Ladies and gentlemen, thank you for standing by and welcome to the WellPoint Conference Call. At this time, all lines are in a listen-only mode. Later there will be a question-and-answer session and instructions will be given at that time. [Operator Instructions]. As a reminder, this call is being recorded. I'd now like to turn the conference over to the Company's management.

Good morning and welcome to Wellpoint Third quarter earnings conference call. I am Jamie Miller, Chief Accounting Officer and Executive responsible for Investor Relation. And with me this morning are Angela Braly, our President and Chief Executive Officer and Wayne DeVeydt, Executive Vice President and Chief Financial Officer. Angela will begin this morning's call with and overview of our third quarter accomplishments and then Wayne will offer a detailed review of our third quarter financial performance and current year guidance which will be followed by a question-and-answer session. We will be making some forward-looking statements on this call, listeners are cautioned are that these statements are subject to certain risks and uncertainties, many of which are difficult to predict and generally beyond the control of WellPoint. These risks and uncertainties can cause actual results to differ materially from our current expectations. We advise listeners to review the risks factors discussed in our press release this morning and other periodic filings we make with the SEC. I will now turn the call over to Angela Braly.

Good morning and thank you, Jamie. We are very pleased to report another quarter of record earnings per share. In the third quarter, WellPoint reported net income of $1.45 per diluted share which included $0.01 in net realized investment gain. These results are inline with our prior guidance and we continue to have met or exceeded our EPS guidance every quarter, since our IPO in 2001. As a reminder, net income in the third quarter of 2006 was $1.29 per diluted share which included $0.04 per share in tax benefits due to a change in state tax apportionment factors and $0.01 per share in net realized investment gain. Operating revenue was $15 billion in third quarter 2007, an increase of $745 million or 5.2% from the third quarter of 2006. The increase resulted primarily from disciplined pricing and local group business and growth in state sponsored and Medicare Advantage membership. Medical enrolment totaled 34.8 million members at September 30, 2007. An increase of 615,000 members from 34.2 million reported at September 30, 2006. The increase was driven by our national business which added 511,000 members and our state sponsored business which grew by 336,000 members. Growth from the prior year and state sponsored business excludes the impact of the change in our 50% ownership interest in a joint venture in Puerto Rico to a smaller percentage ownership in the joint venture parent company. Accordingly, we no longer include the 222,000 members related to this investment in our reported enrollment. This growth was partially offset by a decline in individual business. Overall pricing remains rational and we expect even stronger overall membership growth in 2008 with at least 1 million net new members. We have had another excellent national account selling season as employers continue to recognize the superior value proposition…

Thank you, Angela and good morning to all of those on the call. We are very pleased with our financial results this quarter of $1.45 in earnings per share, that includes $0.01 per share in net realized investment gains. Premium revenue was $13.9 billion in the third quarter of '07, an increase of $725 million or 5.5% over the third quarter of '06 due to disciplined pricing, our local group business and growth in state-sponsored and senior business. Administrative fees were $912 million in the third quarter of '07, an increase of $21 million or 2.3% over the third quarter of '06, due primarily to growth in our national accounts business, including Blue Card and local group. Self-funded membership increased by 634,000 members and included 86,000 members who switched from our fully insured plans to self-funded. As Angela noted, in the third quarter, our benefit expense ratio was 81.8%. For the full year, we now expect the benefit expense ratio to be 82% slightly higher than our previous guidance, due to the CMS Part D reconciliation process for 2006 and related items in 2007. We continue to price our business so that expected premium yield exceeds total cost trend, where total cost trend includes medical cost and selling, general and administrative expenses. We remain very disciplined in our underwriting approach and do not target business that we believe is priced below our profitability targets. Based upon medical cost trends in the third quarter, we continue to believe that our 2007 medical cost trend estimate of less than 8% is appropriate. Inpatient trend is in the mid-single digit range, and is almost all related to unit cost increases. Unit cost pressure continues throughout the country. However, due to our re-contracting efforts, unit cost trend is slightly lower than it was earlier…

Thank you Wayne, operator, please open the call up for questions. Question And Answer

Certainly will, and ladies and gentlemen we will now begin the question and answer session. [Operator Instructions]. Now due to limited time and fairness to other listeners, we do ask that you please limit yourself to one question and one related follow-up per turn. Our first question in this morning comes from the line of Matthew Borsch with Goldman Sachs, please go ahead.

