquarters from HealthPlan Holdings. During 2002, we incurred
approximately $25,000 in rent expense related to this lease. This lease expired
in June 2002.

        We believe that all consolidated operating and financing obligations for
the next twelve months will be met from internally generated cash flow from
operations and available cash. Although there can be no assurances, management
believes, based on available information, that we will be able to maintain
compliance with the terms of our restructured credit facility, including the
financial covenants, for the foreseeable future. Our ability to fund our
operations, make scheduled payments of interest and principal on our
indebtedness, and maintain compliance with the terms of our restructured credit
facility, including our financial covenants, depends on our future performance,
which is subject to economic, financial, competitive, and other factors beyond
our control. If we are unable to generate sufficient cash flows from operations
to meet our financial obligations and achieve the restrictive debt covenants as
required under the restructured credit facility, there may be a material adverse
effect on our business, financial condition, and results of operations.
Management is continuing to explore alternatives to reduce our obligations,
recapitalize our company, and provide additional liquidity. There can be no
assurances that we will be successful in these endeavors.

        On March 7, 2003, PVC Funding Partners LLC, an affiliate of Commonwealth
Associates, LP and Comvest Venture Partners, acquired directly from our senior
lenders 96.0% of our outstanding Series C convertible preferred stock previously
held by our senior lenders and $20.5 million of our outstanding bank debt. The
transaction reduces our senior lenders' collective interest in PlanVista from
over $71.0 million to $20.6 million. See Note 16.

3.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        USE OF ESTIMATES

        We prepare our consolidated financial statements in conformity with
generally accepted accounting principles in the United States of America. These
principles require 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 operating revenues and expenses during the reporting period.
Actual results could differ from those estimates.

                                       F-8

<PAGE>

        PRINCIPLES OF PRESENTATION

        The consolidated financial statements include our accounts and those of
our subsidiaries. All intercompany transactions and balances have been
eliminated in consolidation.

        REVENUE RECOGNITION

        We generally earn our operating revenue in the form of fees generated
from the discounts we provide for the payers that access our network. We enter
into agreements with our healthcare payer customers that require them to pay a
percentage of the cost savings generated from our network discounts with
participating providers. These agreements are generally terminable upon 90 days
notice. During 2002, three clients and their affiliates accounted for an
aggregate of 19.6% of our net operating revenue. The loss of any of these client
groups could have a material adverse effect on our financial results. In 2002,
approximately 87.0% of our operating revenues were generated from percentage of
savings contracts with our customers. Operating revenue from a percentage of
savings contract is generally recognized when claims processing and
administrative services have been performed. Operating revenue from customers
with certain contingent contractual rights is not recognized until the
corresponding cash is collected. The remainder of our operating revenue is
generated from customers that pay us a monthly fee based on eligible employees
enrolled in a benefit plan covered by our health benefits payers clients.
Operating revenues under such agreements are recognized based on when the
services are provided.

        CASH AND CASH EQUIVALENTS

        Cash and cash equivalents are defined as highly liquid investments that
have original maturities of three months or less.

        ACCOUNTS RECEIVABLE

        We generate our operating revenue and related accounts receivable from
services provided to healthcare payers, such as self-insured employers, medical
insurance carriers, health maintenance organizations (sometimes called HMOs),
third party administrators (sometimes called TPAs) and other entities that pay
claims on behalf of health plans, and participating health care services
providers, including providers and provider networks.

        We evaluate the collectibility of our accounts receivable based on a
combination of factors. In circumstances where we are aware of a specific
customer's inability to meet its financial obligations to us, we record a
specific reserve for bad debts against amounts due to reduce the net recognized
receivable to the amount we reasonably believe will be collected. For all other
customers, we recognize reserves for bad debts based on past write-off history,
average percentage of receivables written off historically, and the length of
time the receivables are past due. To the extent historical credit experience is
not indicative of future performance or other assumptions used by management do
not prevail, loss experience could differ significantly, resulting in either
higher or lower future provision for losses.

        PREPAID EXPENSES AND OTHER CURRENT ASSETS

        Prepaid expenses and other current assets consist primarily of prepaid
insurance, postage, and repair and maintenance contracts.

        IMPAIRMENT OF LONG-LIVED ASSETS

        The excess of cost over the fair value of net assets acquired is
recorded as goodwill and through the year ended December 31, 2001 was amortized
on a straight-line basis over 25 years. We adopted the accounting requirements
of SFAS No. 142 effective January 1, 2002. See Note 8. Under SFAS No. 142,
goodwill is no longer amortized.

        SFAS No. 142 requires the use of a nonamortization approach to account
for purchased goodwill and certain intangibles. Under a nonamortization
approach, goodwill and certain intangibles are not amortized into results of
operations, but instead are reviewed for impairment and written down and charged
to results of operations

                                       F-9

<PAGE>

only in the periods in which the recorded value of goodwill and certain
intangibles is more than its fair value. The provisions of each statement apply
to goodwill and intangible assets acquired prior to June 30, 2001. These new
requirements will impact future period net income by an amount equal to the
discontinued goodwill amortization offset by goodwill impairment charges, if
any, and adjusted for any differences between the old and new rules for defining
intangible assets on future business combinations. We conducted our impairment
test in 2002 and determined that our goodwill was not impaired.

        PROPERTY AND EQUIPMENT

        Property and equipment is stated at cost. Costs of the assets acquired
have been recorded at their respective fair values at the date of acquisition.
Expenditures for maintenance and repairs and research and development costs are
expensed as incurred. Major improvements that increase the estimated useful life
of an asset are capitalized. Depreciation is computed using the straight-line
method over the following estimated useful lives the related assets:

                                                YEARS
                                                -----
        Furniture and fixtures                  3-10
        Computers and equipment                 2-5
        Computer software                       3 or expected life
        Leasehold improvements                  Lease term

        STOCK-BASED COMPENSATION

        We apply the intrinsic value method currently prescribed by Accounting
Principles Board Opinion No. 25 ("APB 25") and discloses the pro forma effects
of the fair value based method, as prescribed by Statement of Financial
Accounting Standards ("SFAS") No. 123.

        MEASUREMENT OF FAIR VALUE

        We apply APB 25 and related interpretations in accounting for its stock
option plans and employee stock purchase plan. Accordingly, no compensation cost
has been recognized related to these plans. Had compensation cost for our stock
option and employee stock purchase plans been determined based on the fair value
at the grant dates, as prescribed in SFAS 123, our net income (loss) and net
income (loss) per share would have been as follows:

                                             YEAR ENDED DECEMBER 31,
                                       ----------------------------------
                                         2002         2001        2000
                                       --------    ---------   ----------
Net income (loss) attributable to
 common stock (in thousands):
    As reported                        $  4,185    $ (45,221)  $ (104,477)
    Pro forma                             4,179      (46,269)    (105,352)
Net income (loss) per share:
    Basic as reported                  $   0.25    $   (3.11)  $    (7.64)
    Basic pro forma                        0.25        (3.18)       (7.70)
    Diluted as reported                    0.25        (3.11)       (7.64)
    Diluted pro forma                      0.25        (3.18)       (7.70)

        The fair value of each option grant is estimated on the date of grant
using the Black-Scholes option pricing model with the following assumptions used
for grants during the applicable year: dividend yield of 0.00% for the years
ended December 31, 2002, 2001 and 2000; expected volatility of 30% for each of
the years ended December 31, 2002, 2001 and 2000; risk-free interest rates of
5.25% for options granted during the year ended December 31, 2002, 4.64% to
4.93% for options granted during the year ended December 31, 2001, and 6.38% to
6.47% for options granted during the year ended December 31, 2000, and a
weighted average expected option term of four years for all three years.

