8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):
February 20, 2003

PROXYMED, INC.

(Exact name of registrant as specified in its charter)

Florida	0-22052	65-0202059
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

2555 Davie Road, Suite 110, Ft. Lauderdale, Florida	33317-7424
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (954) 473-1001

Item 9. Regulation FD Disclosure.

     On February 20, 2003, the ProxyMed, Inc. (the “Company”) held a teleconference call to report its financial and operating results for the quarter and year ended December 31, 2002. A transcript of the call, excluding questions from participants and answers from management is attached. Additionally, the Company’s press release dated February 20, 2003 reporting financial results for the three months and year ended December 31, 2002 is also attached.

     FORWARD LOOKING STATEMENTS — This document contains forward-looking statements that reflect the Company’s current assumptions and expectations regarding future events. While these statements reflect the Company’s current judgment, they are subject to risks and uncertainties. Actual results may differ significantly from projected results due to a number of factors, including, but not limited to, the soundness of our business strategies relative to the perceived market opportunities; our ability to integrate MedUnite into our existing operations, our ability to successfully identify and integrate other acquisition candidates; our ability to successfully develop, market, sell, cross-sell, install and upgrade our clinical and financial transaction services and applications to current and new physicians, payers, medical laboratories and pharmacies; our ability to consummate and integrate any acquisitions successfully; our ability to compete effectively on price and support services; our assessment of the healthcare industry’s need, desire and ability to become technology efficient; and our ability and that of our business associates to comply with various government rules regarding healthcare and patient privacy. These and other risk factors are more fully discussed in the Risk Factor disclosure in our Form 10-K for the year ended December 31, 2001 and our other filings with the Securities and Exchange Commission, which we strongly urge you to read. ProxyMed expressly disclaims any intent or obligation to update any forward-looking statements. When used, the words “believes,” “estimated,” “expects,” “anticipates,” “may” and similar expressions are intended to identify forward-looking statements.

Item 7. Financial Statements and Exhibits.

(c)  The following exhibits are included herein:

Exhibit 99.1 -	Transcript of fourth quarter and annual 2002 financial results teleconference call held on February 20, 2003.
Exhibit 99.2 -	Press Release dated February 20, 2003 reporting financial results for the three months and year ended December 31, 2002.

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		ProxyMed, Inc.
Date:	February 25, 2003	/s/ Judson E. Schmid
		Judson E. Schmid, Executive Vice President and Chief Financial Officer

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INDEX TO EXHIBITS

EXHIBIT NUMBER	DESCRIPTION
99.1	Transcript of fourth quarter and annual 2002 financial results teleconference call held on February 20, 2003.
99.2	Press Release dated February 20, 2003 reporting financial results for the three months and year ended December 31, 2002.

