FOR IMMEDIATE RELEASE

Medsphere's OpenVista EHR Goes Live at State Hospital in West Virginia; First Site in Seven-Facility Contract Designed to Improve State Healthcare

Prototype for Other States with Electronic Health Records Initiatives

ALISO VIEJO, California, April 10, 2007 - Medsphere Systems Corporation today announced the successful deployment of its OpenVista^® electronic health record (EHR) platform at William R. Sharpe Jr. Hospital, the first of seven state-operated hospitals in West Virginia that will be equipped with the system under a contract signed last year. More than 280 physicians, nurses, pharmacists, dietitians and other staff at Sharpe Hospital, a 150-bed acute care psychiatric facility in the city of Weston, are now using OpenVista to record and retrieve patient information electronically.

The installation of OpenVista at Sharpe was completed in less than a year. Clinicians from the hospital entered 1,962 orders and 2,323 progress notes into the OpenVista EHR in the first three days of live operation, reflecting immediate user acceptance of the technology.

The remaining facilities covered by the contract are scheduled to add OpenVista functionality on a once-a-month basis through the end of 2007. The additional sites include acute care hospitals and long-term care facilities as well as a second psychiatric hospital. Patient data from all sites will be accessible to authorized personnel from a single state-maintained database, creating a continuous medical record for each patient treated at state-run facilities as part of a broader effort to improve healthcare in West Virginia.

The project is expected to serve as a model for health information technology initiatives that are being launched by states across the country. It is also the first state-sponsored adoption of OpenVista, a commercial implementation of the highly regarded VistA EHR system developed by the U.S. Department of Veteran Affairs that offers two decades of real-world use as well as cost advantages over proprietary EHR applications.

The Medsphere EHR platform has been successfully deployed at Midland Memorial Hospital in Midland, Texas, for over a year, and is currently being deployed in numerous other sites including community hospitals, rural community health centers and other government-operated healthcare facilities.

"OpenVista enabled us to achieve a seamless transition from paper to electronic patient records with immediate acceptance from our physicians and clinical staff," said Jack Clohan, CEO of Sharpe Hospital. "With our system up and running, the state can proceed with the rest of the rollout and work toward the goal of using computerized medical records to drive improvements in patient safety, staff efficiency and quality of care."

"This deployment is significant because it will be carefully scrutinized by other states that are moving toward EHR adoptions," said Dr. Kenneth W. Kizer, Chairman and CEO of Medsphere Systems and former Director of the California Department of Health Services. "West Virginia's positive experience with OpenVista provides an important example for other states that may be considering the special advantages offered by the OpenVista platform."

The six other West Virginia facilities where OpenVista will be implemented under the initial contract with the state's Department of Health and Human Resources include Welch Community Hospital (Welch), Mildred Mitchell-Bateman Hospital (Huntington), Hopemont Hospital (Hopemont), Lakin Hospital (Lakin), John Manchin Sr. Health Care Center (Fairmont), and Pinecrest Hospital (Beckley). A transitional living facility that recently opened on the same property as Sharpe Hospital is expected to be added when funding is approved.

Under the contractual arrangement, Medsphere is also coordinating the concurrent installation of Patcom, Keane Inc.'s industry-recognized Revenue Cycle Management suite of applications, to replace the facilities' legacy accounts receivable, patient billing and accounting systems and improve financial performance. Medsphere is the prime contractor.

Medsphere's OpenVista EHR is an enhanced version of the VA VistA application specifically designed for the commercial healthcare market. The use of VistA as the core of OpenVista significantly reduces the cost of EHR deployments by reducing upfront proprietary license fees, while providing a platform tested and proven in the VA for many years.

OpenVista consists of an integrated suite of clinical and administrative modules that can be deployed across acute, ambulatory, and long term care environments. Modules cover the full range of patient care functions including patient information management, health information management, laboratory, pharmacy, radiology, mental health, nutrition and food service, and a robust clinical information system complete with clinical documentation, computerized provider order entry, and clinical reminders.

Together, these systems provide an integrated view of orders, test results and medications for a given patient to help strengthen clinical decision support, improve patient safety and healthcare outcomes, and reduce costs. Other benefits include HIPAA compliance improvement, accreditation standards compliance, and reporting standardization.

OpenVista is available under a commercial license as part of Medsphere's commercial open source business model. Commercial users receive professional services, training, ongoing product upgrades, and 24x7 technical support from Medsphere. It is also available in a community edition under an open source license.

About Medsphere and OpenVista

As a disruptive force in healthcare information technology, Medsphere is revolutionizing the industry by delivering commercially supported Open Source software based on the U.S. Department of Veterans Affairs' proven VistA EHR. The product of 20-plus years of development and more than $8 billion invested, VistA enabled the transformation of the VA into the nation's most efficient and clinically effective healthcare organization. Currently VistA contains roughly 2.1 billion clinical documents, 2.76 billion orders, and 1.51 billion images. As the commercialized version of VistA, Medsphere's OpenVista is a portfolio of products and professional services for hospitals, clinics and integrated delivery networks. OpenVista is currently used by over 20,000 individuals, including 2,500 physicians and contains hundreds of thousands of medical records. Medsphere addresses healthcare's capital constraints through an innovative business model:

A unique subscription-based pricing model minimizes upfront costs.
The Healthcare Open Source Ecosystem and Medsphere.org portal coordinate a unique grassroots community of customers/subscribers, partners and developers driving OpenVista innovation and providing a parallel development and support structure.
Medsphere's experienced team of healthcare technology professionals and unique suite of implementation tools deliver a fluid transition to a comprehensive healthcare information technology solution.

Founded in 2002, Medsphere is backed financially by Azure Capital Partners, Thomas Weisel Venture Partners and EPIC Ventures (formerly the Wasatch Venture Fund). Medsphere clients include Midland Memorial Hospital, Midland, Texas; West Virginia Department of Health and Human Resources (WV DHHR); Memorial Hospital of Sweetwater County, Rock Springs, Wyoming; Lutheran Medical Center, Brooklyn, New York; and the federal government's Indian Health Service. For more information, visit http://www.medsphere.com and http://www.medsphere.org.

Contacts

Corporate Rick Jung Chief Operating Officer Medsphere Systems Corporation (760) 692-3742 (office) rick.jung@medsphere.com	Media Lily Eng or Thea Lavin Schwartz Communications for Medsphere (415) 512-0770 (office) medsphere@schwartz-pr.com
General Inquiries info@medsphere.com