Q S I   P R E S S   R E L E A S E S

• Share Repurchase Authorization Extended

TUSTIN, Calif., February 10, 1999 -- Quality Systems, Inc. (NASDAQ: QSII) announced today results for the fiscal 1999 third quarter ended December 31, 1998.

Third quarter revenues for fiscal 1999 increased 17.1% to $8.8 million, from $7.5 million for the third quarter of the previous year.  Net income for the Company was $369,000, or $0.06 per basic and diluted share, for the quarter ended December 31, 1998 compared with net income of $232,000, or $0.04 per basic and diluted share, for the comparable quarter of the previous year.

For the nine-month period ended December 31, 1998, the Company posted net revenues of $24.0 million, up 8.0% from $22.2 million for the nine months ended December 31, 1997.  In the current nine-month period, the Company incurred a net loss of $(171,000), or $(0.03) per basic and diluted share, compared to a net loss of $(2.2) million, or $(0.36) per basic and diluted share, for the same period a year ago.  The nine-months ended December 31, 1997 included the recognition of a $4.7 million charge for purchased in-process research and development in connection with the MicroMed acquisition.  Excluding this charge and the related income tax benefit, net income for the nine months ended December 31, 1997 would have been $837,000, or $0.14 per share on a basic and diluted basis.

The increase in net revenues for the quarter ended December 31, 1998 was driven primarily by the increase in revenues from recurring maintenance and other services which rose to $3.8 million, up 39.6% from $2.7 million for the same period a year ago.  This increase was principally a result of growing additional service revenues from Quality Systems’ installed client base, augmented by growth in such revenues from its subsidiaries, Clinitec and MicroMed.  Quarterly revenues from sales of computer systems, upgrades and supplies also contributed to the increase in net revenues, growing 4.3% to $5.0 million from $4.8 million for the prior year’s period.  The more moderate growth of sales of computer systems, upgrades and supplies is primarily due to the adoption of a new accounting method which defers certain revenues from systems contracts executed and shipped during the quarter.

Quality Systems’ Chairman and CEO, Sheldon Razin commented, “Our third quarter activity included several important new agreements throughout the company’s lines of business.  We are most excited about the growing synergy in our sales opportunities.  For example, one-third of the new systems agreements for Clinitec’s NextGen® software also included the purchase of either the MicroMed Practice Management System or Quality Systems’ legacy product.  To continue to build on this trend, we have merged the sales personnel of Clinitec and MicroMed into one team of representatives promoting both products.

“We also concluded two key agreements with separate customers using our dental practice management system to incorporate our leading-edge Clinical Product Suite technology, which integrates electronic charting, digitized x-rays, intra-oral imaging, and patient education.  These agreements will help transform these two dental groups, one in Delaware and the other in Colorado, into truly state-of-the-art practices, with integrated computerization throughout their operatories and the front-office.”

Mr. Razin also announced that the Company’s Board of Directors has extended for another year management’s authority to repurchase shares of the Company’s Common Stock on the open market subject to compliance with applicable laws and regulations.  The timing and amount of repurchases, if any, will be at the sole discretion of the Company’s management.  The Board in February 1997 authorized management to repurchase, at its sole discretion, up to 10% of the Company’s then outstanding shares through February 1998.  On February 9, 1998, the Board approved a one-year extension of the authorization.  To date, the Company has repurchased 92,500 shares.

Quality Systems is one of the leading developers and providers of computer-based practice management and electronic medical records systems for medical and dental group practices, with a customer base of approximately 500 clients in 45 states, Canada and Saudi Arabia.

This press release contains forward-looking statements, including those relating to revenue and net income, that involve a number of risks and uncertainties. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are volume and timing of systems sales and installations, length of sales cycles and installation process, seasonal patterns of sales and customer buying behavior, the development by competitors of new or superior technologies, delays in product development, undetected errors or bugs in software, product liability, changing economic, political or regulatory influences on the healthcare industry, changes in product pricing policies, competitive pressures, possible regulation of the Company's software by the U.S. Food and Drug Administration, general economic conditions, and the risk factors detailed from time to time in Quality Systems' periodic reports and registration statements filed with the Securities and Exchange Commission as applied to the company as of the date hereof.

(A) Pro forma information for the nine months ended December 31, 1997 excludes a $4.7 million charge for purchased in-process research and development and the related $1.7 million benefit from income taxes incurred in connection with the acquisition of MicroMed Healthcare Information Systems, Inc.

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