Powering Smarter

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Frank Pecaitis Senior Vice President
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SAFE HARBOR STATEMENT

• Cautionary Statement on Risks Associated With
  Forward-Looking Statements This presentation
  contains forward-looking statements within the
  meaning of the Private Securities Litigation
  Reform Act of 1995 that are subject to risks and
  uncertainties. The words "believe," "expect,"
  "anticipate," "intend," "plan," "estimate,"
  "may," "should," "could," and similar expressions
  are intended to identify such statements.
  Forward-looking statements are not guarantees of
  future performance and are to be interpreted only
  as of the date on which they are made. QuadraMed
  undertakes no obligation to update or revise any
  forward-looking statement. Important factors
  that could affect our business and future
  performance, and could cause QuadraMeds actual
  results to differ materially from these
  forward-looking statements, include but are not
  limited to the following (i) our operating
  losses have adversely affected our ability to
  compete (ii) our auditing firms have in the past
  found material weaknesses in our systems of
  internal controls, policies and procedures (iii)
  there may be additional costs of complying with
  recent and proposed changes in SEC, American
  Stock Exchange and accounting rules (iv) our
  ability to borrow or issue additional preferred
  stock is restricted by the terms of our Series A
  Preferred Stock (v) we were subject to a formal
  SEC inquiry, and the SEC has issued a cease and
  desist order to which we have consented (vi) the
  trading price of our common stock has been and is
  expected to be volatile (vii) our quarterly
  results are subject to fluctuations (viii) we
  and competitors in our industry are at risk of
  third party infringement claims and are at risk
  of intellectual property infringement by others
  (ix) we are dependent on third party software
  licenses in connection with the sale of our
  software (x) we face product development risks
  associated with rapid technological changes (xi)
  our products may be subject to bugs and other
  errors (xii) our products and services,
  particularly those sold to government entities
  and those sold to customers receiving government
  reimbursement, are subject to scrutiny,
  regulation, and possible future regulation by
  state and federal governments (xiii) we may
  experience increased competition for our products
  and services. QuadraMed does not intend this
  list of important factors to be exhaustive and
  advises investors that it discusses these and
  other risks and uncertainties that could cause
  QuadraMed's actual results to differ from these
  forward-looking statements in its periodic
  reports filed with the SEC. These SEC filings can
  be accessed through the Investor Relations
  section of our website, www.quadramed.com, or
  through the SEC's EDGAR Database at www.sec.gov
  (QuadraMed has EDGAR CIK No. 0001018833).
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• QuadraMed uses both financial measures in
  accordance with accounting principles generally
  accepted in the United States of America, or
  GAAP, as well as non-GAAP financial measures.
  The non-GAAP financial measures include
  bookings, pipeline, backlog, visible revenue and
  net deferred revenue. QuadraMed believes that
  these non-GAAP measures, and changes in those
  measures, are meaningful indicators of
  QuadraMeds performance and provide additional
  information that QuadraMeds management finds
  useful in evaluating such performance and in
  planning for future periods. Accordingly,
  QuadraMed believes that such additional
  information may be useful to investors, from time
  to time. To the extent that these non-GAAP
  financial measures are referred to or discussed,
  they should be viewed as supplemental to, and not
  as an alternative for, the GAAP financial
  measures.

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GUIDANCE DISCLAIMER

• QuadraMed does not make estimates of future
  operating results nor does it provide financial
  guidance. We have played no role in the
  preparation of the historical or forward looking
  numbers included in any published reports on our
  Company. Any opinions, estimates or forecasts
  regarding QuadraMeds historical or future
  performance made in any such reports are the
  authors alone, and do not represent opinions,
  forecasts or predictions of QuadraMed or its
  management. QuadraMed makes no representations,
  warranties, or assurances as to the accuracy or
  completeness of the statements made in any such
  reports.

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Market Opportunity
SIZE OF MARKET
in billions
Estimated HIT Spending
Annual Growth Rate
Source Sheldon I. Dorenfest Associates, Ltd.,
2004
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Products

• Affinity
• Enterprise level Patient Management, Revenue
  Cycle and Patient Care
• Quantim
• Medical records systems for Coding, Compliance,
  Abstracting and chart management

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Affinity

• Revenue Cycle
• Patient Care

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Affinity Revenue Cycle

• Registration
• Scheduling
• Billing
• Contract Management
• Denial Management
• Decision Support
• Core Financial Systems
• General Ledger
• Accounts Payable
• Payroll

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Affinity Revenue Cycle

• Benefits
• Improve Cash Flow
• Reduce A/R Days
• Exception-based, Flexible Workflow
• Denial Management
• Manage Contracts
• Regulatory Compliance
• Reduce Cost-to-Collect
• Paperless Operations
• Integrated EDI
• Seamless Document Imaging

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2004 Best in KLAS

• Acute Care Registration, Scheduling and Patient
  Accounting Product

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Affinity Care Management

• Physician Solutions
• 21st Century Web-based CPOE
• Nursing Solutions
• Pharmacy Solutions
• Laboratory/Radiology Solutions

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Customers
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Competition

• Cerner
• Eclipsys
• Siemens
• McKesson
• Meditech
• CPSI

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Misperceptions

• Financial stability concerns
• Have hindered RFP participation
• These issues are behind us
• We are debt free
• We have positive Shareholder Equity
• SEC Matter is resolved
• Shareholder matters are resolved

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Quantim

• Medical Records Systems
• Coding
• Compliance
• Abstracting
• Chart management
• Electronic Document management

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Quantim Solving HIM Challenges Today, While
Proving the Path to Paperless HIM
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Government Penetration

• nCoder Coding Software
• ProFee Compliance Suite

Total Number of VA Medical Centers 139
70 of VA Medical Center Facilities have
contracted for QuadraMed products and service
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Financials

• Bad Debt
• San Rafael to Reston
• San Rafael Lease
• Legal Expense
• Sales Commissions
• SOX 404
• Retirement of Debt Expense
• Peoplesoft Conversion
• Interest Expense
• Financial Services Shutdown
• Management Consolidation and RIF

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Challenges

• Much Larger Competitors
• Lingering issues around stability

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Opportunity

• Excellent Market
• Proven Products
• Loyal Customers
• Recurring revenues
• Mature Management

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