Mercator Chosen by KPS Health Plans for HIPAA Compliance

Business Wire, March 7, 2002

Business Editors

WILTON, Conn.--(BUSINESS WIRE)--March 7, 2002

Pacific Northwest Healthcare Organization to Rapidly Implement

Federally Mandated Requirements, Reduce Administrative Costs

Mercator(R) Software, Inc. (Nasdaq: MCTR), has been selected by KPS Health Plans to provide the technology, training, and professional services to enable the health plan to comply with the federally mandated Health Insurance Portability and Accountability Act of 1996, known as HIPAA.

Per the government legislation, all covered entities need to have implemented the HIPAA EDI X12 transactions and code set standards by October 16, 2003.

Mercator will improve KPS's ability to rapidly implement the required HIPAA transactions and code sets, and reduce overall administrative costs.

Pam Tirao, director of business systems for KPS Health Plans, commented: "Mercator will help KPS Health Plans quickly comply with the HIPAA ANSI X12 transaction set requirements. Their professional services team worked closely with our IT team to assess our architecture and deliver a workable solution. Mercator is providing training in the development and systems testing to ensure that the installation is a success."

Robert J. Farrell, president of Mercator Americas, said, "Mercator is the industry leader in delivering integration solutions to healthcare organizations seeking to comply with HIPAA. Our expertise allows us to work swiftly with healthcare insurance providers such as KPS and get them HIPAA compliant on or ahead of schedule."

About Mercator

Mercator Software's intelligent business integration solutions unify any internal operations and connect them with partners and customers while leveraging current technology investments. Over 7,000 businesses, including over 1,100 enterprise customers in financial services, healthcare, utilities, manufacturing, retail, and distribution, use Mercator software to maximize their performance. Additional information about Mercator (Nasdaq: MCTR) may be found at www.mercator.com.

About KPS Health Plans

KPS Health Plans was established by the members of the Kitsap County Medical Society in 1946 as a medical service bureau. Today, KPS Health Plans is a non-profit corporation licensed as a health care service contractor under the laws of the State of Washington. They are based in Bremerton and provide health coverage to over 40,000 members.

Mercator is a registered trademark of Mercator Software, Inc.

Legal Notice Regarding Forward-Looking Statements

Statements in this press release that are not purely historical are forward-looking statements, including statements regarding Mercator Software's beliefs, expectations, hopes or intentions regarding the future. Forward-looking statements in this release include, but are not limited to, statements regarding the growth of the enterprise application market, the demand for the company's application integration solutions and the speed of deployment of new products, including combined Mercator e-business integration broker products. It is important to note that actual outcomes and the company's actual results could differ materially from those in such forward-looking statements. Factors that could cause actual results to differ materially include risks and uncertainties such as changes in demand for application integration or e-business integration software and the company's Mercator e-business integration broker suite of products in particular, the ability of the company to expand its international operations, the ability of the company to manage expanded global operations, the ability of the company to continue to add resellers and other distribution channels, and the success of third parties in utilizing and marketing the company's products, the Company's ability to raise financing, or seasonality in operating results. Readers should also refer to the risk disclosures outlined in the company's reports filed with the Securities and Exchange Commission. All forward-looking statements and reasons why results might differ included in this release are made as of the date hereof, based on information available to the company as of the date hereof, and the company assumes no obligation to update any such forward-looking statement or reasons why results might differ.