##### Table of Contents









UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549





Form 10-Q


|           |  |                                                                                             
|---------- |  | --------------------------------------------------------------------------------------------
|(Mark One) |  |                                                                                             
|þ          |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934 
|          
|           |  | For the quarterly period ended March 31, 2006                                               
|          
|OR        
|          
|o          |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
|          
|           |  | For the transition period
    from           to                                             

Commission file number: 000-19480


Per-Se Technologies, Inc.


(Exact name of Registrant as specified in its charter)


|                                                                                                  |  |                                         
|------------------------------------------------------------------------------------------------- |  | ----------------------------------------
|Delaware                                                                                          |  | 58-1651222                              
|(State or other jurisdiction of
    incorporation or organization)                                |  | (I.R.S. Employer
    Identification No.)
|                                                                                                 
|1145 Sanctuary Parkway, Suite 200
    Alpharetta, Georgia(Address of principal executive offices) |  | 30004(Zip code)                         

(770) 237-4300


(Registrants telephone number, including area code)


Not Applicable


(Former name, former address and former fiscal year, if
changed since last report)


þ o


12b-2


o þ o


12b-2 o þ




|                                        |  |                                  
|--------------------------------------- |  | ---------------------------------
|Title of Class                          |  | Shares Outstanding at May 4, 2006
|                                        |  |                                  
|Common Stock $0.01 Par Value            |  | 39,016,626 shares                
|Non-voting Common Stock $0.01 Par Value |  | 0 Shares                         









---



##### 










PER-SE TECHNOLOGIES, INC.


FORM 10-Q


For the Fiscal Quarter Ended March 31, 2006


|                                             |  |                                                                                           |  |                                                                                                              |    |  |   | 
|-------------------------------------------- |  | ----------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------ | -- |  | - | 
|                                             |  |                                                                                           |  | Page                                                                                                         |   
|                                             |  |                                                                                           |  |                                                                                                              |   
|PART I: FINANCIAL
    INFORMATION           
|Item 1.                                      |  | Financial Statements                                                                      |  |                                                                                                              | 2  | 
|                                             |  |                                                                                           |  | Consolidated Balance Sheets as of
    March 31, 2006 and December 31, 2005 (Unaudited)                       |    |  | 2 | 
|                                             |  |                                                                                           |  | Consolidated Statements of Operations for
    the three months ended March 31, 2006 and 2005
    (Unaudited) |    |  | 3 | 
|                                             |  |                                                                                           |  | Consolidated Statements of Cash Flows for
    the three months ended March 31, 2006 and 2005
    (Unaudited) |    |  | 4 | 
|                                             |  |                                                                                           |  | Notes to Consolidated Financial Statements
    (Unaudited)                                                   |    |  | 5 | 
|Item 2.                                      |  | Managements Discussion and Analysis
    of Financial Condition and Results of Operations |  |                                                                                                              | 21 | 
|Item 3.                                      |  | Quantitative and Qualitative Disclosures
    About Market Risk                            |  |                                                                                                              | 28 | 
|Item 4.                                      |  | Controls and Procedures                                                                   |  |                                                                                                              | 29 | 
|                                            
|PART II: OTHER INFORMATION                  
|Item 1.                                      |  | Legal Proceedings                                                                         |  |                                                                                                              | 32 | 
|Item 1A.                                     |  | Risk Factors                                                                              |  |                                                                                                              | 32 | 
|Item 4.                                      |  | Submission of Matters to a Vote of Security
    Holders                                   |  |                                                                                                              | 39 | 
|Item 6.                                      |  | Exhibits                                                                                  |  |                                                                                                              | 39 | 
|EX-31.1 SECTION 302 CERTIFICATION OF THE CEO
|EX-31.2 SECTION 302 CERTIFICATION OF THE CFO
|EX-32.1 SECTION 906 CERTIFICATION OF THE CEO
|EX-32.2 SECTION 906 CERTIFICATION OF THE CFO



1



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##### Table of Contents






PART I: FINANCIAL INFORMATION







|        |                     
|------- | --------------------
|Item 1. | Financial Statements

PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES





CONSOLIDATED BALANCE SHEETS (UNAUDITED)


