##### 



UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
  Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2006oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) 
    OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission File Number
    001-31574
 AMERIGROUP
    Corporation
 (Exact name of registrant as
    specified in its charter)
  Delaware(State or Other
    Jurisdiction of Incorporation or Organization)4425 Corporation
    Lane, Virginia Beach, Virginia(Address of principal
    executive offices)

54-1739323(I.R.S. Employer
    Identification No.)23462(Zip
    Code)   Registrants telephone number, including area code:
 (757) 490-6900
  Securities registered pursuant to Section 12(b) of the
    Act:
   Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, $.01 par
    value

New York Stock
    Exchange   þ o
  o þ
  þ o
  Regulation S-K Form 10-K 10-K. o
  Rule 12b-2
  þ o o þ o þ
  Rule 12b-2 o þ
      Class

Outstanding at February 21, 2006Common Stock, $.01 par
    value

52,312,689   Documents Incorporated by Reference
  Document

Parts Into Which IncorporatedProxy Statement for the Annual
    Meeting of Stockholders to be held May 10, 2007 (Proxy
    Statement)

Part III




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##### 



TABLE OF
    CONTENTS
  PagePART I.Item 1.


Business


3Item 1A.


Risk
    Factors


26Item 1B.


Unresolved Staff
    Comments


39Item 2.


Properties


39Item 3.


Legal
    Proceedings


40Item 4.


Submission of
    Matters to a Vote of Security Holders


42PART II.Item 5.


Market for
    Registrants Common Equity, Related Stockholder Matters and
    Issuer Purchases of Equity Securities


44Item 6.


Selected Financial
    Data


46Item 7.


Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations


47Item 7A.


Quantitative and
    Qualitative Disclosures About Market Risk


65Item 8.


Financial
    Statements and Supplementary Data


67Item 9.


Changes in and
    Disagreements with Accountants on Accounting and Financial
    Disclosure


101Item 9A.


Controls and
    Procedures


101Item 9B.


Other
    Information


102PART III.Item 10.


Directors,
    Executive Officers and Corporate Governance


104Item 11.


Executive
    Compensation


104Item 12.


Security Ownership
    of Certain Beneficial Owners and Management and Related
    Stockholder Matters


104Item 13.


Certain
    Relationships and Related Transactions, and Director
    Independence


104Item 14.


Principal
    Accountant Fees and Services


105PART IV.Item 15.


Exhibits and
    Financial Statement Schedules


105   1




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##### 



Forward-looking
    Statements
  Form 10-K, time-to-time,
    
    national, state and local economic conditions, including their
    effect on the rate increase process, timing of payments, as well
    as their effect on the availability and cost of labor, utilities
    and materials;
    the effect of government regulations and changes in regulations
    governing the healthcare industry, including our compliance with
    such regulations and their effect on certain of our unit costs
    and our ability to manage our medical costs;
    changes in Medicaid payment levels and methodologies and the
    application of such methodologies by the government;
    liabilities and other claims asserted against us;
    our ability to attract and retain qualified personnel;
    our ability to maintain compliance with all minimum capital
    requirements;
    the availability and terms of capital to fund acquisitions and
    capital improvements;
    the competitive environment in which we operate;
    our ability to maintain and increase membership levels;
    demographic changes;
    increased use of services, increased cost of individual
    services, epidemics, the introduction of new or costly
    treatments and technology, new mandated benefits or other
    regulatory changes, insured population characteristics and
    seasonal changes in the level of healthcare use;
    our inability to operate new products and markets at expected
    levels, including, but not limited to, profitability, membership
    and targeted service standards;
    catastrophes, including acts of terrorism or severe
    weather; and
    the unfavorable resolution of pending litigation and our ability
    to fund any significant judgment resulting from such a
    resolution.   2




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##### 



PART I.  Item 1.
    Business  Overview
      Market
    Opportunity
  Medicaid
    Managed Care Today
       3




---



##### 



Medicaid,
    SCHIP, FamilyCare and SNP Programs
     4




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##### 




    number of eligible individuals who enroll,
    price of medical and long-term care services,
    use of covered services,
    state decisions regarding optional services and optional
    eligibility groups, and
    effectiveness of programs to reduce costs of providing benefits,
    including managed care.  Medicaid
    and Medicare Funding
   5




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##### 



State

FMAPDistrict of Columbia


70.0
%Florida


58.8
%Georgia


62.0
%Maryland


50.0
%New Jersey


50.0
%New York


50.0
%Ohio


59.7
%Tennessee


63.6
%Texas


60.8
%Virginia


50.0
%     fee-for-service
       6




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##### 



The
    AMERIGROUP Approach
    Government
    Partners
  24-hour
  Providers
    Members
    Communities
   7




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##### 



Strategy
    Increase our membership in existing and new markets through
    internal growth and acquisitions.
      Capitalize on our experience working in partnership with
    governments.
  Focus on our medical home concept to provide
    quality, cost-effective healthcare.
  24-hour
  Utilize population-specific disease management programs and
    related techniques to improve quality and reduce
    costs.
 8




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##### 



Products
    
    primary and specialty physician care,
    inpatient and outpatient hospital care,
    emergency and urgent care,
    prenatal care,
    laboratory and x-ray services,
    home health and durable medical equipment,
    behavioral health services and substance abuse,
    long-term and nursing home care,
    24-hour
    on-call nurses,
    social and community-based services,
    vision care and exam allowances,
    dental care,
    chiropractic care,
    podiatry,
    prescriptions and limited
    over-the-counter
    drugs,
    assistance with obtaining transportation for office or health
    education visits,
    memberships in the Boys and Girls Clubs, and
    welcome calls and Early Care Finding, or outreach, calls to
    coordinate care.   9




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##### 



December 31,Product

2006


2005AMERICAID (Medicaid 
    TANF)


910,000



800,000AMERIKIDS (SCHIP)


264,000



197,000AMERIPLUS (Medicaid 
    SSI)


94,000



88,000AMERIFAM (FamilyCare)


43,000



44,000AMERIVANTAGE (SNP)


5,000



Total


1,316,000



1,129,000               Disease
    and Medical Management Programs
  3
 10




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##### 



Marketing
    and Educational Programs
    ®
      over-the-counter
 11




---



##### 



Provider
    Network
    PrimaryCare








AncillaryService Areas

Physicians


Specialists


Hospitals


ProvidersFlorida


1,639



6,263



98



2,002Georgia


2,300



9,384



101



738Maryland and D.C.


1,715



8,224



48



518New Jersey


1,826



4,210



61



677New York


2,058



9,462



57



1,882Ohio


599



2,323



32



106Texas


2,622



8,872



118



1,357Virginia


397



1,465



11



97Total


13,156



50,203



526



7,377            12




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##### 



Provider
    Payment Methods
  Fee-for-Service. fee-for-service fee-for-service
  
    Maximum Allowable Fee Schedule.  Providers are
    paid the lesser of billed charges or a specified fixed payment
    for a covered service. The maximum allowable fee schedule is
    developed using, among other indicators, the state
    fee-for-service
    Medicaid program fee schedule, Medicare fee schedules, medical
    costs trends and market conditions.
    Per Diem and Case Rates.  Hospital facility
    costs are typically reimbursed at negotiated per diem or case
    rates, which vary by level of care within the hospital setting.
    Lower rates are paid for lower intensity services, such as a low
    birth weight newborn baby who stays in the hospital a few days
    longer than the mother, compared to higher rates for a neonatal
    intensive care unit stay for a baby born with severe
    developmental disabilities.
    Percent of Charges.  We contract with providers
    to pay them an
    agreed-upon
    percent of their standard charges for covered services. This is
    typically done where hospitals are reimbursed under the state
    fee-for-service
    Medicaid program on a percent of charges basis.  Capitation.
  fee-for-service
 13




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##### 



Our
    Health Plans
    Market

Product

Term End DateDistrict of Columbia

TANF, SCHIP, FamilyCare

July 31, 2007Florida (Non-Reform Contract)

TANF, SSI, SCHIP

August 31, 2009Florida (Reform Contract)

TANF, SSI, SCHIP

June 30, 2009Florida

SCHIP

September 30, 2007Florida

SSI (Summit Care)

August 31, 2007Georgia

TANF, SCHIP

June 30, 2007Maryland(a)

TANF, SSI, SCHIP

Maryland(b)

Medicare Advantage/SNP

December 31, 2007New Jersey

TANF, SSI, SCHIP, FamilyCare

June 30, 2007New York  State Contract

TANF, SSI, FamilyCare

September 30, 2008New York  City of New
    York

TANF, SSI

September 30, 2007New York

SCHIP

June 30, 2007New York

SSI (Managed Long-Term Care)

December 31, 2009Ohio

TANF, SCHIP

June 30, 2007Ohio

SSI

June 30, 2007Virginia

TANF, SSI

June 30, 2007Virginia

SCHIP

June 30, 2007Tennessee(c)

TANF, SSI, SCHIP

June 30, 2010Texas

Medicare Advantage/SNP

December 31, 2007Texas

TANF, SCHIP

August 31, 2008Texas(d)

SSI

January 31, 2007     (a)
    
    Our Maryland contract does not have a set term but can be
    terminated by the Company upon 90 days written notice.(b)
    
    We were approved to operate a SNP effective January 1, 2007
    in Maryland through our Maryland subsidiary, AMERIGROUP
    Maryland, Inc. Accordingly, we began enrolling SNP members in
    that market in 2007. The contract terminates December 31,
    2007 with annual renewal options for successive one-year periods.(c)
    
    We entered into a contract with the State of Tennessee in August
    2006 to offer healthcare coverage to low-income residents in the
    Middle-Grand Region of Tennessee through our subsidiary
    AMERIGROUP Tennessee, Inc. (d/b/a AMERIGROUP Community Care).
    The contract is expected to commence in mid-2007 and continue
    through June 30, 2010, with five one-year renewal options
    thereafter.(d)
    
    Our Texas SSI contract was renewed on February 1, 2007 and
    includes the expanded Houston service area, Austin, Texas and
    San Antonio, Texas.   14




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##### 



December 31,Market

2006


2005


2004District of Columbia


40,000



41,000



41,000Florida


202,000



219,000



229,000Georgia


227,000







Illinois






41,000



37,000Maryland


145,000



141,000



130,000New Jersey


102,000



109,000



105,000New York


126,000



138,000



Ohio


46,000



22,000



Texas


406,000



399,000



394,000Virginia


22,000



19,000



Total


1,316,000



1,129,000



936,000   District
    of Columbia
    Florida
   15




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##### 



Georgia
    Illinois
    Maryland
    New
    Jersey
    New
    York
   16




---



##### 



Ohio
    Texas
      Virginia
    Quality
    Management
    
    Analysis of healthcare utilization data.  To
    avoid duplication of services or medications, in conjunction
    with the PCPs, healthcare utilization data is analyzed and,
    through comparative provider data and periodic meetings with
    physicians, we identify areas in which a physicians
    utilization rate differs significantly from the rates of other
    physicians. On the basis of this analysis, we suggest
    opportunities for improvement and
    follow-up
    with the PCP to monitor utilization. 17




---



##### 




    Medical care satisfaction studies.  We evaluate
    the quality and appropriateness of care provided to our health
    plan members by reviewing healthcare utilization data and
    responses to member and physician questionnaires and grievances.
    Clinical care oversight.  Each of our health
    plans has a medical advisory committee comprised of physician
    representatives and chaired by the plans medical director.
    This committee reviews credentialing, approves clinical
    protocols and practice guidelines and evaluates new physician
    group candidates. Based on regular reviews, the medical
    directors who head these committees develop recommendations for
    improvements in the delivery of medical care.
    Quality improvement plan.  A quality
    improvement plan is implemented in each of our health plans and
    is governed by a quality management committee. The quality
    management committee is comprised of senior management at our
    health plans, who review and evaluate the quality of our health
    services and are responsible for the development of quality
    improvement plans spanning both clinical quality and customer
    service quality. These plans are developed from provider and
    membership feedback, satisfaction surveys and results of action
    plans. Our corporate quality improvement council oversees and
    meets regularly with our health plan quality management
    committees to help ensure that we have a coordinated,
    quality-focused approach relating to our members, providers and
    state governments.  Management
    Information Systems
    tm long-term
  Competition
    
    Traditional
    Fee-for-Service 
    Original unmanaged provider payment system whereby the state
    governments pay providers directly for services provided to
    Medicaid members.
    Primary Care Case Management Programs (PCCMs) 
    Programs established by the states through contracts with PCPs
    to provide primary care services to the Medicaid recipient, as
    well as provide limited oversight over other services.
    Commercial HMOs  National and regional commercial
    managed care organizations that have Medicaid and Medicare
    members in addition to members in private commercial plans. 18