4 EX-99.1 3 g80904exv99w1.txt TRANSCRIPT OF 4TH QUARTER & ANNUAL 2002 FINANCIAL EXHIBIT 99.1 PROXYMED, INC. FOURTH QUARTER AND ANNUAL 2002 FINANCIAL RESULTS CONFERENCE CALL MODERATOR: MICHAEL HOOVER FEBRUARY 20, 2003 10:00 A.M. ET OPERATOR: I would like to welcome everyone to ProxyMed's conference call to discuss its financial results for the 2002 fourth quarter and full year 2002, including its discussion of the progress made on the MedUnite acquisition and integration. At this time I would like to inform you that all participants are in a listen only mode. At the request of the company, we will open up the conference for questions and answers after the presentation. We would appreciate it if you would limit your questions to one and then getting back in the queue if you have any follow-up questions or another question to ask. Today's conference call is being webcast and replays of this call will be available on the Internet at www.proxymed.com shortly after this call. Leading today's call from ProxyMed are Mike Hoover, Chairman and CEO; Nancy Ham, President and COO; and Judd Schmid, Chief Financial Officer. Before the discussion begins, please be reminded that statements made by ProxyMed during this call, including answers given in response to the questions, are intended to fall within the Safe Harbor Provisions of the securities laws, and that actual results might differ materially from those in this statement. Such statements are subject to a variety of risks which are discussed in the Company's most recent Form 10K and other SEC filings, which the Company strongly urges you to read. At this time, I would like to turn the presentation over to Mr. Mike Hoover. Please go ahead, sir. MICHAEL HOOVER: Good morning. Thank you, Heather, and thanks to everyone for joining us. On our call today, we will report on our financial results for the fourth quarter as well as provide you with a quick recap of the whole year. We'll also walk you through in detail how we will be booking the MedUnite purchase price and how that will drive our amortization and earnings per share for 2003. Finally, we'll give you an operational update on the MedUnite acquisition and our integration progress to date. 1 Before turning it over to Judd, let me make a few brief comments on the fourth quarter of 2002. For the quarter, we're very pleased to report record-setting results for revenue, EBITDA and EBITDA margin percentage. We exceeded the low end of our range in each category despite absorbing $97,000 in MedUnite deal costs in our numbers. In addition, we achieved positive earnings per share for all of 2002, a true milestone for any company and certainly for ProxyMed. This record-setting performance gives ProxyMed strong momentum heading into 2003 and 2004. Nancy will be providing a detailed operational update on MedUnite later in the call, but from my perspective we've made good progress to date. The market response from both ProxyMed and MedUnite customers, partners and prospects has been positive, as they are enthusiastic about the combination of ProxyMed's proven claims platform and MedUnite's leading real-time platform and portal. We're off to a great start with our new NDCHealth partnership, as well as with the seven founding payers. We gained over 140 new associates who bring to ProxyMed many years of experience in healthcare transaction services. On the financial front, we've moved swiftly to reduce overhead and to reduce the cash burn rate. As you know, the deal process at the end of December was condensed into less than a week, so I was a little concerned about what we didn't know that might come back to hurt us. So I am relieved to report that the bad things we knew going into the deal have turned out to be no worse than we expected, and we've discovered more than one pleasant surprise. In summary, early results of this strategic acquisition are positive, and I am very confident that we are on track to complete the restructuring and bring MedUnite to EBITDA profitability this year as we committed to you in our last call. So with that, let me turn it over to Nancy and Judd to provide you all the details. Judd. JUDSON SCHMID: Thanks, Mike. As Mike pointed out, we once again had a successful quarter with the reporting of record revenues, EBITDA and EBITDA margin, and exceeding the low end of our expectation range and meeting analysts' consensus. All in all, another solid quarter behind us, but most of all, we reported the first-ever positive year of EPS in the history of the company. A tremendous milestone and one that we and all of our associates are very proud of. Capping off the year with the acquisition of MedUnite was a real nice feather in our cap. In my discussion today I'd like to talk about four items: (1) the results for the fourth quarter and 2002 2 year; (2) how we recorded the MedUnite transaction; (3) our cash flow and interest expectations for 2003; and (4) our 2003 guidance, including down to EPS. Turning now to our detailed results for the fourth quarter, ProxyMed reported record quarterly revenues of $13.2 million, record EBITDA profits of $1.4 million and net income of $731,000 or 11 cents per share as compared to a net loss of $4.7 million or $1.44 loss per share last year. Our revenue increase came from our Healthcare Transaction Services segment, where revenues grew 13% from $5.4 million last year to $6.1 million this year, and on a sequential basis our overall revenue was up three percent with transaction revenues increasing by six percent, both over the third quarter. On an annual basis, ProxyMed achieved record consolidated revenues of $50.2 million. Once again our transaction business led the way with $22.4 million in revenues, up a solid 32% over 2001 annual revenues of $16.9 million. The increase in the transaction service revenues was led by a 27% year-over-year increase in "core" transactions, which include all transactions except of encounters and transactions acquired in the current quarter. And as a reminder, we only report on an acquisitions metric in the quarter acquired as we move rapidly to integrate the business into our own. Therefore, transactions associated with our third quarter acquisitions of MDIP and the certain assets of Claimsnet.com are now included in core transactions. On a sequential basis, core transactions were up six percent despite there being two fewer processing days in the fourth quarter. Looking now at total transactions, which are core transitions plus encounters, in the fourth quarter we processed a total of 30.1 million clinical and financial transactions through ProxyMed, our secure national healthcare information network. The increase in transactions was primarily due to a solid growth in claim transactions, especially since going live with Aetna in October, and in statement processing. From a gross margin perspective, we achieved a 55% margin in the fourth quarter of 2002 compared to 49% last year. Annually, overall gross margins were at 54% in 2002 compared to 53% for 2001. This improvement is driven from the gradual shift in our overall business mix between our transaction and lab segments. Last year, 39% of our revenues came from the transaction segment while 45% came from this business in 2002. As this shift continues to occur, and it will shift dramatically in 2003 with MedUnite, we expect our 3 overall margins to increase to the 57 to 58 percent level. We'll speak more to our 2003 forecast in a few minutes. On the expense side, as always, we continue to monitor and control our SG&A expenses. On a full year basis, consolidated SG&A expenses increased by nine percent. However, sequentially they actually decreased by one percent as we were able to balance increased investing in our transaction business, mostly for implementation and support resources that were necessary to keep pace with the new business from the sales team, along with cost reductions in our lab operations. Looking now at corporate, SG&A expenses were up over the third quarter due to, as Mike mentioned, the $97,000 in MedUnite deal expenses. But even including those, corporate SG&A expenses decreased on an annual basis. As a percentage of revenues, our consolidated SG&A expenses dropped from 45.8% in the third quarter to 44.1% in the fourth quarter; but more importantly, they dropped from 49.2% to 46.1% on an annual basis as we achieve operational leverage within our business. From an EBITDA perspective, we had record EBITDA of $1.4 million for the quarter, an increase of 52% over last year's quarter and a solid 32% increase over the third quarter. We also continued to improve our margin percentage with EBITDA margins improving from 8.3% in the third quarter to 10.7% this quarter. This gives us good margin momentum for 2003 and we remain confident in achieving expanding EBITDA margins on an annual basis. On a year-over-year basis, we more than doubled our EBITDA margin from four percent in 2001 to eight percent in 2002. An increase in the EBITDA margin of our transaction business from three percent in 2001 to 10% in 2002 led our success in this important metric. EBITDA margins in our lab business remain stable at 16% for the year. Depreciation and amortization was $700,000 for the quarter and included approximately $146,000 related to the amortization of intangibles from our 2002 acquisitions. One item to note here is that going forward we won't be breaking out depreciation and amortization from our acquisitions on our press releases. So this will be the last quarter that we'll present that. As a result of the above, net income for the fourth quarter was $731,000 or 11 cents per share, a nice turn around from a loss of $4.7 million last year. Annually, we had our first full year of profitability ever with net income of $1.3 million or 21 cents a share, an important milestone in the history of the Company. 4 We'll talk about our cash needs in a minute or so, but for the year we generated about $2.7 million in cash from operations compared to only $1 million last year. Of that $2.7 million, we invested $1.9 million back into the business through capital expenditures and capitalized software costs primarily for upgrades and enhancements to our customer relationship software for HIPAA compliance efforts and for our data center consolidation efforts. As projected, capitalized costs were approximately 14% of our $3.2 million R&D spending of the year. Of course, we also acquired four businesses for a total of $16 million in cash and $14 million in stock and debt during the year. Our capital structure remains virtually unchanged at 8.5 million fully diluted shares. Please note that this number does not include the 731,000 contingent shares underlying the convertible notes issued in the MedUnite transaction. So let's now turn to our MedUnite acquisition from an accounting standpoint. We will be wrapping up the 2002 MedUnite audit in the next 10 days or so and then publishing it in a Form 8K before the middle of March. Because the audit is still pending, we have not been able to include a consolidated balance sheet or cash flow statement with our press release, as we usually do. So from an allocation perspective, we have approximately $32.4 million of purchase price to be allocated to the assets and liabilities acquired. This amount was determined as follows: $10 million in cash consideration, $13.4 million in four percent convertible notes, and $9 million in estimated transaction and exit costs such as severance, lease termination fees and contract penalties. So, the purchase price of $32.4 million will be allocated as follows: o $6 million to current assets such as cash and receivables; o $2.7 million to fixed and other assets, and this is an estimated fair market value and we're currently in the process of completing a formal appraisal for much of these, so this amount may change; o $12 million in total liabilities, including capital leases and operating expenses. And just to note, this amount actually gets added back to the purchase price I mentioned before for allocation purposes. Many of these are not due immediately but are payable at some time in the future. We have been successful in converting some of these obligations to be paid under installment notes, and we'll discuss that shortly. o $6.6 million dollars is allocated for customer relationships. These will be amortized over 10 years. 5 o $1.2 million dollars has been allocated for the existing Legacy platform, and since our plan is to migrate all of the customers off this platform and on to ProxyMed's platform by the end of the 2003 year, this asset will be amortized over one year. o $4.8 million dollars was allocated to the real-time platform and portal. This will be amortized over five years. o The balance of approximately $23 million will be allocated to goodwill. Two items to note since our call on January 6th, first we originally thought that there would be a large amount of in-process research and development costs associated with some of the technology platforms we acquired. As our valuation of the intangible assets was progressing, it became clear to us that these costs would be capitalizable. Secondly, we originally reported total liabilities for transaction and exit costs as well as the net liabilities of the company at $10.7 million. While we expect to ultimately be within the original range, we believe that the $12.7 million we just noted to be our conservative estimate at this time. Although the valuation report is technically still preliminary, we believe that the intangible valuations I just gave you are essentially final. Any changes, if any, should only affect the goodwill amount. So in summary, from a depreciation and amortization perspective as it relates to MedUnite, we expect between $3.3 million and $4.2 million in D&A for 2003. With our acquisition of MedUnite, ProxyMed acquired the obligations I just mentioned. We wanted to be aggressive here, so even before the deal actually closed, we had begun to negotiate many of the liabilities as possible in order to proactively manage our cash flow. We are working to finance, discount, or negotiate out of many of the obligations and we've been appreciative of the willingness of our major vendor partners to support our restructuring by working with us along these lines. Of the $21 million in obligations, we have been successful in negotiating financing arrangements for $6.3 million of liabilities, including two of the more significant ones. These arrangements range in term from one to three years at interest rates ranging from five to 10% and have included some up-front payments. We continue to work on limiting our exposure on MedUnite's San Diego facility and have two leads that we're currently pursuing to sub-lease or even terminate our obligations. We expect the resulting cash savings to be close to $1 million. Remember that we accrued the worst 6 case of $2.5 million into the $9 million of exit costs, so this could be a nice pick-up from a cash perspective. On an overall basis, $7.6 million of the liabilities, including some of those under the installment, are not due until after 2003. So with that background, let me recap the expected cash outflows over this year and the next two years as it relates to the MedUnite obligations: o $13.6 million dollars is payable in 2003; o $4.3 million is payable in 2004; and o $3.3 million are payable in 2005. Along with the financing of some of these liabilities and the convertible notes comes, unfortunately, some cash interest. So based on our current calculations, interest expense for 2003 for these MedUnite obligations will be approximately $800,000 to $900,000 and we expect our consolidated interest expense to be between $750,000 and $850,000 for 2003. With $13 million of cash in the bank currently, and this includes approximately $1.2 million in restricted cash, we project that our consolidated cash balance by the end of the year will be sufficient to cover our operating and capital needs for 2003. Of course, this assumes that we will successfully resolve all outstanding liabilities, hit our operational EBITDA targets and remain within our capital expenditure budget. We, therefore, have no plans to raise any additional capital in 2003 through the public for private capital markets. So what does this all mean? Well, in early January we provided guidance to the Street through our EBITDA line for 2003. With most of the depreciable and amortizable assets essentially resolved from MedUnite