|                                                         |                                                                                                                                                                                                    |                                            |         |           |              |  |         |          |         | 
|-------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ------- | --------- | ------------ |  | ------- | -------- | ------- | 
|                                                         |                                                                                                                                                                                                    | March 31,                                  |         |           | December 31, | 
|                                                         |                                                                                                                                                                                                    | 2006                                       |         |           | 2005         | 
|                                                         |                                                                                                                                                                                                    |                                            |         |           |              | 
|                                                         |                                                                                                                                                                                                    | (In thousands, except                      |        
|                                                         |                                                                                                                                                                                                    | par value data)                            |        
|Current Assets:                                          |                                                                                                                                                                                                    |                                            |         |           |              |  |         |         
|                                                         | Cash and cash equivalents                                                                                                                                                                          |                                            | $       | 35,908    |              |  | $       | 61,161   |        
|                                                         | Restricted cash                                                                                                                                                                                    |                                            |         | 43        |              |  |         | 20       |        
|                                                         | Accounts receivable, billed (less allowances of $3,804 and
    $3,035 as of March 31, 2006, and December 31, 2005,
    respectively)                                                               |                                            |         | 92,316    |              |  |         | 54,135   |        
|                                                         | Accounts receivable, unbilled (less allowances of $313 as of
    March 31, 2006, and December 31, 2005)                                                                                            |                                            |         | 436       |              |  |         | 262      |        
|                                                         | Deferred income taxes  current, net                                                                                                                                                               |                                            |         | 4,507     |              |  |         | 4,056    |        
|                                                         | Prepaid expenses                                                                                                                                                                                   |                                            |         | 12,363    |              |  |         | 3,004    |        
|                                                         | Other                                                                                                                                                                                              |                                            |         | 5,944     |              |  |         | 3,535    |        
|                                                         |                                                                                                                                                                                                    |                                            |         |           |              | 
|                                                         |                                                                                                                                                                                                    | Total current assets                       |         |           | 151,517      |  |         |          | 126,173 | 
|Property and equipment, net of accumulated depreciation  |                                                                                                                                                                                                    |                                            | 42,168  |           |              |  | 16,843  |         
|Goodwill                                                 |                                                                                                                                                                                                    |                                            | 382,486 |           |              |  | 38,199  |         
|Other intangible assets, net of accumulated amortization |                                                                                                                                                                                                    |                                            | 306,888 |           |              |  | 21,946  |         
|Deferred income taxes, net                               |                                                                                                                                                                                                    |                                            | 29,151  |           |              |  | 26,238  |         
|Other                                                    |                                                                                                                                                                                                    |                                            | 18,362  |           |              |  | 10,124  |         
|                                                         |                                                                                                                                                                                                    |                                            |         |           |              | 
|                                                         |                                                                                                                                                                                                    | Total assets                               |         | $         | 930,572      |  |         | $        | 239,523 | 
|                                                         |                                                                                                                                                                                                    |                                            |         |           |              | 
|Current Liabilities:                                     |                                                                                                                                                                                                    |                                            |         |           |              |  |         |         
|                                                         | Accounts payable                                                                                                                                                                                   |                                            | $       | 15,099    |              |  | $       | 5,982    |        
|                                                         | Accrued compensation                                                                                                                                                                               |                                            |         | 24,681    |              |  |         | 15,265   |        
|                                                         | Accrued expenses                                                                                                                                                                                   |                                            |         | 57,030    |              |  |         | 17,002   |        
|                                                         | Current portion of long-term debt and capital lease obligations                                                                                                                                    |                                            |         | 269       |              |  |         | 135      |        
|                                                         | Deferred revenue                                                                                                                                                                                   |                                            |         | 37,608    |              |  |         | 25,821   |        
|                                                         |                                                                                                                                                                                                    |                                            |         |           |              | 
|                                                         |                                                                                                                                                                                                    | Total current liabilities                  |         |           | 134,687      |  |         |          | 64,205  | 
|Long-term debt and capital lease obligations             |                                                                                                                                                                                                    |                                            | 520,495 |           |              |  | 125,490 |         
|Deferred revenue                                         |                                                                                                                                                                                                    |                                            | 11,137  |           |              |  |        |         
|Other obligations                                        |                                                                                                                                                                                                    |                                            | 22,347  |           |              |  | 5,312   |         
|                                                         |                                                                                                                                                                                                    |                                            |         |           |              | 
|                                                         |                                                                                                                                                                                                    | Total liabilities                          |         |           | 688,666      |  |         |          | 195,007 | 
|                                                         |                                                                                                                                                                                                    |                                            |         |           |              | 
|Stockholders Equity:                                    |                                                                                                                                                                                                    |                                            |         |           |              |  |         |         
|                                                         | Preferred stock, no par value, 20,000 shares authorized;
    none issued                                                                                                                           |                                            |         |          |              |  |         |         |        
|                                                         | Common stock, voting, $0.01 par value, 200,000 shares
    authorized, 41,945 and 33,511 issued and 38,957 and 30,523
    outstanding as of March 31, 2006, and December 31,
    2005, respectively |                                            |         | 419       |              |  |         | 335      |        
|                                                         | Common stock, non-voting, $0.01 par value, 600 shares
    authorized; none issued                                                                                                                  |                                            |         |          |              |  |         |         |        
|                                                         | Paid-in capital                                                                                                                                                                                    |                                            |         | 1,009,109 |              |  |         | 804,875  |        
|                                                         | Accumulated deficit                                                                                                                                                                                |                                            |         | (728,350  | )            |  |         | (719,759 | )      
|                                                         | Treasury stock at cost, 2,988 as of March 31, 2006, and
    December 31, 2005                                                                                                                      |                                            |         | (41,857   | )            |  |         | (41,817  | )      
|                                                         | Deferred stock unit plan obligation                                                                                                                                                                |                                            |         | 1,471     |              |  |         | 1,429    |        
|                                                         | Accumulated other comprehensive income (loss)                                                                                                                                                      |                                            |         | 1,114     |              |  |         | (547     | )      
|                                                         |                                                                                                                                                                                                    |                                            |         |           |              | 
|                                                         |                                                                                                                                                                                                    | Total stockholders equity                 |         |           | 241,906      |  |         |          | 44,516  | 
|                                                         |                                                                                                                                                                                                    |                                            |         |           |              | 
|                                                         |                                                                                                                                                                                                    | Total liabilities and stockholders equity |         | $         | 930,572      |  |         | $        | 239,523 | 
|                                                         |                                                                                                                                                                                                    |                                            |         |           |              | 



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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)


|                                                                                     |                                               |                                            |         |         |        |   |        |        |       | 
|------------------------------------------------------------------------------------ | --------------------------------------------- | ------------------------------------------ | ------- | ------- | ------ | - | ------ | ------ | ----- | 
|                                                                                     |                                               | Three Months Ended                         |        
|                                                                                     |                                               | March 31,                                  |        
|                                                                                     |                                               |                                            |        
|                                                                                     |                                               | 2006                                       |         |         | 2005   |  
|                                                                                     |                                               |                                            |         |         |        |  
|                                                                                     |                                               | (In thousands, except                      |        
|                                                                                     |                                               | per share data)                            |        
|Revenue                                                                              |                                               | $                                          | 146,241 |         |        | $ | 92,030 |       
|Operating expenses:                                                                  |                                               |                                            |         |         |        |   |        |       
|                                                                                     | Cost of services                              |                                            |         | 101,605 |        |   |        | 60,037 |      
|                                                                                     | Selling, general and administrative           |                                            |         | 44,460  |        |   |        | 21,140 |      
|                                                                                     |                                               |                                            |         |         |        |  
|Operating income                                                                     |                                               |                                            | 176     |         |        |   | 10,853 |       
|Interest expense                                                                     |                                               |                                            | 8,513   |         |        |   | 1,481  |       
|Interest income                                                                      |                                               |                                            | (632    | )       |        |   | (312   | )     
|                                                                                     |                                               |                                            |         |         |        |  
|                                                                                     | (Loss) income before income taxes             |                                            |         | (7,705  | )      |   |        | 9,684  |      
|Income tax expense                                                                   |                                               |                                            | 861     |         |        |   | 253    |       
|                                                                                     |                                               |                                            |         |         |        |  
|                                                                                     | (Loss) income from continuing operations      |                                            |         | (8,566  | )      |   |        | 9,431  |      
|                                                                                     | Loss from discontinued operations, net of tax |                                            |         | (25     | )      |   |        |       |      
|                                                                                     |                                               |                                            |         |         |        |  
|                                                                                     |                                               | Net (loss) income                          |         | $       | (8,591 | ) |        | $      | 9,431 | 
|                                                                                     |                                               |                                            |         |         |        |  
|Net (loss) income per common share-basic:                                            |                                               |                                            |         |         |        |   |        |       
|                                                                                     | (Loss) income from continuing operations      |                                            | $       | (0.22   | )      |   | $      | 0.31   |      
|                                                                                     | Loss from discontinued operations, net of tax |                                            |         |        |        |   |        |       |      
|                                                                                     |                                               |                                            |         |         |        |  
|                                                                                     |                                               | Net (loss) income per common share-basic   |         | $       | (0.22  | ) |        | $      | 0.31  | 
|                                                                                     |                                               |                                            |         |         |        |  
|Weighted average shares used in computing basic (loss) income
    per common share   |                                               |                                            | 38,414  |         |        |   | 30,294 |       
|                                                                                     |                                               |                                            |         |         |        |  
|Net (loss) income per common share-diluted:                                          |                                               |                                            |         |         |        |   |        |       
|                                                                                     | (Loss) income from continuing operations      |                                            | $       | (0.22   | )      |   | $      | 0.29   |      
|                                                                                     | Loss from discontinued operations, net of tax |                                            |         |        |        |   |        |       |      
|                                                                                     |                                               |                                            |         |         |        |  
|                                                                                     |                                               | Net (loss) income per common share-diluted |         | $       | (0.22  | ) |        | $      | 0.29  | 
|                                                                                     |                                               |                                            |         |         |        |  
|Weighted average shares used in computing diluted (loss) income
    per common share |                                               |                                            | 38,414  |         |        |   | 32,552 |       
|                                                                                     |                                               |                                            |         |         |        |  