---



##### 




    Medicaid HMOs  Managed care organizations that focus
    solely on serving people who receive healthcare benefits through
    Medicaid.
    Medicare Coordinated Care Plans  Managed care
    organizations that focus on serving people who receive
    healthcare benefits through Medicare. These plans also may
    include Medicare Part D prescription coverage.
    Private
    Fee-For-Service
    Organizations  These organizations provide the
    standard fee-for-service arrangements of Medicare, but are run
    by private plans and may or may not include a prescription drug
    plan.
    Medicare Part D Plans  These plans offer
    Medicare beneficiaries prescription drug coverage only, while
    members of these plans continue to receive their medical
    benefits from either another Medicare plan or Medicare
    Fee-For-Service.        Regulation
    Regulated
    Entities
  and/or
   19




---



##### 



Medicaid
    and Medicare
    
    establishes its own eligibility standards,
    determines the type, amount, duration and scope of services,
    sets the rate of payment for services, and
    administers its own program.  time-to-time.
    
    mandating Medicaid enrollment into managed care,
    utilizing a central broker for enrollment into plans,
    using cost savings to provide additional services, and
    limiting the number of providers for additional services.          
    eligibility, enrollment and disenrollment processes,
    covered services,
    eligible providers,
    subcontractors,
    record-keeping and record retention, 20




---



##### 




    periodic financial and informational reporting,
    quality assurance,
    marketing,
    financial standards,
    timeliness of claims payment,
    health education and wellness and prevention programs,
    safeguarding of member information,
    fraud and abuse detection and reporting,
    grievance procedures, and
    organization and administrative systems.        
    enrollment and disenrollment,
    marketing;
    benefits and beneficiary protections,
    quality assessment,
    relationships with providers,
    payment from CMS,
    premiums and cost-sharing,
    our contract with CMS,
    the effect of a change of ownership during the contract period
    with CMS, and
    beneficiary grievances, organization determinations, and appeals.      
    benefits and beneficiary protections,
    Part D drugs and formulary requirements,
    marketing (included in the MMC Manual),
    enrollment and disenrollment guidance, 21




---



##### 




    quality improvement and medication therapy management,
    fraud, waste and abuse,
    coordination of benefits, and
    Part D grievances, coverage determinations, and appeals.        Additional
    Federal Regulation
  HIPAA
        Medicaid
    Reform
   22




---



##### 



Fee-For-Service out-of-network
      Presidents
    2008 Budget
        Medicaid
    Commission
   23




---



##### 



Patients
    Rights Legislation
  make-up
  Other
    Fraud and Abuse Laws
    Employees
    Available
    Information
  1-800-SEC-0330. Form 10-K, Form 10-Q, Form 8-K,
 24




---



##### 



Form 10-K, Form 10-Q, Form 8-K,
   25




---



##### 



Item 1A.
    Risk
    Factors  RISK
    FACTORS
  Risks
    related to being a regulated entity
  Changes
    in government regulations designed to protect providers and
    members could force us to change how we operate and could harm
    our business.
    
    force us to change how we do business,
    restrict revenue and enrollment growth,
    increase our health benefits and administrative costs,
    impose additional capital requirements, and
    increase or change our claims liability.  If
    state regulators do not approve payments of dividends,
    distributions or administrative fees by our
    subsidiaries to us, it could negatively affect our business
    strategy.
  .
  Regulations
    could limit our profits as a percentage of
    revenues.
     26




---



##### 



Failure
    to comply with the terms of our contracts with our government
    partners could negatively impact our profitability and subject
    us to fines and penalties.
      Our
    failure to comply with government regulations could subject us
    to civil and criminal penalties and limitations on our
    profitability.
    time-to-time
  and/or
   27




---



##### 



and/or
        Compliance
    with new federal and state rules and regulations may require us
    to make unanticipated expenditures.
    Changes
    in healthcare laws could reduce our profitability.
  time-to-time.
 28




---



##### 



Changes
    in federal funding mechanisms could reduce our
    profitability.
    Fee-For-Service out-of-network
           29




---



##### 



Reductions
    in Medicaid funding by the states could substantially reduce our
    profitability.
      If
    state governments do not renew our contracts on favorable terms
    or we fail to retain our contracts as a result of a re-bidding
    process, our business will suffer.
      Delays
    in program expansions or contract changes could negatively
    impact our business.
  start-up,
 30




---



##### 



If a
    state fails to renew its federal waiver application for mandated
    Medicaid enrollment into managed care or such application is
    denied, our membership in that state will likely
    decrease.
    We
    rely on the accuracy of eligibility lists provided by the state
    government, and in the case of our SNP members, by the federal
    government. Inaccuracies in those lists would negatively affect
    our results of operations.
  time-to-time,
  If
    state regulatory agencies require a statutory capital level
    higher than the state regulations we may be required to make
    additional capital contributions.
    Risks
    related to our business
  Results
    of our Qui Tam litigation could negatively impact our revenues,
    profitability and cash flows.
           31




---



##### 



32




---



##### 



Legal Proceedings Litigation and Capital
    Resources.
  Receipt
    of inadequate or significantly delayed premiums would negatively
    impact our revenues, profitability and cash flow.
      Our
    inability to manage medical costs effectively would reduce our
    profitability.
  non-network
 33




---



##### 



Our
    limited ability to predict our incurred medical expenses
    accurately has in the past and could in the future materially
    impact our reported results.
    Our
    inability to operate new business opportunities at underwritten
    levels could have a material adverse effect on our
    business.
    Difficulties
    in executing our acquisition strategy or integrating acquired
    business could adversely affect our business.
    .
 34




---



##### 




    additional employees who are not familiar with our operations,
    existing provider networks, which may operate on different terms
    than our existing networks,
    existing members, who may decide to switch to another healthcare
    provider, and
    disparate information and record keeping systems.    Failure
    of a new business would negatively impact our results of
    operations.
  Start-up start-up
  Ineffective
    management of rapid growth or our inability to grow could
    negatively affect our results of operations, financial condition
    and business.
     35




---



##### 



We are
    subject to competition that impacts our ability to increase our
    penetration of the markets that we serve.
        Restrictions
    and covenants in our credit facility could limit our ability to
    take actions.
  Legal Proceedings.
     36




---



##### 



Our
    inability to maintain satisfactory relationships with providers
    would harm our profitability.
    non-network fee-for-service non-network non-network non- fee-for-service
  non-network non-network
  Negative
    publicity regarding the managed care industry may harm our
    business and operating results.
   37




---



##### 



We may
    be subject to claims relating to medical malpractice, which
    could cause us to incur significant expenses.
      Changes
    in the number of Medicaid eligibles, or benefits provided to
    Medicaid eligibles or a change in mix of Medicaid eligibles
    could cause our operating results to suffer.
    Changes
    in SCHIP rules restricting eligibility could cause our operating
    results to suffer.
  and/or
  Our
    inability to integrate, manage and grow our information systems
    effectively could disrupt our operations.
     38




---



##### 



Acts
    of terrorism, natural disasters and medical epidemics could
    cause our business to suffer.
    We are
    currently involved in litigation, and may become involved in
    future litigation, which may result in substantial expense and
    may divert our attention from our business.
      Item 1B.
    Unresolved
    Staff Comments  None.
  Item 2.
    Properties   39




---



##### 



Item 3.
    Legal
    Proceedings  Tyson
                 40




---



##### 



Class Action
    Complaints
  Rule 10b-5 No. 2:05-cv-701
  Rule 10b-5
 41




---



##### 



Item 4.
    Submission
    of Matters to a Vote of Security Holders    Executive
    Officers of the Company
    Name

Age

PositionJeffrey L. McWaters


50


Chairman and Chief Executive
    OfficerJames G. Carlson


54


President and Chief Operating
    OfficerJames W. Truess


41


Executive Vice President, Chief
    Financial OfficerStanley F. Baldwin


58


Executive Vice President, General
    Counsel and SecretaryCatherine S. Callahan


49


Executive Vice President,
    Associate ServicesNancy L. Grden


55


Executive Vice President and Chief
    Marketing OfficerWilliam T. Keena


47


Executive Vice President, Support
    OperationsSteven B. Larsen


47


Executive Vice President, Health
    Plan OperationsJohn E. Littel


42


Executive Vice President, External
    AffairsMargaret M. Roomsburg


47


Senior Vice President and Chief
    Accounting OfficerLeon A. Root, Jr.


53


Executive Vice President and Chief
    Information OfficerRichard C. Zoretic


48


Executive Vice President, Health
    Plan Operations and Healthcare Delivery Systems   Jeffrey L. McWaters
 42




---



##### 



James G. Carlson
  James W. Truess
  Stanley F. Baldwin
  Catherine S. Callahan
  Nancy L. Grden
  William T. Keena
  Steven B. Larsen
  John E. Littel
  Margaret M. Roomsburg
  Leon A. Root, Jr. e-commerce
  Richard C. Zoretic
 43




---



##### 



PART II.  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities    two-for-one
    High


Low2005First quarter

$
43.69


$
34.75Second quarter


40.81



30.92Third quarter


49.30



18.53Fourth quarter


19.99



14.602006First quarter

$
23.31


$
18.84Second quarter


32.69



20.30Third quarter


33.07



27.40Fourth quarter


37.15



27.87December 31, 2006 Closing
    Sales Price

$
35.89        44




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##### 



Performance
    Graph
      
  Value of $100 Invested Over Past 5 Years01/01/02


12/31/02


12/31/03


12/31/04


12/31/05


12/31/06(GRAPHIC)AGP


$
100.00



$
137.10



$
193.03



$
342.35



$
176.11



$
324.80(GRAPHIC)Peers


$
100.00



$
121.04



$
238.26



$
353.22



$
544.49



$
544.74(GRAPHIC)S&P
    500


$
100.00



$
75.50



$
95.13



$
103.16



$
107.12



$
121.71  45




---



##### 



Item 6.
    Selected
    Financial Data  Form 10-K. two-for-one
  Years Ended December 31,2006


2005


2004


2003


2002(Dollars in thousands, except per share data)Income Statement
    Data:Revenues:Premium

$
2,795,810


$
2,311,599


$
1,813,391


$
1,615,508


$
1,152,636Investment income and other


39,279



18,310



10,340



6,726



8,026Total revenues


2,835,089



2,329,909



1,823,731



1,622,234



1,160,662Expenses:Health benefits


2,266,017



1,957,196



1,469,097



1,295,900



933,591Selling, general and administrative


369,896



258,446



191,915



186,856



133,409Depreciation and amortization


25,486



26,948



20,750



23,650



13,149Interest


608



608



731



1,913



791Total expenses


2,662,007



2,243,198



1,682,493



1,508,319



1,080,940Income before income taxes


173,082



86,711



141,238



113,915



79,722Income tax expense


65,976



33,060



55,224



46,591



32,686Net income

$
107,106


$
53,651


$
86,014


$
67,324


$
47,036Basic net income per share

$
2.07


$
1.05


$
1.73


$
1.56


$
1.17Weighted average number of shares
    outstanding


51,863,999



51,213,589



49,721,945



43,245,408



40,355,456Diluted net income per share

$
2.02


$
1.02


$
1.66


$
1.48


$
1.10Weighted average number of common
    shares and dilutive potential common shares outstanding


53,082,933



52,857,682



51,837,579



45,603,300



42,938,844   December 31,2006


2005


2004


2003


2002(Dollars in thousands)Balance Sheet Data:Cash and cash equivalents and
    short and long-term investments

$
776,273


$
587,106


$
612,059


$
535,103


$
306,935Total assets


1,345,695



1,093,588



919,850



826,021



578,484Long-term debt


















50,000Total liabilities


577,110



452,034



351,138



364,307



339,103Stockholders equity


768,585



641,554



568,712



461,714



239,381  46




---



##### 



Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Overview
    Revenue
    Growth in 2006
        Opportunities
    for Future Growth
       47




---



##### 



Status
    of Qui Tam Litigation
    and/or
     48




---



##### 



Operating
    Costs
  Health
    Benefits
    Years Ended December 31,2006


2005Reported premium revenues

$
2,795,810


$
2,311,599Reported health benefits expenses

$
2,266,017


$
1,957,196Reported HBR


81.1
%


84.7
%Reported premium revenues


2,795,810


$
2,311,599Less: Prior period premium
    revenues adjustments


(1,699
)


(1,624
)Recast premium revenues

$
2,794,111


$
2,309,975Reported health benefits expenses

$
2,266,017


$
1,957,196Plus (less): Prior period health
    benefits expense developments, net


