<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________
FORM 11-K
______________
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1997
Commission File No. 0-19506
UWSI/BCBSUW 401(k) PLAN
(Full title of the plan)
UNITED WISCONSIN SERVICES, INC.
401 West Michigan Street
Milwaukee, WI 53203
(Name of the issuer of the securities held pursuant to the
plan and the address of its principal executive office)
<PAGE>
FINANCIAL STATEMENTS AND
SUPPLEMENTAL SCHEDULES
UWSI/BCBSUW 401(k) PLAN
YEARS ENDED
DECEMBER 31, 1997 AND 1996
<PAGE>
UWSI/BCBSUW 401(k) Plan
Financial Statements
and Supplemental Schedules
Years ended December 31, 1997 and 1996
CONTENTS
<TABLE>
<CAPTION>
<S> <C>
Report of Independent Auditors............................................. 1
Financial Statements
Statements of Assets Available for Benefits................................ 2
Statements of Changes in Assets Available for Benefits..................... 3
Notes to Financial Statements.............................................. 5
Supplemental Schedules
Line 27(a) - Schedule of Assets Held for Investment Purposes............... 10
Line 27(d) - Schedule of Reportable Transactions........................... 11
</TABLE>
<PAGE>
Report of Independent Auditors
Employee Benefits Committee
UWSI/BCBSUW 401(k) Plan
We have audited the accompanying statements of assets available for benefits
of UWSI/BCBSUW 401(k) Plan (the Plan) as of December 31, 1997 and 1996, and
the related statements of changes in assets available for benefits for the
years then ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the assets available for benefits of the Plan at
December 31, 1997 and 1996, and the changes in its assets available for
benefits for the years then ended, in conformity with generally accepted
accounting principles.
Our audits were performed for the purpose of forming an opinion on the
financial statements taken as a whole. The accompanying supplemental
schedules of assets held for investment purposes as of December 31, 1997, and
reportable transactions for the year then ended, are presented for purposes
of complying with the Department of Labor's Rules and Regulations for
Reporting Disclosure under the Employee Retirement Income Security Act of
1974, and are not a required part of the financial statements. The fund
information in the statement of assets available for benefits and the
statement of changes in assets available for benefits is presented for
purposes of additional analysis rather than to present the assets available
for benefits and changes in assets available for benefits of each fund. The
supplemental schedules and fund information have been subjected to the
auditing procedures applied in our audits of the financial statements and, in
our opinion, are fairly stated in all material respects in relation to the
financial statements taken as a whole.
June 22, 1998
1
<PAGE>
UWSI/BCBSUW 401(k) Plan
Statements of Assets Available for Benefits
<TABLE>
<CAPTION>
DECEMBER 31, 1997
--------------------------------------------------------------------------------------------------------------
American
American Express
Express Trust PIMCO AIM IDS New Templeton UWSI
Trust Equity Total IDS Constel- Dimen- Foreign Common
Income Index Return Mutual lation sions Fund Stock Loan
Fund II Fund II Fund Fund (Y) Fund Fund (Y) Class I Fund Fund Total
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Cash $13,404 $47,342 $13,203 $25,264 $12,457 $12,749 $6,757 $47,042 $(22,682) $155,536
Investments, at
fair value (NOTE 3) 5,038,571 15,116,162 4,009,283 7,833,142 2,288,686 2,333,885 1,380,381 5,632,449 1,313,712 44,946,271
Interest and
dividends
receivable - - 122,549 - - - - - - 122,549
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
Assets available
for benefits $5,051,975 $15,163,504 $4,145,035 $7,858,406 $2,301,143 $2,346,634 $1,387,138 $5,679,491 $1,291,030 $45,224,356
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31, 1996
--------------------------------------------------------------------------------------------------------------
American
American Express
Express Trust PIMCO AIM IDS New Templeton UWSI
Trust Equity Total IDS Constel- Dimen- Foreign Common
Income Index Return Mutual lation sions Fund Stock Loan
Fund II Fund II Fund Fund (Y) Fund Fund (Y) Class I Fund Fund Total
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments, at fair
value (NOTE 3) $4,370,429 $10,666,389 $3,802,388 $6,420,603 $956,633 $806,596 $457,299 $4,712,344 $1,110,694 $33,303,375
Receivables:
Employee
contributions 10,963 11,667 10,288 20,187 18,456 4,623 7,751 31,053 20,656 135,644
Employer
contributions - - - - - - - 37,212 - 37,212
Interest and
dividends - - 20,020 - - - - - - 20,020
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
Assets available
for benefits $4,381,392 $10,678,056 $3,832,696 $6,440,790 $975,089 $811,219 $465,050 $4,780,609 $1,131,350 $33,496,251
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
</TABLE>
SEE ACCOMPANYING NOTES.