and with interest expense estimates as just discussed, we can now provide guidance to the bottom line. To reiterate some of the high points from our January 6th call, we said that we would achieve: o Revenues of $78 million to $84 million, including $49 to $54 million from our transaction processing business, which includes MedUnite, and $29 million to $30 million from our laboratory business; o Gross margins are expected to be between 57 and 58 percent on a consolidated basis; o SG&A expenses between $39 million and $42 million; and o EBITDA profits of between $4.6 million and $5.9 million; 7 o Depreciation, as we just mentioned, will be between $6.6 million to $7.3 million, including MedUnite intangible assets; and o Net interest expense of $750,000 to $850,000 including the interest on the convertible notes and other negotiated obligations of MedUnite; o All resulting in a net loss of $2 million to $3 million and a loss per share of 32 to 42 cents based on basic outstanding shares of 6.8 million. These calculations assume no conversion of the convertible notes in 2003. We stated before that 2003 will be a restructuring year for the company with the first two quarters sustaining substantial EBITDA and bottom line losses. However, we're off to a good start with our integration plans with MedUnite, which started the day after the acquisition, and we expect to exit the year on a positive EBITDA run rate. We have much work to do, but we are all up for the challenge. And as Nancy will report, we've made good progress so far. Nancy. NANCY HAM: Thanks, Judd, and good morning everyone. Well, it's certainly been a pretty hectic six weeks around here since the acquisition, but overall I think we have good news to report on our progress. The most important part of any company is the people, and this has really been one of the most pleasant surprises of the acquisition. We have discovered a team with a wealth of knowledge about healthcare transactions, payers and providers. In addition, MedUnite had a layer of middle management that ProxyMed was lacking in our own transaction business and we've been able to use that in our new organizational structure, which I'm happy to report is complete, and I believe that leverages the strengths of both companies. From an SG&A perspective, as a result of the elimination of duplicative executive and corporate functions, a reduction in force and the termination or conversion of a large number of contractors and temps, we've been able to right size the monthly personnel costs including contractors, from almost $1.8 million in December to approximately $900,000 on a pro forma basis for March. This is exactly in line with our original plans, so we're pleased to have this already accomplished. In addition, we've made rapid progress with our new facilities. Judd has already given you an update on sub-leasing our San Diego space. I do want to mention that while we'll still maintain an office in San Diego, I'm pretty confident we can find smaller and certainly 8 much cheaper space. In addition, ProxyMed is closing ProxyMed's prior Atlanta office effective tomorrow and is consolidating those people and functions into MedUnite's Atlanta office. This not only provides better merger integration; it will also save us almost $200,000 this year in rent. The next wave of operating cost reductions will come as we're able to integrate all of our transaction platforms. As we mentioned on our last call, we're moving all of the batch claims business to ProxyMed's proven platform. I am pleased to report that we've already moved all payers and implementation to the ProxyMed platform. We've moved one of the seven founders, we've rerouted over 400,000 claims per month to one of our direct connects and more. We have initial project growth maps complete for all platforms and we're finalizing the detail project plans now, including the sunset dates for the Legacy MedUnite claims platform. On the real-time side, we've been able to move even faster. We should have the ProxyMed real-time platform fully integrated with MedUnite's by early to mid second quarter and we'll then begin realizing the savings for running one platform instead of two. On the customer front, we've spent a lot of time trying to understand and validate the revenue and the overall MedUnite pipeline. After much scrubbing of lists and volumes, we're comfortable that we have over $3.7 million in annual revenue in the pipeline. Of this, approximately $750,000 is already closed and in various stages of implementation and ramping; $600,000 is in deals that we've closed since January the first; $100,000 is in final contract negotiations; and we have verbal commitments or in final negotiations for another $700,000. Not bad. With regards to our new strategic partner, NDCHealth, things are going well. We're already working together much more closely than before the acquisition closed. For example, I was personally very pleased that we were invited to attend NDCHealth's annual VAR summit for all of their MediSoft and Lytec dealers. We had a chance to exhibit, to speak and to socialize. While there certainly have been some significant MedUnite service issues in the past, we clearly have a fresh start with NDCHealth and there's tremendous untapped opportunity with their physicians and also across our two businesses. Finally, we've also been busy with the seven founding payers. We've had substantive meetings already with several of them with the rest scheduled over the next few weeks. These meetings are focused on understanding all of the current business and updating a strategic 9 plan for 2003 to 2004 that can drive additional revenue. Remember, the founders have a strong incentive to grow their revenue to us in order to achieve the right to convert their debt to ProxyMed common stock. The outcome of these individual planning meetings will be a presentation to all the CEOs, which we're working on scheduling for late March, and we hope to get from the CEOs a buy-in on how to move forward with both our tactical and strategic plans. So in summary, while it's been a pretty busy six weeks, I think we've gotten a lot done. Most importantly, from your perspective, we've been able to validate our plans to bring this business to EBITDA profitability within our guidance time line of late 2003. There is still a lot to be done, but we've progressed from high level ideas to detail project plans in most areas, so now it's all about execution. And with that, I'll turn it back over to Mike for a wrap-up. MICHAEL HOOVER: Thank you, Nancy. I hope that this acquisition integration update has given you the same confidence that I have that we are well on our way to integrating the teams, products and platforms. We have already cut MedUnite's monthly EBITDA loss in half from $1.6 million in November to an estimated $800,000 in January. Although we certainly have more work ahead to bring the business to positive EBITDA this year, this is pretty good progress for six short weeks. In addition, we have made excellent progress in restructuring MedUnite's liabilities to reduce the 2003 cash needs, giving us increased comfort that we have sufficient cash on hand for all of 2003. In addition, although MedUnite will experience cash losses early in the year, we have already provided guidance that our overall EBITDA for 2003 will still be up over our 2002 results with a range of $4.6 to $5.9 million. As a result of the acquisition, we are well positioned as a company, serving over 140,000 physicians who process well over 200 million transactions a year. We have new strategic partners such as NDCHealth and MedUnite's seven payer founders. If all our integration progress continues on schedule in 2004, we should achieve a revenue target of close to $100 million with normalized EBITDA margins for the full year. This concludes our prepared statements and comments and we would now like to open up the lines for any questions that we may have. [Questions from participants and answers from management omitted] 10 MICHAEL HOOVER: Okay, operator, I think that should wrap it up. NANCY HAM: We'd like to thank everyone for joining us for our call today, and we look forward to coming back next quarter and give you a further update on our progress with the MedUnite integration. OPERATOR: Ladies and gentlemen, this concludes our conference call for today. Thank you all for participating and have a nice day. All parties may now disconnect. 11 EX-99.2 4 g80904exv99w2.txt PRESS RELEASE EXHIBIT 99.2 (PROXYMED LOGO) COMPANY NEWS RELEASE FOR IMMEDIATE RELEASE IMPORTANT NOTE: ProxyMed's live teleconference call to discuss its fourth quarter and annual 2002 results is accessible by calling 1-800-915-4836 beginning at 10:00 a.m. Eastern Time on Thursday, February 20, 2003 and will be simultaneously broadcast on the Internet at WWW.PROXYMED.COM. Replays of the teleconference call will be available at WWW.PROXYMED.COM after 1:00 p.m. ET on February 20th. CONTACT: JUDSON E. SCHMID CHIEF FINANCIAL OFFICER (954) 473-1001, EXT. 353 INVESTORRELATIONS@PROXYMED.COM PROXYMED REPORTS RECORD REVENUES FOR THE FOURTH QUARTER AND ITS FIRST EVER POSITIVE ANNUAL EARNINGS PER SHARE - PROXYMED ALSO REPORTS ON 2002 ANNUAL RESULTS AND PROVIDES ADDITIONAL MEDUNITE DETAIL - FORT LAUDERDALE, FLORIDA (Business Wire) February 20, 2003 - ProxyMed, Inc. (Nasdaq: PILL), a leading provider of healthcare transaction processing services, today reported its operating results for the fourth quarter and 2002 year. MedUnite, Inc., which was acquired by ProxyMed on December 31, 2002, is not included in the 2002 results. FOURTH QUARTER 2002 RESULTS ProxyMed reported record revenues of $13.2 million for the fourth quarter, an increase of over 3% compared to revenues of $12.8 million for the same period of 2001. Net income applicable to common shareholders and diluted income per share were $0.7 million and $0.11, respectively, compared to a net loss of $4.7 million and diluted net loss per share of $1.44 for the fourth quarter of 2001. Diluted weighted average shares outstanding for the quarters ended December 31, 2002 and 2001 were 6,762,089 and 3,286,149, respectively. Additionally, for the fourth quarter of 2002, the Company's EBITDA profit (a non-GAAP measure defined as earnings before interest, taxes, depreciation and amortization) increased 52% to a record $1.4 million, compared to $0.9 million a year ago. Also compared to the prior year, consolidated EBITDA margins increased to 11% from 7% in 2001. ANNUAL 2002 RESULTS For the year ended December 31, 2002, ProxyMed reported record revenues of $50.2 million, an increase of 16% compared to revenues of $43.2 million for the 2001 year. Net income applicable to common shareholders and diluted income per share were $1.3 million and $0.21, respectively, compared to a net loss of $19.1 million and diluted net loss per share of $8.81 for 2001. Diluted weighted average shares outstanding for the years ended December 31, 2002 and 2001 were 6,396,893 and 2,162,352, respectively. Additionally, for the 2002 year the Company's EBITDA profit increased by 158% to a record $4.0 million, compared to $1.6 million a year ago. Compared to the prior year, consolidated EBITDA margins more than doubled to 8% from 4% in 2001. Cash flow from operations for the year ended December 31, 2002 was $2.7 million versus $1.0 million for the prior year. Total cash at December 31, 2002, including cash acquired from MedUnite, was approximately $17.2 million and is currently at approximately $13.0 million. To ensure its cash needs for operations and capital projects for 2003, the Company has been successful in negotiating extended payment terms, including installment-based payments, for many of the larger obligations related to MedUnite in order to improve its cash flow. "Achieving a full year of positive earnings per share is a major milestone for ProxyMed," said Judson E. Schmid, ProxyMed's chief financial officer. "In addition, throughout the year we continued to make strong progress in our core operations, which culminated in the fourth quarter with the achievement of record revenues, EBITDA, and EBITDA margins. Our core transaction growth (excluding encounters) also continued to increase as a result of success with our payer partners and we achieved a solid sequential growth rate of 6% over last quarter, despite there being 2 fewer processing days in the quarter." SEGMENT PERFORMANCE ELECTRONIC HEALTHCARE TRANSACTION SERVICES The Electronic Healthcare Transaction Services segment reported revenues of $6.1 million for the fourth quarter of 2002, an increase of 13% compared to revenues of $5.4 million for 2001. EBITDA for the fourth quarters of 2002 and 2001 was flat at $0.7 million. EBITDA margins also remained steady at 12% for both quarters due to the mix in transaction revenues and increased SG&A costs in the areas of sales, implementation and HIPAA remediation. Sequentially, revenues increased by 6% to $6.1 million over the third quarter of 2002, while EBITDA was up 16% to $0.7 million. EBITDA margins also improved to 12% from the 11% margins achieved last quarter. For the 2002 year, the transaction segment reported revenues of $22.4 million, an increase of 32% over 2001 revenues of $16.9 million. EBITDA grew from $0.5 million in 2001 to $2.2 million in 2002 while annual EBITDA margins increased from 3% to 10%. 2 During the fourth quarter, ProxyMed continued its growth by adding 22 new payers and strategic partners and also adding over 4,000 new physicians representing over 14,400 services sold, or 3.6 services sold per physician, in its transaction segment. "Since the driving force behind ProxyMed's growth is our transaction business, we are pleased at our continued progress in this segment, as highlighted by the strong sequential growth of 6% in our core transaction volume," said Nancy J. Ham, ProxyMed's president and chief operating officer. "In addition, the number of new physicians and partners that we signed in the quarter provide a strong foundation for accelerating growth in the first two quarters of 2003. We are confident that our recent investments in expanding our implementation throughput have us well positioned to quickly bring these customers into production." LABORATORY COMMUNICATIONS SOLUTIONS The Laboratory Communications Solutions segment reported revenues of $7.1 million for the fourth quarter of 2002, a decrease of 4% compared to revenues of $7.4 million for 2001. However, due to proactive cost controls implemented early in the fourth quarter, EBITDA for the quarter increased 45% to $1.4 million. EBITDA margins increased from almost 13% to over 19% as a result of the mix of revenues and cost controls implemented. Sequentially, revenues were flat compared to the third quarter of 2002 while EBITDA was up 28% from $1.1 million. EBITDA margins also improved from last quarter's margin of 15%. For the 2002 year, the lab segment reported revenues of $27.7 million, an increase of over 5% compared to revenues of $26.3 million for 2001. EBITDA for the 2002 year was up slightly to $4.4 million while annual EBITDA margins remained steady at 16%. During the fourth quarter, ProxyMed introduced two significant new products. First, ProxyMed announced the general availability of Report Tracker, an innovative, comprehensive and scalable reporting technology. Report Tracker technology provides proof of delivery and audit trail capabilities in a design that can host a variety of access control devices and also take advantage of Internet connectivity options. This new design allows labs the level of control and security they need for HIPAA, as well as greater flexibility to take advantage of evolving connectivity options and protocols. ProxyMed also introduced Quick-Req, its new modular approach to lab order entry/result reporting solutions. Initial feedback and interest on both products has been strong. "Even with the relative maturity of our lab business, we continue to maintain strong profitability. We achieved this by focusing on higher margin products, implementing cost controls, and completing the successful integration of our KenCom acquisition," added Nancy Ham. "Looking ahead to 2003, we are well-positioned with new technologies targeted at upselling our existing large customer base, and with increasing penetration into newer markets such as anatomical pathology." 3 STATISTICS Management considers the following metrics important to monitor its transaction business:

