1998
Management
Incentive Plan
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[LOGO]

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1998
MANAGEMENT INCENTIVE PLAN

The realignment of United HealthCare into six strategically aligned, but
independent business segments established a framework for our company's ongoing
growth and opportunity well into the next century. One of the principal
advantages the new structure offers is the capability to leverage our
considerable resources and capacity, while still nurturing and sustaining the
entrepreneurial spirit that brought us to where we are today.

Our compensation programs have been and will continue to be structured to
encourage leaders to strive for and be rewarded for excellence and continuous
improvement. The belief in pay for performance is inherent in our culture. The
1998 Management Incentive Program carries this philosophy forward within the
framework of our new organization by aligning incentive pools and measurement
goals not only with overall company and individual results, but also more
closely with business segment and business/corporate unit results.

We will measure our success against the goals we set for ourselves, not against
the benchmarks or predictions set by Wall Street. To be truly great, we must
reach for the future. We must believe in ourselves and in what we are capable
of achieving.

This is and will continue to be a challenging year. While part of our energies
must go into continuing to shape and construct our new organization, we also
must achieve even higher levels of growth and financial performance in a dynamic
and competitive environment. We must deliver high quality service and improved
product choices for our customers. And we must remain focused on appropriate
health care delivery, operating and medical cost trends.

As leaders of United HealthCare, we set the standards of excellence for the
organization. I believe we can achieve great things.

William W. McGuire, MD
President, Chairman and
Chief Executive Officer

1998
MANAGEMENT INCENTIVE PLAN
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OVERVIEW

Annual management incentive plan funding and payout amounts are determined by
the overall performance of United HealthCare, as well as the performance of your
Business Segment, Business Unit/Corporate or Enterprise Services group and
your individual performance as compared to the goals and objectives established
in our internal business planning process as shown in the diagram on page 4 and
as described below:

1) The OVERALL PERFORMANCE OF UNITED HEALTHCARE will be measured by
accomplishment of strategic initiatives, employment of capital and resources,
market valuation, merger and acquisition activity, and public image and
recognition, as well as financial results in the following categories: earnings,
earnings per share, revenue, operating costs, medical care ratio, growth and
membership. Strategic and financial goals have been determined by the Office of
the Chairman and are imbedded in our current year operating plans.

2) United HealthCare is now organized into six business segments. The
OVERALL FINANCIAL AND STRATEGIC PERFORMANCE OF EACH BUSINESS SEGMENT WILL BE
DETERMINING FACTORS FOR EACH BUSINESS SEGMENT AND BUSINESS UNIT PARTICIPANT. If
you are part of a United HealthCare business segment, your strategic and
financial goals will be determined jointly by Senior Leaders and the Office
of the Chairman.

3) The OVERALL FINANCIAL AND STRATEGIC PERFORMANCE OF YOUR BUSINESS UNIT/
CORPORATE OR ENTERPRISE SERVICES GROUP WILL BE CONSIDERED. If you are part of a
business unit, goals will be developed jointly by your Senior Leader and the
person to whom they report. If you are part of the corporate or enterprise
services group, goals will be established by the appropriate Senior Leader and
the person to whom they report.

4) INDIVIDUAL PERFORMANCE and accomplishment of individual goals and
objectives are also considered in determining incentive awards.

All four performance measures are used to determine incentive pools and
incentive awards. This blend of performance measurements helps ensure that all
of United HealthCare works together toward common goals and allows us the
greatest opportunities for success professionally and personally. The company's
internal targeted goals and measures always exceed the externally anticipated
results held by the investment community.

OVERVIEW OF THE MIP PROCESS

The diagram below graphically depicts the MIP program process detailed above.

[DIAGRAM]

INCENTIVE POOLS

Incentive pools for 1998 will be more closely aligned with the results of the
business segments and business units to reflect the operational realignment of
the organization. Performance against the internal goals at these levels and
the company's overall performance will determine the size of the incentive
pools. Corporate and Enterprise Service units will be aligned with overall
company performance and the results of their unit objectives.

INCENTIVE TARGETS

Incentives are an important part of your total compensation package. Each
participant is assigned an MIP Incentive Target percent. This target percent is
determined by your grade, overall level of responsibility within the
organization and market competitiveness.

The calculation of the incentive pools will generally be determined as follows
with the final decision on incentive pools subject to the discretion of the
company's top management:

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GENERAL DETERMINERS OF INCENTIVE POOLS
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ORGANIZATION LEVEL OVERALL COMPANY BUSINESS SEGMENT BUSINESS UNIT CORP. & ENTERPRISE
RESULTS RESULTS RESULTS SERVICES RESULTS
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CORPORATE & ENTERPRISE
SERVICES LEADERS AND MANAGERS: Critical Very Important Very Important Critical
Incentive pool will be
primarily based on overall
United HealthCare Results and
results of
Corporate/Enterprise Services
Scorecard.

BUSINESS SEGMENT LEADERS AND
MANAGERS: Very Important Critical Critical Important
The incentive pool will be
primarily based on the
performance of your business
segment and units and the
overall company

BUSINESS UNIT LEADERS AND
MANAGERS: Important Very Important Critical Important
The incentive pool will be
primarily based on the
performance of your business
unit with consideration of the
overall business segment
performance.
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Your targeted incentive award is determined by your eligible base earnings paid
during the fiscal year multiplied by your MIP Target percent (or prorated target
percent if it changed during the year).

Your senior business leader will communicate this year's overall company,
business segment, business unit/corporate or enterprise services and individual
goals.

