FPA Medical Management, Inc. announces first quarter results.

SAN DIEGO, CALIFORNIA--(BUSINESS WIRE)--April 30, 1997--

Fifth consecutive quarter of exceeding analysts' estimates

FPA Medical Management, Inc. (Nasdaq:FPAM) today announced revenues and earnings for the first quarter ended March 31, 1997.

Operating revenues for the first quarter ended March 31, 1997 increased 114% to $223 million compared to $104 million in the same period last year, including the operations of AHI Healthcare Systems, Inc., recently merged into FPA, accounted for as a pooling of interests. Net income for the first quarter was $6.4 million or $0.20 per share (excluding a non-recurring charge of $37 million related to costs associated with the acquisition of AHI Healthcare Systems, Inc.) compared to net income of $1.4 million or $0.05 per share for the same period last year. Weighted average shares outstanding were 32,288,183 and 25,814,913 for the first quarters of 1997 and 1996, respectively.

Commenting on the results, Steven M. Lash, Executive Vice President and Chief Financial Officer stated, "We are pleased with our financial performance in the first quarter. Strong HMO enrollment continues to drive our growth. After the recent completed acquisition of AHI, we now have over 7,200 primary care physicians providing quality care to over 864,000 HMO members as compared to 1,800 primary care physicians and 232,000 HMO members for the same quarter last year. In addition, we continue to show margin improvements based on the further integration of acquisitions as we continue to reduce medical and administrative expenses. This operating leverage is reflected in the reduction in our overall medical loss ratio of 71% for the first quarter of 1997 compared to 72% for the same period last year."

Dr. Seth Flam, President and Chief Executive Officer, stated, "We continue to realize strong revenue and earnings growth. During the quarter, we showed same-store growth of 7% due to the successful integration of new operations into the FPA network. Specifically, the integration and consolidation of the previously owned Foundation Health Systems (NYSE:FHS) clinics is ahead of plan."

Dr. Sol Lizerbram, Chairman, added, "FPA maintains strong relationships with over 30 HMOs and continues to pursue new payor agreements. We are in the process of expanding existing payor relationships into statewide service contracts, and are exploring national payor agreements. Two new global capitation agreements were signed this quarter with Humana (NYSE:HUM) and Physician Corporation of America (Nasdaq:PCAM). These two new contracts will add over 14,000 members in the state of Florida. In addition, we believe Sterling's emergency room physician network will enhance our ability to attract new payors and will enable us to penetrate new markets."

FPA Medical Management, Inc. is a national physician practice management company which acquires, organizes and manages primary care physician networks and provides contract management services to hospital emergency departments.

Certain statements contained in this release are forward looking. Although FPA Medical Management, Inc. believes that its expectations are based on reasonable assumptions within the bounds of its knowledge of its business and operations, there can be no assurance that actual results will not differ materially from their expectations. Factors that could cause actual results to differ from expectations include the difficulty in controlling healthcare costs, integrating new operations, and the possible negative effects of prospective healthcare reform. For other important factors that may cause actual results to differ materially from expectations and underlying assumptions, see reports by FPA Medical Management, Inc. filed with the Securities and Exchange Commission. -0-

            FPA MEDICAL MANAGEMENT, INC. AND SUBSIDIARIES
                Consolidated Statements of Operations


                                Three Months Ended
                              3/31/97(1)   3/31/97       3/31/96

Operating revenue           $222,839,614  $222,839,614 $103,952,815
Medical services expense     158,105,082  158,105,082    74,725,588
Gross profit                  64,734,532   64,734,532    29,227,227
General and administrative
 expense                      53,312,526   53,312,526    26,477,739
Merger, restructuring and
   other unusual charges              --   36,833,586            --
Income (loss) from
  operations                  11,422,006  (25,411,580)    2,749,488
Other expense - net           (1,625,180)  (1,625,180)     (173,473)
Income (loss) before tax       9,796,826  (27,036,760)    2,576,015
Income tax (expense) benefit  (3,428,890)   8,111,027    (1,159,683)
Net income (loss)             $6,367,936 $(18,925,733)   $1,416,332

Net income (loss)
  per share (a)                 $   0.20     $  (0.59)      $  0.05

Weighted average shares
 outstanding (a)              32,288,183   32,288,183    25,814,913

Depreciation and amortization
 included in general and
 administrative expense   $    5,865,267  $ 5,865,267  $  2,376,085

(1) Excludes merger, restructuring and other unusual charges.

(a) Reflects a one-for-one stock dividend effective April 3, 1995 to
stockholders of record on March 1, 1995.
-0-

                    FPA MEDICAL MANAGEMENT, INC.
            Statistical Information as of March 31, 1997

Number of Primary Care Physicians:     Number of:

  Employed           382               Physician Groups (IPAs)   73
  IPA              5,489               Emergency Room Contracts 109
  Hospital-Based   1,338               HMO Payors                36
  Total Physicians 7,209

Number of Enrollees:                   Global Capitation:
Commercial              631,924        Percent of Membership   16.9
Senior                   86,709        Percent of Capitation
Medicaid                146,143         Revenues               27.6
Total Enrollment        864,776

CONTACT: FPA Medical Management, Inc.

Investor Contact:

Steven M. Lash

Executive Vice President and

Chief Financial Officer

619-453-1000

or

Robert P. Jones/Jill Ruja

Media Contact: Miriam Adler

Morgen-Walke Associates

212-850-5600