Yes, good morning and I am wondering if you could just talk a little bit about the trend in the commercial fully insured business. I think if I am running the numbers right, I think you are down about 400,000 commercial fully insured members for the first nine months of this year. Is that... can you just highlight for us again the key triggers there and I heard you that there were some, I guess you said 86,000 lives that switched this quarter to ASO maybe you could just elaborate on whether that was a couple of large accounts or something that you see on a continuing basis. I am just asking of course, because it has an impact on the revenue and I think if we were to loose another 400,000 next year that would make for a tougher, tougher from an operating leverage standpoint.

Let me address that generally and then I will turn it over to Wayne to address more of the specifics. But I think it is important as you know that that 44,000 of this decline actually converted from fully insured to ASO. So we retain the accounts. But they chose to self fund. The remaining, we look total as the sequential decline of 141,000; if you look at the remaining 97,000, almost 70% of that occurred in our non-Blue branded market. So we still believe that we are competitive because we're disciplined around price. We think we have the best networks to offer, and we're obviously very competitive on our administrative cost. So Wayne, you want to address any of those other issues specifically?

Yes. And Matt, to your comment, as Angela addressed the sequential decline, and obviously on a full-year basis we're seeing about 86,000 of those members. Well, we are retaining the members that are converting, but clearly in the fully insured market it's very competitive today and I think the important thing is that we are refocusing our efforts on part of our non-Blue branded strategy and are putting Dennis Casey over that unit and to work forward on a new strategy in '08, which I think we will really see the value in '09 from that. In our Blue markets we're doing quite well but again we are not going to buy membership, and I think if you look at commercial segment you will see that that we are holding that true and our margins are expanding. So it's clearly a competitive environment, it's a challenging environment, and we have seen trends where there's been conversions from fully insured to ASO, but we remain disciplined in our Blue states.

And if I could just ask one more on the question of enrollment timing, I guess there has been some speculation that your commercial... total commercial enrollment risk in ASO might be down going into January 1 versus year-end 2007, can you just comment on that directionally?

I am not expecting it to be down at this point, Matt.

Okay, great, fantastic. Thank you.

And the next question then comes from the line of Charles Boorady with Citi. Please go ahead.

Thanks. Good morning. I have a question, then a follow up. First, in terms of just understanding the run rate of your earnings in this quarter, I recognize the CMS charge should be accounted for but it relates mostly to '06. So is the $1.50 really the right sort of run rate to think about in terms of modeling going forward, or were there other offsets in the quarter?

Charles, it's a very good question. The majority of the other Part D does relate to the '06 CMS reconciliation. There's a small amount that we did book related to 2007, under the premise that we've always been conservative and consistent in our methodology. I want to emphasize here on the Medicare Part D, we are still pursuing reconciliations on that with CMS and as it relates to '07 while we have recorded a small reserve associated with that, the time frame for selling that goes out into '08. From a run rate perspective, we are using some of those dollars in the fourth quarter though, to help us with our '08 membership. We've got a number of national account wins and so we are ramping up spending in the fourth quarter to support that. With us expanding in the South Carolina Medicaid we have some ramp up in the fourth quarter to support that as well, but you definitely hit it on the head and again had we not had that charge, we would have had a very, very great quarter.

And the mention that you just made Angela in your prepared remarks regarding the ongoing reconciliation with CMS, how should we... including for amounts related to '06 though, how should we think about those going forward, were they fully reserved for us as part of the 40 bip hit this quarter, and if you're successful in this process with CMS, could we see a future positive adjustment or are you contesting something that could potentially be another negative adjustment going forward?