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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


|                                                                                             |                                                                                            |                               |                                                      |         |         |          |        |       |        |        |  
|-------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------ | ----------------------------- | ---------------------------------------------------- | ------- | ------- | -------- | ------ | ----- | ------ | ------ | -
|                                                                                             |                                                                                            | Three Months Ended            |                                                     
|                                                                                             |                                                                                            | March 31,                     |                                                     
|                                                                                             |                                                                                            |                               |                                                     
|                                                                                             |                                                                                            | 2006                          |                                                      |         | 2005    |         
|                                                                                             |                                                                                            |                               |                                                      |         |         |         
|                                                                                             |                                                                                            | (In thousands)                |                                                     
|Cash Flows from Operating Activities:                                                        |                                                                                            |                               |                                                      |         |         |          |        |      
|Net (loss) income                                                                            |                                                                                            | $                             | (8,591                                               | )       |         | $        | 9,431  |      
|Adjustments to reconcile net (loss) income to net cash provided
    by operating activities: |                                                                                            |                               |                                                      |         |         |          |        |      
|                                                                                             | Depreciation and amortization                                                              |                               |                                                      | 25,446  |         |          |        | 3,752 |       
|                                                                                             | Stock-based compensation expense                                                           |                               |                                                      | 931     |         |          |        |      |       
|                                                                                             | Amortization of deferred financing costs                                                   |                               |                                                      | 553     |         |          |        | 343   |       
|                                                                                             | Deferred income taxes                                                                      |                               |                                                      | 513     |         |          |        |      |       
|                                                                                             | Changes in assets and liabilities, excluding effects of
    acquisitions and divestitures: |                               |                                                      |         |         |          |        |       |       
|                                                                                             |                                                                                            | Accounts receivable, billed   |                                                      |         | (8,395  | )        |        |       | (4,807 | )     
|                                                                                             |                                                                                            | Accounts receivable, unbilled |                                                      |         | 6,210   |          |        |       | (95    | )     
|                                                                                             |                                                                                            | Accounts payable              |                                                      |         | 1,245   |          |        |       | 598    |       
|                                                                                             |                                                                                            | Accrued compensation          |                                                      |         | 3,005   |          |        |       | 2,798  |       
|                                                                                             |                                                                                            | Accrued expenses              |                                                      |         | (23,332 | )        |        |       | (1,085 | )     
|                                                                                             |                                                                                            | Deferred revenue              |                                                      |         | 18,898  |          |        |       | 2,270  |       
|                                                                                             |                                                                                            | Other, net                    |                                                      |         | 6,656   |          |        |       | (43    | )     
|                                                                                             |                                                                                            |                               |                                                      |         |         |         
|                                                                                             |                                                                                            |                               | Net cash provided by operating activities            |         |         | 23,139   |        |       |        | 13,162 |  
|                                                                                             |                                                                                            |                               |                                                      |         |         |         
|Cash Flows from Investing Activities:                                                        |                                                                                            |                               |                                                      |         |         |          |        |      
|Acquisitions, net of cash acquired                                                           |                                                                                            |                               | (429,866                                             | )       |         |          |       |      
|Purchases of property and equipment                                                          |                                                                                            |                               | (3,422                                               | )       |         |          | (2,552 | )    
|Software development costs                                                                   |                                                                                            |                               | (3,901                                               | )       |         |          | (2,073 | )    
|Proceeds from sale of property and equipment                                                 |                                                                                            |                               |                                                     |         |         |          | 19     |      
|Other                                                                                        |                                                                                            |                               |                                                     |         |         |          | (69    | )    
|                                                                                             |                                                                                            |                               |                                                      |         |         |         
|                                                                                             |                                                                                            |                               | Net cash used for investing activities               |         |         | (437,189 | )      |       |        | (4,675 | )
|                                                                                             |                                                                                            |                               |                                                      |         |         |         
|Cash Flows from Financing Activities:                                                        |                                                                                            |                               |                                                      |         |         |          |        |      
|Treasury stock purchases                                                                     |                                                                                            |                               |                                                     |         |         |          | (9,890 | )    
|Proceeds from the exercise of stock options                                                  |                                                                                            |                               | 1,501                                                |         |         |          | 1,402  |      
|Proceeds from borrowings                                                                     |                                                                                            |                               | 435,000                                              |         |         |          |       |      
|Payments of debt                                                                             |                                                                                            |                               | (40,067                                              | )       |         |          |       |      
|Deferred financing costs                                                                     |                                                                                            |                               | (7,662                                               | )       |         |          |       |      
|Other                                                                                        |                                                                                            |                               | 25                                                   |         |         |          | 42     |      
|                                                                                             |                                                                                            |                               |                                                      |         |         |         
|                                                                                             |                                                                                            |                               | Net cash provided by (used for) financing activities |         |         | 388,797  |        |       |        | (8,446 | )
|                                                                                             |                                                                                            |                               |                                                      |         |         |         
|Cash and Cash Equivalents:                                                                   |                                                                                            |                               |                                                      |         |         |          |        |      
|Net change                                                                                   |                                                                                            |                               | (25,253                                              | )       |         |          | 41     |      
|Balance at beginning of period                                                               |                                                                                            |                               | 61,161                                               |         |         |          | 42,422 |      
|                                                                                             |                                                                                            |                               |                                                      |         |         |         
|Balance at end of period                                                                     |                                                                                            | $                             | 35,908                                               |         |         | $        | 42,463 |      
|                                                                                             |                                                                                            |                               |                                                      |         |         |         
|Supplemental Disclosures:                                                                    |                                                                                            |                               |                                                      |         |         |          |        |      
|Cash paid for:                                                                               |                                                                                            |                               |                                                      |         |         |          |        |      
|                                                                                             | Interest                                                                                   |                               | $                                                    | 6,959   |         |          | $      | 94    |       
|                                                                                             | Income taxes                                                                               |                               |                                                      | 9,797   |         |          |        | 118   |       
|Non-cash investing activity:                                                                 |                                                                                            |                               |                                                      |         |         |          |        |      
|                                                                                             | Common Stock issued in connection with the acquisition of
    NDCHealth                    |                               | $                                                    | 197,915 |         |          | $      |      |       



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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES





NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)


Note 1  Basis of Presentation




10-K 10-K). 10-K.




