Item 1.02 Termination of a Material Definitive Agreement.

On June 30, 2009, HC Innovations, Inc. (the "Company"), a Delaware Corporation, received notice from HealthSpring of Tennessee ("HealthSpring") stating that effective September 30, 2009, it is terminating the Care Management Services Agreement (the "Agreement") entered into by and between the Company and HealthSpring. Such termination relates specifically to approximately 1,200 members being supported under the Agreement in Tennessee and Texas. Pursuant to the Agreement, the Company was to provide services under its Easy Care program to such members until September 30, 2012.

The termination of the Agreement did not result from any disagreement between the parties and does not affect the Agreement insofar as it relates to HealthSpring, Inc. of Alabama, Inc. where the Company serves approximately 500 members. The Agreement does not provide for any penalties to be incurred by either party upon the termination thereof.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED.

Not applicable.

(b) PRO FORMA FINANCIAL INFORMATION.

Not applicable.

(c) SHELL COMPANY TRANSACTIONS.

Not applicable.

(d) EXHIBITS.

Exhibit No. Exhibit Description
1.01 Notice of Termination

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