<PAGE>
                                      F-10
        INCOME TAXES

        We recognize deferred assets and liabilities for the expected future tax
consequences of temporary differences between the carrying amounts and the tax
bases of assets and liabilities. A valuation allowance is provided when it is
more likely than not that some portion of the deferred tax asset will not be
realized.

        EARNINGS PER SHARE

        Basic earnings per share is calculated by dividing the income or loss
available to common stockholders by the weighted average number of shares
outstanding for the period, without consideration for common stock equivalents.
The calculation of diluted earnings per share reflects the effect of outstanding
options and warrants using the treasury stock method, unless antidilutive.

        ESTIMATED FAIR VALUE OF FINANCIAL INSTRUMENTS

        SFAS No. 107, "Disclosure about Fair Value of Financial Instruments,"
requires the disclosure of the fair value of financial instruments, including
assets and liabilities recognized and not recognized in the consolidated balance
sheet.

        Management estimates that the aggregate net fair value of other
financial instruments recognized on the consolidated balance sheet (including
cash and cash equivalents, receivables and payables and short-term borrowings)
approximates their carrying value, as such financial instruments are short-term
in nature, bear interest at current market rates or are subject to repricing.

        DERIVATIVE FINANCIAL INSTRUMENTS

        We had no derivative financial instrument transactions during 2002.
During 2001, we used derivative financial instruments including interest rate
swaps principally in the management of its interest rate exposures. Amounts to
be paid or received under interest rate swap agreements were accrued as interest
rates change and were recognized over the life of the swap agreements as an
adjustment to interest expense.

        We managed interest rate risk on our variable rate debt by using
interest rate swap agreements. The agreements, which expired in September 2001
and December 2001, effectively converted $40.0 million of variable rate debt
under the Credit Agreement to fixed rate debt at a weighted average rate of
6.18%.

        On June 15, 1998, the FASB issued SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities." We adopted SFAS 133 in the first
quarter of 2001. SFAS 133 requires that all derivative instruments be recorded
on the balance sheet at their fair value. Changes in the fair value of
derivatives are recorded each period in current earnings or other comprehensive
income, depending on whether a derivative is designated as part of a hedge
transaction and, if it is, the type of hedge transaction. During the twelve
months ended December 31, 2001, we recorded a $76,000 pretax change in the
market value of the interest rate swaps from December 31, 2000. We also recorded
a $76,000 expense, net of taxes, as a cumulative effect of change in accounting
principle representing the fair value of the interest rate swaps at January 1,
2001.

        NEW ACCOUNTING PRONOUNCEMENTS

        In August 2001, the FASB finalized SFAS 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets." SFAS 144 addresses accounting and
reporting for the impairment or disposal of long-lived assets, including the
disposal of a segment of business. SFAS 144 is effective for fiscal years
beginning after December 15, 2001, with earlier application encouraged. We
adopted SFAS 144 as of January 1, 2002.

        On April 30, 2002, the FASB issued SFAS No. 145, "Rescission of FASB
Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections." SFAS No. 145 eliminates the requirement that gains and losses from
the extinguishment of debt be aggregated and, if material, classified as an
extraordinary item, net of the related income tax effect and eliminates an
inconsistency between the accounting for sale-leaseback transactions and certain
lease modifications that have economic effects that are similar to
sale-leaseback

                                      F-11

<PAGE>

transactions. Generally, SFAS No. 145 is effective for transactions occurring
after May 15, 2002. The adoption of the standard will have no impact on us.

        In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities" ("SFAS No. 146"), which addresses
accounting for restructuring and similar costs. SFAS No. 146 supersedes previous
accounting guidance, principally Emerging Issues Task Force Issue No. 94-3. We
will adopt the provisions of SFAS No. 146 for restructuring activities initiated
after December 31, 2002. SFAS No. 146 requires that the liability for costs
associated with an exit or disposal activity be recognized when the liability is
incurred. Under Issue 94-3, a liability for an exit cost was recognized at the
date of our commitment to an exit plan. SFAS No. 146 also establishes that the
liability should initially be measured and recorded at fair value. Accordingly,
SFAS No. 146 may affect the timing of recognizing future restructuring costs as
well as the amounts recognized. The adoption of SFAS No. 146 will not have an
impact on us.

        In November 2002, the FASB issued FIN 45, "Guarantor's Accounting and
Disclosure Requirements for Guarantees, Including Guarantees of Indebtedness of
Others (an interpretation of SFAS No. 5, 57 and 107 and rescission of SFAS
Interpretation No. 34)," which modifies the accounting and enhances the
disclosure of certain types of guarantees. FIN 45 requires that upon issuance of
certain guarantees, the guarantor must recognize a liability for the fair value
of the obligation it assumes under the guarantee. FIN 45's provisions for the
initial recognition and measurement are to be applied to guarantees issued or
modified after December 31, 2002. The disclosure requirements are effective for
financial statements of annual periods that end after December 15, 2002. We do
not believe FIN 45 will have an impact on us.

        In December 2002, the FASB issued SFAS No. 148, "Accounting for
Stock-Based Compensation - Transition and Disclosure - an amendment of FASB
Statement No. 123," and is effective for fiscal years ending after December 15,
2002. SFAS No. 148 provides for alternative methods of transition for a
voluntary change to the fair value based method of accounting for stock-based
employee compensation. Additionally, SFAS No. 148 requires prominent disclosures
in both annual and interim financial statements about the method of accounting
for stock-based employee compensation. The adoption of SFAS No. 148 did not have
a material impact on us.

        On January 17, 2003, the FASB issued FIN No. 46, "Consolidation of
Variable Interest Entities, an interpretation of ARB No. 51," which imposes a
new approach in determining if a reporting entity should consolidate certain
legal entities, including partnerships, limited liability companies, or trusts,
among others, collectively defined as variable interest entities or VIEs. A
legal entity is considered a VIE if it does not have sufficient equity at risk
to finance its own activities without relying on financial support from other
parties. Additional criteria must be applied to determine if this condition is
met or if the equity holders, as a group, lack any one of three stipulated
characteristics of a controlling financial interest. If the legal entity is a
VIE, then the reporting entity determined to be the primary beneficiary must
consolidate it. Even if a reporting entity is not obligated to consolidate a
VIE, then certain disclosures must be made about the VIE if the reporting entity
has a significant variable interest. Certain transition disclosures are required
for all financial statements issued after January 31, 203. The ongoing
disclosure and consolidation requirements are effective for all interim
financial periods beginning after June 15, 2003. We do not believe that FIN 46
will currently have a material impact on us.

        RECLASSIFICATIONS

        Certain amounts in the 2001 and 2000 consolidated financial statements
are reclassified to conform to the 2002 presentation.

4.      SALE OF ASSETS AND DISCONTINUED OPERATIONS

        On June 18, 2001, we completed the sale of our TPA and MGU business
units to HealthPlan Holdings, Inc. The TPA business included the small group
business operations and its associated data processing facilities located in
Tampa, FL, as well as the Taft-Hartley businesses that operate under the name
ABPA and SNA, based in EL Monte, CA and Las Vegas, NV, respectively. The MGU
business was the Philadelphia-based Montgomery Management Corporation. As a
result of the transaction, we recognized a pretax loss of $9.3 million. The
accompanying consolidated financial statements reflect the business units sold
as discontinued operations.