Note 2  Stock-Based Compensation Plans


Share-Based Payment Accounting for Stock-Based
Compensation Accounting for Stock
Issued to Employees Statement of Cash
Flows.








| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | A modified prospective method in which compensation
    cost is recognized beginning with the effective date
    (a) based on the requirements of SFAS No. 123(R)
    for all share-based payments granted after the effective date,
    and (b) based on the requirements of SFAS No. 123
    for all awards granted to employees prior to the effective date
    of SFAS No. 123(R) that remain unvested on the
    effective date.
|
| |  | A modified retrospective method which includes the
    requirements of the modified prospective method described above,
    but also permits entities to restate based on the amounts
    previously recognized under SFAS No. 123 for purposes
    of pro forma disclosures either (a) all periods presented
    or (b) prior interim periods of the year of adoption.                                                              



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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)








|                                |         |                       |        |       |           |   |        |       |  
|------------------------------- | ------- | --------------------- | ------ | ----- | --------- | - | ------ | ----- | -
|                                |         | As Reported           |        |       | Pro Forma |  
|                                |         |                       |        |       |           |  
|                                |         | (In thousands, except |       
|                                |         | per share data)       |       
|Loss before income taxes        |         | $                     | (7,705 | )     |           | $ | (6,774 | )    
|Loss from continuing operations |         | $                     | (8,566 | )     |           | $ | (8,007 | )    
|Net loss                        |         | $                     | (8,591 | )     |           | $ | (8,032 | )    
|Net loss per common share:      |         |                       |        |       |           |   |        |      
|                                | Basic   |                       | $      | (0.22 | )         |   | $      | (0.21 | )
|                                | Diluted |                       | $      | (0.22 | )         |   | $      | (0.21 | )



|                                                                                                                                                    |                       |   |        |      | 
|--------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------- | - | ------ | ---- | 
|Net income as reported                                                                                                                              |                       | $ | 9,431  |     
|Deduct: total stock-based employee compensation expense
    determined under fair value based method for all awards, net of
    related tax effects |                       |   | (1,263 | )   
|                                                                                                                                                    |                       |   |       
|Pro forma net income                                                                                                                                |                       | $ | 8,168  |     
|                                                                                                                                                    |                       |   |       
|Net income per common share:                                                                                                                        |                       |   |        |     
|                                                                                                                                                    | Basic  as reported   |   | $      | 0.31 | 
|                                                                                                                                                    |                       |   |       
|                                                                                                                                                    | Basic  pro forma     |   | $      | 0.27 | 
|                                                                                                                                                    |                       |   |       
|                                                                                                                                                    | Diluted  as reported |   | $      | 0.29 | 
|                                                                                                                                                    |                       |   |       
|                                                                                                                                                    | Diluted  pro forma   |   | $      | 0.25 | 
|                                                                                                                                                    |                       |   |       

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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)


three-to






|                                                   |  |        |       |                  |  |                  |       |                     |  |  |      |  |  |   |        | 
|-------------------------------------------------- |  | ------ | ----- | ---------------- |  | ---------------- | ----- | ------------------- |  |  | ---- |  |  | - | ------ | 
|                                                   |  |        |       |                  |  | Weighted-Average |       |                    
|                                                   |  |        |       | Weighted-Average |  | Remaining        |       | Aggregate Intrinsic
|                                                   |  | Shares |       | Exercise Price   |  | Contractual Term |       | Value              
|                                                   |  |        |       |                  |  |                  |       |                    
|Options outstanding as of January 1                |  |        | 5,386 |                  |  | $                | 10.86 |                     |  |  |      |  |  |   |        | 
|Granted                                            |  |        | 505   |                  |  | $                | 26.32 |                     |  |  |      |  |  |   |        | 
|Exercised                                          |  |        | (170  | )                |  | $                | 8.84  |                     |  |  |      |  |  |   |        | 
|Canceled                                           |  |        | (42   | )                |  | $                | 14.98 |                     |  |  |      |  |  |   |        | 
|                                                   |  |        |       |                  |  |                  |       |                     |  |  |      |  |  |   |        | 
|Options outstanding as of March 31                 |  |        | 5,679 |                  |  | $                | 12.26 |                     |  |  | 7.06 |  |  | $ | 81,778 | 
|                                                   |  |        |       |                  |  |                  |       |                     |  |  |      |  |  |   |        | 
|Options exercisable as of March 31                 |  |        | 3,849 |                  |  | $                | 9.64  |                     |  |  | 5.85 |  |  | $ | 65,510 | 
|                                                   |  |        |       |                  |  |                  |       |                     |  |  |      |  |  |   |        | 
|Options vested and expected to vest as of March 31 |  |        | 5,313 |                  |  | $                | 11.88 |                     |  |  | 6.88 |  |  | $ | 78,524 | 
|                                                   |  |        |       |                  |  |                  |       |                     |  |  |      |  |  |   |        | 





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##### Table of Contents



PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)




|                        |  |              |      |   |      |  |      |  
|----------------------- |  | ------------ | ---- | - | ---- |  | ---- | -
|                        |  | Three Months |     
|                        |  | Ended        |     
|                        |  | March 31,    |     
|                        |  |              |     
|                        |  | 2006         |      |   | 2005 | 
|                        |  |              |      |   |      | 
|Expected life (years)   |  |              | 3.27 |   |      |  | 3.26 |  
|Risk-free interest rate |  |              | 4.3  | % |      |  | 4.0  | %
|Dividend rate           |  |              | 0    | % |      |  | 0    | %
|Expected volatility     |  |              | 46.7 | % |      |  | 50.0 | %





Note 3  Acquisitions










|                                         |  |                |         | 
|---------------------------------------- |  | -------------- | ------- | 
|                                         |  | (In thousands)
|Cash paid to NDCHealth Stockholders      |  | $              | 515,996 | 
|Fair value of Per-Se Common Stock issued |  |                | 197,915 | 
|Transaction costs                        |  |                | 13,891  | 
|                                         |  |                |         | 
|                                         |  | $              | 727,802 | 
|                                         |  |                |         | 



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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)






| |                                      
| | -------------------------------------
| | Preliminary Purchase Price Allocation



|                                       |                      |                |         |         | 
|-------------------------------------- | -------------------- | -------------- | ------- | ------- | 
|                                       |                      | (In thousands)
|Cash                                   |                      | $              | 99,985  |        
|Accounts receivable, billed            |                      |                | 29,786  |        
|Accounts receivable, unbilled          |                      |                | 6,383   |        
|Deferred income tax asset              |                      |                | 96,793  |        
|Other current assets                   |                      |                | 9,892   |        
|Property and equipment                 |                      |                | 25,082  |        
|Identifiable intangible assets         |                      |                | 289,400 |        
|Goodwill  Physician Solutions         |                      |                | 81,825  |        
|Goodwill  Hospital Solutions          |                      |                | 175,512 |        
|Goodwill  Pharmacy Solutions          |                      |                | 86,925  |        
|Other long-term assets                 |                      |                | 8,249   |        
|In-process research and development    |                      |                | 13,300  |        
|Accounts payable                       |                      |                | (7,998  | )      
|Accrued expenses                       |                      |                | (52,278 | )      
|Accrued compensation                   |                      |                | (6,412  | )      
|Deferred revenue                       |                      |                | (3,650  | )      
|Accrued restructuring and merger costs |                      |                | (11,047 | )      
|Deferred income taxes                  |                      |                | (96,793 | )      
|Other long-term obligations            |                      |                | (17,152 | )      
|                                       |                      |                |         |        
|                                       | Total purchase price |                | $       | 727,802 | 
|                                       |                      |                |         |        