28,675



(37,508
)Recast health benefits expenses

$
2,294,692


$
1,919,688Recast HBR


82.1
%


83.1
%     Selling,
    general and administrative expenses
   49




---



##### 



New
    Products and Markets
          Significant
    Market Updates
     50




---



##### 



Contingencies
  Medicare
    Parts A & B
       51




---



##### 



Medicare
    Part D
    start-up Plan-to-Plan Plan-to-Plan
  Florida
    Behavioral Health
    Experience
    Rebate Payable
   52




---



##### 



New
    Jersey Provider Network
    Discussion
    of Critical Accounting Policies
    Revenue
    recognition
    Estimating
    health benefits expense and claims payable
  24-hour
 53




---



##### 



fee-for-service
  year-to-year,
          out-of-network
 54




---



##### 



2006


2005


2004Medical claims payable as of
    January 1

$
348,679


$
241,253


$
239,532Medical claims payable assumed
    from businesses acquired during the year






27,424



Health benefits expenses incurred
    during the year:Related to current year


2,328,863



1,982,880



1,505,482Related to prior years


(62,846
)


(25,684
)


(36,385
)Total incurred


2,266,017



1,957,196



1,469,097Health benefits payments during
    the year:Related to current year


1,971,505



1,646,664



1,274,460Related to prior years


257,987



230,530



192,916Total payments


2,229,492



1,877,194



1,467,376Medical claims payable as of
    December 31

$
385,204


$
348,679


$
241,253     year-to-year.
     55




---



##### 



Income
    taxes
    Goodwill
    and intangible assets
    Share-Based
    Payments
            Recent
    Accounting Standards
  Accounting for Uncertainty in Income Taxes Accounting for Income Taxes
  Shared-Based Payment Accounting for Stock Issued to Employees Accounting for Stock-Based
    Compensation Statement
    of Cash Flows.
 56




---



##### 



Results
    of Operations
    Years Ended December 31,2006


2005


2004Premium revenue


98.6
%


99.2
%


99.4
%Investment income and other


1.4



0.8



0.6Total revenues


100.0
%


100.0
%


100.0
%Health benefits(1)


81.1
%


84.7
%


81.0
%Selling, general and
    administrative expenses


13.0
%


11.1
%


10.5
%Income before income taxes


6.1
%


3.7
%


7.7
%Net income


3.8
%


2.3
%


4.7
%     (1)
    
    The health benefits ratio is shown as a percentage of premium
    revenue because there is a direct relationship between the
    premium received and the health benefits provided.    December 31,


% Change2006


2005


2004


2005-2006


2004-2005Revenues:Premium

$
2,795.8


$
2,311.6


$
1,813.4



20.9
%


27.5
%Investment income and other


39.3



18.3



10.3



114.8
%


77.7
%Total revenues


2,835.1



2,329.9



1,823.7



21.7
%


27.8
%Expenses:Health benefits


2,266.0



1,957.2



1,469.1



15.8
%


33.2
%Selling, general and administrative


369.9



258.4



191.9



43.2
%


34.7
%Depreciation and amortization


25.5



26.9



20.8



(5.2
)%


29.3
%Interest


0.6



0.6



0.7



0.0
%


(14.3
)%Total expenses


2,662.0



2,243.1



1,682.5



18.7
%


33.3
%Income before income taxes


173.1



86.8



141.2



99.4
%


(38.5
)%Income tax expense


66.0



33.1



55.2



99.4
%


(40.0
)%Net income

$
107.1


$
53.7


$
86.0



99.4
%


(37.6
)%Diluted net income per common share

$
2.02


$
1.02


$
1.66



98.0
%


(38.6
)%   Revenues
   57




---



##### 



December 31,Market

2006


2005


2004


2003


2002Texas


406,000



399,000



394,000



343,000



296,000Georgia


227,000















Florida


202,000



219,000



229,000



221,000



Maryland


145,000



141,000



130,000



124,000



125,000New York


126,000



138,000











New Jersey


102,000



109,000



105,000



99,000



99,000Ohio


46,000



22,000











District of Columbia


40,000



41,000



41,000



38,000



37,000Virginia


22,000



19,000











Illinois






41,000



37,000



32,000



34,000Total


1,316,000



1,129,000



936,000



857,000



591,000      58




---



##### 



Health
    benefits
    Years Ended December 31,2006


2005Reported premium revenues

$
2,795,810


$
2,311,599Reported health benefits expenses

$
2,266,017


$
1,957,196Reported HBR


81.1
%


84.7
%Reported premium revenues

$
2,795,810


$
2,311,599Less: Prior period premium
    revenues adjustments


(1,699
)


(1,624
)Recast premium revenues

$
2,794,111


$
2,309,975Reported health benefits expenses

$
2,266,017


$
1,957,196Plus (less): Prior period health
    benefits expense developments, net


28,675



(37,508
)Recast health benefits expenses

$
2,294,692


$
1,919,688Recast HBR


82.1
%


83.1
%     Selling,
    general and administrative expenses
    
    an increase in salaries and benefits as a result of a 30%
    increase in employees, stock compensation expense related to the
    adoption of SFAS No. 123(R) and earnings-based
    compensation not provided for in the preceding year;
    an increase in premium taxes as a result of our entry into the
    Georgia market, increased revenues in our Maryland and Ohio
    markets which bear premium tax and an increase in the premium
    tax rate in New Jersey;
    an increase in legal expenses related to the Qui Tam
    litigation; and
    an increase in operational and technological initiatives and
    recruiting expenses to support the Companys growth.    
    an increase in premium taxes that the States of Texas, New
    Jersey and Maryland began assessing in September 2003, July
    2004, and April 2005, respectively;
    an increase in legal expenses related to the Qui Tam litigation
    and the securities class action complaints; and
    an increase in experience rebate expense in our Texas market.   59




---



##### 



Depreciation
    and amortization expense
    Interest
    expense
    Provision
    for income taxes
    Net
    income
    Liquidity
    and Capital Resources
     60




---



##### 



Legal Proceedings.
  and/or
    No. 02-C-6074,
       61




---



##### 



time-to-time
      
    an increase in net income of $53.5 million;
    an increase in the change in premium receivables of
    $38.8 million primarily due to the acceleration of premium
    receipts from the State of the New York that had historically
    paid in arrears;
    an increase in the change in accounts payable, accrued expense
    and other current liabilities of $56.8 million primarily as
    a result of timing of premium tax payments, the reversal of the
    contingent liability in the Maryland market of $6.1 million
    in the prior year, increase in accrued legal fees and experience
    rebate payable and the net increase in the change in the
    earnings-based compensation liabilities of
    $27.5 million; and
    an increase in the change in unearned revenue of
    $32.9 million due to the timing of a premium receipts and
    increase in estimated premium recoupment balances.    
    a decrease in the change in deferred taxes of $11.0 million
    primarily related to the increase in unearned revenue and
    establishment of a deferred tax asset in connection with the
    adoption of SFAS No. 123(R); and
    a decrease in the change in claims payable of $43.5 million
    related to efforts to resolve outstanding claims issues and
    reducing ending inventory levels.       62




---



##### 



Contractual Obligations

Total


2007


2008


2009


2010


2011


ThereafterLease financing:Operating lease obligations

$
92,609


$
13,172


$
11,324


$
10,384


$
10,082


$
9,675


$
37,972Capital lease obligations


1,264



838



426















Total lease financing

$
93,873


$
14,010


$
11,750


$
10,384


$
10,082


$
9,675


$
37,972   Lease
    Financing
  Operating Lease Obligations.
  Capital Lease Obligations.
  Long-term
    Borrowings
  Legal
    Proceedings.
   63




---



##### 



Commitments
    Regulatory
    Capital and Dividend Restrictions
   64




---



##### 



Inflation
    Off-Balance
    Sheet Arrangements
  Legal Proceedings.
 Item 7A.  Quantitative
    and Qualitative Disclosures About Market Risk   65




---



##### 



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  
        Share-Based
    Payments.
  Internal Control 
    Integrated Framework
  
   66




---



##### 



Item 8.
    Financial
    Statements and Supplementary Data  AMERIGROUP
    CORPORATION AND SUBSIDIARIES
  CONSOLIDATED
    BALANCE SHEETS
    (Dollars in thousands, except per share data)
  2006


2005ASSETSCurrent assets:Cash and cash equivalents

$
176,718


$
272,169Short-term investments


167,703



130,054Premium receivables


63,594



76,142Deferred income taxes


21,550



11,972Provider and other receivables


44,098



24,783Prepaid expenses and other current
    assets


27,446



13,009Total current assets


501,109



528,129Long-term investments


431,852



184,883Investments on deposit for
    licensure


68,511



56,657Property and equipment, net


46,983



36,967Software, net of accumulated
    amortization of $34,447 and $27,016 at December 31, 2006
    and 2005, respectively


34,621



24,697Other long-term assets


7,279



7,140Goodwill and other intangible
    assets, net of accumulated amortization of $27,707 and $23,166
    at December 31, 2006 and 2005, respectively


255,340



255,115$
1,345,695


$
1,093,588LIABILITIES AND
    STOCKHOLDERS EQUITYCurrent liabilities:Claims payable

$
385,204


$
348,679Accounts payable


6,285



7,243Unearned revenue


63,765



32,598Accrued payroll and related
    liabilities


39,951



17,978Accrued expenses and other current
    liabilities


66,922



26,730Current portion of capital lease
    obligations


795



1,642Total current liabilities


562,922



434,870Capital lease obligations less
    current portion


415



1,175Deferred income taxes


7,637



10,273Other long-term liabilities


6,136



5,716Total liabilities


577,110



452,034Commitments and contingencies
    (note 11)Stockholders equity:Common stock, $0.01 par
    value. Authorized 100,000,000 shares; issued and
    outstanding 52,274,552 and 51,567,340 at December 31, 2006
    and 2005, respectively


523



516Additional paid-in capital


391,515



371,744Retained earnings


376,547



269,294Total stockholders equity


768,585



641,554$
1,345,695


$
1,093,588    67




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
  CONSOLIDATED
    INCOME STATEMENTS
  Years Ended December 31,2006


2005


2004(Dollars in thousands, except for per share data)Revenues:Premium

$
2,795,810


$
2,311,599


$
1,813,391Investment income and other


39,279



18,310



10,340Total revenues


2,835,089



2,329,909



1,823,731Expenses:Health benefits


2,266,017



1,957,196



1,469,097Selling, general and administrative


369,896



258,446



191,915Depreciation and amortization


25,486



26,948



20,750Interest


608



608



731Total expenses


2,662,007



2,243,198



1,682,493Income before income taxes


173,082



86,711



141,238Income tax expense


65,976



33,060



55,224Net income

$
107,106


$
53,651


$
86,014Net income per share:Basic net income per share

$
2.07


$
1.05


$
1.73Weighted average number of common
    shares outstanding


51,863,999



51,213,589



49,721,945Diluted net income per share

$
2.02


$
1.02


$
1.66Weighted average number of common
    shares and dilutive potential common shares outstanding


53,082,933



52,857,682



51,837,579    68




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF STOCKHOLDERS EQUITY
  Additional








TotalCommon Stock


Paid-In


Retained


Deferred


StockholdersShares


Amount


Capital


Earnings


Compensation


Equity(Dollars in thousands)Balances at January 1, 2004


48,889,244


$
489


$
331,506


$
129,776


$
(57)


$
461,714Common stock issued upon exercise
    of stock options and purchases under the employee stock purchase
    plan


1,640,480



16



12,902











12,918Tax benefit from exercise of stock
    options










8,009











8,009Amortization of deferred
    compensation


















57



57Net income














86,014







86,014Balances at December 31, 2004


50,529,724



505



352,417



215,790







568,712Common stock issued upon exercise
    of stock options and purchases under the employee stock purchase
    plan


1,037,616



11



10,756











10,767Tax benefit from exercise of
    options










8,571











8,571Other














(147
)






(147
)Net income














53,651







53,651Balances at December 31, 2005


51,567,340



516



371,744



269,294







641,554Common stock issued upon exercise
    of stock options, vesting of restricted stock grants, and
    purchases under the employee stock purchase plan


707,212



7



8,683











8,690Compensation expense related to
    share-based payments










8,477











8,477Tax benefit from exercise of stock
    options










2,611











2,611Other














147







147Net income














107,106







107,106Balances at December 31, 2006


52,274,552


$
523


$
391,515


$
376,547


$



$
768,585    69




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
  Years Ended December 31,2006


2005


2004(Dollars in thousands)Cash flows from operating
    activities:Net income

$
107,106


$
53,651


$
86,014Adjustments to reconcile net income
    to net cash provided by operating activities:Depreciation and amortization


25,486



26,948



20,750Loss (gain) on disposal or
    abandonment of property, equipment and software