                                      F-12

<PAGE>

        In 2000, we recorded an $80.3 million impairment of goodwill and
contract rights related to our TPA segment and MGU business.

        On October 26, 2000, we sold our self-funded business unit for
approximately $13.6 million, consisting of $12.1 million cash and the assumption
of additional current liabilities in the amount of $1.5 million. The unit was
headquartered in Columbus, Ohio and operated primarily under the names
Harrington Benefit Services and CENTRA HealthPlan. We used the net cash proceeds
from the sale to reduce our bank debt by $8.7 million. As a result of the
transaction, we recognized a pretax loss of $52.5 million. We settled
contingencies during the fourth quarter of 2000 and recorded an additional loss
of $4.8 million. We do not believe that there are any additional material
contingencies.

        On September 15, 2000, we sold our Ohio workers' compensation managed
care organization unit for approximately $3.5 million cash. The unit was part of
our acquisition of Columbus, Ohio-based Harrington Services Corporation in 1996.
We used the net cash proceeds from the sale to reduce our bank debt by $2.8
million. As a result of the transaction, we recognized a pretax gain of $3.2
million.

        On July 5, 2000, we sold our unemployment compensation and workers'
compensation units for approximately $19.1 million cash. Our unemployment
compensation business operated under the name R.E. Harrington, and our workers'
compensation unit conducted business as Harrington Benefit Services Workers'
Compensation Division. Both units were part of our acquisition of Columbus,
Ohio-based Harrington Services Corporation in 1996. We used the net cash
proceeds from the sale to reduce our bank debt by $18.0 million. As a result of
the transaction, we recognized a pretax gain of $7.3 million.

        On April 14, 2000, we agreed to terminate our merger agreement with
UICI. As a result, we expensed $1.1 million of costs including legal, financial
advisory, and other fees associated with this transaction in the second quarter
of 2000.

        Summarized financial position and operating results of the discontinued
business units for the years ended December 31, 2001 and 2000 are as follows:

                                                  YEAR ENDED DECEMBER 31,
                                                    2001            2000
                                               ---------------  ------------
Net revenues   ............................... $        36,427  $    157,867
                                               ===============  ============
Loss from discontinued operations
  before income tax benefit (expense)......... $          (509) $    (82,586)
Income tax (expense) benefit .................             (46)       23,782
                                               ---------------  ------------
Loss from discontinued operations ............ $          (555) $    (58,804)
                                               ===============  ============
Loss on sale of discontinued operations
  before income tax (expense) benefit......... $        (9,288) $    (42,741)
Income tax (expense) benefit..................            (789)        3,408
                                               ---------------  ------------
Loss on sale of discontinued operations....... $       (10,077) $    (39,333)
                                               ===============  ============

        As of December 31, 2002 and 2001, there were no assets or liabilities
remaining included on our consolidated financial statements associated with
discontinued operations.

5.      CONCENTRATION OF CUSTOMERS

        We are a party to a variety of contracts to provide medical cost
containment and business process outsourcing services. For the years ended
December 31, 2002, 2001 and 2000, our three largest customers accounted for
approximately 19.6%, 24.6%, and 33.0%, respectively, of total revenues.

                                      F-13

<PAGE>

6.      PROPERTY AND EQUIPMENT

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

                                                   December 31,
                                            -------------------------
                                                2002           2001
                                            ------------  -----------
        Furniture and fixtures              $        603  $       603
        Computers and equipment                    1,233        1,039
        Computer software                          1,694        1,635
                                            ------------  -----------
                                                   3,530        3,277

        Less accumulated depreciation             (1,989)      (1,473)
                                            ------------  -----------
                                            $      1,541  $     1,804
                                            ============  ===========

        We capitalize purchased software which is ready for service and software
development costs incurred from the time technological feasibility of the
software is established until the software is ready for use. Costs not
associated with other software modifications, and other computer software
maintenance costs related to software development were expensed as incurred.
Software development costs and costs of purchased software are amortized using
the straight-line method over a maximum of three years or the expected life of
the product.

        We regularly review the carrying value of capitalized software assets,
and a loss is recognized when the net realizable value falls below the
unamortized cost. In the fourth quarter of 2000, we wrote off $7.7 million of
internally developed software connected with our TPA segment that was previously
capitalized. The charge related to client server technology and other
functionality that was programmed for former customers. We decided to abandon
the client server technology and no longer provide the administrative services
that formed the basis of other programming.

7.      INVESTMENTS

        On January 29, 2001, HealthAxis, Inc. and HealthAxis.com, Inc. announced
a merger of the two companies effective January 26, 2001. We owned 1,367,787
shares of the combined companies. In April 2001, we sold all of our shares of
HealthAxis Inc. stock and realized a net pretax loss on the sale of
approximately $2.5 million.

        During 2000, we sold our remaining shares of Caredata.com and recorded a
pre-tax gain on sale of approximately $0.3 million.

8.      INTANGIBLE ASSETS

        On April 1, 2001, we entered into a definitive agreement to sell our TPA
and MGU business units. Based upon the consideration we expected to receive at
closing, our goodwill and contract rights related to the business units sold
became impaired and we recorded an $80.3 million charge for the impairment of
intangible assets for the year ended December 31, 2000. This charge included
$4.1 million of goodwill related to the 1998 acquisition of Montgomery
Management Corporation, $49.0 million of goodwill related to the 1996
acquisition of Consolidated Group, Inc., $21.1 million of goodwill related to
the 1996 acquisition of American Benefit Plan Administrators, Inc. which was a
part of our acquisition of Harrington Services Corporation, $5.5 million of
goodwill related to the 1994 acquisition of HealthPlan Services, Inc. from the
Dun and Bradstreet Corporation, and $0.6 million of contract rights related to
the purchase of contract rights related to blocks of business purchased for the
small group business unit.

        Intangible assets resulting from the excess of cost over the fair value
of the respective net assets acquired was as follows (in thousands):

                                      F-14

<PAGE>

                                                     DECEMBER 31,
                                            ---------------------------
                                                 2002          2001
                                            ------------  -------------
        Goodwill                            $     34,021  $      34,021

        Less accumulated amortization             (4,616)        (4,616)
                                            ------------  -------------
                                            $     29,405  $      29,405
                                            ============  =============

We adopted SFAS No. 142 beginning January 1, 2002. Goodwill is deemed to have an
indefinite useful life. Thus, we ceased amortizing goodwill on January 1, 2002.
Amortization expense was $1.4 million in each of the years ended December 31,
2001 and 2000. The effect on our net income and basic and diluted earnings per
share for all periods presented was as follows (in thousands, except per share
amounts):

<TABLE>
<CAPTION>
                                                                          YEAR ENDED DECEMBER 31,
                                                                  2002              2001             2000
                                                            -------------     --------------  --------------
<S>                                                         <C>               <C>             <C>
Net income (loss) as reported ...........................   $       4,185     $      (45,221) $     (104,477)
Add back: amortization of goodwill ......................               -              1,378           1,380
                                                            -------------     --------------  --------------
Adjusted net income (loss)  .............................   $       4,185     $      (43,843) $     (103,097)
                                                            =============     ==============  ==============
Basic earnings per share:
Net income (loss) as reported  ..........................   $        0.25     $        (3.11) $        (7.64)
Add back: amortization of goodwill ......................               -               0.09            0.10
                                                            -------------     --------------  --------------
Adjusted net income (loss)  .............................   $        0.25     $        (3.02) $        (7.54)
                                                            =============     ==============  ==============
Diluted earnings per share:
Net income (loss) as reported ...........................   $        0.25     $        (3.11) $        (7.64)
Add back: amortization of goodwill ......................               -               0.09            0.10
                                                            -------------     --------------  --------------
Adjusted net income (loss)...............................   $        0.25     $        (3.02) $        (7.54)
                                                            =============     ==============  ==============
Basic weighted average number of shares outstanding ....    $      16,427     $       14,558  $       13,679
                                                            =============     ==============  ==============
Diluted weighted average number of shares outstanding ..    $      16,523     $       14,558  $       13,679
                                                            =============     ==============  ==============
</TABLE>

