APACHE Awarded First Veterans Administration Contract; Bed Study Focuses on Meeting Growing Need for Inpatient Surgical Services at Chicago-area VA Hospital.

Business Editors/Health & Medical Writers

MCLEAN, Va.--(BW HealthWire)--Nov. 29, 2000

APACHE Medical Systems, Inc. (Nasdaq:AMSI), today announced that the Company has obtained its first major contract with the Veterans Administration. Edward Hines Jr. Veterans Administration Hospital, Hines, Illinois has contracted with APACHE to conduct a Surgical Bed Utilization Planning and Analysis study.

The APACHE Study will combine the Company's expertise in analyzing patient care flow and bed utilization for high-risk surgical patients. Using the internationally-acclaimed APACHE III system as a foundation for examining patient severity and utilization at the facility, the APACHE study will assist in assessing how much surgical care capacity is needed and how best to meet demand.

"Our contract with the Hines VA Hospital is especially noteworthy because it brings APACHE further into the federal healthcare sector, where our expertise in high-risk, high-cost patient care can make a significant impact," said APACHE president and CEO William A. Knaus, MD, noting that the Northern Virginia Company has also recently announced expansion of its HIV/AIDS-related contract with the Centers for Disease Control and Prevention.

"I'm very pleased with this early success from our Federal initiative, and confident that this important engagement will lead to more frequent association with federal institutions," he added. APACHE announced a new focus on the federal market earlier this year. Last week the Company announced the renewal of a contract with the US Centers for Disease Control and Prevention ("CDC") to continue collecting data and managing the APACHE HIV Insight (R) Database for the CDC's HIV Outpatient Study, and a related award with the CDC's Opportunistic Infection Division to investigate hepatitis and influenza in HIV-positive patients.

About APACHE

APACHE Medical Systems, Inc.--a recognized leader in clinical decision support/outcomes management systems and consulting services for the care of high-risk patients--provides products and services that enable health systems, hospitals and providers to apply an evidence-based approach to achieve clinical performance excellence, reduce cost and compete effectively under managed care. APACHE is helping providers better manage the clinical, financial and patient outcomes of high-risk, high-cost patients in critical, acute, cardiovascular and HIV/AIDS care. APACHE provides advanced clinical data collection tools, registry management and analytic services for federal government research, as well as in support of clinical trial design and product-effectiveness evaluations for the pharmaceutical and medical device industries.

APACHE (www.apache-msi.com) is headquartered in Northern Virginia.

HIV Insight is a registered trademark of APACHE Medical Systems, Inc.

Statements in this press release which are not historical facts are forward-looking statements under provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be recognized by the use of words such as "anticipate," "believe," "expect," "intend" and "estimate" or similar language. All forward-looking statements involve risks and uncertainties. The Company wishes to caution readers that the following important factors, among others, in some cases have affected, and in the future could affect, the Company's actual results and could cause its actual results in fiscal 2000 and beyond to differ materially from those expressed in any forward-looking statements made by, or on behalf of the Company.

Important factors that could cause actual results to differ materially include but are not limited to the Company's having sufficient sales and timely collections to meet cash requirements and achieve profitability; ability to attract and retain key employees; success of its strategy to concentrate its product offerings on high-risk, high-cost patients; ability to timely develop new products and enhance existing products; ability to compete in the competitive and rapidly evolving healthcare information technology industry; success of its marketing and consulting efforts and ability to effectively utilize its direct sales force; ability to protect proprietary information and to obtain necessary licenses on commercially reasonable terms; and ability to comply with and adopt products and services to potential regulatory changes.

All forward looking statements in this press release are made as of the date of the release and are based on information available to the Company's management as of the date of the release. The Company undertakes no obligation to update any statement in this release to reflect information that becomes available to the Company after the date of this release.