Molina Healthcare of Texas Begins Administering CHIP Program in Rural Areas

New Service Area Includes 174 Counties, and New Enrollment is Nearly 64,000 Women and Children

SAN ANTONIO--(BUSINESS WIRE)--Molina Healthcare of Texas announced today that it has begun arranging healthcare services for approximately 63,700 low-income children and pregnant women in 174 predominantly rural counties through Texas’ Children’s Health Insurance Program (CHIP) and CHIP Perinatal Program.

“Texas has one of the highest numbers of uninsured children in the nation”

The contract is held by Molina Healthcare of Texas’s newly formed, wholly owned subsidiary, Molina Healthcare of Texas Insurance Company, which has been approved to operate as an exclusive provider organization in the service area. Molina Healthcare of Texas will administer the contract on behalf of its subsidiary.

Originally created in 1997, CHIP is a state and federal partnership that provides low-cost health insurance coverage for children in families who earn too much income to qualify for Medicaid but cannot afford to purchase private health insurance coverage.

“As of September 1st, we began serving a significant percentage of the population enrolled in CHIP in these Texas communities. We are excited about welcoming and assisting our new members in accessing quality healthcare benefits,” said Don Hairston, president of Molina Healthcare of Texas. “Our involvement in this program will complement our existing participation in Texas’ STAR and STAR+PLUS Medicaid programs, as well as CHIP in non-rural areas. The additional scale offered by the expansion of our programs in the state will enable us to further leverage our resources in order to bring important benefits to a greater number of persons and communities.”

In January 2010, the Texas Health and Human Services Commission (HHSC) selected Molina Healthcare of Texas as one of two managed care organizations to enter into a contract to provide comprehensive healthcare services for participants of Texas’ CHIP Rural Service Area Program.

“Texas has one of the highest numbers of uninsured children in the nation,” said Robert Hilliard, Jr., M.D., Chief Medical Officer of Molina Healthcare of Texas. “By participating not only in the CHIP but also in the CHIP Perinatal Program, we are able to care for children even before they are born. One of the most significant factors in a mother’s delivery of a healthy baby is having timely access to prenatal care. We are excited to be working closely with local providers to provide these much needed healthcare services.”

Molina Healthcare of Texas already serves Medicaid, CHIP and Medicare beneficiaries in the Harris service area, which includes Houston, in the Bexar service area, which includes San Antonio, and the Webb Service area, which includes Laredo. In addition, Molina Healthcare of Texas was recently awarded a contract for the STAR+PLUS program starting in the first quarter of 2011 in the Dallas Service Area, which includes Dallas and six surrounding counties. It is estimated that there are approximately 50,000 aged, blind or disabled beneficiaries in this service area.

About Molina Healthcare

Molina Healthcare, Inc. (NYSE: MOH) provides quality and cost-effective Medicaid-related solutions to meet the health care needs of low-income families and individuals and to assist state agencies in their administration of the Medicaid program. Our licensed health plans in California, Florida, Michigan, Missouri, New Mexico, Ohio, Texas, Utah, and Washington currently serve approximately 1.5 million members, and our subsidiary, Molina Medicaid Solutions, provides business processing and information technology administrative services to Medicaid agencies in Idaho, Louisiana, Maine, New Jersey, and West Virginia, and drug rebate administration services in Florida. More information about Molina Healthcare is available at www.molinahealthcare.com.

Cautionary Statement under the Private Securities Litigation Reform Act: This press release contains “forward-looking statements” that are subject to risks and uncertainties that may cause actual results to differ materially. A discussion of the risk factors facing the Company can be found in its annual report on Form 10-K for the year ended December 31, 2009, in its quarterly reports on Form 10-Q for the quarters ended March 31 and June 30, 2010, in its Form 8-K current reports, and in its other reports and filings with the SEC. These reports can be accessed under the investor relations tab of the Company's website or on the SEC's website at www.sec.gov. Except as required by law, the Company disclaims any obligation to update its forward-looking statements.