9.      ACCRUED LIABILITIES

        Accrued liabilities consist of the following (in thousands):

                                                   December 31,
                                            --------------------------
                                                 2002         2001
                                            -------------- -----------
        Accrued interest and fees           $        691   $     6,115
        Accrued compensation and benefits            479         1,138
        Accrued divestiture reserves               2,017         1,918
        Accrued legal and related reserves         1,314         2,037
        Accrued restructuring costs                  191           467
        Other                                        882         1,259
                                            ------------   -----------
                                            $      5,574   $    12,934
                                            ============   ===========

        Accrued restructuring charges consist primarily of accrued severance and
related costs and accrued office closures costs. We established restructuring
charges of $0.5 million and $2.2 million in 2001 and 2000, respectively. We
incurred amounts relating to such restructuring charges totaling $0.3 million,
$1.1 million, and $0.6 million in 2002, 2001, and 2000, respectively.

                                      F-15

<PAGE>

10.      NOTES PAYABLE AND CREDIT FACILITIES

        As part of our business strategy, we pursued the restructure of our
credit facility during the second half of 2001 and the first quarter of 2002. As
of March 31, 2002, we had debt outstanding to our senior lenders totaling
approximately $69.0 million, including accrued and unpaid interest and fees. On
April 12, 2002 (the "Effective Date"), we closed a transaction for the
restructure and refinancing of our existing bank debt. Under the terms of the
restructuring, in exchange for the outstanding principal, accrued and unpaid
interest and fees due to our lenders, we entered into a $40.0 million term loan
that accrues interest at prime plus 1.0%, with interest payments due monthly.
Quarterly principal payments of $50,000 became due beginning June 30, 2002, and
the term loan is due in full on May 31, 2004. The term loan is collateralized by
all of our assets. The restructured credit facility does not include a line of
credit or the ability to borrow additional funds. The $29.0 million due to our
senior lenders was exchanged for 29,000 shares of our newly authorized Series C
convertible preferred stock and an additional promissory note in the amount of
$184,872. The terms of the Series C convertible preferred stock are disclosed in
Note 2. As described in Note 2, the restructured credit facility contains
certain financial covenants, including minimum monthly EBITDA levels, maximum
quarterly and annual capital expenditures, a minimum quarterly fixed charge
ratio, and maximum quarterly and annual extraordinary expenses (as defined in
the Agreement). From April 12, 2002 through November 30, 2002, we were in
compliance with these financial covenants. During December 2002, we were not in
compliance with our EBITDA covenant and we subsequently obtained a waiver for
this non-compliance from our senior lenders. Beginning in 2003, the required
monthly minimum EBITDA levels are $1.0 million in January 2003, $700,000 in
February 2003, $800,000 in March 2003 through July 2003, and $1.0 million
thereafter. As a result of the restructuring, the amounts due to our senior
lenders as of December 31, 2002 and 2001 are classified as long-term debt in the
accompanying consolidated financial statements.

        The accounting treatment for the restructured credit facility followed
the requirements of SFAS No. 15, "Accounting by Debtors and Creditors for
Troubled Debt Restructurings" ("SFAS 15"), which requires that a comparison be
made between the future cash outflows associated with the restructured facility
(including principal, interest, and related costs), and the carrying value
related to the previous credit facility. The carrying value of the restructured
credit facility would be the same as the carrying value of the previous
obligations, less the fair value of the preferred stock or common stock warrants
issued. During 2002, we obtained an appraisal to determine the fair value of the
stock and warrants issued, which indicated the fair value to be approximately
$29.0 million. No gain or loss was recognized for accounting purposes in
connection with the debt restructuring. We recorded a charge of $0.4 million
upon closing of the debt restructuring for various investment advisory and legal
fees incurred in connection with the arrangement of the credit facility.

        In connection with the closing of the transactions contemplated by the
Agreements, we entered into a letter agreement, as amended, with the lenders and
Wachovia Bank, National Association, as administrative agent for the lenders,
and for the holders of the Series C convertible preferred stock, pursuant to
which the lenders, in their capacity as such and as holders of the Series C
convertible preferred stock, granted to us an option to consider the entire
indebtedness under the Agreements paid in full and to redeem the Series C
convertible preferred stock in exchange for the following consideration: (1)
payment of $40.0 million plus accrued and unpaid interest under the credit
facility; (2) payment of the outstanding principal balance plus accrued interest
under an additional note in the principal amount of $184,872; (3) payment of
outstanding fees and expenses of lenders' counsel and consultants incurred in
connection with the restructured credit agreement and prior credit agreements;
(4) the issuance of an additional 1,650,000 shares of our common stock; and (5)
replacement, substitution, or cash collateralization of an existing letter of
credit in the approximate amount of $0.8 million provided for under the credit
facility. We were unable to obtain the funds necessary to exercise the option
granted by our senior lenders. This option expired on September 9, 2002.

        On March 13, 2003, PVC Funding Partners LLC, an affiliate of
Commonwealth Associates, LP and Comvest Venture Partners, filed a form 13D
with the Securities and Exchange Commission in which it indicated that on March
7, 2003, it acquired 29,851, or 96.0%, of our outstanding Series C convertible
preferred stock from our senior lenders. These shares of Series C convertible
preferred stock were purchased from the senior lenders on a prorata basis at a
price of $33.50 per share. The selling lenders continue to hold the remaining
4.0% of the Series C convertible preferred stock. In connection with the
transaction, PVC Funding Partners also acquired $20.5 million in principal
amount of our outstanding bank debt from our senior lenders. See Note 16.

                                      F-16

<PAGE>

        Prior to us entering into the restructured credit agreement, we operated
under a Forbearance Agreement, as amended (the "Forbearance Agreement"), with
our lending group. The Forbearance Agreement extended the terms and conditions
of the June 8, 2000, second Amended and Restated Credit Agreement (the "Prior
Credit Agreement"), which matured on August 31, 2001. Under the terms of the
Forbearance Agreement, as amended, which became effective on September 1, 2001,
we had until March 29, 2002 to repay the amounts under the Prior Credit
Agreement or to restructure the credit facility. During the term of the
Forbearance Agreement, interest accrued at an annual interest rate equal to
prime plus 6.0%. Interest was payable monthly at prime plus 1.0% per annum. The
difference between the accrual rate of interest and the rate paid was due at the
termination of the Forbearance Agreement and was rolled into the amount
restructured. In addition, we were required to repay accrued and unpaid interest
as of August 31, 2001 (totaling approximately $1.0 million) and were required to
achieve minimum cash collection levels and maximum cash disbursements as defined
in the Forbearance Agreement. We were in compliance with the terms of the
Forbearance Agreement, as amended.