2
<PAGE>
UWSI/BCBSUW 401(k) Plan
Statements of Changes in Assets Available for Benefits
Year ended December 31, 1997
<TABLE>
<CAPTION>
American
American Express
Express Trust PIMCO AIM Templeton UWSI
Trust Equity Total IDS Constel- IDS New Foreign Common
Income Index Return Mutual lation Dimensions Fund Stock Loan
Fund II Fund II Fund Fund (Y) Fund Fund (Y) Class I Fund Fund Total
------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Additions:
Net investment
income $ (99) $ 253 $334,900 $1,121,059 $162,624 $174,302 $147,830 $93,472 $106,017 $2,140,358
Net appreciation
(depreciation)
in fair value of
investments 275,777 3,553,148 33,809 96,844 (21,129) 152,389 (141,188) (105,408) - 3,844,242
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
275,678 3,553,401 368,709 1,217,903 141,495 326,691 6,642 (11,936) 106,017 5,984,600
Contributions:
Participants 328,086 1,235,106 326,588 668,258 283,224 265,469 144,528 208,590 - 3,459,849
Employers - - - - - - - 1,104,798 - 1,104,798
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
328,086 1,235,106 326,588 668,258 283,224 265,469 144,528 1,313,388 - 4,564,647
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
Total additions 603,764 4,788,507 695,297 1,886,161 424,719 592,160 151,170 1,301,452 106,017 10,549,247
Deductions:
Cash transfers
and rollovers (411,463) (747,071) 224,292 165,194 (956,575) (976,207) (791,478) 122,631 (38,862) (3,409,539)
Benefits, with-
drawals and
taxes 344,644 1,050,130 158,666 303,351 55,240 32,952 20,560 279,939 (14,801) 2,230,681
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
Total deductions (66,819) 303,059 382,958 468,545 (901,335) (943,255) (770,918) 402,570 (53,663) (1,178,858)
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
Increase in assets
available for
benefits 670,583 4,485,448 312,339 1,417,616 1,326,054 1,535,415 922,088 898,882 159,680 11,728,105
Assets available for
benefits at
beginning of year 4,381,392 10,678,056 3,832,696 6,440,790 975,089 811,219 465,050 4,780,609 1,131,350 33,496,251
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
Assets available
for benefits
at end of year $5,051,975 $15,163,504 $4,145,035 $7,858,406 $2,301,143 $2,346,634 $1,387,138 $5,679,491 $1,291,030 $45,224,356
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
---------- ----------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- -----------
</TABLE>
SEE ACCOMPANYING NOTES.
3
<PAGE>
UWSI/BCBSUW 401(k) Plan
Statements of Changes in Assets Available for Benefits (continued)
Year ended December 31, 1996
<TABLE>
<CAPTION>
American
American Express
Express Trust
Stable M&I UWSI S&P 500 Trust Equity
Income Principal Loan Common Balanced Index Income Index
Fund Fund Fund Stock Fund Fund Fund II Fund II
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Additions:
Interest and dividends $ 222,027 $ 131,814 $ 42,028 $ 38,231 $ 102,849 $ 87,299 $ - $ -
Net appreciation (deprecia-
tion) in fair value
of investments (NOTE 3) (220,635) - - 1,423,263 242,812 787,678 124,845 1,077,230
Loss from Master Trust (65,755) - - - - - - -
----------------------------------------------------------------------------------------------------
(64,363) 131,814 42,028 1,461,494 345,661 874,977 124,845 1,077,230
Contributions:
Employee 191,059 172,279 - 118,708 344,511 564,620 143,560 502,543
Employers - - - 451,742 - - - -
----------------------------------------------------------------------------------------------------
191,059 172,279 - 570,450 344,511 564,620 143,560 502,543
----------------------------------------------------------------------------------------------------
Total additions 126,696 304,093 42,028 2,031,944 690,172 1,439,597 268,405 1,579,773
Deductions:
Cash transfers and
rollovers 4,306,423 4,787,858 959,273 5,025,832 6,487,848 9,362,029 (4,219,889) (9,562,487)
Benefits, withdrawals
and taxes 249,070 144,464 23,253 115,394 263,602 305,595 106,902 464,204
----------------------------------------------------------------------------------------------------
Total deductions 4,555,493 4,932,322 982,526 5,141,226 6,751,450 9,667,624 (4,112,987) (9,098,283)
----------------------------------------------------------------------------------------------------
Increase (decrease) in assets
available for benefits (4,428,797) (4,628,229) (940,498) (3,109,282) (6,061,278) (8,228,027) 4,381,392 10,678,056
Assets available for benefits