725



(61
)


971Deferred tax (benefit) expense


(12,214
)


(1,247
)


2,878Compensation expense related to
    share-based payments


8,477







Tax benefit related to exercise of
    stock options






8,571



8,009Amortization of deferred
    compensation










57Changes in assets and liabilities
    increasing (decreasing) cash flows from operations:Premium receivables


12,548



(26,234
)


(5,822
)Prepaid expenses, provider and
    other receivables and other current assets


(21,683
)


(15,919
)


(2,742
)Other assets


(647
)


(1,074
)


(941
)Claims payable


36,525



80,002



1,721Accounts payable, accrued expenses
    and other current liabilities


47,741



(9,049
)


9,234Unearned revenue


31,167



(1,723
)


(20,096
)Other long-term liabilities


420



(760
)


2,027Net cash provided by operating
    activities


235,651



113,105



102,060Cash flows from investing
    activities:Proceeds from sale of
    available-for-sale
    securities


1,576,108



1,120,383



5,121,916Purchase of
    available-for-sale
    securities


(1,602,946
)


(1,027,478
)


(4,972,080
)Proceeds from redemption of
    held-to-maturity
    securities


383,466



214,333



74,971Purchase of
    held-to-maturity
    securities


(641,099
)


(237,393
)


(158,663
)Purchase of property and equipment
    and software


(41,102
)


(25,819
)


(25,727
)Proceeds from redemption of
    investments on deposit for licensure


50,006



46,064



35,525Purchase of investments on deposit
    for licensure


(61,860
)


(56,329
)


(38,544
)Purchase price adjustment (paid)
    received


(4,766
)


0



512Stock acquisition, net of cash
    acquired






(107,645
)


Net cash (used in) provided by
    investing activities


(342,193
)


(73,884
)


37,910Cash flows from financing
    activities:Net increase (decrease) in bank
    overdrafts


1,397







(5,315
)Payment of debt issuance costs






(1,626
)


Payment of capital lease obligations


(1,607
)


(3,323
)


(4,473
)Proceeds from exercise of stock
    options and employee stock purchases


8,690



10,767



12,918Tax benefit related to exercise of
    stock options


2,611







Net cash provided by financing
    activities


11,091



5,818



3,130Net (decrease) increase in cash and
    cash equivalents


(95,451
)


45,039



143,100Cash and cash equivalents at
    beginning of year


272,169



227,130



84,030Cash and cash equivalents at end of
    year

$
176,718


$
272,169


$
227,130Supplemental disclosures of cash
    flow information:Cash paid for interest

$
576


$
621


$
717Cash paid for income taxes

$
65,917


$
27,494


$
53,628     Assets acquired, including cash of
    $27,755

$
177,144Liabilities assumed


36,978Net assets acquired

$
140,166    70




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    December 31, 2006, 2005 and 2004
    (Dollars in thousands, except for per share data)
  (1)  Corporate
    Organization and Principles of Consolidation
  (a)
    Corporate
    Organization       AMERIGROUP Florida,
    Inc.

 AMERIGROUP South
    Carolina, Inc. AMERIGROUP Illinois,
    Inc.

 AMERIGROUP
    Tennessee, Inc. AMERIGROUP Indiana,
    Inc.

 AMERIGROUP
    Texas, Inc. AMERIGROUP Maryland,
    Inc.

 AMERIGROUP
    Virginia, Inc. AMERIGROUP Nevada, Inc.

 AMGP Georgia,
    Managed Care AMERIGROUP New Jersey,
    Inc.

Company,
    Inc. AMERIGROUP New Mexico,
    Inc.

 CarePlus, LLC, a
    Prepaid Health AMERIGROUP Ohio, Inc.

Services
    Plan Intellident IPA,
    Inc. PHP Holdings,
    Inc., a holding companythat is
    the parent company forAMERIGROUP
    Florida, Inc.   two-for-one
  (b)
    Principles
    of Consolidation    (2)  Summary
    of Significant Accounting Policies and Practices
  (a)
    Cash
    Equivalents   71




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (b)
    Short
    and Long-Term Investments and Investments on Deposit for
    Licensure  available-for-sale held-to-maturity. Held-to-maturity held-to-maturity available-for-sale. available-for-sale. held-to-maturity.
  Available-for-sale
  Held-to-maturity held-to-maturity held-to-maturity
    (c)
    Property
    and Equipment    Leasehold improvements


3-15 yearsFurniture and fixtures


5-7 yearsEquipment


3-5 years   (d)
    Software  98-1, Accounting for the Costs of Software Developed or Obtained
    for Internal Use.
  (e)
    Goodwill
    and Other Intangibles  Goodwill and Other
    Intangible Assets
 72




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Accounting for
    Impairment or Disposal of Long-Lived Assets.
  (f)
    Other
    Assets    (g)
    Income
    Taxes  Accounting for Income Taxes
  (h)
    Premium
    Taxes    (i)
    Stock-Based
    Compensation  Shared-Based Payment Accounting
    for Stock Issued to Employees Accounting for Stock-Based Compensation Statement of Cash Flows.
 73




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     2005


2004Net income:Reported net income

$
53,651


$
86,014Deduct: Total stock-based employee
    compensation expense determined under fair value based method
    for all awards, net of related tax effects


16,563



9,321Pro forma net income

$
37,088


$
76,693Basic net income per share:Reported basic net income per share

$
1.05


$
1.73Pro forma basic net income per
    share


0.72



1.54Diluted net income per share:Reported diluted net income per
    share

$
1.02


$
1.66Pro forma diluted net income per
    share


0.70



1.49   out-of-the-money
  (j)
    Premium
    Revenue  and/or
   74




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        (k)
    Experience
    Rebate Payable    (l)
    Claims
    Payable      (m)
    Stop-loss
    Coverage    (n)
    Impairment
    of Long-Lived Assets   75




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Business Combinations.
  (o)
    Net
    Income Per Share    (p)
    Use of
    Estimates    (q)
    Reclassifications    (r)
    Recent
    Accounting Standards  Accounting for Uncertainty in Income Taxes Accounting for Income Taxes
 76




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (s)
    Risks
    and Uncertainties      (3)
    Short and
    Long-Term Investments and Investments on Deposit for
    Licensure  available-for-sale held-to-maturity
  Gross


GrossUnrealized


UnrealizedAmortized


Holding


Holding


FairCost


Gains


Losses


Value2006:Auction rate
    securities 
    available-for-sale
    (carried at fair value)

$
121,090


$



$



$
121,090Held-to-maturity
    (carried at amortized cost):Commercial paper

$
5,980


$



$



$
5,980Debt securities of government
    sponsored entities


36,633



3



6



36,630Municipal bonds


4,000







1



3,999Total

$
46,613


$
3


$
7


$
46,6092005:Auction rate
    securities 
    available-for-sale
    (carried at fair value)

$
59,500


$



$



$
59,500Held-to-maturity
    (carried at amortized cost):Commercial paper

$
5,382


$



$
5


$
5,377Certificates of deposit


513











513Corporate securities


1,500











1,500Debt securities of government
    sponsored entities


52,681



1



50



52,632Municipal bonds


10,478







6



10,472Total

$
70,554


$
1


$
61


$
70,494  77




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  available-for-sale held-to-maturity
  Gross


GrossUnrealized


UnrealizedAmortized


Holding


Holding


FairCost


Gains


Losses


Value2006:Held-to-maturity
    (carried at amortized cost):Municipal bonds, maturing within
    one year

$
1,998


$



$
1


$
1,997Debt securities of government
    sponsored entities, maturing within one year


96,825



13



166



96,672Debt securities of government
    sponsored entities, maturing between one year and five years


333,029



84



824



332,289Total

$
431,852


$
97


$
991


$
430,9582005:Auction rate
    securities 
    available-for-sale
    (carried at fair value)

$
34,752


$



$
147


$
34,605Held-to-maturity
    (carried at amortized cost):Municipal bonds, maturing within
    one year

$
6,400


$



$
29


$
6,371Corporate securities, maturing
    within one year


2,000







10



1,990Debt securities of government
    sponsored entities, maturing within one year


114,384







645



113,739Debt securities of government
    sponsored entities, maturing between one year and five years


27,494



1



32



27,463Total

$
150,278


$
1


$
716


$
149,563  78




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  held-to-maturity
  Gross


GrossUnrealized


UnrealizedAmortized


Holding


Holding


FairCost


Gains


Losses


Value2006:Money market funds

$
5,235


$



$



$
5,235Certificates of deposit


307











307U.S. Treasury securities, maturing
    within one year


13,540



1



5



13,536U.S. Treasury securities, maturing
    between one year and five years


2,480







26



2,454U.S. Treasury securities, maturing
    between five years and ten years


596







21



575Debt securities of government
    sponsored entities, maturing within one year


19,491



2



30



19,463Debt securities of government
    sponsored entities, maturing between one year and five years


26,460



19



55



26,424Debt securities of government
    sponsored entities, maturing between five and ten years


402



33



6



429Total

$
68,511


$
55


$
143


$
68,4232005:Money market funds

$
4,984


$



$



$
4,984Commercial paper


422







15



407Certificates of deposit


303







3



300U.S. Treasury securities, maturing
    within one year


13,791







53



13,738U.S. Treasury securities, maturing
    between one year and five years


503







11



492U.S. Treasury securities, maturing
    between five years and ten years


2,456



50



45



2,461Debt securities of government
    sponsored entities, maturing within one year


23,415



1



213



23,203Debt securities of government
    sponsored entities, maturing between one year and five years


10,368







24



10,344Debt securities of government
    sponsored entities, maturing between five and ten years


415







74



341Total

$
56,657


$
51


$
438


$
56,270    79




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  held-to-maturity other-than-temporarily
  Less than 12 Months


12 Months or GreaterGross








GrossUnrealized


Total





Unrealized


TotalFair


Holding


Number of


Fair


Holding


Number ofValue


Losses


Securities


Value


Losses


Securities2006:Commercial paper

$



$







$



$




Certificates of deposit






















Corporate securities






















Debt securities of government
    sponsored entities


383,081



987



191



36,237



100



20Municipal bonds


3,996



2



2











U.S. Treasury securities


6,931



5



7



2,916



47



5Total temporarily impaired
    securities

$
394,008


$
994



200


$
39,153


$
147



25   held-to-maturity other-than-temporarily
  Less than 12 Months


12 Months or GreaterGross








GrossUnrealized


Total





Unrealized


TotalFair


Holding


Number of


Fair


Holding


Number ofValue


Losses


Securities


Value


Losses


Securities2005:Commercial paper

$
4,383


$
20



3


$



$




Certificates of deposit


300



3



1











Corporate securities


1,990



10



1











Debt securities of government
    sponsored entities


94,801



260



66



118,899



778



60Municipal bonds


5,972



6



3



6,371



29



5US Treasury securities


9,082



109



15











Total temporarily impaired
    securities

$
116,528


$
408



89


$
125,270


$
807



65    80




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (4)  Property
    and Equipment, Net
    2006


2005Leasehold improvements

$
28,700


$
20,110Furniture and fixtures


18,344



14,683Equipment


56,143



57,583103,187



92,376Less accumulated depreciation and
    amortization


(56,204
)


(55,409
)$
46,983


$
36,967   (5)  Acquisitions
  (a)
    CarePlus        Cash and cash equivalents

$
27,755Investments on deposit for
    licensure


8,027Goodwill and other intangible
    assets


127,439Property, equipment and software


3,941Other assets


9,982Total assets acquired


177,144Claims payable


27,424Other liabilities


9,554Total liabilities assumed


36,978Net assets acquired

$
140,166  81




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    AmortizationPeriodMembership rights and provider
    network

$
12,900



10 yearsNon-compete agreement and
    trademarks


1,080



1-3 years$
13,980     Premium revenue

$
2,008,319Investment income and other


9,030Total revenues


2,017,349Health benefits expenses


1,608,656Selling, general and
    administrative expenses


229,812Depreciation and amortization
    expenses


28,734Interest expense


731Income before income taxes


149,416Provision for income taxes


59,093Net income

$
90,323Diluted net income per share

$
1.74   (d)
    Summary
    of Goodwill and Acquired Intangible Assets    2006


Weighted


2005Gross Carrying


Accumulated


Average


Gross Carrying


Accumulated


WeightedAmount


Amortization


Life


Amount


Amortization


Average LifeGoodwill

$
257,403


$
(5,773
)


n/a


$
252,637


$
(5,773
)


n/aMembership rights and
    provider contracts


24,116



(20,543
)


10



24,116



(16,252
)


10Non-compete agreements and
    trademarks


1,528



(1,391
)


2



1,528



(1,141
)