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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)






| |                               
| | ------------------------------
| | Identifiable Intangible Assets



|                      |  |            |         |              |  |          |       |             |  |   |         |  |  |  |               | 
|--------------------- |  | ---------- | ------- | ------------ |  | -------- | ----- | ----------- |  | - | ------- |  |  |  | ------------- | 
|                      |  |            |         | Accumulated  |  | Net Book |       |            
|Intangible Asset      |  | Fair Value |         | Amortization |  | Value    |       | Useful Life
|                      |  |            |         |              |  |          |       |            
|Customer lists        |  | $          | 180,900 |              |  | $        | 2,880 |             |  | $ | 178,020 |  |  |  | 11 - 22 years | 
|Developed technology  |  |            | 105,900 |              |  |          | 3,941 |             |  |   | 101,959 |  |  |  | 5 - 8 years   | 
|Trademarks            |  |            | 1,500   |              |  |          | 19    |             |  |   | 1,481   |  |  |  | 20 years      | 
|Noncompete agreements |  |            | 1,100   |              |  |          | 138   |             |  |   | 962     |  |  |  | 2 years       | 
|                      |  |            |         |              |  |          |       |             |  |   |         |  |  |  |               | 
|                      |  | $          | 289,400 |              |  | $        | 6,978 |             |  | $ | 282,422 |  |  |  |               | 
|                      |  |            |         |              |  |          |       |             |  |   |         |  |  |  |               | 





| |                                    
| | -----------------------------------
| | In-Process Research and Development

Accounting
for Business Combinations.




| |                 
| | ----------------
| | Deferred Revenue

build-up build-up


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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)






| |                                       
| | --------------------------------------
| | Accrued Restructuring and Merger Costs







|                                 |  |       |        |  
|-------------------------------- |  | ----- | ------ | -
|                                 |  | Total
|                                 |  |      
|Reserve balance, January 6, 2006 |  | $     | 11,047 |  
|Cost applied against the reserve |  |       | (7,315 | )
|                                 |  |       |        |  
|Reserve balance, March 31, 2006  |  | $     | 3,732  |  
|                                 |  |       |        |  



| |                              
| | -----------------------------
| | Pre-Acquisition Contingencies





| |                                
| | -------------------------------
| | Pro Forma Financial Information



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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)






|                                    |  |                       |         |  
|----------------------------------- |  | --------------------- | ------- | -
|                                    |  | Three Months Ended   
|                                    |  | March 31, 2005(1)    
|                                    |  |                      
|                                    |  | (In thousands, except
|                                    |  | per share data)      
|Revenue                             |  | $                     | 148,842 |  
|Net loss                            |  | $                     | (4,230  | )
|Net loss per common share  basic   |  | $                     | (0.11   | )
|Net loss per common share  diluted |  | $                     | (0.11   | )



|    |                                                                                         
|--- | ----------------------------------------------------------------------------------------
|(1) | Includes approximately $13.3 million of in-process research
    and development expense.

Note 4  (Loss) Earnings Per Share




|                                    |                                                                           |                       |        |        |   |   |       |        | 
|----------------------------------- | ------------------------------------------------------------------------- | --------------------- | ------ | ------ | - | - | ----- | ------ | 
|                                    |                                                                           | Three Months         
|                                    |                                                                           | Ended March 31,      
|                                    |                                                                           |                      
|                                    |                                                                           | 2006                  |        | 2005  
|                                    |                                                                           |                       |        |       
|                                    |                                                                           | (In thousands, except
|                                    |                                                                           | per share data)      
|Net (loss) income                   |                                                                           | $                     | (8,591 | )      |   | $ | 9,431 |       
|Common shares outstanding:          |                                                                           |                       |        |        |   |   |       |       
|                                    | Shares used in computing net (loss) income per common
    share  basic   |                       |        | 38,414 |   |   |       | 30,294 | 
|                                    | Effect of potentially dilutive stock options                              |                       |        |       |   |   |       | 2,258  | 
|                                    |                                                                           |                       |        |        |   |   |       |       
|                                    | Shares used in computing net (loss) income per common
    share  diluted |                       |        | 38,414 |   |   |       | 32,552 | 
|                                    |                                                                           |                       |        |        |   |   |       |       
|Net (loss) income per common share: |                                                                           |                       |        |        |   |   |       |       
|                                    | Basic                                                                     |                       | $      | (0.22  | ) |   | $     | 0.31   | 
|                                    |                                                                           |                       |        |        |   |   |       |       
|                                    | Diluted                                                                   |                       | $      | (0.22  | ) |   | $     | 0.29   | 
|                                    |                                                                           |                       |        |        |   |   |       |       





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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)




Note 5  Comprehensive Income (Loss)






|                                                             |  |                    |        |      |  |   |       | 
|------------------------------------------------------------ |  | ------------------ | ------ | ---- |  | - | ----- | 
|                                                             |  | Three Months Ended
|                                                             |  | March 31,         
|                                                             |  |                   
|                                                             |  | 2006               |        | 2005
|                                                             |  |                    |        |     
|Net (loss) income                                            |  | $                  | (8,591 | )    |  | $ | 9,431 | 
|Change in cumulative foreign currency translation adjustment |  |                    | (171   | )    |  |   | 6     | 
|Change in cash flow hedging activities                       |  |                    | 1,490  |      |  |   |      | 
|                                                             |  |                    |        |      |  |   |       | 
|Comprehensive (loss) income                                  |  | $                  | (7,272 | )    |  | $ | 9,437 | 
|                                                             |  |                    |        |      |  |   |       | 



|                                                   |  |           |       |              |  |   |      |  
|-------------------------------------------------- |  | --------- | ----- | ------------ |  | - | ---- | -
|                                                   |  | March 31, |       | December 31,
|                                                   |  | 2006      |       | 2005        
|                                                   |  |           |       |             
|Cumulative foreign currency translation adjustment |  | $         | (376  | )            |  | $ | (547 | )
|Cumulative cash flow hedging activities            |  |           | 1,490 |              |  |   |     |  
|                                                   |  |           |       |              |  |   |      |  
|Accumulated other comprehensive income (loss)      |  | $         | 1,114 |              |  | $ | (547 | )
|                                                   |  |           |       |              |  |   |      |  



Note 6  Legal Matters


10b-5


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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)




10b-5






Note 7  Long-Term Debt




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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)












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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)






Note 8  Income Taxes






paid-in


Transition Election Related
to Accounting for Tax Effects of Share-Based Payment
Awards.