Yes, Charles, it's a good question. I would tell you that, we could have positive adjustments, but I would view those positive adjustments not as run rate, no different in this charge here. I think the important point to recognize on the '06 reconciliations, what we are talking about is the excess profit margins that we share with the government. So in this case it's not necessarily a run rate item as much it is settling up on what that excess amount actually is. So even if we get some favorable settlement on it, I would not view the favorable settlement as being run rate either just as I wouldn't view this unfavorable charge in the quarter as being run rate.

Okay, great, thank you.

Thanks. And our next question then comes from the line of Josh Raskin with Lehman Brothers. Please go ahead.

Thanks, two questions. One, I just want to make sure that I heard you right, Wayne, that you said the inpatient trend was improving. I didn't know if that was just utilization or if there was actually unit cost improvement there? And then also if you could just let us know what was the driver of the higher corporate expense?

Yes, Josh, the inpatient trend mark is still up. It has improved slightly over where we were at earlier in the year so from that perspective we think some of our contract is paying off and utilization remains flat. So while it's up we have seen it actually slightly decline and that's why on the cost side again utilization remains flat. So we feel pretty good there. In terms of the higher corporate expenses, it's really just a potpourri of items. Some of it is our through ups on our pension benefits that we have and of course those are items that when we allocate certain components not all components get allocated so it's no one particular driver in particular at this point in time. It's just really a potpourri of small items.

And then just to sneak one in the... you've been talking about this reconciliation with CMS is taking a charge in the quarter, if that was an income statement item right, that was above the line that didn't go through, I guess why calling it a charge I guess is the question?

I'm sorry, yes, it's a double-line item and it ran through revenue. Because this was a settlement on premiums, so this is actually going through revenue.

Okay, perfect, thanks.

Thank you. And we have a question now from the line of Scott Fidel with Deutsche Bank. Please go ahead.

Thanks. First, Wayne can you just actually specify how much the hit to revenue was from the CMS reconciliation?

Hi Scott. Right now as we talked about it, it's about 40 basis points. The reason we haven't specifically called out the numbers is because we are still working on settlements with CMS on this and so we are trying not to publicly negotiate on what we believe we are entitled to at this point in time around that process. But I think you would be able to probably back into it fairly easy based on that.

Okay. And just a follow up, just if you can talk about your cost trend expectations for 2008, are you still thinking in that slightly less than 8% or are there any factors you think can drive that higher or lower? Just thinking United, they said on their call maybe some public policy ch0anges that could have an impact, and are you thinking about that as well?

Clearly, we always think about pricing and insuring that we cover total trend, to be able to cost to care and SG&A. Scott we are in the process of finalizing our '08 plan, our Board seemed to discuss it. I would prefer to wait until we got approval from our Board to provide that details that are out there.

Okay. If I could just sneak up one more follow up in and just thinking about the outlook for the specialty businesses and how much given that 1 million lives of growth you expect next year, how much of penetration opportunity do you see in that for the PBM and the behavioral business?

Let me talk about that a little bit, because that's part of the reason that we made this organizational change. We are bringing the specialty businesses into the commercial business that would be led by Ken Goulet, which I think, will really create some great opportunities for us to talk about a truly integrated solution. We are seeing the impact of that, for example in our PBM we are seeing a higher penetration in the PBM than we have ever in the past. Our 360 degree health solution, our comprehensive health solutions, unit is delivering that, and we are seeing 90% of our national accounts are taking our disease management and wellness programs.

Thank you.

Thanks, and the next question comes from line of Bill Georges with J. P. Morgan. Please go ahead

Thanks, good morning. Talking about the California and Connecticut rate increases, I guess you have specifically said that you got an increase of 8.3% in California, how does that square with your expectations?

Hey Bill, it's a great question. I need to separate the response though into a couple of buckets. Remember there were nine counties in which we were trying to get resolution on in rate increases. So for eight of the counties right now we have 8.3% on the table, I would tell you for many of the counties, it is right in line with our expectation of where we want it to be, for a few of the counties we are still working with the state right now to finalize the terms. There is one county though right now that is hard for me to say, how it aligns, we just don't have the rates on because of the subcontractor arrangement. So that's probably the biggest unknown right now for us is where that one is. But in terms of the other eight right now, they are combining to 8.3% combined return and I do expect that their terms finalize very near terms.