2$
283,047


$
(27,707
)





$
278,281


$
(23,166
)     EstimatedAmortizationExpense2007

$
2,0472008


8042009


4042010


1972011


110  82




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (6)  Income
    Taxes
    Years Ended December 31,2006


2005


2004Income taxes from continuing
    operations

$
65,976


$
33,060


$
55,224Stockholders equity, tax
    benefit on exercise of stock options


(2,611
)


(8,571
)


(8,009
)$
63,365


$
24,489


$
47,215     Current


Deferred


TotalYear ended December 31, 2006:U.S. federal

$
67,014


$
(10,917
)

$
56,097State and local


11,176



(1,297
)


9,879$
78,190


$
(12,214
)

$
65,976Year ended December 31, 2005:US federal

$
29,911


$
292


$
30,203State and local


4,396



(1,539
)


2,857$
34,307


$
(1,247
)

$
33,060Year ended December 31, 2004:U.S. federal

$
44,235


$
2,335


$
46,570State and local


8,111



543



8,654$
52,346


$
2,878


$
55,224     Years Ended December 31,2006


2005


2004Amount


%


Amount


%


Amount


%Tax expense at statutory rate

$
60,579



35.0


$
30,349



35.0


$
49,434



35.0Increase in income taxes resulting
    from:State and local income taxes, net
    of federal income tax effect


6,121



3.5



1,857



2.1



5,625



4.0Effect of nondeductible expenses
    and other, net


(724
)


(0.4
)


854



1.0



165



0.1Total income tax expense

$
65,976



38.1


$
33,060



38.1


$
55,224



39.1    83




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    December 31,2006


2005Deferred tax assets:Estimated claims incurred but not
    reported, a portion of which is deductible as paid for tax
    purposes

$
5,397


$
3,034Vacation, bonus, stock
    compensation and other accruals, deductible as paid for tax
    purposes


14,565



9,272Accounts receivable allowances,
    deductible as written off for tax purposes


4,549



1,846Start-up
    costs, deductible in future periods for tax purposes


205



284Unearned revenue, a portion of
    which is includible in income as received for tax purposes


4,967



2,570State net operating loss/credit
    carryforwards, deductible in future peroids for tax purposes


1,899



2,066Gross deferred tax asset


31,582



19,072Deferred tax liabilities:Goodwill, due to timing
    differences in book and tax amortization


(3,690
)


(4,449
)Property and equipment, due to
    timing differences in book and tax depreciation


(10,900
)


(10,387
)Deductible prepaid expenses and
    other


(3,079
)


(2,537
)Gross deferred tax liabilities


(17,669
)


(17,373
)Net deferred tax asset

$
13,913


$
1,699       (7)
    Long-Term
    Debt   84




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      (8)
    Stock
    Option Plan            Weighted-AverageRemainingWeighted-Average


Aggregate Intrinsic


Contractual TermShares


Exercise Price


Value


(Years)Outstanding at December 31,
    2005


5,267,077


$
23.67Granted


1,010,526



24.90Exercised


(616,801
)


11.51Expired


(309,793
)


37.71Forfeited


(240,033
)


30.48Outstanding at December 31,
    2006


5,110,976


$
24.22


$
66,899



6.60Exercisable as of
    December 31, 2006


4,092,712


$
23.84


$
56,407



6.64  85




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Years Ended December 31,2006

2005

2004Expected volatility

44.35% - 45.32%

29.96 - 46.49%

29.65 - 30.62%Weighted-average stock price
    volatility

45.11%

28.59%

29.49%Expected option life

2.40 - 5.56 years

5.50 - 6.20 years

5.28 - 6.16 yearsRisk-free interest rate

4.52% - 5.11%

3.76 - 4.35%

2.80 %- 4.08%Dividend yield

None

None

None     i.
    the expected life of each award granted was calculated using the
    simplified method in accordance with Staff
    Accounting Bulletin No. 107;  ii.
    expected volatility is based on historical volatility levels; and  iii.
    the risk-free interest rate is based on the implied yield
    currently available on U.S. Treasury zero coupon issues
    with a remaining term equal to the expected life.      Years Ended December 31,2006


2005


2004Cash received upon exercise of
    options

$
8,690


$
10,767


$
12,918Related tax benefit realized


2,611



8,571



8,009       Weighted-AverageGrant Date FairShares


ValueNon-vested balance at
    December 31, 2005





$
Granted


230,350



23.11Vested


(9,259
)


22.75Expired






Forfeited


(18,457
)


21.39Non-vested balance at
    December 31, 2006


202,634


$
23.28    86




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      out-of-the-money
  (9)
    Earnings
    Per Share    Years Ended December 31,2006


2005


2004Basic net income per share:Net income

$
107,106


$
53,651


$
86,014Weighted average number of common
    shares outstanding


51,863,999



51,213,589



49,721,945Basic net income per share

$
2.07


$
1.05


$
1.73Diluted net income per share:Net income

$
107,106


$
53,651


$
86,014Weighted average number of common
    shares outstanding


51,863,999



51,213,589



49,721,945Dilutive effect of stock options
    (as determined by applying the treasury stock method)


1,218,934



1,644,093



2,115,634Weighted average number of common
    shares and dilutive potential common shares outstanding


53,082,933



52,857,682



51,837,579Diluted net income per share

$
2.02


$
1.02


$
1.66  87




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    (10)
    Fair
    Value of Financial Instruments          (11)
    Commitments
    and Contingencies  (a)
    Minimum
    Reserve Requirements    (b)
    Malpractice    (c)
    Lease
    Agreements    2006


2005Equipment

$
16,591


$
17,247Accumulated amortization


(15,678
)


(14,561
)$
913


$
2,686    88




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Capital


OperatingLeases


Leases2007

$
838


$
13,1722008


426



11,3242009






10,3842010






10,0822011






9,675Thereafter






37,972Total minimum lease payments


1,264


$
92,609Amount representing interest


(54
)Present value of minimum lease
    payments


1,210Current installments of
    obligations under capital leases


(795
)Obligations under capital leases,
    excluding current installments

$
415     (d)
    Deferred
    Compensation Plans       89




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    (e)
    Legal
    Proceedings                 90




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
            Class Action
    Complaints
  Rule 10b-5 No. 2:05-cv-701
 91




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Rule 10b-5
        (f)
    Other
    Contingencies  Medicare
    Parts A & B
   92




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Medicare
    Part D
    start-up Plan-to-Plan Plan-to-Plan
  Florida
    Behavioral Health
   93




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Risk
    Sharing Receivable
    Experience
    Rebate Payable
    New
    Jersey Provider Network
   94




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (12)
    Employee
    Stock Purchase Plan      Six Month Offering Periods EndingDecember 31,


June 30,


December 31,


June 30,


December 31,


June 30,2006


2006


2005.


2005


2004


2004Expected volatility


44.90
%


45.65
%


45.65
%


29.42
%


28.20
%


30.62
%Expected term


6 months



6 months



6 months



6 months



6 months



6 monthsRisk-free interest rate


5.24
%


4.16
%


3.40
%


2.44
%


1.58
%


0.95
%Divided yield


None



None



None



None



None



None     Six Month Offering Periods EndingDecember 31,


June 30,


December 31,


June 30,


December 31,


June 30,2006


2006


2005.


2005


2004


2004Grant-date fair value

$
8.70


$
5.46


$
10.68


$
8.51


$
5.47


$
4.80    95




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   (13)
    Parent
    Financial Statements    CONDENSED
    BALANCE SHEETS
  December 31,2006


2005(Dollars in thousands)ASSETSCurrent assets:Cash and cash equivalents

$
20,496


$
19,497Short-term investments


128,090



70,900Due from subsidiaries


17,345



28,222Deferred income taxes


7,344



8,674Prepaid expenses and other current
    assets


30,057



11,700Total current assets


203,332



138,993Long-term investments


5,000



67,505Investment in subsidiaries


577,857



439,982Property and equipment, net


37,618



27,492Software, net of accumulated
    amortization of $31,722 and $24,778 at December 31, 2006
    and 2005, respectively


34,136



23,793Other long-term assets


7,086



6,922Subordinated loan receivable


4,203



4,203$
869,232


$
708,890LIABILITIES AND
    STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable


6,285



7,243Accrued payroll and related
    liabilities


39,951



17,971Accrued expenses and other current
    liabilities


40,907



19,013Current portion of capital lease
    obligations


795



1,642Total current liabilities


87,938



45,869Capital lease obligations less
    current portion


415



1,175Deferred income taxes


6,158



14,576Other long-term liabilities


6,136



5,716Total liabilities


100,647



67,336Commitments and contingenciesStockholders equity:Common stock, $0.01 par value.
    Authorized 100,000,000 shares; issued and outstanding
    52,274,552 and 51,567,340 at December 31, 2006 and 2005,
    respectively


523



516Additional paid-in capital


391,515



371,744Retained earnings


376,547



269,294Total stockholders equity


768,585



641,554$
869,232


$
708,890  96




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    STATEMENTS OF INCOME
  Years Ended December 31,2006


2005


2004(Dollars in thousands, except for per share data)Revenues:Service fees from subsidiaries

$
236,661


$
169,933


$
180,961Investment income


6,728



4,115



3,774Total revenues


243,389



174,048



184,735Expenses:Selling, general and administrative


186,810



114,532



100,719Depreciation and amortization


17,089



15,331



14,369Interest


608



608



731Total expenses


204,507



130,471



115,819Income before income taxes and
    equity earnings in subsidiaries


38,882



43,577



68,916Income tax expense


13,705



16,093



26,880Equity earnings in subsidiaries


81,929



26,167



43,978Net income

$
107,106


$
53,651


$
86,014Net income per share:Basic net income per share

$
2.07


$
1.05


$
1.73Weighted average number of common
    shares outstanding


51,863,999



51,213,589



49,721,945Diluted net income per share

$
2.02


$
1.02


$
1.66Weighted average number of common
    shares and dilutive potential common shares outstanding


53,082,933



52,857,682



51,837,579  97




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    STATEMENTS OF STOCKHOLDERS EQUITY
  Additional








TotalCommon stock


paid-in


Retained


Deferred


stockholdersShares


Amount


capital


earnings


compensation


equity(Dollars in thousands)Balances at January 1, 2004


48,889,244


$
489


$
331,506


$
129,776


$
(57
)

$
461,714Common stock issued upon exercise
    of stock options and purchases under the employee stock purchase
    plan


1,640,480



16



12,902











12,918Tax benefit from exercise of stock
    options










8,009











8,009Amortization of deferred
    compensation


















57



57Net income














86,014







86,014Balances at December 31, 2004


50,529,724



505



352,417



215,790







568,712Common stock issued upon exercise
    of stock options and purchases under the employee stock purchase
    plan


1,037,616



11



10,756











10,767Tax benefit from exercise of
    options










8,571











8,571Other














(147
)






(147
)Net income














53,651







53,651Balances at December 31, 2005


51,567,340



516



371,744



269,294







641,554Common stock issued upon exercise
    of stock options, vesting of restricted stock grants, and
    purchases under the employee stock purchase plan


707,212



7



8,683











8,690Compensation expense related to
    share-based payments










8,477











8,477Tax benefit from exercise of stock
    options










2,611











2,611Other














147







147Net income














107,106







107,106Balances at December 31, 2006


52,274,552


$
523


$
391,515


$
376,547


$



$
768,585  98




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    STATEMENTS OF CASHFLOWS
  Years Ended December 31,2006


2005


2004(Dollars in thousands)Cash flows from operating
    activities:Net income

$
107,106


$
53,651


$
86,014Adjustments to reconcile net
    income to net cash provided by operating activities:Depreciation and amortization


17,089



15,331



14,369Loss on disposal or abandonment of
    property, equipment and software


269







971Deferred tax (benefit) expense


(10,882
)


3,416



2,189Compensation expense related to
    share-based payments


8,477







Tax benefit related to exercise of
    stock options






8,571



8,009Amortization of deferred
    compensation










57Changes in assets and liabilities
    increasing (decreasing) cash flows from operations:Equity earnings in subsidiaries


(81,929
)


(26,167
)


(43,978
)Prepaid expenses and other current
    assets


(18,357
)


(2,016
)


(3,080
)Other assets


(672
)


(1,077
)


(1,002
)Accounts payable, accrued expenses
    and other current liabilities


43,904



3,899



(3,469
)Other long-term liabilities


420



(760
)


2,028Net cash provided by operating
    activities


65,425



54,848



62,108Cash flows from investing
    activities:Proceeds from sale (purchases) of
    securities, net


5,462



(23,724
)


59,366Purchase of property and equipment
    and software


(37,319
)


(19,762
)