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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)


paid-in


Note 9  Restructuring Expenses




|                        |  |                   |     |                 |  |                 |     |   |  |   |     | 
|----------------------- |  | ----------------- | --- | --------------- |  | --------------- | --- | - |  | - | --- | 
|                        |  | Reserve Balance   |     | Costs Applied   |  | Reserve Balance
|                        |  | December 31, 2005 |     | Against Reserve |  | March 31, 2006 
|                        |  |                   |     |                 |  |                
|                        |  | (In thousands)   
|Lease termination costs |  | $                 | 807 |                 |  | $               | (54 | ) |  | $ | 753 | 

Note 10  Segment Reporting






business-to


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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)


percentage-of


point-of point-of Per-Se






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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)




|                                                                 |                     |                    |         |         |      |   |        |        |  
|---------------------------------------------------------------- | ------------------- | ------------------ | ------- | ------- | ---- | - | ------ | ------ | -
|                                                                 |                     | Three Months Ended |        
|                                                                 |                     | March 31,          |        
|                                                                 |                     |                    |        
|                                                                 |                     | 2006               |         |         | 2005 |  
|                                                                 |                     |                    |         |         |      |  
|                                                                 |                     | (In thousands)     |        
|Revenue:                                                         |                     |                    |         |         |      |   |        |       
|                                                                 | Physician Solutions |                    | $       | 77,326  |      |   | $      | 67,190 |  
|                                                                 | Hospital Solutions  |                    |         | 43,527  |      |   |        | 28,364 |  
|                                                                 | Pharmacy Solutions  |                    |         | 29,401  |      |   |        |       |  
|                                                                 | Eliminations        |                    |         | (4,013  | )    |   |        | (3,524 | )
|                                                                 |                     |                    |         |         |      |  
|                                                                 |                     | $                  | 146,241 |         |      | $ | 92,030 |       
|                                                                 |                     |                    |         |         |      |  
|Segment operating expenses:                                      |                     |                    |         |         |      |   |        |       
|                                                                 | Physician Solutions |                    | $       | 69,179  |      |   | $      | 58,622 |  
|                                                                 | Hospital Solutions  |                    |         | 35,996  |      |   |        | 21,935 |  
|                                                                 | Pharmacy Solutions  |                    |         | 33,906  |      |   |        |       |  
|                                                                 | Corporate           |                    |         | 10,997  |      |   |        | 4,144  |  
|                                                                 | Eliminations        |                    |         | (4,013  | )    |   |        | (3,524 | )
|                                                                 |                     |                    |         |         |      |  
|                                                                 |                     | $                  | 146,065 |         |      | $ | 81,177 |       
|                                                                 |                     |                    |         |         |      |  
|Segment operating income:                                        |                     |                    |         |         |      |   |        |       
|                                                                 | Physician Solutions |                    | $       | 8,147   |      |   | $      | 8,568  |  
|                                                                 | Hospital Solutions  |                    |         | 7,531   |      |   |        | 6,429  |  
|                                                                 | Pharmacy Solutions  |                    |         | (4,505  | )    |   |        |       |  
|                                                                 | Corporate           |                    |         | (10,997 | )    |   |        | (4,144 | )
|                                                                 |                     |                    |         |         |      |  
|                                                                 |                     | $                  | 176     |         |      | $ | 10,853 |       
|                                                                 |                     |                    |         |         |      |  
|Interest expense                                                 |                     | $                  | 8,513   |         |      | $ | 1,481  |       
|                                                                 |                     |                    |         |         |      |  
|Interest income                                                  |                     | $                  | (632    | )       |      | $ | (312   | )     
|                                                                 |                     |                    |         |         |      |  
|(Loss) income before income taxes                                |                     | $                  | (7,705  | )       |      | $ | 9,684  |       
|                                                                 |                     |                    |         |         |      |  
|Depreciation and amortization(1):                                |                     |                    |         |         |      |   |        |       
|                                                                 | Physician Solutions |                    | $       | 4,310   |      |   | $      | 2,060  |  
|                                                                 | Hospital Solutions  |                    |         | 6,811   |      |   |        | 1,596  |  
|                                                                 | Pharmacy Solutions  |                    |         | 13,858  |      |   |        |       |  
|                                                                 | Corporate           |                    |         | 467     |      |   |        | 96     |  
|                                                                 |                     |                    |         |         |      |  
|                                                                 |                     | $                  | 25,446  |         |      | $ | 3,752  |       
|                                                                 |                     |                    |         |         |      |  
|Capital expenditures and capitalized software development costs: |                     |                    |         |         |      |   |        |       
|                                                                 | Physician Solutions |                    | $       | 1,419   |      |   | $      | 1,978  |  
|                                                                 | Hospital Solutions  |                    |         | 3,924   |      |   |        | 2,593  |  
|                                                                 | Pharmacy Solutions  |                    |         | 1,464   |      |   |        |       |  
|                                                                 | Corporate           |                    |         | 516     |      |   |        | 54     |  
|                                                                 |                     |                    |         |         |      |  
|                                                                 |                     | $                  | 7,323   |         |      | $ | 4,625  |       
|                                                                 |                     |                    |         |         |      |  

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PER-SE TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)  (Continued)


|                     |                     |                |         |              |  |   |         |         | 
|-------------------- | ------------------- | -------------- | ------- | ------------ |  | - | ------- | ------- | 
|                     |                     | As of         
|                     |                     |               
|                     |                     | March 31,      |         | December 31,
|                     |                     | 2006           |         | 2005        
|                     |                     |                |         |             
|                     |                     | (In thousands)
|Identifiable assets: |                     |                |         |              |  |   |         |        
|                     | Physician Solutions |                | $       | 187,973      |  |   | $       | 66,380  | 
|                     | Hospital Solutions  |                |         | 348,974      |  |   |         | 71,482  | 
|                     | Pharmacy Solutions  |                |         | 284,412      |  |   |         |        | 
|                     | Corporate           |                |         | 109,213      |  |   |         | 101,661 | 
|                     |                     |                |         |              |  |   |         |        
|                     |                     | $              | 930,572 |              |  | $ | 239,523 |        
|                     |                     |                |         |              |  |   |         |        






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | For the three months ended March 31, 2006, depreciation and
    amortization expense includes in-process research and
    development that was purchased as part of the NDCHealth
    acquisition and expensed during the first quarter. By segment,
    Physician Solutions includes approximately $1.9 million,
    Hospital Solutions includes approximately $2.8 million and
    Pharmacy Solutions includes approximately $8.6 million of
    in-process research and development expense.

Note 11  Retirement Benefits






|                                              |  |                |      |  
|--------------------------------------------- |  | -------------- | ---- | -
|                                              |  | (In thousands)
|Interest cost on projected benefit obligation |  | $              | 536  |  
|Expected return on plan assets                |  |                | (500 | )
|                                              |  |                |      |  
|Net periodic pension cost                     |  | $              | 36   |  
|                                              |  |                |      |  



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|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|Item 2. | Managements Discussion and Analysis of Financial
    Condition and Results of Operations

Description of Business








business-to percentage-of


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point-of point-of


General Overview


Key Performance Indicators.


NDC Health Acquisition.


Overview of Operating Results.


Atypical Items.


Adoption of SFAS No. 123(R).


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Cash Flow from Operations.


Capitalization.




