EXHIBIT 99.1

News Release

FOR IMMEDIATE RELEASE

Media Contact:

Julie Pekarek

Chief Marketing Officer

414.977.4254

jpekarek@merge.com

MERGE HEALTHCARE ANNOUNCES THIRD STRAIGHT
QUARTER OF PROFITABILITY

Milwaukee, WI, April 30, 2009 - Merge Healthcare Incorporated (NASDAQ: MRGE), a leading medical imaging solutions provider, today announced financial results for the first quarter of 2009.

First Quarter Results:

First quarter net sales of 2009 totaled $15.3 million, compared to $13.7 million in the first quarter of 2008 and $15.1 million in the fourth quarter of 2008.

Operating income in the first quarter of 2009 was $3.5 million, compared to an operating loss of $8.4 million in the first quarter of 2008 and operating income of $3.7 million in the fourth quarter of 2008.

Net income in the first quarter of 2009 was $2.8 million, or $0.05 earnings per basic and diluted share, compared to a net loss of $7.8 million, or $0.23 loss per basic and diluted share, in the first quarter of 2008; and a net income of $1.9 million, or a $0.03 earnings per basic and diluted share, in the fourth quarter of 2008.

In the first quarter of 2009, the cash balance increased by $1.8 million to $19.7 million at March 31, 2009.  In addition, net accounts receivable increased by $0.6 million to $13.4 million, while deferred revenue decreased by $2.0 million to $14.8 million at March 31, 2009.

"Merge Healthcare has started 2009 with a solid quarter in a difficult economic environment,” states Justin Dearborn, CEO.   We are pleased to deliver a third consecutive quarter of EPS growth, and look forward to discussing the results in more detail on the call later today.”

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Conference Call Information:

Merge will hold a public web cast today at 4:15 p.m. EDT to review financial results for the first quarter of 2009 and to provide an update on business operations and strategy. Immediately following, there will be a question and answer session.

Investors will have the opportunity to listen to the conference call via telephone or over the Internet at Merge Healthcare Web Cast.  To access the call, dial 1.800.221.2015 or 706.634.2159. The Conference ID Number to reference is 96808446.  A replay via the Internet or telephone will be available shortly after the call at http://www.merge.com/investor/conferencecall.asp.  

Merge Healthcare’s solutions solve mission-critical issues for radiology practices, outpatient imaging centers, hospitals, pharmaceutical companies and device manufacturers worldwide.  For additional information, visit www.merge.com.

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This news release contains "forward-looking statements," including statements with respect to the financial results the Company currently expects it will report for the first quarter, which are statements related to future, not past, events, and, with respect to such anticipated report of its financial results, are based on the Company’s preliminary review of its operations for such period, and which are unaudited and remain subject to quarter-end and year-end adjustment, as well as potential revision upon completion of our 2009 financial statements and review thereof by our independent registered accounting firm.  Forward-looking statements usually describe our expected future business and financial outlook or performance, and often contain words such as “will,” “believes,” “intends,” “anticipates,” “expects,” "plans," "seeks," and similar expressions.  Forward-looking statements, by their nature, address matters that are, to varying degrees, uncertain and subject to various known and unknown risks.  For us, particular uncertainties and risks that could cause actual results to differ materially from our forward-looking statements include: possible accounting adjustments and revisions to our current preliminary expectations as to the results the Company will report for 2009 financial results; market acceptance and performance of our products and services; the impact of competitive products and pricing; possible delays in the implementation of our managed services offering; the risks and effects of our recent changes in our executive and Board leadership; the risks and effects of our recent securities issues, including the issuance of certain senior secured notes; the past restatement of our financial statements and other actions that may be taken or required as a result of such restatement; our ability to generate sufficient cash from operations to meet future operating, financing and capital requirements, including repayment obligations with respect to our outstanding indebtedness; risks associated with our prior delays in filings with the SEC or our ability to continue to meet the listing requirements of The NASDAQ Stock Market; the costs, risks and effects of various pending legal proceedings and investigations, including the formal investigation being conducted by the Securities and Exchange Commission; and other risk factors detailed in our filings with the Securities and Exchange Commission.  These uncertainties and risks may cause our actual future results to be materially different than those expressed in our forward-looking statements.  Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made.  We undertake no obligation to update such forward-looking statements or any of such risks, uncertainties and other factors.