        The Prior Credit Agreement originally provided for a $73.8 million term
loan facility, a $25.0 million revolving credit facility, and a letter of credit
facility of up to $16.0 million available for current letters of credit. Under
the term loan facility, a payment of $250,000 was required at closing and
monthly for a two-month period commencing May 31, 2000. Repayments of $500,000
were required each month thereafter with additional repayments of $15.0 million
on January 31 and July 31, 2001, and a final payment on August 31, 2001.
Interest rates varied from the higher of (a) the Prime Rate or (b) the Federal
Funds rate plus 1/2 of 1%, plus a margin of 1.5% to 3%. The Prior Credit
Agreement required an initial payment of 1.0% of the maximum amount of the
facility, plus certain administrative fees and an annual commitment fee of .25%
for letters of credit and unused commitments. We capitalized approximately $1.4
million of bank fees related to the Prior Credit Agreement. Under the loan
terms, we were required to maintain certain financial covenants for operating
revenue and EBITDA as defined in the Prior Credit Agreement. We were also
restricted in capital expenditures and were subject to repayment with proceeds
of certain future activities such as sale of certain assets and public
offerings. As of December 31, 2001, the balance outstanding under the Prior
Credit Agreement was $64.7 million plus accrued and unpaid interest and fees of
$4.5 million. During 2001, we paid interest of $3.7 million and principal of
$2.0 million on the Prior Credit Agreement. On June 29, 2000, September 12,
2000, September 29, 2000, October 19, 2000, and December 8, 2000, we signed
Limited Waivers and Consents related to the disposition of assets and certain
payment and other covenant requirements.

        As of March 29, 2001, we signed a First Amendment and Limited Waiver and
Consent ("the First Amendment") to the Prior Credit Agreement. The First
Amendment became effective upon the satisfaction of certain conditions,
including the written confirmation from one of our small group customers in
support of the sale of our third party administration and managing general
underwriter business. We obtained this written confirmation prior to the closing
of such sale. Under the terms of the First Amendment, the commitment of banks
which were signers to the Prior Credit Agreement (the "Bank Group") on the
revolving credit facility was frozen at the $14.9 million outstanding balance
upon the signing of the First Amendment. The repayments of $500,000 due on March
31, 2001 and April 30, 2001 were waived and certain other repayments which had
been previously deferred were waived. In addition, a repayment of $1.5 million
was due and paid in April 2001, the monthly repayment was increased from
$500,000 to $750,000 beginning on May 31, 2001, and the unpaid additional
payment of $4.5 million due on July 31, 2001 was waived to the maturity date.

        The First Amendment required certain prepayments upon the receipt of tax
refunds, debt refinancing proceeds or the proceeds of new equity issuances, and
also revised various other provisions relating to covenants and defined
defaults. Additionally, the First Amendment required us to retain the services
of an investment banker by April 30, 2001 to assist us with refinancing, and the
First Amendment also required that in the event the third party administration
business was not sold or otherwise disposed of before May 30, 2001, we were to
prepare and submit by June 6, 2001 for approval of the Lenders a detailed plan
for the alternate disposition of such business. The businesses were sold
effective June 18, 2001.

        As of April 13, 2001, we signed a Second Amendment and Limited Waiver
and Consent ("the Second Amendment"), which removed from the Prior Credit
Agreement certain requirements that could have affected our ability to draw on
the revolving credit facility at the level to which it was frozen in the First
Amendment. The Second Amendment became effective concurrently with the First
Amendment.

                                      F-17

<PAGE>

        In June 2001, Ronald Davi, former principal of National Preferred
Provider Network prior to its acquisition by us, drew in full on a letter of
credit in his favor in the amount of $2.0 million. Such amount is included in
the obligations owed to our lending group at December 31, 2002 and December 31,
2001.

        On July 2, 2001, we executed the Third Amendment and Limited Waiver to
the Prior Credit Agreement (the "Third Amendment") with our Bank Group and
certain other parties. The Third Amendment provided for, among other things, (a)
permission for us to issue common stock to DePrince, Race & Zollo, Inc. for $3.8
million, (b) permission for us to use those funds to satisfy certain
post-closing obligations to HealthPlan Holdings in connection with the sale of
the third party administration and managing general underwriter businesses, (c)
the postponement of certain scheduled payments of principal until August 31,
2001, (d) a 100 basis point increase in the interest rate, and (e) the delivery
of 74,998 shares of common stock to the Bank Group in consideration for its
consent to the Third Amendment.

        In connection with the sale of the third party administration and
managing general underwriter business units and the assumption by HealthPlan
Holdings of certain liabilities associated therewith (the "Transaction"), the
New England Life Insurance Co. drew in full on a letter of credit in its favor
in the amount of $6.0 million. Under the terms of the Prior Credit Agreement,
any payment under the letter of credit which is not promptly reimbursed to the
lenders by us upon notice of such draw constitutes a payment default. The
lenders indefinitely waived this payment default pursuant to the terms of a
Limited Waiver and Extension dated as of June 15, 2001, which also waived
certain additional terms of the Prior Credit Agreement in order to permit
certain terms of the Transaction which were not part of the original Stock
Purchase Agreement of April 1, 2001 but were added through the First Amendment
to the Stock Purchase Agreement (the "First Amendment"), dated June 18, 2001.

        As of December 31, 2002 and December 31, 2001, respectively, PlanVista
had additional notes and other obligations totaling approximately $10.6 million
and $11.0 million, respectively, related to a 1993 acquisition, a 1998
acquisition, and equipment purchases, and related to the HealthPlan Holdings
transaction. As described in Note 2, included in these totals was a $5.0 million
note related to the HealthPlan Holdings transaction that converted to 813,273
shares of our common stock upon the Effective Date, subject to guarantee that
provides HealthPlan Holdings with $5.0 million in gross proceeds from the sale
of the stock. The number of shares of common stock issued in satisfaction of
this note was based on the average closing price of our common stock for the 10
days immediately prior to the conversion. Also included in the total was $4.0
million of notes payable to CENTRA Benefits, Inc. ("CENTRA") originally
delivered in connection with the 1998 acquisition, which was restructured so
that amended and restated notes totaling $4.3 million (representing the
principal under the original notes plus accrued unpaid interest) were issued to
CENTRA under terms including interest at 12.0% (payable in additional shares of
our common stock, except under specified circumstances) and a maturity date of
December 1, 2004. In connection with the restructuring of the CENTRA notes, we
also issued to CENTRA warrants to purchase an aggregate of 200,000 shares of our
common stock at an exercise price of $0.25 over the market price of the stock on
the date of the issuance of the restructured notes (based on the average trading
price during the ten trading days preceding such note restructure), subject to
reduction to a price equal to the conversion price of the Series C convertible
preferred stock upon the happening of certain events. In March 2003, we
refinanced the Centra notes. See Note 16.

        As a part of the sale of HealthPlan Holdings, we settled certain
obligations with one of its large carriers by issuing a promissory note. As of
the restructuring of our credit facility, the amount owed on this note was
approximately $1.0 million plus $1.5 million of other obligations. On March 27,
2002, we retired this note by issuing 274,369 shares of our common stock, based
on the closing price of our common stock one day immediately prior to the
retirement date of this note, and by issuing a credit for $950,000 payable with
in-kind claims repricing services.

        On April 12, 2002, we extended the maturity date of notes totaling
$500,000 due to two members of our board of directors to December 1, 2004. These
notes bear interest, which accrues at prime plus 4.0% per annum, but payment of
interest is subordinated and deferred until all senior obligations are paid.