at beginning of year 4,428,797 4,628,229 940,498 3,109,282 6,061,278 8,228,027 - -
----------------------------------------------------------------------------------------------------
Assets available for benefits
at end of year $ - $ - $ - $ - $ - $ - $ 4,381,392 $10,678,056
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PIMCO Templeton UWSI
Total IDS AIM IDS New Foreign Common
Return Mutual Constellation Dimensions Fund Stock Loan
Fund Fund (Y) Fund Fund (Y) Class I Fund Fund Total
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Additions:
Interest and dividends $ 124,213 $ 495,830 $ 32,408 $ 30,976 $ 14,734 $ 40,224 $ 36,659 $ 1,399,292
Net appreciation (deprecia-
tion) in fair value
of investments (NOTE 3) 119,977 58,176 (3,469) 7,404 14,524 41,127 - 3,672,932
Loss from Master Trust - - - - - - - (65,755)
----------------------------------------------------------------------------------------------------
244,190 554,006 28,939 38,380 29,258 81,351 36,659 5,006,469
Contributions:
Employee 152,206 302,192 51,313 31,976 21,653 120,138 - 2,716,758
Employers - - - - - 435,116 - 886,858
----------------------------------------------------------------------------------------------------
152,206 302,192 51,313 31,976 21,653 555,254 - 3,603,616
----------------------------------------------------------------------------------------------------
Total additions 396,396 856,198 80,252 70,356 50,911 636,605 36,659 8,610,085
Deductions:
Cash transfers and
rollovers (3,559,345) (5,905,779) (899,495) (746,594) (415,634) (4,284,676) (996,814) 338,550
Benefits, withdrawals
and taxes 123,045 321,187 4,658 5,731 1,495 140,672 (97,877) 2,171,395
----------------------------------------------------------------------------------------------------
Total deductions (3,436,300) (5,584,592) (894,837) (740,863) (414,139) (4,144,004) (1,094,691) 2,509,945
----------------------------------------------------------------------------------------------------
Increase (decrease) in assets
available for benefits 3,832,696 6,440,790 975,089 811,219 465,050 4,780,609 1,131,350 6,100,140
Assets available for benefits
at beginning of year - - - - - - - 27,396,111
----------------------------------------------------------------------------------------------------
Assets available for benefits
at end of year $ 3,832,696 $ 6,440,790 $ 975,089 $ 811,219 $ 465,050 $ 4,780,609 $ 1,131,350 $33,496,251
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
</TABLE>
SEE ACCOMPANYING NOTES.
4
<PAGE>
UWSI/BCBSUW 401(k) Plan
Notes to Financial Statements
December 31, 1997
1. DESCRIPTION OF THE PLAN
The UWSI/BCBSUW 401(k) Plan (the Plan) is a defined contribution plan which
covers eligible salaried and hourly employees not subject to collective
bargaining agreements of Blue Cross & Blue Shield United of Wisconsin, United
Wisconsin Services, Inc., and any of their subsidiaries to which
participation has been extended (Employers). The Plan allows participants to
direct their contributions (not the Employers' match, however) into one or a
combination of several investment options offered by the Plan. Participants
can make qualifying contributions of 2% to 5% of their basic compensation,
which the Employers match on a 50% basis. Additional participant
contributions of up to 11% of their basic compensation are also permitted,
subject to statutory limitations. Effective January 1, 1996, the Company
matching contributions are invested in United Wisconsin Services, Inc. Common
Stock in the UWSI Common Stock Fund. The UWSI Common Stock Fund included
$4,146,996 and $3,532,459 of plan net assets that were not participant
directed at December 31, 1997 and 1996, respectively.
Earnings of the Plan are allocated daily to individual participant accounts,
as defined in the Plan.
The participants' contributions and earnings thereon are 100% vested at all
times. Participants' contributions may be withdrawn, subject to certain
limitations, prior to termination of participation in the Plan. Earnings
thereon may be withdrawn only upon termination of employment. Employers'
contributions and earnings thereon become vested based on years of service
and may be withdrawn only upon termination of employment. Employees may enter
the Plan following the completion of one year of service with no minimum age
requirement. Forfeited Employer contributions revert to the Plan
administrator for payment of Plan expenses.