(27,367
)Contributions made to subsidiaries


(87,291
)


(153,426
)


(2,394
)Dividends received from
    subsidiaries


34,151



9,533



30,437Net cash (used in) provided by
    investing activities


(84,997
)


(187,379
)


60,042Cash flows from financing
    activities:Increase (decrease) in due from
    subsidiaries


10,877



(10,710
)


568Payment of debt issuance costs






(1,626
)


Payment of capital lease
    obligations


(1,607
)


(3,229
)


(4,473
)Proceeds from exercise of stock
    options and employee stock purchases


8,690



10,767



12,918Tax benefit related to exercise of
    stock options


2,611







Net cash provided by (used in)
    financing activities


20,571



(4,798
)


9,013Net increase (decrease) in cash
    and cash equivalents


999



(137,329
)


131,163Cash and cash equivalents at
    beginning of year


19,497



156,826



25,663Cash and cash equivalents at end
    of year

$
20,496


$
19,497


$
156,826  99




---



##### 



AMERIGROUP
    CORPORATION AND SUBSIDIARIES
    NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (14)
    Quarterly
    Financial Data (unaudited)  Three Months Ended2006

March 31


June 30


September 30


December 31Premium revenues

$
666,158


$
633,340


$
698,507


$
797,805Health benefits expenses


525,466



527,945



570,928



641,678Selling, general and
    administrative expenses


79,224



83,514



92,316



114,842Income before income taxes


62,318



24,430



39,656



46,678Net income


37,278



15,280



24,604



29,944Diluted net income per share


0.71



0.29



0.46



0.56Weighted average number of common
    shares and dilutive potential shares outstanding


52,591,485



52,995,812



53,331,741



53,525,958   Three Months Ended2005

March 31


June 30


September 30


December 31Premium revenues

$
553,888


$
560,731


$
582,784


$
614,196Health benefits expenses


454,404



463,071



520,243



519,478Selling, general and
    administrative expenses


62,041



57,745



63,596



75,064Income (loss) before income taxes


33,816



37,085



(3,110
)


18,920Net income (loss)


20,443



22,548



(2,260
)


12,920Diluted net income (loss) per share


0.39



0.43



(0.04
)


0.25Weighted average number of common
    shares and dilutive potential shares outstanding


52,961,652



53,053,949



51,420,856



52,148,265  100




---



##### 



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  Evaluation of Disclosure Controls and Procedures.
  Rules 13a-15(e) 15d-15(e)
  Internal Control over Financial Reporting.
  MANAGEMENTS
    REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
  Rules 13a-15(f) 15d-15(f)
  Internal
    Control  Integrated Framework
    Changes in Internal Controls.
    (d)
    Other    
    pertain to the maintenance of records that in reasonable detail
    accurately and fairly reflect the transactions and dispositions
    of the assets of the Company; 101




---



##### 




    provide reasonable assurance that transactions are recorded as
    necessary to permit preparation of financial statements in
    accordance with U.S. generally accepted accounting
    principles, and that receipts and expenditures of the Company
    are being made only in accordance with authorizations of
    management and directors of the Company; and
    provide reasonable assurance regarding prevention or timely
    detection of unauthorized acquisition, use, or disposition of
    the Companys assets that could have a material effect on
    the consolidated financial statements.    Item 9B.
    Other
    Information   102




---



##### 



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
     Internal Control  Integrated Framework
        Internal
    Control  Integrated Framework Internal Control  Integrated
    Framework
    
   103




---



##### 



PART III.  Item 10.
    Directors
    and Executive Officers of the Company          Item 11.
    Executive
    Compensation    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters  Number of SecuritiesNumber of


Weighted-


Remaining AvailableSecurities to be


Average Exercise


for Future IssuanceIssued Upon


Price of


Under EquityExercise of


Outstanding


Compensation PlansOutstanding


Options,


(excluding securitiesOptions, Warrants


Warrants and


reflected in the firstand Rights


Rights


column)(1)Equity compensation plans approved
    by security holders


5,110,976


$
24.22



4,064,812Equity compensation plans not
    approved by security holders










Total


5,110,976


$
24.22



4,064,812     (1)
    
    Includes a total of 3,263,478 shares not yet issued as of
    December 31, 2006 under the 1994 Stock Plan and the 2000,
    2003, and 2005 Equity Incentive Plans and 801,334 shares
    not yet issued under the Employee Stock Purchase Plan.    Item 13.
    Certain
    Relationships and Related Transactions   104




---



##### 



Item 14.
    Principal
    Accountant Fees and Services   PART IV.  Item 15.
    Exhibits
    and Financial Statement Schedules  Financial Statements.
    Financial Statement Schedules.
    Exhibits.
    ExhibitNumber

Description3
.1

Amended and Restated Certificate
    of Incorporation of the Company (incorporated by reference to
    exhibit 3.1 to our Registration Statement on
    Form S-3
    (No. 333-108831)).3
.2

By-Laws of the Company
    (incorporated by reference to exhibit 3.2 to our
    Registration Statement on
    Form S-3
    (No. 333-108831)).4
.1

Form of share certificate for
    common stock (incorporated by reference to exhibit 4.1 to
    our Registration Statement on
    Form S-1
    (No. 333-347410)).4
.2

AMERIGROUP Corporation Second
    Restated Investor Rights Agreement, dated July 28, 1998
    (incorporated by reference to exhibit 4.2 to our
    Registration Statement on
    Form S-1
    (No. 333-37410)).10
.1

Second Amended and Restated
    Employment Agreement of Jeffrey L. McWaters, dated
    October 2, 2000 (incorporated by reference to our
    Registration Statement
    No. 333-3740
    on
    Form S-1
    which was declared effective by the Securities and Exchange
    Commission on November 5, 2001).*10
.6.11

Amendment to Amended and Restated
    Contract between State of New Jersey, Department of Human
    Services, Division of Medical Assistance and Health Services and
    AMERIGROUP New Jersey, Inc. dated July 1, 2006
    (incorporated by reference to exhibit 10.6.11 to our
    Form 10-Q
    filed on August 4, 2006).*10
.6.12

Amendment to Amended and Restated
    Contract between State of New Jersey, Department of Human
    Services, Division of Medical Assistance and Health Services and
    AMERIGROUP New Jersey, Inc. dated July 1, 2006
    (incorporated by reference to exhibit 10.6.12 to our
    Form 10-Q filed on November 14, 2006).10
.8

Form 2003 Cash Incentive Plan
    of the Company (incorporated by reference to exhibit 10.38
    to our Quarterly Report of
    Form 10-Q
    for the last quarter ended June 30, 2003, filed on
    August 11, 2003).10
.9

Form 2005 Equity Incentive
    Plan (incorporated by reference to our Definitive Proxy
    Statement Pursuant to Schedule 14a of the Securities
    Exchange Act of 1934, filed on April 4, 2005). 105




---



##### 



ExhibitNumber

Description10
.10

Definitive Agreement dated
    October 26, 2004, between CarePlus, LLC and AMERIGROUP
    Corporation (incorporated by reference to our Current Report on
    Form 8-K,
    filed on November 1, 2004).10
.11

Closing Agreement dated
    January 3, 2005, between CarePlus, LLC and AMERIGROUP
    Corporation (incorporated by reference to exhibit 10.47 to
    our Current Report on
    Form 8-K,
    filed on January 6, 2005).10
.12

Separation Agreement and General
    Release with E. Paul Dunn, Jr. former Executive Vice
    President and Chief Financial Officer effective December 2,
    2005 (incorporated by reference to our Current Report on
    Form 8-K,
    filed on December 6, 2005).10
.13

Form the Officer and Director
    Indemnification Agreement (incorporated by reference to
    exhibit 10.16 to our Registration Statement on
    Form S-1
    (No. 333-37410).10
.14

Form of Employee Non-compete,
    Nondisclosure and Developments Agreement (incorporated by
    reference to exhibit 10.1 to our Current Report on
    Form 8-K,
    filed on February 23, 2005).10
.15

Form of Incentive Stock Option
    Agreement (incorporated by reference to exhibit 10.1 to our
    Current Report of
    Form 8-K,
    filed on May 13, 2005).10
.16

Form of Nonqualified Stock Option
    Agreement (incorporated by reference to exhibit 10.2 to our
    Current Report on
    Form 8-K
    filed on May 13, 2005).10
.17

Form of Stock Appreciation Rights
    Agreement (incorporated by reference to exhibit 10.3 to our
    Current
    Form 8-K
    filed on May 13, 2005).10
.17.8

Amendment No. 2 to the
    Amended Restated Credit Agreement dated October 22, 2003,
    among AMERIGROUP Corporation, the Guarantors and the Lenders,
    named therein, dated May 10, 2005 (incorporated by
    reference to Exhibit 10.1 to our Current Report on
    Form 8-K,
    filed on May 13, 2005).10
.17.9

Amendment No. 3 to the Amended
    Restated Credit Agreement dated October 22, 2003, among
    AMERIGROUP Corporation, the Guarantors and the Lenders, named
    therein, dated November 21, 2006 (incorporated by reference to
    Exhibit 10.1 to our Current Report on Form 8-K, filed on
    November 27, 2006).10
.18

Form of AMERIGROUP Corporation
    Nonqualified Stock Option Agreement (incorporated by reference
    to exhibit 10.1 to our Current
    Form 8-K
    filed on November 3, 2005).10
.19

The Board of Directors approved
    and adopted a resolution for director compensation practices on
    February 10, 2005 (incorporated by reference to our Current
    Report on
    Form 8-K,
    filed on February 15, 2005).10
.20

Form of Separation Agreement
    between AMERIGROUP Corporation and Lorenzo
    Childress, Jr., M.D. (incorporated by reference to
    exhibit 10.1 to our Current Report on
    Form 8-K
    filed March 4, 2005).10
.21

Form of 2005 Executive Deferred
    Compensation Plan between AMERIGROUP Corporation and Executive
    Associates (incorporated by reference to exhibit 10.2 to
    our Current Report on
    Form 8-K
    filed March 4, 2005).10
.22

Form of 2005 Non-Employee Director
    Deferred Compensation Plan between AMERIGROUP Corporation and
    Non-Executive Associates (incorporated by reference to
    exhibit 10.2 to our Current Report on
    Form 8-K
    filed March 4, 2005). 106




---



##### 



ExhibitNumber

Description10
.23

Amendment No. 00017, dated
    March 1, 2005, to the District of Columbia Healthy Families
    Programs, Department of Health Medical Assistance
    Administration, Prepaid, Capital Risk Contract
    (POHC-2002-D-2003)
    (incorporated by reference to our Current Report on
    Form 8-K,
    filed on May 5, 2005).10
.23.1

Amendment No. 00026, dated
    December 31, 2005, to the District of Columbia Healthy
    Families Programs, Department of Health Medical Assistance
    Administration, Prepaid, Capital Risk Contract
    (POHC-2002-D-2003)
    effective January 1, 2006 (incorporated by reference to our
    Quarterly Report on
    Form 10-Q
    filed on May 9, 2006).10
.23.2

Amendment No. 00027, dated
    December 30, 2005, to the District of Columbia Healthy
    Families Programs, Department of Health Medical Assistance
    Administration, Prepaid, Capital Risk Contract
    (POHC-2002-D-2003)
    effective January 1, 2006 (incorporated by reference to our
    Quarterly Report on
    Form 10-Q
    filed on May 9, 2006).*10
.23.3

Amendment No. 00029 to the
    District of Columbia Healthy Families Programs, Department of
    Health Medical Assistance Administration, Prepaid, Capital Risk
    Contract
    (POHC-2002-D-2003)
    effective August 1, 2006 (incorporated by reference to
    exhibit 10.23.1 to our
    Form 10-Q
    filed on August 4, 2006).10
.25.1

Medical Services Contract by and
    between Florida Healthy Kids Corporation and AMERIGROUP Florida,
    Inc., dated October 1, 2005 (incorporated by reference to
    exhibit 10.5 to our Quarterly Report on
    Form 10-Q
    filed on November 4, 2005).*10
.25.2

Medicaid Managed Care Services
    Contract between The State of Florida, Agency for Health Care
    Administration and AMERIGROUP Florida, Inc. for Broward County,
    Florida effective July 1, 2006 (incorporated by reference
    to exhibit 10.25.11 to our
    Form 10-Q
    filed on August 4, 2006).10
.25.3

Medical Contract between the State
    of Florida, Agency for Health Care Administration and AMERIGROUP
    Florida Inc. (AHCA Contract No. FA614) (incorporated by
    reference to Exhibit 10.1 to our Current Report on
    Form 8-K,
    filed on November 7, 2006).10
.25.3.1