        The balances outstanding on the above debt instruments are as follows
(in thousands):

                                      F-18

<PAGE>

                                             DECEMBER 31,
                                      -----------------------
                                          2002         2001
                                      ------------   ---------
         Line of Credit/Term Loan     $     40,005   $  64,681
         CAL/GROUP Note                        751         848
         Sun Capital Note                        -       5,000
         PlanVista Equipment Notes               -          57
         CENTRA Note                         4,288       4,000
         NEF Note                                -       1,000
         Board of Directors Notes              500         500
                                      ------------   ---------
                                            45,544      76,086
         Less current portion                 (356)       (308)
                                      ------------   ---------
         Long-term debt               $     45,188   $  75,778
                                      ============   =========

        Future minimum principal payments for all notes as of December 31, 2002
are as follows (in thousands). These amounts have been adjusted to reflect our
restructured debt arrangement (exclusive of the revised Centra note, which were
executed in March 2003) as discussed above.


         2003                          $           356
         2004                                   45,188
         2005                                        -
         2006                                        -
         2007                                        -
         Thereafter                                  -
                                       ---------------
                                       $        45,544
                                       ===============

11.     EMPLOYEE BENEFIT PLANS

        DEFINED CONTRIBUTION PLAN

        We have a defined contribution employee benefit plan established
pursuant to Section 401(k) of the Internal Revenue Code covering substantially
all employees. PlanVista matches one-third of employee contributions limited to
6.0% of the employee's salary. Under the provisions of the plan, participants'
rights to employer contributions vest 40.0% after completion of three years of
qualified service and increase by 20.0% for each additional year of qualified
service completed thereafter. Expense in connection with this plan for the years
ended December 31, 2002, 2001, and 2000 was approximately $0.1 million, $0.2
million, and $0.7 million, respectively.

        POST-RETIREMENT BENEFIT PLAN

        We provide medical and term life insurance benefits to certain retired
employees. We fund the benefit costs on a current basis because there are no
plan assets. At December 31, 2002 and 2001, accrued post-retirement liability of
$0.2 million was included in the balance in accrued liabilities.

        DEFERRED COMPENSATION PLAN

        We have a deferred compensation plan with two former officers. The
deferred compensation, which together with accumulated interest is accrued but
unfunded, is distributable in cash after retirement or termination of
employment, and amounted to approximately $1.0 million at December 31, 2002 and
2001. Both participants began receiving such deferred amounts, together with
interest at 12% annually, at age 65.

                                      F-19

<PAGE>

12.     COMMITMENTS AND CONTINGENCIES

        LEASE COMMITMENTS

        We rent office space and equipment under non-cancelable operating
leases. Rental expense under the leases approximated $0.6 million for each of
the years ended December 31, 2002, 2001, and 2000. Future minimum rental
payments under these leases are as follows (in thousands):

     2003                                   $   698
     2004                                       665
     2005                                       631
     2006                                       624
     2007                                       622
         Thereafter                             582
                                            -------
                                            $ 3,822
                                            =======
        LITIGATION

        In the ordinary course of business, we may be a party to a variety of
legal actions that affect any business, including employment and employment
discrimination-related suits, employee benefit claims, breach of contract
actions, and tort claims. In addition, we entered into indemnification
obligations related to certain of the businesses we sold during 2001 and 2000
and we could be subject to a variety of legal and other actions related to such
indemnification obligations. We currently have insurance coverage for some of
these potential liabilities. Other potential liabilities may not be covered by
insurance, insurers may dispute coverage, or the amount of insurance may not
cover the damages awarded. While the ultimate financial effect of these claims
and indemnification agreements cannot be fully determined at this time, in the
opinion of management, they will not have a material adverse effect on our
financial condition, results of operations, or cash flows.

        In July 1999, TMG Life Insurance Company (now known as Clarica Life
Insurance Company) asserted a demand against HealthPlan Services (the former
subsidiary that we sold to HealthPlan Holdings) for claims in excess of $7.0
million for breach of contract and related claims. HealthPlan Services asserted
breach of contract and various other claims against Clarica. Following
arbitration, we settled the dispute with Clarica in October 2000, in
consideration for payment to them of $400,000. On April 17, 2000, Admiral
Insurance Company, our errors and omissions carrier, filed a complaint for
declaratory judgment in the United States District Court for the Middle District
of Florida, naming HealthPlan Services, Clarica, and Connecticut General Life
Insurance Company as defendants. In December 2001, we reached a settlement
agreement related to these claims. The settlement agreement obligated us to pay
Connecticut General Life Insurance Company approximately $150,000, which we paid
on January 2, 2003.

        In November 2001, Paid Prescriptions, LLC initiated a breach of contract
action in the United States District Court for the District of New Jersey
against HealthPlan Services, our former subsidiary. Paid Prescriptions seeks
$1.6 million to $2.0 million in compensation arising from HealthPlan Services'
alleged failure to meet certain performance goals under a contract requiring
HealthPlan Services to enroll a certain number of customers for Paid
Prescriptions' services. Because the events giving rise to this claim allegedly
occurred prior to our sale of the HealthPlan Services business to HealthPlan
Holdings, we are vigorously defending the action on behalf of HealthPlan
Services, in accordance with our indemnification obligations to HealthPlan
Holdings.

        In November 2001, we filed a complaint for breach of contract and unjust
enrichment in the Circuit Court of the Thirteenth Judicial Circuit, Hillsborough
County, Florida, against Trewit, Inc. and Harrington Benefit Services, Inc., our
former subsidiary. The complaint, which we amended in February 2002, sought in
excess of $3.5 million in damages arising primarily out of a settlement entered
into in connection with a dispute that arose after Trewit's acquisition of
Harrington Benefit Services from us in 2000. In April 2002, we again amended the
complaint to include claims of fraudulent misrepresentation, negligent
misrepresentation, and promissory estoppel, seeking additional damages for these
causes of action in excess of $1.4 million. On June 28, 2002, Trewit filed a
complaint against us in the Circuit Court of the Thirteenth Judicial Circuit,
Hillsborough County, Florida, alleging breach of contract and fraud in
connection with its acquisition of Harrington Benefit Services. The complaint

                                      F-20

<PAGE>

sought damages in excess of $2.0 million. In February 2003, we resolved our
litigation with Trewit, Inc. and Harrington Benefit Services, Inc. without
payment by us, and the parties signed mutual releases.

        We are currently negotiating certain disputes regarding the closing
balance sheet of the HealthPlan Services business that we sold to HealthPlan
Holdings in June 2001. See Note 2.

