1. J.P. Morgan 29 th Annual Healthcare Conference January 10, 2011 Bill Lucia, CEO Walter Hosp, CFO Contact: Christine Saenz csaenz@hms.com 212.857.5986

2. What We Do We provide cost containment services for healthcare payors. We help ensure that claims are paid correctly (Program Integrity) and by the responsible party (Coordination of Benefits). As a result, our clients spend more of their healthcare dollars on the people entitled to them. 2

3. Who We Serve Federal Programs –Centers for Medicare & Medicaid Services –Veterans Administration 3 State Programs –Medicaid agencies –CHIPs (Children’s Health Insurance Programs) –Child Support agencies Commercial Programs –Medicaid Managed Care Organizations (MCOs) –Commercial Plans –Employers

4. COMMERCIAL $847 billion 164 million lives Source: 2009 CMS Office of the Actuary MEDICARE $515.5 billion 47 million lives MEDICAID $436 billion 57 million lives UNINSURED 46 million lives Coordination of Benefits 4

5. 5 How We Grow Capture more lives Ride the Medicaid growth wave Add new products, enter new markets Upsell to existing customers

6. Capture More Medicaid Lives Sources: HMS & 2009 CMS Office of the Actuary. 6

7. Ride the Medicaid Growth Wave Actual Projected 1995-2008 data, 2008 CMS Office of the Actuary 2010-2019 data, 2009 CMS Office of the Actuary With reform 7

8. 2005 2006 2007 2008 2009 2010 & Beyond Acquired Permedion Hospital Audits CHIP Enrollment Integrity Acquired BSPA Premium Assistance Real-time COB Managed Care Acquired PrudentRx Federal MIC Clinical Review M & A Market Service Acquired IntegriGuard Acquired Verify Solutions Behavioral Health Long-term Care Audits Pharmacy Audits Acquired AMG Acquired Chapman Kelly Medicare Employers Commercial Insures Dependent Eligibility Audits New Product Development Healthcare Reform Products Add New Products, Enter New Markets 8

9. Upsell to existing customers 9

10. 10

11. Upsell to existing customers 11

12. HEALTHCARE REFORM

13. COMMERCIAL $847 billion 164 million lives Source: 2009 CMS Office of the Actuary MEDICARE $515.5 billion 47 million lives MEDICAID $436 billion 57 million lives UNINSURED 46 million lives Healthcare Financing Today 13

14. COMMERCIAL $1335 billion 168 million lives Source: 2019 Estimates, 2009 CMS Office of the Actuary. MEDICARE $904 billion 60.5 million lives 14 UNINSURED 16 million lives MEDICAID $994 billion 83 million lives Healthcare Financing 2019

15. Medicaid Expansion Actual Projected 15 1995-2008 data, 2008 CMS Office of the Actuary 2010-2019 data, 2009 CMS Office of the Actuary With reform

16. National healthcare expenditures Early adoption of reform Program compliance Exchanges Reform Activity 2011-2014 16

17. National Healthcare Expenditures 17 CMS Office of the Actuary, “Estimated Financial Effects of PPACA as Amended”, April 2010 As a percentage of GDP

18. Massachusetts (2007) Connecticut (2010) District of Columbia (2010) California (2010) Minnesota (2011) Early Adoption of Reform 18

19. Medicaid RACs Employer plan and claim audits Third-level appeals Managed care Federal Program Compliance 19

20. Federal planning grants awarded Pilots in place in several states Coordination of benefits required Responsible for eligibility determination Right insurance home Exchanges 20

21. Revenue Diversity and Growth 21 $ Millions

22. Key Financial Indicators Rolling Four Quarters 22

23. Guidance Revenue 20102011 $$300.0$370.0 % change y/y30.9%23.0% Operating Profit $$66.9$85.0 % change y/y29.0%26.8% Margin22.3%23.0% GAAP EPS $$1.40$1.74 % change y/y28.7%23.6% Adjusted EPS $$1.68$2.03 % change y/y25.9%20.1% 23

24. Investment Considerations Low risk, high growth core business High growth, early stage program integrity business Well positioned in current healthcare environment Multiple new growth opportunities - Products- Acquisitions - Markets Recurring, transparent and diversified revenue Strong financial position 24

25. 25 Safe Harbor Statement Certain statements in this presentation constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Reform Act”). Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance, or achievements of HMSY, or industry results, to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. The important factors that could cause actual results to differ materially from those indicated by such forward-looking statements include, but are not limited to (i) the information being of a preliminary nature and therefore subject to further adjustment; (ii) the uncertainties of litigation; (iii) HMSY’s dependence on significant customers; (iv) changing conditions in the healthcare industry which could simplify the reimbursement process and adversely affect HMSY’s business; (v) government regulatory and political pressures which could reduce the rate of growth of healthcare expenditures and/or discourage the assertion of claims for reimbursement against and delay the ultimate receipt of payment from third party payors; (vi) competitive actions by other companies, including the development by competitors of new or superior services or products or the entry into the market of new competitors; (vii) all the risks inherent in the development, introduction, and implementation of new products and services; and (viii) other risk factors described from time to time in HMSY’s filings with the SEC, including HMSY’s Form 10-K for the year ended December 31, 2009. HMSY assumes no responsibility to update the forward-looking statements contained in this release as a result of new information, future events or otherwise. When/if used in this presentation, the words “ focus,” “ believe, ” “ confident, ” “ anticipate, ” “ expected, ” “ strong, ” “ potential, ” and similar expressions are intended to identify forward- looking statements, and the above described risks inherent therein.

26. 26 NASDAQ: HMSY