---------------------------------- -------------- ------------ ------------- --------------- ------------- DESCRIPTION ANNUAL ANNUAL Q/E Q/E Q/E 2002 2001 12/31/02 9/30/02 12/31/01 ---------------------------------- -------------- ------------ ------------- --------------- ------------- Core transactions (excluding 89,122,600 60,072,800 24,534,800 23,211,800(1) 19,272,600 encounters) Encounters 25,044,900 27,418,800 5,571,500 5,977,400 7,195,600 ----------- ---------- ---------- ---------- ---------- TOTAL TRANSACTIONS 114,167,500 87,941,600 30,106,300 29,189,200 26,468,200 =========== ========== ========== ========== ========== Number of direct physicians 74,000 70,000 60,000 Number of indirect physicians 63,850 56,250 40,000 Number of services utilized per 2.5 2.05 1.3 (est) all direct physicians

(1) Includes "acquired transactions" from Q3 2002 acquisitions ACQUISITION In addition to these operating events, during the fourth quarter of 2002 ProxyMed also acquired all of the capital stock of MedUnite, Inc., a leading provider of healthcare claims processing services founded by seven of the nation's largest health insurance companies, for $10.0 million in cash and $13.4 million in 4% convertible notes. In addition to the consideration paid, ProxyMed has also recorded approximately $9.0 million in acquisition-related expenses including transaction and exit costs. While the year end 2002 audited balance sheet of MedUnite is still being finalized, the purchase price is expected to include the following allocation to intangible assets: o Customer relationships of $6.6 million to be amortized over 10 years o Legacy technology platform of $1.2 million to be amortized over 1 year o New technology platforms of $4.8 million to be amortized over 5 years. Additional development expenditures of $2.0 million are expected to be spent in relation to these projects in 2003 o Goodwill of approximately $23 million The acquisition of MedUnite on December 31, 2002 did not have any significant financial impact on ProxyMed's results of operations in the fourth quarter of 2002, other than the incurring of $97,000 in acquisition expenses, which were included in the company's operating expenses. 4 "With all of the progress we made in 2002 it was extremely rewarding to culminate the year with our acquisition of MedUnite. The combined operations of ProxyMed and MedUnite create the second largest physician claims clearinghouse in the country," said Michael K. Hoover, ProxyMed's chairman and chief executive officer. "Our goal for 2003 is clear - integrate MedUnite into our existing operations to achieve positive cash contribution from MedUnite as soon as possible and expand our relationship with the seven founding members and NDCHealth. Achieving both of these goals will provide a solid base to increase shareholder value." ABOUT PROXYMED - WHERE HEALTHCARE CONNECTS(TM) ProxyMed solves the business problems of physician offices every day by automating their financial, administrative and clinical transactions with healthcare institutions. To facilitate these services, ProxyMed operates ProxyNet(R), its secure, proprietary national electronic information network, which provides physicians and other healthcare providers with direct connectivity to one of the industry's largest list of payers, the largest list of chain and independent pharmacies and the largest list of clinical laboratories. ProxyMed exceeds customer expectations through our expertise, proven methodologies and dedication to service excellence. SAFE HARBOR STATEMENT NOTE: THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS THAT REFLECT OUR CURRENT ASSUMPTIONS AND EXPECTATIONS REGARDING FUTURE EVENTS. WHILE THESE STATEMENTS REFLECT OUR CURRENT JUDGMENT, THEY ARE SUBJECT TO RISKS AND UNCERTAINTIES. ACTUAL RESULTS MAY DIFFER SIGNIFICANTLY FROM PROJECTED RESULTS DUE TO A NUMBER OF FACTORS, INCLUDING, THE SOUNDNESS OF OUR BUSINESS STRATEGIES RELATIVE TO THE PERCEIVED MARKET OPPORTUNITIES; OUR ABILITY TO INTEGRATE MEDUNITE INTO OUR EXISTING OPERATIONS, OUR ABILITY TO IDENTIFY SUITABLE FUTURE ACQUISITION CANDIDATES; OUR ABILITY TO SUCCESSFULLY INTEGRATE ANY FUTURE ACQUISITIONS; OUR ABILITY TO SUCCESSFULLY DEVELOP, MARKET, SELL, CROSS-SELL, INSTALL AND UPGRADE OUR CLINICAL AND FINANCIAL TRANSACTION SERVICES AND APPLICATIONS TO CURRENT AND NEW PHYSICIANS, PAYERS, MEDICAL LABORATORIES AND PHARMACIES; OUR ABILITY TO COMPETE EFFECTIVELY ON PRICE AND SUPPORT SERVICES; OUR ASSESSMENT OF THE HEALTHCARE INDUSTRY'S NEED, DESIRE AND ABILITY TO BECOME TECHNOLOGY EFFICIENT; AND OUR ABILITY AND THAT OF OUR BUSINESS ASSOCIATES TO COMPLY WITH VARIOUS GOVERNMENT RULES REGARDING HEALTHCARE AND PATIENT PRIVACY. THESE AND OTHER RISK FACTORS ARE MORE FULLY DISCUSSED IN THE RISK FACTORS DISCLOSURE IN OUR FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2001 AND OUR OTHER FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION, WHICH WE STRONGLY URGE YOU TO READ. WE EXPRESSLY DISCLAIM ANY INTENT OR OBLIGATION TO UPDATE ANY FORWARD-LOOKING STATEMENTS. WHEN USED, THE WORDS "BELIEVES," "ESTIMATED," "EXPECTS," "ANTICIPATES," "MAY" AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS. MORE INFORMATION ON PROXYMED IS AVAILABLE ON ITS HOME PAGE AT www.proxymed.com. 5 PROXYMED, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

Three Months Ended December 31, Year Ended December 31, ------------------------------- ----------------------------- 2002 2001 2002 2001 ------------ ------------ ------------ ------------ Revenues $ 13,193,600 $ 12,773,200 $ 50,181,800 $ 43,230,300 ------------ ------------ ------------ ------------ Costs and expenses: Cost of sales 5,962,800 6,497,300 23,023,500 20,408,000 Selling, general and administrative expenses 5,817,400 5,345,800 23,144,700 21,266,900 Write-of of impaired assets 37,500 91,100 37,500 91,100 Operating depreciation and amortization (1) 510,000 462,500 1,968,700 1,766,700 ------------ ------------ ------------ ------------ Total operating costs and expenses (1) 12,327,700 12,396,700 48,174,400 43,532,700 ------------ ------------ ------------ ------------ Operating income (loss), as adjusted (1) 865,900 376,500 2,007,400 (302,400) Acquisition-related amortization charges (229,000) (991,900) (667,300) (6,409,700) Litigation settlement, net -- 39,800 264,500 39,800 Interest income (expense), net 94,500 (105,300) 345,300 (125,600) ------------ ------------ ------------ ------------ Net income (loss) 731,400 (680,900) 1,949,900 (6,797,900) Deemed dividends and other charges -- 4,042,600 611,700 12,262,000 ------------ ------------ ------------ ------------ Net income (loss) applicable to common shareholders $ 731,400 $ (4,723,500) $ 1,338,200 $(19,059,900) ============ ============ ============ ============ Diluted income (loss) per share: $ 0.11 $ (1.44) $ 0.21 $ (8.81) ============ ============ ============ ============ Diluted weighted average shares outstanding 6,762,089 3,286,149 6,396,893 2,162,352 ============ ============ ============ ============ EBITDA (2) $ 1,413,400 $ 930,100 $ 4,013,600 $ 1,555,400 ============ ============ ============ ============

(1) Excludes acquisition-related amortization charges related to goodwill and other intangibles. Amortization of goodwill ceased as of January 1, 2002 under FAS No. 142. (2) EBITDA is a metric that ProxyMed believes is a meaningful measurement of operating performance. The calculation of EBITDA has no basis in Generally Accepted Accounting Principles. 6 PROXYMED, INC. AND SUBSIDIARIES SEGMENT INFORMATION (UNAUDITED)

Three Months Ended December 31, Year Ended December 31, --------------------------------- --------------------------------- 2002 2001 2002 2001 -------------- -------------- -------------- -------------- Revenues: Electronic healthcare transaction processing $ 6,095,400 $ 5,404,800 $ 22,439,100 $ 16,938,400 Laboratory communication solutions 7,098,200 7,368,400 27,742,700 26,291,900 ------------ ------------ ------------ ------------ $ 13,193,600 $ 12,773,200 $ 50,181,800 $ 43,230,300 ============ ============ ============ ============ Cost of sales: Electronic healthcare transaction processing $ 2,381,300 $ 2,281,300 $ 8,793,600 $ 6,531,200 Laboratory communication solutions 3,581,500 4,216,000 14,229,900 13,876,800 ------------ ------------ ------------ ------------ $ 5,962,800 $ 6,497,300 $ 23,023,500 $ 20,408,000 ============ ============ ============ ============ Selling, general and administrative expenses: Electronic healthcare transaction processing $ 2,992,300 $ 2,465,500 $ 11,429,600 $ 9,905,600 Laboratory communication solutions 2,144,400 2,208,900 9,120,600 8,168,500 Corporate 680,700 671,400 2,594,500 3,192,800 ------------ ------------ ------------ ------------ $ 5,817,400 $ 5,345,800 $ 23,144,700 $ 21,266,900 ============ ============ ============ ============ Depreciation and amortization: Electronic healthcare transaction processing $ 437,200 $ 1,233,400 $ 1,581,400 $ 7,285,400 Laboratory communication solutions 255,600 157,900 856,700 560,600 Corporate 46,200 63,100 197,900 330,400 ------------ ------------ ------------ ------------ $ 739,000 $ 1,454,400 $ 2,636,000 $ 8,176,400 ============ ============ ============ ============ Operating income (loss): Electronic healthcare transaction processing $ 247,100 $ (650,300) $ 597,000 $ (6,858,700) Laboratory communication solutions 1,116,700 785,600 3,535,500 3,685,900 Corporate (726,900) (750,700) (2,792,400) (3,539,300) ------------ ------------ ------------ ------------ $ 636,900 $ (615,400) $ 1,340,100 $ (6,712,100) ============ ============ ============ ============ EBITDA: Electronic healthcare transaction processing $ 721,800 $ 658,000 $ 2,215,900 $ 501,600 Laboratory communication solutions 1,372,300 943,500 4,392,200 4,246,600 Corporate (680,700) (671,400) (2,594,500) (3,192,800) ------------ ------------ ------------ ------------ $ 1,413,400 $ 930,100 $ 4,013,600 $ 1,555,400 ============ ============ ============ ============

7 -----END PRIVACY-ENHANCED MESSAGE-----

EX-99.1

                                                                    EXHIBIT 99.1


                                 PROXYMED, INC.
                FOURTH QUARTER AND ANNUAL 2002 FINANCIAL RESULTS
                                CONFERENCE CALL

                            MODERATOR: MICHAEL HOOVER
                                FEBRUARY 20, 2003
                                  10:00 A.M. ET

  OPERATOR:              I would like to welcome everyone to ProxyMed's
                         conference call to discuss its financial results for
                         the 2002 fourth quarter and full year 2002, including
                         its discussion of the progress made on the MedUnite
                         acquisition and integration. At this time I would like
                         to inform you that all participants are in a listen
                         only mode. At the request of the company, we will open
                         up the conference for questions and answers after the
                         presentation. We would appreciate it if you would limit
                         your questions to one and then getting back in the
                         queue if you have any follow-up questions or another
                         question to ask.

                         Today's conference call is being webcast and replays of
                         this call will be available on the Internet at
                         www.proxymed.com shortly after this call. Leading
                         today's call from ProxyMed are Mike Hoover, Chairman
                         and CEO; Nancy Ham, President and COO; and Judd Schmid,
                         Chief Financial Officer.