13.     INCOME TAXES

        The provision (benefit) for income taxes is as follows (in thousands):

                                       FOR THE YEAR ENDED DECEMBER 31,
                                     ---------------------------------
                                        2002        2001        2000
                                     ---------    --------    --------
        Current:
           Federal                   $       -    $      -    $      -
           State                             -           -           -
                                     ---------    --------    --------
                                             -           -           -
                                     ---------    --------    --------
        Deferred:
           Federal                      (1,191)     23,989      (2,844)
           State                             -       2,822        (419)
                                     ---------    --------    --------
                                        (1,191)     26,811      (3,263)
                                     ---------    --------    --------
        (Benefit) provision for
         income taxes                $  (1,191)   $ 26,811    $ (3,263)
                                     =========    ========    ========
         The components of deferred taxes recognized in the accompanying
consolidated financial statements are as follows (in thousands):

<TABLE>
<CAPTION>
                                                                          DECEMBER 31,
                                                                   ------------------------
                                                                       2002         2001
                                                                   -----------   ----------
     <S>                                                           <C>           <C>
     Accrued expenses and reserves not currently deductible        $     1,613   $    1,026
     Net operating loss                                                 34,786       36,538
     Depreciation                                                         (354)        (224)
     Goodwill                                                           (2,089)        (875)
                                                                   -----------   ----------
                                                                        33,956       36,465

     Valuation allowance                                               (33,956)     (36,465)
                                                                   -----------   ----------
                                                                   $         -   $        -
                                                                   ===========   ==========
</TABLE>

         We recognize deferred assets and liabilities for the expected future
tax consequences of temporary differences between the carrying amounts and the
tax bases of assets and liabilities. A valuation allowance is provided when it
is more likely than not that some portion of the deferred tax asset will not be
realized. Due to cumulative losses in recent years, we recorded a valuation
allowance of $34.0 and $36.5 million on net deferred tax assets as of December
31, 2002 and 2001, respectively. We have net operating loss carryforwards of
approximately $84.1 million that expire in 2021. Due to a change in ownership
under Section 382 of the Internal Revenue Code, utilization of the net operating
loss carryforward will be limited to approximately $3.0 million per year.

        The (benefit) provision for income taxes varies from the federal
statutory income tax rates due to the following:

                                      F-21

<PAGE>

                                                    2002      2001      2000
                                                  --------   -------   -------
Federal statutory rate applied to pretax income       35.0%    (34.0)%    34.0%
State income taxes net of federal tax benefit          3.9%     (6.0)%     5.0%
Other non-deductible items                             0.2%      2.0%     (0.1)%
Valuation allowance                                  (78.9)%   386.0%        -
                                                  --------   -------   -------
Effective tax rate                                   (39.8)%   348.0%     38.9%
                                                  ========   =======   =======

14.     EARNINGS PER COMMON SHARE

        Basic earnings per share, which is based on the weighted-average number
of common shares outstanding, and diluted earnings per share, which includes all
dilutive potential common shares outstanding is as follows.

<TABLE>
<CAPTION>
                                                       NET INCOME
                                                         (LOSS)
                                                    ATTRIBUTABLE TO
                                                      COMMON STOCK           SHARES         PER SHARE
                                                     (IN THOUSANDS)      (IN THOUSANDS)       AMOUNT
       <S>                                         <C>                           <C>       <C>
       2002
       Earnings per share of common stock-basic    $            4,185            16,427    $      0.25
       Effect of dilutive securities:                               -                96              -
                                                   ------------------    --------------    -----------
       Earnings per share of common stock--
         assuming dilution                         $            4,185            16,523    $      0.25
                                                   ==================    ==============    ===========

       2001
       Loss per share of common stock-basic        $          (45,221)           14,558    $     (3.11)
       Effect of dilutive securities:                              -                  -              -
                                                   ------------------    --------------    -----------
       Loss per share of common stock--
         assuming dilution                         $          (45,221)           14,558    $     (3.11)
                                                   ==================    ==============    ===========

       2000
       Loss per share of common stock-basic        $         (104,477)           13,679    $     (7.64)
       Effect of dilutive securities:                               -                 -              -
                                                   ------------------    --------------    -----------
       Loss per share of common stock--
         assuming dilution                         $         (104,477)           13,679    $     (7.64)
                                                   ==================    ==============    ===========
</TABLE>

        During the years ending December 31, 2002, 2001 and 2000, approximately
0.7 million, 1.0 million and 1.7 million options are not included in the
calculation of earnings (loss) per shares because they are antidilutive.

15.     STOCK OPTION PLANS AND EMPLOYEE STOCK PURCHASE PLANS

        STOCK OPTION PLANS

        Our stock option plans authorize the granting of both incentive and
non-incentive stock options for a total of 2,710,000 shares of common stock to
key executives, management, consultants, and, with respect to 360,000 shares, to
directors. Under the plans, all options have been granted at prices not less
than market value on the date of grant. Certain non-qualified incentive stock
options may be granted at less than market value.

        Options granted to employees and directors generally vest over a
four-year period from the date of grant, with 20% of the options becoming
exercisable on the date of the grant and 20% becoming exercisable on each of the
next four anniversaries of the date of the grant.

                                      F-22

<PAGE>

        A summary of option transactions during each of the three years ended
December 31, 2002 is shown below:

                                               NUMBER            WEIGHTED
                                                 OF               AVERAGE
                                               SHARES          OPTION PRICE
                                           -------------       ------------

      Under option, December 31, 1999
        (1,247,000 exercisable)                1,965,450
        Granted                                  836,000       $       2.62
        Exercised                                 (1,100)              2.50
        Canceled                              (1,084,050)             15.23
                                           -------------

      Under option, December 31, 2000
        (915,906 exercisable)                  1,716,300
        Granted                                  645,000               8.82
        Exercised                               (199,300)              2.54
        Canceled                              (1,184,600)             11.73
                                           -------------

      Under option, December 31, 2001
        (600,466 exercisable)                    977,400
        Granted                                  958,500               4.89
        Exercised                                (12,200)              2.50
        Canceled                                (113,563)             12.07
                                           -------------
      Under option, December 31, 2002          1,810,137
                                           =============

        (807,403 exercisable)

        There were 533,344 and 1,732,600 shares available for the granting of
options at December 31, 2002 and 2001, respectively.

        The following table summarizes the stock options outstanding at December
31, 2002:


      RANGE                  NUMBER          WEIGHTED AVERAGE      WEIGHTED
       OF                OUTSTANDING AT         REMAINING          AVERAGE
 EXERCISE PRICES        DECEMBER 31, 2002    CONTRACTUAL LIFE   EXERCISE PRICE
---------------------- -------------------  ------------------- --------------

 $  2.50   -   $  9.19           1,577,137             4 years         $  5.34
   11.00   -     25.50             233,000             4 years         $ 16.97

        EMPLOYEE STOCK PURCHASE PLAN

        Under the 1996 Employee Stock Purchase Plan ("Employee Plan"), we are
authorized to issue up to 250,000 shares of common stock to our employees who
have completed one year of service. The Employee Plan is intended to provide a
method whereby employees have an opportunity to acquire shares of our common
stock.

        Under the terms of the Employee Plan, an employee may authorize a
payroll deduction of a specified dollar amount per pay period. The proceeds of
that deduction are used to acquire shares of our common stock on the offering
date. The number of shares acquired is determined based on 85% of the closing
price of our common stock on the offering date.

        PlanVista sold 387 shares in 2002, 2,051 shares in 2001 and 12,708
shares in 2000 to employees under the Employee Plan.

                                      F-23

<PAGE>

16.     SUBSEQUENT EVENTS

        On March 13, 2003, PVC Funding Partners LLC, an affiliate of
Commonwealth Associates, LP and Comvest Venture Partners, filed a form 13D with
the Securities and Exchange Commission in which it indicated that on March 7,
2003, it acquired 29,851, or 96.0%, of our outstanding Series C convertible
preferred stock from our senior lenders. This Series C convertible preferred
stock was purchased from the lenders on a prorata basis at a price of $33.50 per
share. The original lenders continue to hold the remaining 4.0% of the Series C
convertible preferred stock. In connection with the transaction, PVC Funding
Partners also acquired $20.5 million in principal amount of our outstanding bank
debt from our senior lenders. See Note 2 for additional information on the
Series C convertible preferred stock.