All contributions required by the Plan were made to the Plan or, prior to
July 1, 1996, to the Blue Cross & Blue Shield United of Wisconsin Master
Trust (Master Trust). Transactions between the Plan and the Master Trust were
carried out using unit values.
5
<PAGE>
UWSI/BCBSUW 401(k) Plan
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
Although they have not expressed any intent to do so, the Employers have the
right under the Plan to discontinue their contributions at any time and to
terminate the Plan subject to the provisions of the Employee Retirement
Income Security Act of 1974 (ERISA). In the event of Plan termination,
participants' Employer contribution accounts will become 100% vested.
A description of the Plan is summarized in the SUMMARY PLAN DESCRIPTION,
which can be obtained from the Plan administrator.
2. SIGNIFICANT ACCOUNTING POLICIES
INVESTMENT VALUATION
Certain assets of the Plan are held by American Express Trust Company under a
master trust agreement dated July 1, 1996, under which the assets of the Plan
are segregated and invested separately from the remainder of the trust's
funds. Investments are valued at fair value based on quoted market prices,
except for participant loans, which are valued at their current outstanding
balances, which approximate fair value.
Prior to July 1, 1996, certain assets of the Plan were held by the Marshall &
Ilsley Trust Company (Trustee) under a master trust agreement dated July 1,
1988 (Master Trust), under which certain investments of several benefit plans
of the Employers were commingled. Master Trust assets were managed by various
investment managers in separate investment accounts. The Plan had an
undivided interest in the net assets and earnings of the Master Trust
investment accounts, which were stated at fair value, in which the Plan was
invested.
CONTRIBUTIONS
Contributions from participants are recorded in the period the Employers make
corresponding payroll deductions. Contributions from the Employers are recorded
based upon amounts required to be contributed as determined by the Plan.
6
<PAGE>
UWSI/BCBSUW 401(k) Plan
Notes to Financial Statements (continued)
2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
ADMINISTRATIVE EXPENSES
With the exception of fees on personal loans, all administrative expenses in
1997 and 1996 were paid by the Employers. Forfeited Employer contributions are
used to offset administrative expenses or are reported as a reduction in
contributions.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect amounts reported in the financial statements and accompanying notes. Such
estimates and assumptions could change in the future as more information becomes
known, which could impact the amounts reported and disclosed herein.
3. INVESTMENTS
The fair values of investments held by the Plan at December 31 are as follows:
<TABLE>
<CAPTION>
1997 1996
-------------------------------
<S> <C> <C>
United Wisconsin Services, Inc. Common
Stock Fund $ 5,632,449 $ 4,712,344
Mutual funds 38,000,110 27,480,337
Loans to various participants 1,313,712 1,110,694
-------------------------------
$44,946,271 $33,303,375
-------------------------------
-------------------------------
</TABLE>
Investments that represent 5% or more of the Plan's net assets at either
December 31, 1997 or 1996 are as follows:
<TABLE>
<CAPTION>
1997 1996
-------------------------------
<S> <C> <C>
United Wisconsin Services, Inc. Common
Stock Fund $ 5,632,449 $ 4,712,344
IDS Mutual Fund (Y) 7,833,142 6,420,603
IDS New Dimensions Fund (Y) 2,333,885 806,596
PIMCO Total Return Fund 4,009,283 3,802,388
American Express Trust Income Fund II 5,038,571 4,370,429
American Express Trust Equity Index Fund II 15,116,162 10,666,389
AIM Constellation Fund 2,288,686 956,633
</TABLE>
7
<PAGE>
UWSI/BCBSUW 401(k) Plan
Notes to Financial Statements (continued)
3. INVESTMENTS (CONTINUED)
During 1997 and 1996, the fair value of the Plan's non-Master Trust
investments (including investments bought, sold, as well as held during the
year) appreciated (depreciated) as follows:
<TABLE>
<CAPTION>
1997 1996
-------------------------------
<S> <C> <C>
Investments at fair value as determined
by quoted market price:
United Wisconsin Services, Inc.