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MERGE HEALTHCARE INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
	March 31,		December 31,
	2009		2008
Current assets:
Cash (including restricted cash)	$	19,690	$	17,848
Accounts receivable, net		13,387		12,779
Inventory		114		550
Prepaid expenses		1,456		1,509
Deferred income taxes		217		217
Other current assets		278		721
Total current assets		35,142		33,624
Property and equipment, net		1,730		1,974
Purchased and developed software, net		5,003		5,653
Customer relationships, net		2,054		2,291
Deferred tax assets		4,585		4,585
Investments		5,527		5,690
Other		775		920
Total assets	$	54,816	$	54,737
Current liabilities:
Accounts payable	$	2,760	$	3,387
Accrued wages		1,759		1,590
Restructuring accrual		673		1,173
Deferred revenue		14,324		16,150
Other accrued liabilities		2,760		3,070
Total current liabilities		22,276		25,370
Note payable		14,358		14,230
Deferred income taxes		39		39
Deferred revenue		466		644
Income taxes payable		5,435		5,418
Other		177		195
Total liabilities		42,751		45,896
Total shareholders' equity		12,065		8,841
Total liabilities and shareholders' equity	$	54,816	$	54,737

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MERGE HEALTHCARE INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
	Three Months Ended
	March 31,
	2009			2008
Net sales
Software and other	$	8,684		$	6,055
Services and maintenance		6,625			7,688
Total net sales		15,309			13,743
Cost of sales
Software and other		1,230			1,199
Services and maintenance		2,150			3,775
Amortization		650			716
Total cost of sales		4,030			5,690
Gross margin		11,279			8,053
Operating costs and expenses:
Sales and marketing		1,672			3,362
Product research and development		2,271			4,735
General and administrative		3,252			6,158
Restructuring and other expenses		-			1,362
Depreciation and amortization		548			842
Total operating costs and expenses		7,743			16,459
Operating income (loss)		3,536			(8,406	)
Other income (expense)		(672	)		574
Income (loss) before income taxes		2,864			(7,832	)
Income tax expense		22			-
Net income (loss)	$	2,842		$	(7,832	)
Net income (loss) per share - basic	$	0.05		$	(0.23	)
Weighted average number of common
shares outstanding - basic		56,304,568			33,926,183
Net income (loss) per share - diluted	$	0.05		$	(0.23	)
Weighted average number of common
shares outstanding - diluted		57,189,532			33,926,183

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MERGE HEALTHCARE INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
	Three Months Ended
	March 31,
	2009			2008
Cash flows from operating activities:
Net income (loss)	$	2,842		$	(7,832	)
Adjustments to reconcile net income (loss) to
net cash provided by (used in) operating activities:
Depreciation and amortization		1,198			1,558
Share-based compensation		519			1,328
Amortization of note payable issuance costs & discount		274			-
Provision for doubtful accounts receivable and sales returns, net of recoveries		234			18
Net change in assets and liabilities (net of effects of dispositions)		(3,184	)		(221	)
Net cash provided by (used in) operating activities		1,883			(5,149	)
Cash flows from investing activities:
Purchases of property, equipment and leasehold improvements		(67	)		(296	)
Change in restricted cash		258			-
Net cash provided by (used in) investing activities		191			(296	)
Cash flows from financing activities:
Proceeds from exercise of stock options and employee stock purchase plan		26			-
Net cash provided by financing activities		26			-
Effect of exchange rate changes on cash		-			(33	)
Net increase (decrease) in cash		2,100			(5,478	)
Cash and cash equivalents, beginning of period (net of restricted cash) (1)		17,227			13,637
Cash and cash equivalents, end of period (net of restricted cash) (2)	$	19,327		$	8,159

(1)	Restricted cash of $621 and $363 as of December 31, 2008 and 2007, respectively.
(2)	Restricted cash of $363 and $363 as of March 31, 2009 and 2008, respectively.