                         Before the discussion begins, please be reminded that
                         statements made by ProxyMed during this call, including
                         answers given in response to the questions, are
                         intended to fall within the Safe Harbor Provisions of
                         the securities laws, and that actual results might
                         differ materially from those in this statement. Such
                         statements are subject to a variety of risks which are
                         discussed in the Company's most recent Form 10K and
                         other SEC filings, which the Company strongly urges you
                         to read. At this time, I would like to turn the
                         presentation over to Mr. Mike Hoover. Please go ahead,
                         sir.

  MICHAEL HOOVER:        Good morning. Thank you, Heather, and thanks to
                         everyone for joining us. On our call today, we will
                         report on our financial results for the fourth quarter
                         as well as provide you with a quick recap of the whole
                         year. We'll also walk you through in detail how we will
                         be booking the MedUnite purchase price and how that
                         will drive our amortization and earnings per share for
                         2003. Finally, we'll give you an operational update on
                         the MedUnite acquisition and our integration progress
                         to date.

                                       1


                         Before turning it over to Judd, let me make a few brief
                         comments on the fourth quarter of 2002. For the
                         quarter, we're very pleased to report record-setting
                         results for revenue, EBITDA and EBITDA margin
                         percentage. We exceeded the low end of our range in
                         each category despite absorbing $97,000 in MedUnite
                         deal costs in our numbers. In addition, we achieved
                         positive earnings per share for all of 2002, a true
                         milestone for any company and certainly for ProxyMed.
                         This record-setting performance gives ProxyMed strong
                         momentum heading into 2003 and 2004.

                         Nancy will be providing a detailed operational update
                         on MedUnite later in the call, but from my perspective
                         we've made good progress to date. The market response
                         from both ProxyMed and MedUnite customers, partners and
                         prospects has been positive, as they are enthusiastic
                         about the combination of ProxyMed's proven claims
                         platform and MedUnite's leading real-time platform and
                         portal. We're off to a great start with our new
                         NDCHealth partnership, as well as with the seven
                         founding payers. We gained over 140 new associates who
                         bring to ProxyMed many years of experience in
                         healthcare transaction services.

                         On the financial front, we've moved swiftly to reduce
                         overhead and to reduce the cash burn rate. As you know,
                         the deal process at the end of December was condensed
                         into less than a week, so I was a little concerned
                         about what we didn't know that might come back to hurt
                         us. So I am relieved to report that the bad things we
                         knew going into the deal have turned out to be no worse
                         than we expected, and we've discovered more than one
                         pleasant surprise.

                         In summary, early results of this strategic acquisition
                         are positive, and I am very confident that we are on
                         track to complete the restructuring and bring MedUnite
                         to EBITDA profitability this year as we committed to
                         you in our last call. So with that, let me turn it over
                         to Nancy and Judd to provide you all the details. Judd.

  JUDSON SCHMID:         Thanks, Mike. As Mike pointed out, we once again had a
                         successful quarter with the reporting of record
                         revenues, EBITDA and EBITDA margin, and exceeding the
                         low end of our expectation range and meeting analysts'
                         consensus. All in all, another solid quarter behind us,
                         but most of all, we reported the first-ever positive
                         year of EPS in the history of the company. A tremendous
                         milestone and one that we and all of our associates are
                         very proud of. Capping off the year with the
                         acquisition of MedUnite was a real nice feather in our
                         cap.

                         In my discussion today I'd like to talk about four
                         items: (1) the results for the fourth quarter and 2002

                                       2


                         year; (2) how we recorded the MedUnite transaction; (3)
                         our cash flow and interest expectations for 2003; and
                         (4) our 2003 guidance, including down to EPS.

                         Turning now to our detailed results for the fourth
                         quarter, ProxyMed reported record quarterly revenues of
                         $13.2 million, record EBITDA profits of $1.4 million
                         and net income of $731,000 or 11 cents per share as
                         compared to a net loss of $4.7 million or $1.44 loss
                         per share last year. Our revenue increase came from our
                         Healthcare Transaction Services segment, where revenues
                         grew 13% from $5.4 million last year to $6.1 million
                         this year, and on a sequential basis our overall
                         revenue was up three percent with transaction revenues
                         increasing by six percent, both over the third quarter.

                         On an annual basis, ProxyMed achieved record
                         consolidated revenues of $50.2 million. Once again our
                         transaction business led the way with $22.4 million in
                         revenues, up a solid 32% over 2001 annual revenues of
                         $16.9 million.

                         The increase in the transaction service revenues was
                         led by a 27% year-over-year increase in "core"
                         transactions, which include all transactions except of
                         encounters and transactions acquired in the current
                         quarter. And as a reminder, we only report on an
                         acquisitions metric in the quarter acquired as we move
                         rapidly to integrate the business into our own.
                         Therefore, transactions associated with our third
                         quarter acquisitions of MDIP and the certain assets of
                         Claimsnet.com are now included in core transactions. On
                         a sequential basis, core transactions were up six
                         percent despite there being two fewer processing days
                         in the fourth quarter.

                         Looking now at total transactions, which are core
                         transitions plus encounters, in the fourth quarter we
                         processed a total of 30.1 million clinical and
                         financial transactions through ProxyMed, our secure
                         national healthcare information network. The increase
                         in transactions was primarily due to a solid growth in
                         claim transactions, especially since going live with
                         Aetna in October, and in statement processing.

                         From a gross margin perspective, we achieved a 55%
                         margin in the fourth quarter of 2002 compared to 49%
                         last year. Annually, overall gross margins were at 54%
                         in 2002 compared to 53% for 2001. This improvement is
                         driven from the gradual shift in our overall business
                         mix between our transaction and lab segments. Last
                         year, 39% of our revenues came from the transaction
                         segment while 45% came from this business in 2002. As
                         this shift continues to occur, and it will shift
                         dramatically in 2003 with MedUnite, we expect our

                                       3


                         overall margins to increase to the 57 to 58 percent
                         level. We'll speak more to our 2003 forecast in a few
                         minutes.

                         On the expense side, as always, we continue to monitor
                         and control our SG&A expenses. On a full year basis,
                         consolidated SG&A expenses increased by nine percent.
                         However, sequentially they actually decreased by one
                         percent as we were able to balance increased investing
                         in our transaction business, mostly for implementation
                         and support resources that were necessary to keep pace
                         with the new business from the sales team, along with
                         cost reductions in our lab operations. Looking now at
                         corporate, SG&A expenses were up over the third quarter
                         due to, as Mike mentioned, the $97,000 in MedUnite deal
                         expenses. But even including those, corporate SG&A
                         expenses decreased on an annual basis. As a percentage
                         of revenues, our consolidated SG&A expenses dropped
                         from 45.8% in the third quarter to 44.1% in the fourth
                         quarter; but more importantly, they dropped from 49.2%
                         to 46.1% on an annual basis as we achieve operational
                         leverage within our business.

                         From an EBITDA perspective, we had record EBITDA of
                         $1.4 million for the quarter, an increase of 52% over
                         last year's quarter and a solid 32% increase over the
                         third quarter. We also continued to improve our margin
                         percentage with EBITDA margins improving from 8.3% in
                         the third quarter to 10.7% this quarter. This gives us
                         good margin momentum for 2003 and we remain confident
                         in achieving expanding EBITDA margins on an annual
                         basis. On a year-over-year basis, we more than doubled
                         our EBITDA margin from four percent in 2001 to eight
                         percent in 2002. An increase in the EBITDA margin of
                         our transaction business from three percent in 2001 to
                         10% in 2002 led our success in this important metric.
                         EBITDA margins in our lab business remain stable at 16%
                         for the year.

                         Depreciation and amortization was $700,000 for the
                         quarter and included approximately $146,000 related to
                         the amortization of intangibles from our 2002
                         acquisitions. One item to note here is that going
                         forward we won't be breaking out depreciation and
                         amortization from our acquisitions on our press
                         releases. So this will be the last quarter that we'll
                         present that.

                         As a result of the above, net income for the fourth
                         quarter was $731,000 or 11 cents per share, a nice turn
                         around from a loss of $4.7 million last year. Annually,
                         we had our first full year of profitability ever with
                         net income of $1.3 million or 21 cents a share, an
                         important milestone in the history of the Company.

                                       4


                         We'll talk about our cash needs in a minute or so, but
                         for the year we generated about $2.7 million in cash
                         from operations compared to only $1 million last year.
                         Of that $2.7 million, we invested $1.9 million back
                         into the business through capital expenditures and
                         capitalized software costs primarily for upgrades and
                         enhancements to our customer relationship software for
                         HIPAA compliance efforts and for our data center
                         consolidation efforts. As projected, capitalized costs
                         were approximately 14% of our $3.2 million R&D spending
                         of the year. Of course, we also acquired four
                         businesses for a total of $16 million in cash and $14
                         million in stock and debt during the year. Our capital
                         structure remains virtually unchanged at 8.5 million
                         fully diluted shares. Please note that this number does
                         not include the 731,000 contingent shares underlying
                         the convertible notes issued in the MedUnite
                         transaction.

                         So let's now turn to our MedUnite acquisition from an
                         accounting standpoint. We will be wrapping up the 2002
                         MedUnite audit in the next 10 days or so and then
                         publishing it in a Form 8K before the middle of March.
                         Because the audit is still pending, we have not been
                         able to include a consolidated balance sheet or cash
                         flow statement with our press release, as we usually
                         do.

                         So from an allocation perspective, we have
                         approximately $32.4 million of purchase price to be
                         allocated to the assets and liabilities acquired. This
                         amount was determined as follows: $10 million in cash
                         consideration, $13.4 million in four percent
                         convertible notes, and $9 million in estimated
                         transaction and exit costs such as severance, lease
                         termination fees and contract penalties.

                         So, the purchase price of $32.4 million will be
                         allocated as follows:

                              o  $6 million to current assets such as cash and
                                 receivables;

                              o  $2.7 million to fixed and other assets, and
                                 this is an estimated fair market value and
                                 we're currently in the process of completing a
                                 formal appraisal for much of these, so this
                                 amount may change;

                              o  $12 million in total liabilities, including
                                 capital leases and operating expenses. And just
                                 to note, this amount actually gets added back
                                 to the purchase price I mentioned before for
                                 allocation purposes. Many of these are not due
                                 immediately but are payable at some time in the
                                 future. We have been successful in converting
                                 some of these obligations to be paid under
                                 installment notes, and we'll discuss that
                                 shortly.