And what portion of that increase accrues directly to you versus going towards a provider rate increase?

Well, our provider rates have already been locked and loaded, and I don't believe there's any changes to those structures. So from this perspective, the majority of this accrues to us.

Okay. And then just regarding your SG&A improvements, can you talk about to what extent is that a delay of discretionary spending versus planned improvements in your SG&A?

Let me try to address that generally. Last November we organized as an enterprise to really leverage what we think are our key strengths, our differentiating characteristics which is the ability to really scale across the enterprise and I think the SG&A improvements are a direct reflection of that organizational structure and our ability to really scale across the enterprise.

I would say Bill, that there was no delays in spending this quarter.

Okay. Alright, great. Thanks very much.

Thank you.

Thanks and our next question then comes from the line of Christine Arnold with Morgan Stanley. Please go ahead.

Hi there. I'd like to probe the enrolment guidance a little bit. Could you talk about whether you expect at risk commercial enrolment to be up or down next year? Are you expecting to continue to call from some of the UniCare enrolment or should we see kind of the end of that and net enrolment growth on the average commercial side?

Hi Christine. That's a good question. While, we are finalizing our '08 plan, I think it's fair to say that we will see some growth in UniCare, but in some ways we are also trying to rebuild the strategy so... but we do expect and we will provide more details in '08 guidance, so we will have growth in our commercial for insured group next year.

That's again on 1/1 or do we take a step down and then grow?

Again, we will provide more details at our IR day because we have got a number of initiatives that we are putting forward in front of the Board to stimulate some of the growth but I think at this point it's fair to say that we will comment a little more evenly throughout the year but again we will provide more details at our IR day.

And stability in the MLR is probably a reasonable expectation on the commercial side.

Absolutely.

Yes, thank you.

Thanks, and our next question comes from the line of Justin Lake with UBS. Please go ahead.

Thanks, just a quick follow-up on the UniCare business. Can you give us an idea as far as sizing that from membership and premium standpoint just to let us know what the potential is here?

We have 1.7 million members in UniCare.

And Justin if you compare that 1.7 to when we brought the two entities together, that number was closer to 2.2 million so you can really see where we share a number of our lives over the last 2.5 year or so. It really has been in the non-Blue branded aspects of our business. I think it's fair to say that this is an area where we know we can improve. It's an area where we know there is a great growth opportunity out there and its one of the reasons we put Dennis over this unit. Dennis has led us to number one market share in Indiana and great margins, and we think he will do an exceptional job on UniCare as well, but to do that we really do need to get in '08 as an opportunity to build out a strategy to see success in '09.

And the predominance of those numbers are full risk, right?

They are about 50-50.

Okay. And just a quick follow up on the SG&A side. With regards to this year, obviously you have seen a pretty dramatic improvement in SG&A. I think you saw the results are pretty big bifurcation as far as growth in the commercial versus the government which I always think of as lower SG&A margin. Can you give us an idea of maybe, bifurcate that, the SG&A improvement, how much of that's been mix, versus actual decline. I mean if we were to look for instance at the commercial book at the consumer business, it looks like you are, it looks like you were down, you improved margins there by 120 basis points. 40 basis points of acknowledged MLR, so that made me believe that the SG&A is 80 basis points better in the consumer business this quarter.

Yes, Justin. It's a good question. I apologize, I don't know, whether I can have that break down now, but I will follow-up on that. What I can say though is that, it's more than just mix when you consider the fact that on an absolute dollar basis, our overall SG&A spend is down about $24 million, when compare us in the third quarter of '07 versus '06, while adding 700,000 lives. So while mix is part of it, it's not all that reliable. We are just getting it done, day in and day out and be more efficient.