MIP PROGRAM

STEP 1 - ESTABLISHMENT OF TOTAL INCENTIVE POOL

At the end of United HealthCare's fiscal year, the Compensation and Stock Option
Committee of the Board of Directors will review the overall financial and
strategic results of each business segment in order to determine the overall
company performance and the total amount available in the incentive pool.

The Compensation and Stock Option Committee will approve an incentive pool
amount.

STEP 2 - ESTABLISHMENT OF BUSINESS SEGMENT, CORPORATE & ENTERPRISE SERVICES
POOLS

Business segment and business unit performance will play an increased role in
determining incentive pools. Once the company overall incentive pool is
established, Senior Leaders will determine the performance and incentive pools
specific to the business segments.

The ratings for determining incentive pool amounts for individual business
segments and units may exceed or be less than that of the overall company
rating.

STEP 3 - ESTABLISHMENT OF BUSINESS UNIT POOLS

Business segment senior leaders and corporate top management will be responsible
for allocating the pools among the business units and corporate divisions based
on their relative performance.

STEP 4 - ESTABLISHMENT OF INDIVIDUAL INCENTIVE PAYMENTS

After pools are established and allocated to each entity, management will then
shift the focus to the individuals in their groups to determine individual
incentive awards. Incentive awards will be based on individual performance
and accomplishment of objectives.

ELIGIBILITY

Generally, full-time regular employees grade 28 and above are eligible for MIP
awards. At this level, positions are directly accountable for meeting key
corporate/enterprise, business segment or business unit objectives, generally
manage staff, and determine and manage financial resources and budgets. Certain
positions are not eligible for MIP due to participation in other incentive
plans, even if they meet the eligibility criteria.

- - If you were hired or promoted during the year to an MIP eligible position,
your participation will be prorated for the time you serve as an eligible
employee. New hires and promotions to MIP eligible positions in the FOURTH
QUARTER of a plan year are eligible for the plan in the following year but
are not eligible to participate in the plan for the current year.
However, employees who were eligible for the performance incentive plan
(PIP) or business incentive plan (BIP) prior to their promotion in the
fourth quarter are eligible for a year-end PIP or BIP award.

- - Participants eligible for a full or partial year MIP award are not eligible
for PIP or BIP.

- - If you are promoted to a position that carries a higher management
incentive target, any incentive paid to you would be based on a combination
of both your existing and new incentive targets. The targets are weighted
according to the time you held each position. Your bonus is based on your
eligible fiscal year base earnings and MIP target (prorated if necessary).

- - If you are on leave of absence during the performance measurement period,
any pay received during the leave (e.g., short term disability) will not be
included in your eligible base earnings for purposes of calculating the
amount of the incentive payment.

- - If a participant transfers during the year from an MIP eligible position to
a non-eligible position (e.g. sales), they will not be eligible for a
partial MIP incentive. Employees must be classified as eligible at
year-end to receive an MIP award.

- - If an MIP participant is reclassified to part-time or temporary status,
they are eligible for an MIP award in the current year if the
reclassification occurs after year-end.

- - MIP payout for employees rehired in the same MIP year will only be based
on eligible base earnings from the employees date of re-hire. Earnings
from service prior to their rehire date will not be considered.

- - To be eligible for a management incentive payment, you must be an active
employee at the time such payments are made. Employees who terminate
employment prior to the date incentive awards are paid-out are not eligible
for any awards. If you are on a leave of absence and are scheduled to
receive an incentive, you will receive that award upon your return to work.
Employees who do not return to work from leave are not eligible to receive
an incentive award.

EMPLOYEES ON FORMAL DISCIPLINARY ACTION ARE NOT ELIGIBLE FOR AN INCENTIVE
PAYMENT.

The senior vice president of Human Resources will determine any exceptions to
eligibility guidelines.

401(K) PLAN AND ESOP CONTRIBUTIONS

Management Incentive Plan payments are considered compensation under the United
HealthCare 401(k) plan and Employee Stock Ownership Plan. In addition,
incentive payments are included in benefits compensation for employees enrolled
in the flexible benefit plans.

However, management incentive payments are not eligible for contributions to the
United HealthCare Employee Stock Purchase Plan.

PAYMENTS

Management Incentive Plan payments generally are made during the first quarter
following the close of the corporate and business segment books for the fiscal
year.

For questions regarding the Management Incentive Plan, contact your manager, the
head of your business unit or your human resources generalist.

THERE IS NO GUARANTEE THAT ANY MANAGEMENT INCENTIVE PLAN PAYOUTS WILL BE MADE.
UNITED HEALTHCARE HAS THE EXCLUSIVE AND BINDING DISCRETION TO AMEND, TERMINATE
OR INTERPRET THE TERMS OR CONDITIONS OF THE MANAGEMENT INCENTIVE PLAN AT ANY
TIME AND WITHOUT NOTICE. CHANGES TO THIS PLAN MUST BE MADE IN WRITING BY THE
SENIOR VICE PRESIDENT OF HUMAN RESOURCES OR THE CHIEF EXECUTIVE OFFICER OF THE
COMPANY. UNITED HEALTHCARE ALSO HAS THE DISCRETION TO UNILATERALLY MAKE BOTH
LEGAL AND FACTUAL DETERMINATIONS REGARDING THE PLAN. THIS MANAGEMENT INCENTIVE
PLAN IS NOT AND SHALL NOT BE DEEMED TO BE AN ENFORCEABLE CONTRACT OR AN EMPLOYEE
BENEFIT PLAN WITHIN THE MEANING OF ERISA.