                              o  $6.6 million dollars is allocated for customer
                                 relationships. These will be amortized over 10
                                 years.

                                       5


                              o  $1.2 million dollars has been allocated for the
                                 existing Legacy platform, and since our plan is
                                 to migrate all of the customers off this
                                 platform and on to ProxyMed's platform by the
                                 end of the 2003 year, this asset will be
                                 amortized over one year.

                              o  $4.8 million dollars was allocated to the
                                 real-time platform and portal. This will be
                                 amortized over five years.

                              o  The balance of approximately $23 million will
                                 be allocated to goodwill.

                         Two items to note since our call on January 6th, first
                         we originally thought that there would be a large
                         amount of in-process research and development costs
                         associated with some of the technology platforms we
                         acquired. As our valuation of the intangible assets was
                         progressing, it became clear to us that these costs
                         would be capitalizable. Secondly, we originally
                         reported total liabilities for transaction and exit
                         costs as well as the net liabilities of the company at
                         $10.7 million. While we expect to ultimately be within
                         the original range, we believe that the $12.7 million
                         we just noted to be our conservative estimate at this
                         time.

                         Although the valuation report is technically still
                         preliminary, we believe that the intangible valuations
                         I just gave you are essentially final. Any changes, if
                         any, should only affect the goodwill amount. So in
                         summary, from a depreciation and amortization
                         perspective as it relates to MedUnite, we expect
                         between $3.3 million and $4.2 million in D&A for 2003.

                         With our acquisition of MedUnite, ProxyMed acquired the
                         obligations I just mentioned. We wanted to be
                         aggressive here, so even before the deal actually
                         closed, we had begun to negotiate many of the
                         liabilities as possible in order to proactively manage
                         our cash flow. We are working to finance, discount, or
                         negotiate out of many of the obligations and we've been
                         appreciative of the willingness of our major vendor
                         partners to support our restructuring by working with
                         us along these lines.

                         Of the $21 million in obligations, we have been
                         successful in negotiating financing arrangements for
                         $6.3 million of liabilities, including two of the more
                         significant ones. These arrangements range in term from
                         one to three years at interest rates ranging from five
                         to 10% and have included some up-front payments. We
                         continue to work on limiting our exposure on MedUnite's
                         San Diego facility and have two leads that we're
                         currently pursuing to sub-lease or even terminate our
                         obligations. We expect the resulting cash savings to be
                         close to $1 million. Remember that we accrued the worst

                                       6


                         case of $2.5 million into the $9 million of exit costs,
                         so this could be a nice pick-up from a cash
                         perspective. On an overall basis, $7.6 million of the
                         liabilities, including some of those under the
                         installment, are not due until after 2003.

                         So with that background, let me recap the expected cash
                         outflows over this year and the next two years as it
                         relates to the MedUnite obligations:

                              o  $13.6 million dollars is payable in 2003;

                              o  $4.3 million is payable in 2004; and

                              o  $3.3 million are payable in 2005.

                         Along with the financing of some of these liabilities
                         and the convertible notes comes, unfortunately, some
                         cash interest. So based on our current calculations,
                         interest expense for 2003 for these MedUnite
                         obligations will be approximately $800,000 to $900,000
                         and we expect our consolidated interest expense to be
                         between $750,000 and $850,000 for 2003.

                         With $13 million of cash in the bank currently, and
                         this includes approximately $1.2 million in restricted
                         cash, we project that our consolidated cash balance by
                         the end of the year will be sufficient to cover our
                         operating and capital needs for 2003. Of course, this
                         assumes that we will successfully resolve all
                         outstanding liabilities, hit our operational EBITDA
                         targets and remain within our capital expenditure
                         budget. We, therefore, have no plans to raise any
                         additional capital in 2003 through the public for
                         private capital markets.

                         So what does this all mean? Well, in early January we
                         provided guidance to the Street through our EBITDA line
                         for 2003. With most of the depreciable and amortizable
                         assets essentially resolved from MedUnite and with
                         interest expense estimates as just discussed, we can
                         now provide guidance to the bottom line.

                         To reiterate some of the high points from our January
                         6th call, we said that we would achieve:

                              o  Revenues of $78 million to $84 million,
                                 including $49 to $54 million from our
                                 transaction processing business, which includes
                                 MedUnite, and $29 million to $30 million from
                                 our laboratory business;

                              o  Gross margins are expected to be between 57 and
                                 58 percent on a consolidated basis;

                              o  SG&A expenses between $39 million and $42
                                 million; and

                              o  EBITDA profits of between $4.6 million and $5.9
                                 million;

                                       7


                              o  Depreciation, as we just mentioned, will be
                                 between $6.6 million to $7.3 million, including
                                 MedUnite intangible assets; and

                              o  Net interest expense of $750,000 to $850,000
                                 including the interest on the convertible notes
                                 and other negotiated obligations of MedUnite;

                              o  All resulting in a net loss of $2 million to $3
                                 million and a loss per share of 32 to 42 cents
                                 based on basic outstanding shares of 6.8
                                 million.

                         These calculations assume no conversion of the
                         convertible notes in 2003.

                         We stated before that 2003 will be a restructuring year
                         for the company with the first two quarters sustaining
                         substantial EBITDA and bottom line losses. However,
                         we're off to a good start with our integration plans
                         with MedUnite, which started the day after the
                         acquisition, and we expect to exit the year on a
                         positive EBITDA run rate. We have much work to do, but
                         we are all up for the challenge. And as Nancy will
                         report, we've made good progress so far. Nancy.

  NANCY HAM:             Thanks, Judd, and good morning everyone. Well, it's
                         certainly been a pretty hectic six weeks around here
                         since the acquisition, but overall I think we have good
                         news to report on our progress.

                         The most important part of any company is the people,
                         and this has really been one of the most pleasant
                         surprises of the acquisition. We have discovered a team
                         with a wealth of knowledge about healthcare
                         transactions, payers and providers. In addition,
                         MedUnite had a layer of middle management that ProxyMed
                         was lacking in our own transaction business and we've
                         been able to use that in our new organizational
                         structure, which I'm happy to report is complete, and I
                         believe that leverages the strengths of both companies.
                         From an SG&A perspective, as a result of the
                         elimination of duplicative executive and corporate
                         functions, a reduction in force and the termination or
                         conversion of a large number of contractors and temps,
                         we've been able to right size the monthly personnel
                         costs including contractors, from almost $1.8 million
                         in December to approximately $900,000 on a pro forma
                         basis for March. This is exactly in line with our
                         original plans, so we're pleased to have this already
                         accomplished.

                         In addition, we've made rapid progress with our new
                         facilities. Judd has already given you an update on
                         sub-leasing our San Diego space. I do want to mention
                         that while we'll still maintain an office in San Diego,
                         I'm pretty confident we can find smaller and certainly

                                       8


                         much cheaper space. In addition, ProxyMed is closing
                         ProxyMed's prior Atlanta office effective tomorrow and
                         is consolidating those people and functions into
                         MedUnite's Atlanta office. This not only provides
                         better merger integration; it will also save us almost
                         $200,000 this year in rent.

                         The next wave of operating cost reductions will come as
                         we're able to integrate all of our transaction
                         platforms. As we mentioned on our last call, we're
                         moving all of the batch claims business to ProxyMed's
                         proven platform. I am pleased to report that we've
                         already moved all payers and implementation to the
                         ProxyMed platform. We've moved one of the seven
                         founders, we've rerouted over 400,000 claims per month
                         to one of our direct connects and more. We have initial
                         project growth maps complete for all platforms and
                         we're finalizing the detail project plans now,
                         including the sunset dates for the Legacy MedUnite
                         claims platform.

                         On the real-time side, we've been able to move even
                         faster. We should have the ProxyMed real-time platform
                         fully integrated with MedUnite's by early to mid second
                         quarter and we'll then begin realizing the savings for
                         running one platform instead of two.

                         On the customer front, we've spent a lot of time trying
                         to understand and validate the revenue and the overall
                         MedUnite pipeline. After much scrubbing of lists and
                         volumes, we're comfortable that we have over $3.7
                         million in annual revenue in the pipeline. Of this,
                         approximately $750,000 is already closed and in various
                         stages of implementation and ramping; $600,000 is in
                         deals that we've closed since January the first;
                         $100,000 is in final contract negotiations; and we have
                         verbal commitments or in final negotiations for another
                         $700,000. Not bad.

                         With regards to our new strategic partner, NDCHealth,
                         things are going well. We're already working together
                         much more closely than before the acquisition closed.
                         For example, I was personally very pleased that we were
                         invited to attend NDCHealth's annual VAR summit for all
                         of their MediSoft and Lytec dealers. We had a chance to
                         exhibit, to speak and to socialize. While there
                         certainly have been some significant MedUnite service
                         issues in the past, we clearly have a fresh start with
                         NDCHealth and there's tremendous untapped opportunity
                         with their physicians and also across our two
                         businesses.

                         Finally, we've also been busy with the seven founding
                         payers. We've had substantive meetings already with
                         several of them with the rest scheduled over the next
                         few weeks. These meetings are focused on understanding
                         all of the current business and updating a strategic

                                       9


                         plan for 2003 to 2004 that can drive additional
                         revenue. Remember, the founders have a strong incentive
                         to grow their revenue to us in order to achieve the
                         right to convert their debt to ProxyMed common stock.
                         The outcome of these individual planning meetings will
                         be a presentation to all the CEOs, which we're working
                         on scheduling for late March, and we hope to get from
                         the CEOs a buy-in on how to move forward with both our
                         tactical and strategic plans.

                         So in summary, while it's been a pretty busy six weeks,
                         I think we've gotten a lot done. Most importantly, from
                         your perspective, we've been able to validate our plans
                         to bring this business to EBITDA profitability within
                         our guidance time line of late 2003. There is still a
                         lot to be done, but we've progressed from high level
                         ideas to detail project plans in most areas, so now
                         it's all about execution. And with that, I'll turn it
                         back over to Mike for a wrap-up.

  MICHAEL HOOVER:        Thank you, Nancy. I hope that this acquisition
                         integration update has given you the same confidence
                         that I have that we are well on our way to integrating
                         the teams, products and platforms. We have already cut
                         MedUnite's monthly EBITDA loss in half from $1.6
                         million in November to an estimated $800,000 in
                         January. Although we certainly have more work ahead to
                         bring the business to positive EBITDA this year, this
                         is pretty good progress for six short weeks. In
                         addition, we have made excellent progress in
                         restructuring MedUnite's liabilities to reduce the 2003
                         cash needs, giving us increased comfort that we have
                         sufficient cash on hand for all of 2003.