Amendment No. 1 to Medical
    Contract between the State of Florida, Agency for Health Care
    Administration and AMERIGROUP Florida, Inc. (Amendment
    No. 1 to AHCA Contract No. FA614) (incorporated by
    reference to Exhibit 10.1 to our Current Report on
    Form 8-K,
    filed on January 5, 2007).*10
.25.4

Amendment to Medical Services
    Contract by and between Florida Healthy Kids Corporation and
    AMERIGROUP Florida, Inc., dated October 12,
    2006
    (incorporated by reference to exhibit 10.25.4 to our
    Form 10-Q
    filed on November 14, 2006).10
.26

Medicaid Contract between New York
    City Department of Health and Mental Hygiene and CarePlus,
    L.L.C. date October 1, 2004 (incorporated by reference to
    Exhibit 10.48 to our Current Report on
    Form 8-K,
    filed on May 5, 2005).10
.26.1

Contract Amendment, dated
    January 1, 2005, to the Medicaid Managed Care Model
    Contract between New York City Department of Health and Mental
    Hygiene and CarePlus LLC. Dated October 1, 2004
    (incorporated by reference to Exhibit 10.48.1 to our
    Current Report on
    Form 8-K,
    filed on May 5, 2005.)10
.27

Child Health Plus by and between
    The State of New York Department of Health and Care Plus Health
    Plan is effective for the period July 1, 1998 through
    June 30, 2005 (Contract
    No. C-015473)
    (incorporated by reference to Exhibit 10.49 to our Current
    Report on
    Form 8-K,
    filed on May 5, 2005). 107




---



##### 



ExhibitNumber

Description10
.27.1

Contract Amendment 
    Appendix X, dated September 10, 2005, to the Child
    Health Plus Contract by and between The State of New York
    Department of Health and Care Plus Health Plan is effective for
    the period June 30, 2005 through December 31, 2005
    ((Contract
    No. C-015473)
    (incorporated by reference to our Quarterly Report on
    Form 10-Q,
    filed on November 4, 2005)).10
.27.2

Contract Amendment 
    Appendix X, dated September 10, 2005, to the Child
    Health Plus by and between The State of New York Department of
    Health and Care Plus Health Plan is effective for the period
    January 1, 2006 through December 31, 2006 ((Contract
    No. C-015473)
    (incorporated by reference to our Quarterly Report on
    Form 10-Q,
    filed on November 4, 2005)).10
.28

Medicaid Managed Care Model and
    Family Health Plus Model Contract by and between The City of New
    York through the State Department of Health and CarePlus LLC is
    effective for the period October 1, 2005 through
    September 30, 2007 (incorporated by reference to our
    Quarterly Report filed on
    Form 10-Q,
    filed on November 4, 2005).10
.29

Medicaid Managed Care Model and
    Family Health Plus Model Contract by The State of New York
    Department of Health and CarePlus LLC effective for the period
    October 1, 2005 through September 30, 2008
    (incorporated by reference to our Quarterly Report on
    Form 10-Q,
    filed on November 4, 2005).10
.29.1

Amendment to Medicaid Managed Care
    Model Contract by The State of New York Department of Health and
    CarePlus LLC effective for the period October 1, 2005
    through September 30, 2008 (incorporated by reference to
    our Quarterly Report on
    Form 10-Q
    filed on May 9, 2006).*10
.29.2

Amendment to Medicaid Managed Care
    Model Contract by The State of New York Department of Health and
    CarePlus LLC effective for the period from April 1, 2006
    through September 30, 2008 (incorporated by reference to
    exhibit 10.29.2 to our
    Form 10-Q
    filed on August 4, 2006).10
.30

Contract dated July 19, 2005
    between Georgia Department of Community Health and AMGP Georgia
    Managed Care Company, Inc. for the period from July 1, 2005
    through June 30, 2006 with six optional renewal periods
    (incorporated by reference to Exhibit 10.1 to our Current
    Report on
    Form 8-K,
    filed on July 26, 2005).10
.30.1

Contract rates to contract dated
    July 19, 2005 between Georgia Department of Community
    Health and AMGP Georgia Managed Care Company, Inc. for the
    period from July 1, 2005 through June 30, 2006 with
    six optional renewal periods (incorporated by reference to
    Exhibit 10.1.1 to our Current Report on
    Form 8-K,
    filed on July 26, 2005).10
.31

Contract with Eligible Medicare
    Advantage Organization Pursuant to Sections 1851 through
    1859 of the Social Security Act for the Operation of a Medicare
    Advantage Coordinated Care Plan(s) effective January 1,
    2006 (incorporated by reference to our Quarterly Report on
    Form 10-Q
    filed on May 9, 2006).10
.31.1

Addendum To Medicare Managed Care
    Contract Pursuant To
    Sections 1860D-1
    Through 1860D-42 Of The Social Security Act For The Operation of
    a Voluntary Medicare Prescription Drug Plan effective
    January 1, 2006 (incorporated by reference to our Quarterly
    Report on
    Form 10-Q
    filed on May 9, 2006).10
.32.1

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid STAR
    program in the Dallas Service Delivery Area effectively
    extending the contract through August 31, 2006
    (incorporated by reference to Exhibit 10.32.1 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006).10
.32.2

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid STAR
    program in the Harris Service Delivery Area effectively
    extending the contract through August 31, 2006
    (incorporated by reference to Exhibit 10.32.2 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006). 108




---



##### 



ExhibitNumber

Description10
.32.3

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid STAR
    program in the Tarrant Service Delivery Area effectively
    extending the contract through August 31, 2006
    (incorporated by reference to Exhibit 10.32.3 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006).10
.32.4

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid STAR
    program in the Travis Service Delivery Area effectively
    extending the contract through August 31, 2006
    (incorporated by reference to Exhibit 10.32.4 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006).10
.32.5

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid
    STAR+PLUS program in the Harris Service Delivery Area
    effectively extending the contract through August 31, 2006
    (incorporated by reference to Exhibit 10.32.5 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006).10
.32.6

Amendment, effective
    January 1, 2006, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid
    STAR+PLUS program in the Harris County Service Delivery Area
    (incorporated by reference to Exhibit 10.32.6 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006).*10
.32.7

Amendment, effective
    January 1, 2006, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid
    STAR+PLUS program in the Harris County Service Delivery Area
    (incorporated by reference to exhibit 10.32.7 to our
    Form 10-Q
    filed on November 14, 2006).10
.32.8

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Childrens
    Health Insurance Program effectively extending the contract
    through August 31, 2006 (incorporated by reference to
    Exhibit 10.32.8 to our Annual Report on
    Form 10-K,
    filed on March 1, 2006).*10
.32.9

Health & Human Services
    Commission Uniform Managed Care Contract covering all service
    areas and products in which the subsidiary has agreed to
    participate, effective September 1, 2006 (incorporated by
    reference to exhibit 10.32.9 to our
    Form 10-Q
    filed on November 14, 2006).10
.33

Form of Separation Agreement
    between AMERIGROUP Corporation and Eric M. Yoder, M.D.
    (incorporated by reference to exhibit 10.1 to our Current Report
    on Form 8-K filed February 16, 2007).21
.1

List of Subsidiaries23
.1

Consent of KPMG LLP, Independent
    Registered Public Accounting Firm, with respect to financial
    statements of the registrant.31
.1

Certification of Chief Executive
    Officer pursuant to Section 302 of Sarbanes-Oxley Act of
    2002, dated February 27, 2007.31
.2

Certification of Chief Financial
    Officer pursuant to Section 302 of Sarbanes-Oxley Act of
    2002, dated February 27, 2007.32


Certification of Chief Executive
    Officer and Chief Financial Officer pursuant to Section 906
    of Sarbanes-Oxley Act of 2002, dated February 27, 2007     *
    
    The Company has requested confidential treatment of the redacted
    portions of this exhibit pursuant to
    Rule 24b-2,
    under the Securities Exchange Act of 1934, as amended, and has
    separately filed a complete copy of this exhibit with the
    Securities and Exchange Commission. 109




---



##### 



SIGNATURES
    Corporation
  By:
    /s/  James
    W. Truess   Title:
    Executive Vice President and     Signatures

Title

Date/s/  Jeffrey
    L. McWatersJeffrey
    L. McWaters

Chairman and Chief Executive
    Officer

February 27, 2007/s/  James
    W. TruessJames
    W. Truess

Executive Vice President and
    Chief  Financial Officer

February 27, 2007/s/  Margaret
    M.
    RoomsburgMargaret
    M. Roomsburg

Senior Vice President and Chief
    Accounting Officer

February 27, 2007/s/  Thomas
    E. CappsThomas
    E. Capps

Director

February 27, 2007/s/  Jeffrey
    B. ChildJeffrey
    B. Child

Director

February 27, 2007/s/  Kay
    Coles JamesKay
    Coles James

Director

February 27, 2007/s/  William
    J. McbrideWilliam
    J. McBride

Director

February 27, 2007/s/  Uwe
    E. Reinhardt,
    Ph.D.Uwe
    E. Reinhardt, Ph.D.

Director

February 27, 2007/s/  Richard
    D. ShirkRichard
    D. Shirk

Director

February 27, 2007  110




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##### 



EXHIBITS
  ExhibitNumber

Description3
.1

Amended and Restated Certificate
    of Incorporation of the Company (incorporated by reference to
    exhibit 3.1 to our Registration Statement on
    Form S-3
    (No. 333-108831)).3
.2

By-Laws of the Company
    (incorporated by reference to exhibit 3.2 to our
    Registration Statement on
    Form S-3
    (No. 333-108831)).4
.1

Form of share certificate for
    common stock (incorporated by reference to exhibit 4.1 to
    our Registration Statement on
    Form S-1
    (No. 333-347410)).4
.2

AMERIGROUP Corporation Second
    Restated Investor Rights Agreement, dated July 28, 1998
    (incorporated by reference to exhibit 4.2 to our
    Registration Statement on
    Form S-1
    (No. 333-37410)).10
.1

Second Amended and Restated
    Employment Agreement of Jeffrey L. McWaters, dated
    October 2, 2000 (incorporated by reference to our
    Registration Statement
    No. 333-3740
    on
    Form S-1
    which was declared effective by the Securities and Exchange
    Commission on November 5, 2001).*10
.6.11

Amendment to Amended and Restated
    Contract between State of New Jersey, Department of Human
    Services, Division of Medical Assistance and Health Services and
    AMERIGROUP New Jersey, Inc. dated July 1, 2006
    (incorporated by reference to exhibit 10.6.11 to our
    Form 10-Q
    filed on August 4, 2006).*10
.6.12

Amendment to Amended and Restated
    Contract between State of New Jersey, Department of Human
    Services, Division of Medical Assistance and Health Services and
    AMERIGROUP New Jersey, Inc. dated July 1, 2006
    (incorporated by reference to exhibit 10.6.12 to our
    Form 10-Q
    filed on November 14, 2006).10
.8

Form 2003 Cash Incentive Plan
    of the Company (incorporated by reference to exhibit 10.38
    to our Quarterly Report of
    Form 10-Q
    for the last quarter ended June 30, 2003, filed on
    August 11, 2003).10
.9

Form 2005 Equity Incentive
    Plan (incorporated by reference to our Definitive Proxy
    Statement Pursuant to Schedule 14a of the Securities
    Exchange Act of 1934, filed on April 4, 2005).10
.10

Definitive Agreement dated
    October 26, 2004, between CarePlus, LLC and AMERIGROUP
    Corporation (incorporated by reference to our Current Report on
    Form 8-K,
    filed on November 1, 2004).10
.11

Closing Agreement dated
    January 3, 2005, between CarePlus, LLC and AMERIGROUP
    Corporation (incorporated by reference to exhibit 10.47 to
    our Current Report on
    Form 8-K,
    filed on January 6, 2005).10
.12

Separation Agreement and General
    Release with E. Paul Dunn, Jr. former Executive Vice
    President and Chief Financial Officer effective December 2,
    2005 (incorporated by reference to our Current Report on
    Form 8-K,
    filed on December 6, 2005).10
.13

Form the Officer and Director
    Indemnification Agreement (incorporated by reference to
    exhibit 10.16 to our Registration Statement on
    Form S-1
    (No. 333-37410).10
.14

Form of Employee Non-compete,
    Nondisclosure and Developments Agreement (incorporated by
    reference to exhibit 10.1 to our Current Report on
    Form 8-K,
    filed on February 23, 2005).10
.15

Form of Incentive Stock Option
    Agreement (incorporated by reference to exhibit 10.1 to our
    Current Report of
    Form 8-K,
    filed on May 13, 2005).10
.16

Form of Nonqualified Stock Option
    Agreement (incorporated by reference to exhibit 10.2 to our
    Current Report on
    Form 8-K
    filed on May 13, 2005).10
.17

Form of Stock Appreciation Rights
    Agreement (incorporated by reference to exhibit 10.3 to our
    Current
    Form 8-K
    filed on May 13, 2005).