Results of Operations




| |                                                                                        
| | ---------------------------------------------------------------------------------------
| | Three months ended March 31, 2006, as compared to
    three months ended March 31, 2005

Revenue.


|                    |  |                    |         |      |  |   |        |  
|------------------- |  | ------------------ | ------- | ---- |  | - | ------ | -
|                    |  | Three Months Ended
|                    |  | March 31,         
|                    |  |                   
|                    |  | 2006               |         | 2005
|                    |  |                    |         |     
|                    |  | (In thousands)    
|Physician Solutions |  | $                  | 77,326  |      |  | $ | 67,190 |  
|Hospital Solutions  |  |                    | 43,527  |      |  |   | 28,364 |  
|Pharmacy Solutions  |  |                    | 29,401  |      |  |   |       |  
|Eliminations        |  |                    | (4,013  | )    |  |   | (3,524 | )
|                    |  |                    |         |      |  |   |        |  
|                    |  | $                  | 146,241 |      |  | $ | 92,030 |  
|                    |  |                    |         |      |  |   |        |  



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Segment Operating Income.


|                    |  |                    |         |   |      |   |        |  
|------------------- |  | ------------------ | ------- | - | ---- | - | ------ | -
|                    |  | Three Months Ended |        
|                    |  | March 31,          |        
|                    |  |                    |        
|                    |  | 2006               |         |   | 2005 |  
|                    |  |                    |         |   |      |  
|                    |  | (In thousands)     |        
|Physician Solutions |  | $                  | 8,147   |   |      | $ | 8,568  |  
|Hospital Solutions  |  |                    | 7,531   |   |      |   | 6,429  |  
|Pharmacy Solutions  |  |                    | (4,505  | ) |      |   |       |  
|Corporate           |  |                    | (10,997 | ) |      |   | (4,144 | )
|                    |  |                    |         |   |      |  
|                    |  | $                  | 176     |   |      | $ | 10,853 |  
|                    |  |                    |         |   |      |  





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Interest.


Income Taxes.




paid-in


Transition Election Related
to Accounting for Tax Effects of Share-Based Payment
Awards.


25



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paid-in






| |                                
| | -------------------------------
| | Liquidity and Capital Resources



|                                       |  |           |        |              |  |   |        | 
|-------------------------------------- |  | --------- | ------ | ------------ |  | - | ------ | 
|                                       |  | March 31, |        | December 31,
|                                       |  | 2006      |        | 2005        
|                                       |  |           |        |             
|Unrestricted cash and cash equivalents |  | $         | 35,908 |              |  | $ | 61,161 | 

|                                                                                |  |                    |          |   |      |   |        |  
|------------------------------------------------------------------------------- |  | ------------------ | -------- | - | ---- | - | ------ | -
|                                                                                |  | Three Months Ended |         
|                                                                                |  | March 31,          |         
|                                                                                |  |                    |         
|                                                                                |  | 2006               |          |   | 2005 |  
|                                                                                |  |                    |          |   |      |  
|Cash provided by continuing operations                                          |  | $                  | 23,139   |   |      | $ | 13,162 |  
|Cash used for investing activities from continuing operations                   |  | $                  | (437,189 | ) |      | $ | (4,675 | )
|Cash provided by (used for) financing activities from continuing
    operations |  | $                  | 388,797  |   |      | $ | (8,446 | )









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|        |                                                               
|------- | --------------------------------------------------------------
|Item 3. | Quantitative and Qualitative Disclosures about Market
    Risk



| |                          
| | -------------------------
| | Interest Rate Sensitivity











| |                          
| | -------------------------
| | Exchange Rate Sensitivity



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|        |                        
|------- | -----------------------
|Item 4. | Controls and Procedures



| |                                                             
| | ------------------------------------------------------------
| | Conclusions Regarding Disclosure Controls and
    Procedures

13a-15(b)




| |                                                              
| | -------------------------------------------------------------
| | Control System Limitations; NDCHealth Material
    Weaknesses







| |                                          
| | -----------------------------------------
| | Revenue Recognition and Billing Processes







| |   |                                                                                                                                                                                                                                                                                              
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | The lack of policy, procedures and personnel with the skills and
    experience to properly evaluate and record revenue for
    multi-element arrangements, specifically relating to the
    contract review process, evidence of delivery, and establishing
    fair value where applicable;
|
| |  | Lack of controls over recording of certain credit card
    transactions relating to credit card chargebacks and rejects;                                                                                                                                                                     
|
| |  | Lack of controls over the authorization of credit memos and
    their classification between sales allowance and bad debt;                                                                                                                                                                   
|
| |  | Inconsistent management review and approval of journal entries
    and account reconciliations relating to recording of unbilled
    accounts receivable; and                                                                                                                                
|
| |  | Lack of documented controls and review procedures over timely
    and accurate billing of customers.                                                                                                                                                                                         

29



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##### Table of Contents





| |                                  
| | ---------------------------------
| | Financial Statement Close Process







| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Lack of adequate policies and procedures with respect to journal
    entries and account reconciliations, including insufficient
    supporting detail and inconsistent evidence of management review;                                                                                                                                                                                                                           
|
| |  | Lack of sufficient personnel with appropriate skills and
    experience to properly prepare journal entries and account
    reconciliations and to do so in a timely manner;                                                                                                                                                                                                                                                     
|
| |  | Lack of documented controls over the preparation of financial
    statement footnotes and the calculation of earnings per share,
    including consistent first level management review for accuracy,
    completeness, and compliance with generally accepted accounting
    principles; and                                                                                                                                    
|
| |  | Lack of policy, procedures, and controls including review and
    approval procedures to ensure that financial statements for
    external purposes were prepared in accordance with generally
    accepted accounting principles including periodic in-depth
    review of the proper application of generally accepted
    accounting principles to the specific facts and circumstances of
    each of NDCHealths businesses.



| |             
| | ------------
| | Income Taxes







| |                                                                      
| | ---------------------------------------------------------------------
| | Remediation Measures for Identified NDCHealth Material
    Weaknesses





| |   |                                                                                                                                                                                                                                     
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | The NDCHealth account reconciliation process was redesigned to
    provide better support for account balances and to ensure all
    significant accounts were reconciled as a part of the quarter
    end close process;           
|
| |  | Addition of accounting staff with the technical accounting skill
    and experience to review and properly record revenue for
    complex, multi-element agreements in accordance with generally
    accepted accounting principles;
|
| |  | Performing daily reconciliations of credit card transactions;                                                                                                                                                                       
|
| |  | Enforcing company policy on authorization of credit memos and
    the completeness of information needed for proper classification;                                                                                                 
|
| |  | Expanding analytic and review procedures at each quarter end in
    support of footnote disclosures;                                                                                                                                
|
| |  | Providing more focus on income taxes; and                                                                                                                                                                                           
|
| |  | Implementing a
    cash-on-delivery
    recognition process with regard to revenue recognition in the
    physician practice management services and the pharmaceutical
    information businesses.                                 