Absolutely, I am just curious as to how much more room might be there if this is kind -- if that 80 basis points of change that we saw in this third quarter which you kind of identified for us is kind of a good run rate to think of for '08; maybe it's a little early to answer that?

It is a little bit early to answer that. And we will have to get you some more details on that as well, but we will provide more granularity around IR Day. As we said, we have been focusing on a goal of reducing our SG&A by another 150 to 200 basis points, over the next three to five years, but again there is going to be a lot of shifts that we will need to talk about. As you know the AIM acquisition is a great acquisition for us and it drives a lot of value in our cost of care, but it's also administrative in nature and so we'll provide more details at IR day, look around the components.

Great, appreciate the color.

Thanks Justin.

Thanks and we have a question then from the line of John Rex with Bear Stearns. Please go ahead. John Rex - Bear Stearns & Co.: Thank you, two quick questions. First of all, can you tell us for your, '08 earnings how much share repurchase you contemplate in getting at that number.

Yes, but we'll talk a little bit more about that on Investor Day. John Rex - Bear Stearns & Co.: I mean would it be... would it... directionally would it be fair to assume that you do assume additional share repurchase over what you have accomplished through present?

You know John, we obviously believe that we're using our capital effectively and we are going to continue to review that with the Board and we will be doing that over the next month. So we'll be prepared for Investor Day.

I think it's fair to assume John that we expect very strong cash flow next year, no different than we have had this year and we've got $2 billion in cash and investments at the parent and another $1.3, given up in the quarter. So we need to find an effective use for that and we are going to be reviewing that with our Board as part of our '08 plan. John Rex - Bear Stearns & Co.: Okay and then looking at the Medicaid booking, for the... what percent of your California membership would the eight counties represent of your California Medi-Cal membership?

It's -- I have to get you the exact figures, it's a decent size of the nine counties that we have been talking about meaning well in excess of 50% of that. So at this point John, any other comments right now, we expect to move forward satisfactory as well. So it's hard to break it down into all the pieces at this point. Again we are trying to make sure we don't publicly negotiate on the few counties. John Rex - Bear Stearns & Co.: But the eight counties, is it more than 50% of your total California membership?

No, not of total California. John Rex - Bear Stearns & Co.: Of total California Medi-Cal, it's sort of...

Right, but there's a couple of sizable counties that have normal renewal dates of January 1 that we are still negotiating right now, just starting that negotiation. John Rex - Bear Stearns & Co.: Okay, so it's just kind of a smaller percentage of your total of membership base for the number you are talking about then?

Correct. John Rex - Bear Stearns & Co.: Okay and in Connecticut.

Just off of 50%, so it's not dramatically softer there. John Rex - Bear Stearns & Co.: Okay and did you anticipate any retroactivity in Connecticut, in Medicaid, this quarter, that is did you accrue any retroactivity?

Though we anticipated it but we did not accrue for it. John Rex - Bear Stearns & Co.: Okay, great. Thank you.

So we get it in writing, we are not going to go ahead on this. John Rex - Bear Stearns & Co.: Great. Thanks.

Thank you and we have a question then from the line of Douglas Simpson with Merrill Lynch. Please go ahead.

Hi, good morning. Just talking about the other $200 million reduction in the operating cash flow outlook for this year, I know you commented it was both, this Part D reconciliation and part of this total risk enrolment, can you give us any more granularity just which was the bigger of the two?

I would say for this year that it's closer to the 50-50 on the split. It's not at all associated with the Part D, because Part D is substantially less than that. But there is a cash outflow. Let me clarify Doug, that is probably not a perfect 50-50. We have been normal code we already had up with Part D which was big then. So the majority of those are around our membership mix at this point in the quarter.

Okay and then just on the PD reconciliation with the benefit of hindsight and just in terms of processes and controls, this is a rolling process, how comfortable are you guys having nailed now and going forward, this just won't be an issue in future periods?