                         In addition, although MedUnite will experience cash
                         losses early in the year, we have already provided
                         guidance that our overall EBITDA for 2003 will still be
                         up over our 2002 results with a range of $4.6 to $5.9
                         million. As a result of the acquisition, we are well
                         positioned as a company, serving over 140,000
                         physicians who process well over 200 million
                         transactions a year. We have new strategic partners
                         such as NDCHealth and MedUnite's seven payer founders.
                         If all our integration progress continues on schedule
                         in 2004, we should achieve a revenue target of close to
                         $100 million with normalized EBITDA margins for the
                         full year.

                         This concludes our prepared statements and comments and
                         we would now like to open up the lines for any
                         questions that we may have.

        [Questions from participants and answers from management omitted]

                                       10



  MICHAEL HOOVER:        Okay, operator, I think that should wrap it up.

  NANCY HAM:             We'd like to thank everyone for joining us for our call
                         today, and we look forward to coming back next quarter
                         and give you a further update on our progress with the
                         MedUnite integration.

  OPERATOR:              Ladies and gentlemen, this concludes our conference
                         call for today. Thank you all for participating and
                         have a nice day. All parties may now disconnect.

                                       11

EX-99.2

                                                                    EXHIBIT 99.2

(PROXYMED LOGO)

                                                            COMPANY NEWS RELEASE


                              FOR IMMEDIATE RELEASE


IMPORTANT NOTE: ProxyMed's live teleconference call to discuss its fourth
quarter and annual 2002 results is accessible by calling 1-800-915-4836
beginning at 10:00 a.m. Eastern Time on Thursday, February 20, 2003 and will be
simultaneously broadcast on the Internet at WWW.PROXYMED.COM. Replays of the
teleconference call will be available at WWW.PROXYMED.COM after 1:00 p.m. ET on
February 20th.


CONTACT:
JUDSON E. SCHMID
CHIEF FINANCIAL OFFICER
(954) 473-1001, EXT. 353
INVESTORRELATIONS@PROXYMED.COM


           PROXYMED REPORTS RECORD REVENUES FOR THE FOURTH QUARTER AND
               ITS FIRST EVER POSITIVE ANNUAL EARNINGS PER SHARE
     - PROXYMED ALSO REPORTS ON 2002 ANNUAL RESULTS AND PROVIDES ADDITIONAL
                               MEDUNITE DETAIL -

         FORT LAUDERDALE, FLORIDA (Business Wire) February 20, 2003 - ProxyMed,
Inc. (Nasdaq: PILL), a leading provider of healthcare transaction processing
services, today reported its operating results for the fourth quarter and 2002
year. MedUnite, Inc., which was acquired by ProxyMed on December 31, 2002, is
not included in the 2002 results.

                           FOURTH QUARTER 2002 RESULTS

         ProxyMed reported record revenues of $13.2 million for the fourth
quarter, an increase of over 3% compared to revenues of $12.8 million for the
same period of 2001. Net income applicable to common shareholders and diluted
income per share were $0.7 million and $0.11, respectively, compared to a net
loss of $4.7 million and diluted net loss per share of $1.44 for the fourth
quarter of 2001. Diluted weighted average shares outstanding for the quarters
ended December 31, 2002 and 2001 were 6,762,089 and 3,286,149, respectively.

         Additionally, for the fourth quarter of 2002, the Company's EBITDA
profit (a non-GAAP measure defined as earnings before interest, taxes,
depreciation and amortization) increased 52% to a record $1.4 million, compared
to $0.9 million a year ago. Also compared to the prior year, consolidated EBITDA
margins increased to 11% from 7% in 2001.




                               ANNUAL 2002 RESULTS

         For the year ended December 31, 2002, ProxyMed reported record revenues
of $50.2 million, an increase of 16% compared to revenues of $43.2 million for
the 2001 year. Net income applicable to common shareholders and diluted income
per share were $1.3 million and $0.21, respectively, compared to a net loss of
$19.1 million and diluted net loss per share of $8.81 for 2001. Diluted weighted
average shares outstanding for the years ended December 31, 2002 and 2001 were
6,396,893 and 2,162,352, respectively.

         Additionally, for the 2002 year the Company's EBITDA profit increased
by 158% to a record $4.0 million, compared to $1.6 million a year ago. Compared
to the prior year, consolidated EBITDA margins more than doubled to 8% from 4%
in 2001.

         Cash flow from operations for the year ended December 31, 2002 was $2.7
million versus $1.0 million for the prior year. Total cash at December 31, 2002,
including cash acquired from MedUnite, was approximately $17.2 million and is
currently at approximately $13.0 million. To ensure its cash needs for
operations and capital projects for 2003, the Company has been successful in
negotiating extended payment terms, including installment-based payments, for
many of the larger obligations related to MedUnite in order to improve its cash
flow.

         "Achieving a full year of positive earnings per share is a major
milestone for ProxyMed," said Judson E. Schmid, ProxyMed's chief financial
officer. "In addition, throughout the year we continued to make strong progress
in our core operations, which culminated in the fourth quarter with the
achievement of record revenues, EBITDA, and EBITDA margins. Our core transaction
growth (excluding encounters) also continued to increase as a result of success
with our payer partners and we achieved a solid sequential growth rate of 6%
over last quarter, despite there being 2 fewer processing days in the quarter."


                               SEGMENT PERFORMANCE

ELECTRONIC HEALTHCARE TRANSACTION SERVICES

         The Electronic Healthcare Transaction Services segment reported
revenues of $6.1 million for the fourth quarter of 2002, an increase of 13%
compared to revenues of $5.4 million for 2001. EBITDA for the fourth quarters of
2002 and 2001 was flat at $0.7 million. EBITDA margins also remained steady at
12% for both quarters due to the mix in transaction revenues and increased SG&A
costs in the areas of sales, implementation and HIPAA remediation.

         Sequentially, revenues increased by 6% to $6.1 million over the third
quarter of 2002, while EBITDA was up 16% to $0.7 million. EBITDA margins also
improved to 12% from the 11% margins achieved last quarter.

         For the 2002 year, the transaction segment reported revenues of $22.4
million, an increase of 32% over 2001 revenues of $16.9 million. EBITDA grew
from $0.5 million in 2001 to $2.2 million in 2002 while annual EBITDA margins
increased from 3% to 10%.

                                        2


         During the fourth quarter, ProxyMed continued its growth by adding 22
new payers and strategic partners and also adding over 4,000 new physicians
representing over 14,400 services sold, or 3.6 services sold per physician, in
its transaction segment.

         "Since the driving force behind ProxyMed's growth is our transaction
business, we are pleased at our continued progress in this segment, as
highlighted by the strong sequential growth of 6% in our core transaction
volume," said Nancy J. Ham, ProxyMed's president and chief operating officer.
"In addition, the number of new physicians and partners that we signed in the
quarter provide a strong foundation for accelerating growth in the first two
quarters of 2003. We are confident that our recent investments in expanding our
implementation throughput have us well positioned to quickly bring these
customers into production."

LABORATORY COMMUNICATIONS SOLUTIONS

         The Laboratory Communications Solutions segment reported revenues of
$7.1 million for the fourth quarter of 2002, a decrease of 4% compared to
revenues of $7.4 million for 2001. However, due to proactive cost controls
implemented early in the fourth quarter, EBITDA for the quarter increased 45% to
$1.4 million. EBITDA margins increased from almost 13% to over 19% as a result
of the mix of revenues and cost controls implemented.

         Sequentially, revenues were flat compared to the third quarter of 2002
while EBITDA was up 28% from $1.1 million. EBITDA margins also improved from
last quarter's margin of 15%.

         For the 2002 year, the lab segment reported revenues of $27.7 million,
an increase of over 5% compared to revenues of $26.3 million for 2001. EBITDA
for the 2002 year was up slightly to $4.4 million while annual EBITDA margins
remained steady at 16%.

         During the fourth quarter, ProxyMed introduced two significant new
products. First, ProxyMed announced the general availability of Report Tracker,
an innovative, comprehensive and scalable reporting technology. Report Tracker
technology provides proof of delivery and audit trail capabilities in a design
that can host a variety of access control devices and also take advantage of
Internet connectivity options. This new design allows labs the level of control
and security they need for HIPAA, as well as greater flexibility to take
advantage of evolving connectivity options and protocols. ProxyMed also
introduced Quick-Req, its new modular approach to lab order entry/result
reporting solutions. Initial feedback and interest on both products has been
strong.

         "Even with the relative maturity of our lab business, we continue to
maintain strong profitability. We achieved this by focusing on higher margin
products, implementing cost controls, and completing the successful integration
of our KenCom acquisition," added Nancy Ham. "Looking ahead to 2003, we are
well-positioned with new technologies targeted at upselling our existing large
customer base, and with increasing penetration into newer markets such as
anatomical pathology."

                                        3




                                   STATISTICS

         Management considers the following metrics important to monitor its
transaction business:


        ---------------------------------- -------------- ------------    ------------- --------------- -------------
                   DESCRIPTION                ANNUAL        ANNUAL            Q/E            Q/E            Q/E
                                               2002          2001           12/31/02       9/30/02        12/31/01
        ---------------------------------- -------------- ------------    ------------- --------------- -------------
                                                                                           
        Core   transactions    (excluding     89,122,600   60,072,800       24,534,800   23,211,800(1)    19,272,600
        encounters)

        Encounters                            25,044,900   27,418,800        5,571,500       5,977,400     7,195,600
                                             -----------   ----------       ----------      ----------    ----------
        TOTAL TRANSACTIONS                   114,167,500   87,941,600       30,106,300      29,189,200    26,468,200
                                             ===========   ==========       ==========      ==========    ==========
        Number of direct physicians                                             74,000          70,000        60,000

        Number of indirect physicians                                           63,850          56,250        40,000

        Number of services  utilized  per                                      2.5            2.05        1.3 (est)
        all direct physicians


(1) Includes "acquired transactions" from Q3 2002 acquisitions


                                   ACQUISITION

         In addition to these operating events, during the fourth quarter of
2002 ProxyMed also acquired all of the capital stock of MedUnite, Inc., a
leading provider of healthcare claims processing services founded by seven of
the nation's largest health insurance companies, for $10.0 million in cash and
$13.4 million in 4% convertible notes. In addition to the consideration paid,
ProxyMed has also recorded approximately $9.0 million in acquisition-related
expenses including transaction and exit costs. While the year end 2002 audited
balance sheet of MedUnite is still being finalized, the purchase price is
expected to include the following allocation to intangible assets:

               o  Customer relationships of $6.6 million to be amortized over 10
                  years

               o  Legacy technology platform of $1.2 million to be amortized
                  over 1 year

               o  New technology platforms of $4.8 million to be amortized over
                  5 years. Additional development expenditures of $2.0 million
                  are expected to be spent in relation to these projects in 2003

               o  Goodwill of approximately $23 million

         The acquisition of MedUnite on December 31, 2002 did not have any
significant financial impact on ProxyMed's results of operations in the fourth
quarter of 2002, other than the incurring of $97,000 in acquisition expenses,
which were included in the company's operating expenses.