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##### 



ExhibitNumber

Description10
.17.8

Amendment No. 2 to the
    Amended Restated Credit Agreement dated October 22, 2003,
    among AMERIGROUP Corporation, the Guarantors and the Lenders,
    named therein, dated May 10, 2005 (incorporated by
    reference to Exhibit 10.1 to our Current Report on
    Form 8-K,
    filed on May 13, 2005).10
.17.9

Amendment No. 3 to the Amended
    Restated Credit Agreement dated October 22, 2003, among
    AMERIGROUP Corporation, the Guarantors and the Lenders, named
    therein, dated November 21, 2006 (incorporated by reference to
    Exhibit 10.1 to our Current Report on Form 8-K, filed on
    November 27, 2006).10
.18

Form of AMERIGROUP Corporation
    Nonqualified Stock Option Agreement (incorporated by reference
    to exhibit 10.1 to our Current
    Form 8-K
    filed on November 3, 2005).10
.19

The Board of Directors approved
    and adopted a resolution for director compensation practices on
    February 10, 2005 (incorporated by reference to our Current
    Report on
    Form 8-K,
    filed on February 15, 2005).10
.20

Form of Separation Agreement
    between AMERIGROUP Corporation and Lorenzo
    Childress, Jr., M.D. (incorporated by reference to
    exhibit 10.1 to our Current Report on
    Form 8-K
    filed March 4, 2005).10
.21

Form of 2005 Executive Deferred
    Compensation Plan between AMERIGROUP Corporation and Executive
    Associates (incorporated by reference to exhibit 10.2 to
    our Current Report on
    Form 8-K
    filed March 4, 2005).10
.22

Form of 2005 Non-Employee Director
    Deferred Compensation Plan between AMERIGROUP Corporation and
    Non-Executive Associates (incorporated by reference to
    exhibit 10.2 to our Current Report on
    Form 8-K
    filed March 4, 2005).10
.23

Amendment No. 00017, dated
    March 1, 2005, to the District of Columbia Healthy Families
    Programs, Department of Health Medical Assistance
    Administration, Prepaid, Capital Risk Contract
    (POHC-2002-D-2003)
    (incorporated by reference to our Current Report on
    Form 8-K,
    filed on May 5, 2005).10
.23.1

Amendment No. 00026, dated
    December 31, 2005, to the District of Columbia Healthy
    Families Programs, Department of Health Medical Assistance
    Administration, Prepaid, Capital Risk Contract
    (POHC-2002-D-2003)
    effective January 1, 2006 (incorporated by reference to our
    Quarterly Report on
    Form 10-Q
    filed on May 9, 2006).10
.23.2

Amendment No. 00027, dated
    December 30, 2005, to the District of Columbia Healthy
    Families Programs, Department of Health Medical Assistance
    Administration, Prepaid, Capital Risk Contract
    (POHC-2002-D-2003)
    effective January 1, 2006 (incorporated by reference to our
    Quarterly Report on
    Form 10-Q
    filed on May 9, 2006).*10
.23.3

Amendment No. 00029 to the
    District of Columbia Healthy Families Programs, Department of
    Health Medical Assistance Administration, Prepaid, Capital Risk
    Contract
    (POHC-2002-D-2003)
    effective August 1, 2006 (incorporated by reference to
    exhibit 10.23.1 to our
    Form 10-Q
    filed on August 4, 2006).10
.25.1

Medical Services Contract by and
    between Florida Healthy Kids Corporation and AMERIGROUP Florida,
    Inc., dated October 1, 2005 (incorporated by reference to
    exhibit 10.5 to our Quarterly Report on
    Form 10-Q
    filed on November 4, 2005).*10
.25.2

Medicaid Managed Care Services
    Contract between The State of Florida, Agency for Health Care
    Administration and AMERIGROUP Florida, Inc. for Broward County,
    Florida effective July 1, 2006 (incorporated by reference
    to exhibit 10.25.11 to our
    Form 10-Q
    filed on August 4, 2006).




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##### 



ExhibitNumber

Description10
.25.3

Medical Contract between the State
    of Florida, Agency for Health Care Administration and AMERIGROUP
    Florida Inc. (AHCA Contract No. FA614) (incorporated by
    reference to Exhibit 10.1 to our Current Report on
    Form 8-K,
    filed on November 7, 2006).10
.25.3.1

Amendment No. 1 to Medical
    Contract between the State of Florida, Agency for Health Care
    Administration and AMERIGROUP Florida, Inc. (Amendment
    No. 1 to AHCA Contract No. FA614) (incorporated by
    reference to Exhibit 10.1 to our Current Report on
    Form 8-K,
    filed on January 5, 2007).*10
.25.4

Amendment to Medical Services
    Contract by and between Florida Healthy Kids Corporation and
    AMERIGROUP Florida, Inc., dated October 12, 2006
    (incorporated by reference to exhibit 10.25.4 to our
    Form 10-Q filed November 14, 2006).10
.26

Medicaid Contract between New York
    City Department of Health and Mental Hygiene and CarePlus,
    L.L.C. date October 1, 2004 (incorporated by reference to
    Exhibit 10.48 to our Current Report on
    Form 8-K,
    filed on May 5, 2005).10
.26.1

Contract Amendment, dated
    January 1, 2005, to the Medicaid Managed Care Model
    Contract between New York City Department of Health and Mental
    Hygiene and CarePlus LLC. Dated October 1, 2004
    (incorporated by reference to Exhibit 10.48.1 to our
    Current Report on
    Form 8-K,
    filed on May 5, 2005.)10
.27

Child Health Plus by and between
    The State of New York Department of Health and Care Plus Health
    Plan is effective for the period July 1, 1998 through
    June 30, 2005 (Contract
    No. C-015473)
    (incorporated by reference to Exhibit 10.49 to our Current
    Report on
    Form 8-K,
    filed on May 5, 2005).10
.27.1

Contract Amendment 
    Appendix X, dated September 10, 2005, to the Child
    Health Plus Contract by and between The State of New York
    Department of Health and Care Plus Health Plan is effective for
    the period June 30, 2005 through December 31, 2005
    ((Contract
    No. C-015473)
    (incorporated by reference to our Quarterly Report on
    Form 10-Q,
    filed on November 4, 2005)).10
.27.2

Contract Amendment 
    Appendix X, dated September 10, 2005, to the Child
    Health Plus by and between The State of New York Department of
    Health and Care Plus Health Plan is effective for the period
    January 1, 2006 through December 31, 2006 ((Contract
    No. C-015473)
    (incorporated by reference to our Quarterly Report on
    Form 10-Q,
    filed on November 4, 2005)).10
.28

Medicaid Managed Care Model and
    Family Health Plus Model Contract by and between The City of New
    York through the State Department of Health and CarePlus LLC is
    effective for the period October 1, 2005 through
    September 30, 2007 (incorporated by reference to our
    Quarterly Report filed on
    Form 10-Q,
    filed on November 4, 2005).10
.29

Medicaid Managed Care Model and
    Family Health Plus Model Contract by The State of New York
    Department of Health and CarePlus LLC effective for the period
    October 1, 2005 through September 30, 2008
    (incorporated by reference to our Quarterly Report on
    Form 10-Q,
    filed on November 4, 2005).10
.29.1

Amendment to Medicaid Managed Care
    Model Contract by The State of New York Department of Health and
    CarePlus LLC effective for the period October 1, 2005
    through September 30, 2008 (incorporated by reference to
    our Quarterly Report on
    Form 10-Q
    filed on May 9, 2006).*10
.29.2

Amendment to Medicaid Managed Care
    Model Contract by The State of New York Department of Health and
    CarePlus LLC effective for the period from April 1, 2006
    through September 30, 2008 (incorporated by reference to
    exhibit 10.29.2 to our
    Form 10-Q
    filed on August 4, 2006).10
.30

Contract dated July 19, 2005
    between Georgia Department of Community Health and AMGP Georgia
    Managed Care Company, Inc. for the period from July 1, 2005
    through June 30, 2006 with six optional renewal periods
    (incorporated by reference to Exhibit 10.1 to our Current
    Report on
    Form 8-K,
    filed on July 26, 2005).




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##### 



ExhibitNumber

Description10
.30.1

Contract rates to contract dated
    July 19, 2005 between Georgia Department of Community
    Health and AMGP Georgia Managed Care Company, Inc. for the
    period from July 1, 2005 through June 30, 2006 with
    six optional renewal periods (incorporated by reference to
    Exhibit 10.1.1 to our Current Report on
    Form 8-K,
    filed on July 26, 2005).10
.31

Contract with Eligible Medicare
    Advantage Organization Pursuant to Sections 1851 through
    1859 of the Social Security Act for the Operation of a Medicare
    Advantage Coordinated Care Plan(s) effective January 1,
    2006 (incorporated by reference to our Quarterly Report on
    Form 10-Q
    filed on May 9, 2006).10
.31.1

Addendum To Medicare Managed Care
    Contract Pursuant To
    Sections 1860D-1
    Through 1860D-42 Of The Social Security Act For The Operation of
    a Voluntary Medicare Prescription Drug Plan effective
    January 1, 2006 (incorporated by reference to our Quarterly
    Report on
    Form 10-Q
    filed on May 9, 2006).10
.32.1

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid STAR
    program in the Dallas Service Delivery Area effectively
    extending the contract through August 31, 2006
    (incorporated by reference to Exhibit 10.32.1 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006).10
.32.2

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid STAR
    program in the Harris Service Delivery Area effectively
    extending the contract through August 31, 2006
    (incorporated by reference to Exhibit 10.32.2 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006).10
.32.3

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid STAR
    program in the Tarrant Service Delivery Area effectively
    extending the contract through August 31, 2006
    (incorporated by reference to Exhibit 10.32.3 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006).10
.32.4

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid STAR
    program in the Travis Service Delivery Area effectively
    extending the contract through August 31, 2006
    (incorporated by reference to Exhibit 10.32.4 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006).10
.32.5

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid
    STAR+PLUS program in the Harris Service Delivery Area
    effectively extending the contract through August 31, 2006
    (incorporated by reference to Exhibit 10.32.5 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006).10
.32.6

Amendment, effective
    January 1, 2006, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid
    STAR+PLUS program in the Harris County Service Delivery Area
    (incorporated by reference to Exhibit 10.32.6 to our Annual
    Report on
    Form 10-K,
    filed on March 1, 2006).*10
.32.7

Amendment, effective
    January 1, 2006, to the Health & Human Services
    Commission Agreement for Health Services to the Medicaid
    STAR+PLUS program in the Harris County Service Delivery Area
    (incorporated by reference to exhibit 10.32.7 to our
    Form 10-Q
    filed on November 14, 2006).10
.32.8

Amendment, effective
    September 1, 2005, to the Health & Human Services
    Commission Agreement for Health Services to the Childrens
    Health Insurance Program effectively extending the contract
    through August 31, 2006 (incorporated by reference to
    Exhibit 10.32.8 to our Annual Report on
    Form 10-K,
    filed on March 1, 2006).*10
.32.9

Health & Human Services
    Commission Uniform Managed Care Contract covering all service
    areas and products in which the subsidiary has agreed to
    participate, effective September 1, 2006 (incorporated by
    reference to exhibit 10.32.9 to our
    Form 10-Q
    filed on November 14, 2006).




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##### 



ExhibitNumber

Description10
.33

Form of Separation Agreement
    between AMERIGROUP Corporation and Eric M. Yoder, M.D.
    (incorporated by reference to exhibit 10.1 to our Current Report
    on Form 8-K filed February 16, 2007).21
.1

List of Subsidiaries23
.1

Consent of KPMG LLP, Independent
    Registered Public Accounting Firm, with respect to financial
    statements of the registrant.31
.1

Certification of Chief Executive
    Officer pursuant to Section 302 of Sarbanes-Oxley Act of
    2002, dated February 27, 2007.31
.2

Certification of Chief Financial
    Officer pursuant to Section 302 of Sarbanes-Oxley Act of
    2002, dated February 27, 2007.32


Certification of Chief Executive
    Officer and Chief Financial Officer pursuant to Section 906
    of Sarbanes-Oxley Act of 2002, dated February 27, 2007.     *
    
    The Company has requested confidential treatment of the redacted
    portions of this exhibit pursuant to
    Rule 24b-2,
    under the Securities Exchange Act of 1934, as amended, and has
    separately filed a complete copy of this exhibit with the
    Securities and Exchange Commission.