        There is an intercreditor agreement between PVC Funding Partners and
Wachovia Bank, National Association, dated March 7, 2003. The intercreditor
agreement provides that, until the occurrence of a Board Shift Event, PVC
Funding Partners has all of the rights of the original lenders under the
restructured credit agreements, except that (1) PVC Funding Partners' rights to
mandatory prepayments and other principal payments prior to the maturity date
are subordinated to the original lenders' rights to those payments, and (2) PVC
Funding Partners' notes will be voted consistently with and on the same
percentage basis as the original lenders with respect to all matters required to
be submitted to a vote or consent of the lenders, except for matters related to
certain fundamental changes in the loan terms. Upon the first occurrence of a
Board Shift Event, which would allow PVC Funding Partners to appoint an
additional board member and thus obtain control of our board of directors, PVC
Funding Partners has the option of not exercising their right to obtain such
control. If, within fifteen days of a first Board Shift Event, PVC Funding
Partners notifies the original lenders that they will not exercise their right
to control our board, then the original lenders will have the option to
repurchase 14,304 of the Series C convertible preferred stock, at a price of
$33.50 per share. If PVC Funding Partners exercises their right to obtain
control of our board, or fails to timely notify the original lenders that they
will not exercise this right, then the debt held by PVC Funding Partners will
automatically be subordinated to the debt held by the original lenders.

        On March 31, 2003, we renegotiated approximately $4.3 million in
convertible notes that were originally issued to Centra Benefit Services, Inc.
(sometimes referred to as Centra). Pursuant to the renegotiated terms, we have
extended the maturity date of the notes from December 1, 2004 to April 1, 2006,
reduced the interest rate from 12.0% per annum to 6.0% per annum, and fixed the
conversion price at $1.00, subject to adjustment in accordance with
anti-dilution protections. The previous conversion price was based on the
trading price of our common stock. Immediately upon completion of this
restructuring, PVC Funding Partners acquired slightly more than 50.0% of the
face value of the notes from Centra.

17.     QUARTERLY FINANCIAL INFORMATION (UNAUDITED; IN THOUSANDS EXCEPT PER
SHARE DATA)

        The following quarterly statements have been revised to give effect of
the discontinued operations in 2001.

                                      F-24

<PAGE>

<TABLE>
<CAPTION>
                                                         FOURTH         THIRD          SECOND        FIRST
                                                         QUARTER       QUARTER        QUARTER       QUARTER
                                                        ---------     ----------     ---------     ---------
  <S>                                                   <C>           <C>            <C>           <C>
  Year ended December 31, 2002:
     Operating revenues                                 $   8,394     $    8,324     $   8,474     $   7,949
                                                        ---------     ----------     ---------     ---------
     Income from continuing operations
      before minority interest, discontinued
      operations, loss on sale of assets,
      extraordinary item, and cumulative effect
      of change in accounting principle                       484          1,879         1,153           669
     Net income                                               484          1,879         1,153           669
     Basic and diluted earnings from continuing
      operations per common share                       $    0.03     $     0.11     $    0.07     $    0.04
     Basic and diluted net earnings per common
      share                                             $    0.03     $     0.11     $    0.07     $    0.04

<CAPTION>
                                                         FOURTH        THIRD          SECOND        FIRST
                                                         QUARTER       QUARTER        QUARTER       QUARTER
                                                        ---------     ----------     ---------     ---------
  <S>                                                   <C>           <C>            <C>           <C>
  Year ended December 31, 2001:
     Operating revenues                                 $   8,125     $    7,886     $   8,924     $   7,983
                                                        ---------     ----------     ---------     ---------
     Income (loss) from continuing operations
      before minority interest, discontinued
      operations, loss on sale of assets,
      extraordinary item, and cumulative effect
      of change in accounting principle                       179        (33,086)       (1,338)         (268)
     Net loss                                              (5,693)       (34,912)       (3,957)         (659)
     Basic and diluted earnings (loss) from
      continuing operations per common share            $    0.01     $    (2.27)    $   (0.09)    $   (0.02)
     Basic and diluted net loss per common share        $   (0.39)    $    (2.40)    $   (0.27)    $   (0.05)
</TABLE>

                                      F-25

<PAGE>

             REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS ON
                          FINANCIAL STATEMENT SCHEDULES

To the Board of Directors
and Shareholders of
PlanVista Corporation

        Our audits of the consolidated financial statements referred to in our
report dated March 20, 2003 appearing on page F-1 of this Form 10-K of PlanVista
Corporation also included an audit of the Financial Statement Schedule listed in
Item 14 of this Form 10-K. In our opinion, this Financial Statement Schedule
presents fairly, in all material respects, the information set forth therein
when read in conjunction with the related consolidated financial statements.

/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Tampa, Florida
March 20, 2003

                                      F-26

<PAGE>

                              PLANVISTA CORPORATION
                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                                 (in thousands)

<TABLE>
<CAPTION>
                                   BEGINNING    BAD DEBT                    ENDING
DESCRIPTION                         BALANCE     EXPENSE     DEDUCTIONS(1)   BALANCE
                                  ----------   ---------    ----------      --------
<S>                                <C>         <C>          <C>             <C>
Allowance for Doubtful Accounts
 December 31, 2002                 $   6,236   $   3,356    $    7,607      $  1,985

Allowance for Doubtful Accounts
 December 31, 2001                     3,300       3,348           412         6,236

Allowance for Doubtful Accounts
 December 31, 2000                     3,211       1,199         1,110         3,300
</TABLE>

(1) Reflects direct write-off of accounts.

<PAGE>

                                  EXHIBIT INDEX

EXHIBIT
NO.                                     DESCRIPTION
-------                                 -----------

4.4                                     Specimen Series C convertible preferred
                                        stock certificate.

4.5(j)                                  First Amendment and Limited Waiver to
                                        Third Amended and Restated Credit
                                        Agreement dated February 25, 2003 by and
                                        among PlanVista Corporation, PlanVista
                                        Solutions, Inc., the Lenders listed on
                                        the signature pages thereto, Wachovia
                                        Bank, as administrative agent and for
                                        purposes of Section 5 thereof, the
                                        Credit Parties listed on the signature
                                        pages thereto.

4.5(k)                                  Limited Waiver to Third Amended and
                                        Restated Credit Agreement dated March 6,
                                        2003 by and among PlanVista Corporation,
                                        PlanVista Solutions, Inc., the lenders
                                        listed on the signature pages thereto
                                        and Wachovia Bank, National Association,
                                        as administrative agent.

4.7                                     Amended and Restated Convertible
                                        Promissory Notes of HealthPlan Services
                                        Corporation (n/k/a PlanVista
                                        Corporation) dated June 16, 1998,
                                        payable to Centra Benefit Services, Inc.
                                        in the principal amounts listed therein.

4.8                                     Amended and Restated Subordinated
                                        Promissory Note of PlanVista Corporation
                                        dated April 12, 2002, payable to William
                                        L. Bennett in the principal amount of
                                        $250,000.

4.9                                     Amended and Restated Subordinated
                                        Promissory Note of PlanVista Corporation
                                        dated April 12, 2002, payable to John D.
                                        Race in the principal amount of
                                        $250,000.

4.10                                    Asset Sale Agreement dated May 27, 1993,
                                        by and among Plan Services, Inc. (n/k/a
                                        PlanVista Corporation), CG Insurance
                                        Services, Inc. and Renny V. Thomas.

10.18                                   Letter Agreement dated March 5, 2003
                                        between Commonwealth Group Holdings, LLC
                                        and PlanVista Corporation.

21.1                                    Subsidiaries of the registrant.

23.1                                    Consent of PricewaterhouseCoopers LLP.