I think that it's a very good question and I want to spend a few minutes on this topic because I think its one that everybody would want to know. Recognizing the 2006 was the first year of Medicare Part D and was the year in which we were the facilitating role just as we are in 2007. Its important to recognize that because of that facilitated enrollment process, there was not a process but plans to settle with one another, established until late fourth quarter of '06 that continued in to '07. So for us to be able to submit our prescription drug event or PDE format, this really was what I would call kind of one time very unusual event because it was difficult for us to settle upon '06 until we could settle up with other plans and lot of closure and conclusions were there. I don't expect to have similar levels like this in '08 as we settle out '07 but I do want to make sure everybody knows that we applied consistent and conservative approach in determining our '07 reserve but it substantially less than we settled in '06, again because we've cleaner membership data, much sooner than we did a year ago.

You know, I think this product obviously is evolving both on the CMS side and for the plans and we're getting better and better at the processes that we can execute against going forward but there always will be this risk sharing reconciliation. So that part of the process that we think we understand well now.

Okay, thank you.

And Doug, just what I want to put in perspective with you, look at the similar process in '06 we had it settled with other plans and receivables that were owed to us, versus how that stream lined in '07. That receivable balance this year is about 90% less than it was a year ago at this time, so clearly as this program gets rolled out and processes get established, it gets a lot easier.

Okay, thanks.

Thank you andwe have a question then from the line of Carl McDonald with CIBC. Please go ahead

Great, thank you, if we adjust for the PDP charge, you had $0.06 up side roughly relative to your guidance, can you size that for us in terms of how much came from Commercial, Medicare, Specialty?

Our commercial has done quite well, I think most of it's in the commercial book.

Okay, and secondly on the go forward table, it looks like the stable development for the year is actually down 20 million sequentially, so can you walk through the moving pieces driving that?

Yes Carl, its about 20 million that its down, and its really again relates to '06 and its really it's what I would call a fine line true ups on individual lines. So it's not anyone product or anyone customer type, but its really just attributable policy in final development that will come through related to '06. I really don't expect it to move much more at this point.

Got it, thank you.

Thanks. And your next question then comes from the line of Greg Nersessian with Credit Suisse. Please go ahead.

Hey, good morning. Most of my questions have been answered. I just wanted to follow up on Josh's question from earlier about the inpatient cost. I think you mentioned that they were mid single digits earlier in the year and I think you said high single digits, is it your sense that that is a WellPoint specific phenomenon or is it something that you would characterize as more of an industry-wide phenomenon and I guess as you think about that going forward, how might that or might that not impact pricing yields going forward in the level of competition?

I am not so sure that, I think all of this might be experiencing more utilization being flat. I haven't really heard anybody say that that there is an industry issue of utilization picking up. So that may be more of an industry issue. In terms of our unit cost again, while we are still seeing increases, I think we are improving on that and I can't speak for our competitors, but what I can say is I am very proud of the contracting efforts that our team has put forward and holding the line for our members. So, again I don't know how that compares to others, but for us I think we are doing the right thing.

And to the extent of that inpatient cost results and the lower overall trends, the expectations, I know you're not talking about yield going into '08, but the other expectation would be that you will be pricing again in line with whatever your trends, anticipated trends next year will be?

We'll price to cover total cost of care and SG&A.

Alright. Okay. Thank you.

Thanks. And we have a question now from the line of Michael Baker with Raymond James. Please go ahead.

I was just looking for some general commentary on the M&A outlook. Last year it appeared as though it was more cost-focused versus some previous deals, is there any shift towards maybe more cost focus, cost containment-type deals versus revenue-enhancing?

I think our M&A strategy continues. We would look carefully at any Blue transactions, we would look at non-Blue business in the core. But Aim was a great transaction for us, it made great sense from the cost-of-care perspective, but they are really in their essence a technology company. They have been focused on radiology management, but we are going to focus also on cardiology, on orthopedics, so they really do bring a capability to us that we think is very, very strong. On the other side though the M-Plan endorsement transaction is a reflection of what we think is just part of the cycle of the business which is a very attractive option and we think by doing an endorsement deal with M-Plan as opposed to some type of acquisition, we are really getting the benefit to our membership growth.

Thanks.