                                        4




         "With all of the progress we made in 2002 it was extremely rewarding to
culminate the year with our acquisition of MedUnite. The combined operations of
ProxyMed and MedUnite create the second largest physician claims clearinghouse
in the country," said Michael K. Hoover, ProxyMed's chairman and chief executive
officer. "Our goal for 2003 is clear - integrate MedUnite into our existing
operations to achieve positive cash contribution from MedUnite as soon as
possible and expand our relationship with the seven founding members and
NDCHealth. Achieving both of these goals will provide a solid base to increase
shareholder value."


ABOUT PROXYMED - WHERE HEALTHCARE CONNECTS(TM)

ProxyMed solves the business problems of physician offices every day by
automating their financial, administrative and clinical transactions with
healthcare institutions. To facilitate these services, ProxyMed operates
ProxyNet(R), its secure, proprietary national electronic information network,
which provides physicians and other healthcare providers with direct
connectivity to one of the industry's largest list of payers, the largest list
of chain and independent pharmacies and the largest list of clinical
laboratories. ProxyMed exceeds customer expectations through our expertise,
proven methodologies and dedication to service excellence.


SAFE HARBOR STATEMENT

NOTE: THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS THAT REFLECT OUR
CURRENT ASSUMPTIONS AND EXPECTATIONS REGARDING FUTURE EVENTS. WHILE THESE
STATEMENTS REFLECT OUR CURRENT JUDGMENT, THEY ARE SUBJECT TO RISKS AND
UNCERTAINTIES. ACTUAL RESULTS MAY DIFFER SIGNIFICANTLY FROM PROJECTED RESULTS
DUE TO A NUMBER OF FACTORS, INCLUDING, THE SOUNDNESS OF OUR BUSINESS STRATEGIES
RELATIVE TO THE PERCEIVED MARKET OPPORTUNITIES; OUR ABILITY TO INTEGRATE
MEDUNITE INTO OUR EXISTING OPERATIONS, OUR ABILITY TO IDENTIFY SUITABLE FUTURE
ACQUISITION CANDIDATES; OUR ABILITY TO SUCCESSFULLY INTEGRATE ANY FUTURE
ACQUISITIONS; OUR ABILITY TO SUCCESSFULLY DEVELOP, MARKET, SELL, CROSS-SELL,
INSTALL AND UPGRADE OUR CLINICAL AND FINANCIAL TRANSACTION SERVICES AND
APPLICATIONS TO CURRENT AND NEW PHYSICIANS, PAYERS, MEDICAL LABORATORIES AND
PHARMACIES; OUR ABILITY TO COMPETE EFFECTIVELY ON PRICE AND SUPPORT SERVICES;
OUR ASSESSMENT OF THE HEALTHCARE INDUSTRY'S NEED, DESIRE AND ABILITY TO BECOME
TECHNOLOGY EFFICIENT; AND OUR ABILITY AND THAT OF OUR BUSINESS ASSOCIATES TO
COMPLY WITH VARIOUS GOVERNMENT RULES REGARDING HEALTHCARE AND PATIENT PRIVACY.
THESE AND OTHER RISK FACTORS ARE MORE FULLY DISCUSSED IN THE RISK FACTORS
DISCLOSURE IN OUR FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2001 AND OUR OTHER
FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION, WHICH WE STRONGLY URGE YOU
TO READ. WE EXPRESSLY DISCLAIM ANY INTENT OR OBLIGATION TO UPDATE ANY
FORWARD-LOOKING STATEMENTS. WHEN USED, THE WORDS "BELIEVES," "ESTIMATED,"
"EXPECTS," "ANTICIPATES," "MAY" AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY
FORWARD-LOOKING STATEMENTS.

MORE INFORMATION ON PROXYMED IS AVAILABLE ON ITS HOME PAGE AT www.proxymed.com.


                                        5



                         PROXYMED, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)




                                                                 Three Months Ended December 31,       Year Ended December 31,
                                                                 -------------------------------    -----------------------------
                                                                      2002             2001             2002             2001
                                                                  ------------     ------------     ------------     ------------
                                                                                                         
Revenues                                                          $ 13,193,600     $ 12,773,200     $ 50,181,800     $ 43,230,300
                                                                  ------------     ------------     ------------     ------------
Costs and expenses:
     Cost of sales                                                   5,962,800        6,497,300       23,023,500       20,408,000
     Selling, general and administrative expenses                    5,817,400        5,345,800       23,144,700       21,266,900
     Write-of of impaired assets                                        37,500           91,100           37,500           91,100
     Operating depreciation and amortization (1)                       510,000          462,500        1,968,700        1,766,700
                                                                  ------------     ------------     ------------     ------------
           Total operating costs and expenses (1)                   12,327,700       12,396,700       48,174,400       43,532,700
                                                                  ------------     ------------     ------------     ------------

           Operating income (loss), as adjusted (1)                    865,900          376,500        2,007,400         (302,400)

Acquisition-related amortization charges                              (229,000)        (991,900)        (667,300)      (6,409,700)
Litigation settlement, net                                                  --           39,800          264,500           39,800
Interest income (expense), net                                          94,500         (105,300)         345,300         (125,600)
                                                                  ------------     ------------     ------------     ------------

           Net income (loss)                                           731,400         (680,900)       1,949,900       (6,797,900)

Deemed dividends and other charges                                          --        4,042,600          611,700       12,262,000
                                                                  ------------     ------------     ------------     ------------

           Net income (loss) applicable to common shareholders    $    731,400     $ (4,723,500)    $  1,338,200     $(19,059,900)
                                                                  ============     ============     ============     ============

Diluted income (loss) per share:                                  $       0.11     $      (1.44)    $       0.21     $      (8.81)
                                                                  ============     ============     ============     ============

Diluted weighted average shares outstanding                          6,762,089        3,286,149        6,396,893        2,162,352
                                                                  ============     ============     ============     ============

EBITDA (2)                                                        $  1,413,400     $    930,100     $  4,013,600     $  1,555,400
                                                                  ============     ============     ============     ============


(1) Excludes acquisition-related amortization charges related to goodwill and
    other intangibles. Amortization of goodwill ceased as of January 1, 2002
    under FAS No. 142.
(2) EBITDA is a metric that ProxyMed believes is a meaningful measurement of
    operating performance. The calculation of EBITDA has no basis in Generally
    Accepted Accounting Principles.


                                       6



                         PROXYMED, INC. AND SUBSIDIARIES
                         SEGMENT INFORMATION (UNAUDITED)


                                                        Three Months Ended December 31,            Year Ended December 31,
                                                       ---------------------------------     ---------------------------------
                                                            2002               2001               2002               2001
                                                       --------------     --------------     --------------     --------------
                                                                                                    
Revenues:
     Electronic healthcare transaction processing      $  6,095,400       $  5,404,800       $ 22,439,100       $ 16,938,400
     Laboratory communication solutions                   7,098,200          7,368,400         27,742,700         26,291,900
                                                       ------------       ------------       ------------       ------------
                                                       $ 13,193,600       $ 12,773,200       $ 50,181,800       $ 43,230,300
                                                       ============       ============       ============       ============

Cost of sales:
     Electronic healthcare transaction processing      $  2,381,300       $  2,281,300       $  8,793,600       $  6,531,200
     Laboratory communication solutions                   3,581,500          4,216,000         14,229,900         13,876,800
                                                       ------------       ------------       ------------       ------------
                                                       $  5,962,800       $  6,497,300       $ 23,023,500       $ 20,408,000
                                                       ============       ============       ============       ============

Selling, general and administrative expenses:
     Electronic healthcare transaction processing      $  2,992,300       $  2,465,500       $ 11,429,600       $  9,905,600
     Laboratory communication solutions                   2,144,400          2,208,900          9,120,600          8,168,500
     Corporate                                              680,700            671,400          2,594,500          3,192,800
                                                       ------------       ------------       ------------       ------------
                                                       $  5,817,400       $  5,345,800       $ 23,144,700       $ 21,266,900
                                                       ============       ============       ============       ============

Depreciation and amortization:
     Electronic healthcare transaction processing      $    437,200       $  1,233,400       $  1,581,400       $  7,285,400
     Laboratory communication solutions                     255,600            157,900            856,700            560,600
     Corporate                                               46,200             63,100            197,900            330,400
                                                       ------------       ------------       ------------       ------------
                                                       $    739,000       $  1,454,400       $  2,636,000       $  8,176,400
                                                       ============       ============       ============       ============

Operating income (loss):
     Electronic healthcare transaction processing      $    247,100       $   (650,300)      $    597,000       $ (6,858,700)
     Laboratory communication solutions                   1,116,700            785,600          3,535,500          3,685,900
     Corporate                                             (726,900)          (750,700)        (2,792,400)        (3,539,300)
                                                       ------------       ------------       ------------       ------------
                                                       $    636,900       $   (615,400)      $  1,340,100       $ (6,712,100)
                                                       ============       ============       ============       ============

EBITDA:
     Electronic healthcare transaction processing      $    721,800       $    658,000       $  2,215,900       $    501,600
     Laboratory communication solutions                   1,372,300            943,500          4,392,200          4,246,600
     Corporate                                             (680,700)          (671,400)        (2,594,500)        (3,192,800)
                                                       ------------       ------------       ------------       ------------
                                                       $  1,413,400       $    930,100       $  4,013,600       $  1,555,400
                                                       ============       ============       ============       ============


                                       7