Common Stock Fund $ (105,408) $1,464,390
Fidelity Institutional Trust
U.S. Equity Index - 787,678
Fidelity Puritan Fund - 242,842
BCBS Master Trust - (220,635)
IDS New Dimensions Fund (Y) 152,389 7,374
IDS Mutual Fund (Y) 96,844 58,176
PIMCO Total Return Fund 33,809 119,977
AIM Constellation Fund (21,129) (3,469)
Templeton Foreign Fund Class I (141,188) 14,524
American Express Trust Income Fund II 275,777 124,845
American Express Trust Equity Index
Fund II 3,553,148 1,077,230
-------------------------------
$3,844,242 $3,672,932
-------------------------------
-------------------------------
</TABLE>
During 1996, the investment income earned by the Master Trust was as follows:
<TABLE>
<CAPTION>
<S> <C>
Net realized and unrealized appreciation
(depreciation) in fair value of
investments:
Common stocks $13,086,225
Fixed income securities (2,123,999)
Foreign obligations 1,017,910
Real estate equity funds (294,694)
-----------
11,685,442
Interest and dividends 5,514,706
-----------
Investment income earned by the Master Trust $17,200,148
-----------
-----------
</TABLE>
8
<PAGE>
UWSI/BCBSUW 401(k) Plan
Notes to Financial Statements (continued)
4. INCOME TAX STATUS
The Internal Revenue Service has ruled (May 1, 1995) that the Plan qualifies
under Section 401(a) of the Internal Revenue Code (IRC) and is, therefore,
not subject to tax under present income tax law. Once qualified, the Plan is
required to operate in conformity with the IRC to maintain its qualification.
The Plan administrator is not aware of any course of action or series of
events that have occurred that might adversely affect the Plan's qualified
status.
9
<PAGE>
UWSI/BCBSUW 401(k) Plan
Employer Identification Number 39-0138065
Plan Number 336
Line 27(a) - Schedule of Assets Held for Investment Purposes
December 31, 1997
<TABLE>
<CAPTION>
PAR VALUE
OR NUMBER CURRENT
DESCRIPTION OF UNITS COST VALUE
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
American Express Trust Income Fund II 289,672.905 $ 4,712,587 $ 5,038,571
American Express Trust Equity Index
Fund II 584,041.487 10,832,734 15,116,162
PIMCO Total Return Fund 378,234.215 3,885,430 4,009,283
IDS Mutual Fund (Y) 570,596.032 7,755,762 7,833,142
AIM Constellation Fund 86,758.39 2,322,506 2,288,686
IDS New Dimensions Fund (Y) 97,807.602 2,193,939 2,333,885
Templeton Foreign Fund Class I 138,731.76 1,513,034 1,380,381
Loan Fund N/A 1,313,712 1,313,712
UWSI Common Stock Fund 566,132.14 5,766,407 5,632,449
-------------------------
$40,296,111 $44,946,271
-------------------------
-------------------------
</TABLE>
10
<PAGE>
UWSI/BCBSUW 401(k) Plan
Employer Identification Number 39-0138065
Plan Number 336
Line 27(d) - Schedule of Reportable Transactions
Year ended December 31, 1997
<TABLE>
<CAPTION>
NUMBER OF TRANSACTIONS
----------------------- PROCEEDS
SALES/ COST OF FROM SALES/ GAIN
DESCRIPTION PURCHASES MATURITIES PURCHASES MATURITIES (LOSS)
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CATEGORY (III)
American Express Trust Equity Index II 100 107 $2,377,920 $1,481,471 $328,860
American Express Trust Income Fund II 95 95 1,755,485 1,363,115 68,939
IDS Mutual Fund (Y) 96 116 2,184,000 808,306 55,361
------------------------------------------
$6,317,405 $3,652,892 $453,160
------------------------------------------
------------------------------------------
</TABLE>
There were no category (i), (ii) or (iv) reportable transactions during 1997.
Category
(i) - Single transaction in excess of 5% of plan assets
(ii) - Series of transactions (other than securities transactions)
(iii) - Series of securities transactions
(iv) - Transactions with or in conjunction with a person, if any single
transaction with that person was in excess of 5%.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
undersigned member of the Blue Cross & Blue Shield United of Wisconsin Employee
Benefits Committee has duly caused this annual report to be signed as of the
date set forth below.
UWSI/BCBSUW 401(k) PLAN
June 29, 1998 By: /s/ Gail L. Hanson
---------------------------------------------
Gail L. Hanson, a member of the
Blue Cross & Blue Shield United of
Wisconsin Employee Benefits Committee
<PAGE>
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 33-88110) pertaining to the UWSI/BCBSUW 401(k) Plan Employees'
Retirement Plan (the Plan) of our report dated June 22, 1998, with respect to
the financial statements and schedules of the Plan included in this Annual
Report (Form 11-K) for the year ended December 31, 1997.
ERNST & YOUNG LLP
Milwaukee, Wisconsin
June 29, 1998