Thank you. And we have a question now from the line of Brian Wright with Jefferies and Company. Please go ahead.

Thank. Good morning. Can you speak to the operating cash flow growth outlook next year?

Again we are finalizing '08 plan now and I will be presenting it to our Board in the very near term and we will provide more details. But I still would expect that operating cash flow will support the quality of earnings we have and we will exceed net income at this point in time.

Maybe similar kind of levels 1.3 to 1.2?

I think again we are finalizing it, but I think we will see comparable levels but at this point we are still finalizing it.

Okay. Thank you.

Thanks. And we have a question then from the line of Tom Carroll with Stifel Nicolaus. Pease go ahead.

Hi. Good morning. There's been a lot of talk this morning about enrollment numbers and I wanted to continue that conversation. As I think about it, in '07 your expectation was for 1.4 million new enrollees which is ultimately coming in at around 800,000 and in '08 we are suggesting greater than 1 million and it sounds like you are very comfortable with that. And Angela thanks for that commentary in your prepared remarks about it but could you maybe provide a little more comment on that and maybe from the perspective of what could go wrong, maybe what happened in '07, I mean how, what's the chances of seeing that translate into '08 enrollment growth?

Let me address that. Because of this 1 million net new members at this point of the year we are certain about a fair amount of this growth. So we know in the national account areas that we expect our growth to be slightly higher as in this year and because of this large win that we have for July 1 effective date it is going to be shifted to mid year with that group. We know we have the Medicaid contract with our partnership with Blue Cross Blue Shied at South Carolina and we expect 50,000 members and that's fully implemented. The Indiana Health and Family Program, we think we counted our fair, what we think would be a third of the total program size so that's about 47,000 members. And then while M-Plan has more members than needed, we expect about 50,000 commercialized and in the State of New Hampshire it's 39,000. So to the point of what's different in this year, I think this is a practically almost half of that number of what we expect next year. We are going to stay disciplined around pricing but also really think we have the winning product suite for the market price and that we are continue to grow and we are going to deliver more value and in a very disciplined way and we think it will produce membership growth.

Just as a follow up. I guess you were certainly comfortable going into '07 with your numbers and had I thought fairly certain outlooks on the various enrolment buckets. As we look at '07 perhaps maybe your commercial business attrition which is higher than you expected, is that fair to say?

Well, I think in UniCare, it certainly was and we are confident that we are going to get our arms around that with Dennis, and it will help us focus on that in UniCare as well.

Great, I am just trying to think about what is different going into '08 that wasn't there in '07, so thanks.

Yes. And Tom, one thing I'd like to just emphasize is keep in mind that when you look at where we fall short this year, almost half of that guidance we provide is falling short in our non-Blue branded business and we have always said we are not going to buy membership and we do think we have opportunities to expand that book, we think we have better way to focus on it, and I think Dennis is going to do the right things. We had talked more about a million net new lives, we are getting to the point of more large numbers, and adding 5% membership becomes quite difficult when considering we've almost 35 million lives. But nonetheless, we think we can still add over a million lives next year, and we think we have got a great insight into that already.

Okay, good point. Thanks.

Thank you.

Thanks. And our last question this morning comes from the line of Wayne Cooperman with Cobalt Capital. Please go ahead.

Oh boy, thanks, actually my question was answered thank you.

Thank you. Then I'd like to turn the conference back over to Angela Braly with the company's closing comments.

Thank you for your questions. In summary, we had a good quarter and are pleased with our performance to date. Our commercial and consumer business is having a very good year with the operating margin expanding by 60 basis points year-to-date through September 30, 2007. We met our earnings guidance for the quarter despite higher than expected costs, as a result of the accrual for CMS, Medicare Part D, 2006 and 2007 risk sharing, and we remain optimistic about our future. As Wayne noted, we will hold our annual Investor Day at our California House in Longevity Institute in West Lake Village, California on December 11, 2007. We are looking forward to seeing many of you there and for those who cannot be there in person, it will be webcast. I want to thank you for your interest this morning and have a great day.

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