30



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##### Table of Contents









| |                                                         
| | --------------------------------------------------------
| | Changes in Internal Control Over Financial
    Reporting

13a-15(d)




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | On January 6, 2006, following NDCHealths sale of its
    pharmaceutical information management business to Wolters Kluwer
    Health, the Company completed the acquisition of NDCHealth and
    its physician, hospital and pharmacy businesses and immediately
    implemented a new operating and management structure for the
    Company. That acquisition and the Companys new operating
    and management structure have materially affected and are
    reasonably likely to materially affect the Companys
    internal control over financial reporting. For example, as a
    result of the acquisition, NDCHealths legacy financial
    reporting systems and billing platforms and operation systems
    became a material part of the Companys internal controls
    over financial reporting.                                                                                                                                                              
|
| |  | Management has devoted significant attention and resources
    during the quarter to integrating NDCHealths business
    practices and operations with those of the Company. The
    integration of the acquired business operations into the Company
    has also materially affected and is reasonably likely to
    materially affect the Companys internal control over
    financial reporting. For example, during the pendency of such
    integration certain NDCHealth legacy financial reporting
    processes and functions have continued to be performed in a
    similar manner as prior to the acquisition, including
    purchasing, accounts payable, payroll, benefits, billing,
    revenue recognition, calculation of accruals, reserves and
    allowances, posting of journal entries in the former NDCHealth
    financial reporting system, and performing month-end
    reconciliation and close procedures for that financial reporting
    system.
|
| |  | The Company has implemented and installed internal controls and
    procedures regarding tax accounting into the acquired business
    operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

31



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##### Table of Contents






PART II: OTHER INFORMATION







|        |                  
|------- | -----------------
|Item 1. | Legal Proceedings








|         |             
|-------- | ------------
|Item 1A. | Risk Factors

Cautionary Statement Regarding Forward-Looking Statements






| |   |                                                                                                                          
| | - | -------------------------------------------------------------------------------------------------------------------------
| |  | demand for and market acceptance of new and existing products
    and services;                                          
|
| |  | successful development of new products and services;                                                                     
|
| |  | the timing of new product and service introductions;                                                                     
|
| |  | pricing pressures and other competitive factors;                                                                         
|
| |  | product and service obsolescence;                                                                                        
|
| |  | the ability to develop and implement new technologies and to
    obtain protection for the related intellectual property;
|
| |  | the prospect of changes in laws and regulations governing the
    Companys business;                                    
|
| |  | the uncertainties of litigation; and                                                                                     
|
| |  | costs related to integrating NDCHealths business practices
    and operations with those of the Company.                



Factors That May Affect Future Results of Operations,
Financial Condition or Business




32



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##### Table of Contents







| |                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------
| | The Companys businesses are highly competitive, and
    an inability to successfully compete for business could
    adversely affect the company.









| |                                                                                                                                                                                                                                                            
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The markets for the Companys services and solutions
    are characterized by rapidly changing technology, evolving
    industry standards and frequent new product introductions and an
    inability to keep pace could adversely affect the
    Company.





| |   |                                                                            
| | - | ---------------------------------------------------------------------------
| |  | enhance existing products and services;                                    
|
| |  | introduce new products and services quickly and cost effectively;          
|
| |  | achieve market acceptance for new products and services; and               
|
| |  | respond to emerging industry standards and other technological
    changes.





| |                                                                                                                                                
| | -----------------------------------------------------------------------------------------------------------------------------------------------
| | The healthcare marketplace is characterized by
    consolidation, which may result in fewer potential customers for
    the Companys services.



33



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##### Table of Contents







| |                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The healthcare industry is highly regulated, which may
    increase the Companys costs of operation or have a
    material adverse effect on the Companys businesses.









34



---



##### Table of Contents













| |                                                                                                               
| | --------------------------------------------------------------------------------------------------------------
| | The trading price of the Companys common stock may
    be volatile and may negatively affect your investment.





| |                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Per-Se has significantly increased its long-term debt as a
    result of the NDCHealth acquisition, which could limit funds
    available to Per-Se to finance other activities.



35



---



##### Table of Contents





| |                                                                                                    
| | ---------------------------------------------------------------------------------------------------
| | The agreements governing Per-Ses debt limit the
    Companys financial and operating flexibility.





| |   |                                                            
| | - | -----------------------------------------------------------
| |  | incurring additional indebtedness or guarantee obligations;
|
| |  | declaring or paying dividends and other distributions;     
|
| |  | prepaying or modifying the terms of indebtedness;          
|
| |  | creating liens;                                            
|
| |  | making capital expenditures;                               
|
| |  | making investments or acquisitions;                        
|
| |  | entering into acquisitions or consolidations;              
|
| |  | making sales of assets; and                                
|
| |  | engaging in transactions with affiliates.                  







| |                                                                          
| | -------------------------------------------------------------------------
| | Loss of key management could adversely affect the
    Companys business.





| |                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Per-Se may be unable to successfully integrate the
    businesses of Per-Se and NDCHealth and may be unable to realize
    the anticipated benefits of the acquisition.





| |   |                                                                                                                                                                                                                              
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the inability to achieve the cost savings and operating
    synergies anticipated in the acquisition, including a reduction
    in costs associated with the acquisition;                                                    
|
| |  | complexities associated with managing the geographic scope of
    the combined businesses, coupled with those of consolidating
    multiple physical locations where management may determine
    consolidation is desirable;
|
| |  | integrating personnel from diverse corporate cultures while
    maintaining focus on providing consistent, high quality customer
    service; and                                                                            
|
| |  | potential unknown liabilities and increased costs associated
    with the acquisition.                                                                                                                                       



36



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##### Table of Contents









| |                                                                                                          
| | ---------------------------------------------------------------------------------------------------------
| | If Per-Se is unable to manage its growth profitably, its
    business and financial results could suffer.





| |                                                                                                                                                                                                                                                                                                       
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | As part of the acquisition, Per-Se and NDCHealth entered
    into, and are bound by the terms of, long-term data sharing
    agreements with Wolters Kluwer that place certain restrictions
    on the Companys ability to sell certain products to third
    parties and compete in certain markets.



20-year




| |                                                                                                     
| | ----------------------------------------------------------------------------------------------------
| | The Company is regularly involved in litigation, which may
    expose us to significant liabilities.



10b-5


37



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##### Table of Contents











| |                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Per-Se and NDCHealth are each the subject of separate SEC
    investigations, the resolution of which could have a material
    adverse effect on the combined companies.









| |                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Prior to its acquisition by Per-Se, NDCHealth identified
    material weaknesses in its internal control over financial
    reporting. If such deficiencies persist or if additional
    weaknesses are discovered, the combined company may not be able
    to accurately report its financial results and management may
    not be able to conclude that the Companys internal control
    over financial reporting is effective.





38



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##### Table of Contents












|        |                                                    
|------- | ---------------------------------------------------
|Item 4. | Submission of Matters to a Vote of Security Holders








|        |         
|------- | --------
|Item 6. | Exhibits



|        |   |          |  |   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|------- | - | -------- |  | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |   |         
|Number  |   |         
|        |   |         
|        |   | Document
|        |   |         
|        | 2 | .1       |  |  |  | Agreement and Plan of Merger, dated as of August 26, 2005,
    among Registrant, Royal Merger Co. and NDCHealth Corporation
    (incorporated by reference to Exhibit 2.1 to Current Report
    on Form 8-K filed on August 30, 2005). (schedules and
    similar attachments to this exhibit have not been filed;
    Registrant agrees to furnish supplementally a copy of any of
    these materials to the Securities and Exchange Commission upon
    request).                                                                                    
|        | 2 | .2       |  |  |  | Stock Purchase Agreement, dated as of August 26, 2005,
    among Wolters Kluwer Health, Inc., NDC Health Information
    Services (Arizona). Inc., and NDCHealth Corporation
    (incorporated herein by reference to Exhibit 2.1 to
    NDCHealth Corporations Current Report on Form 8-K
    filed on August 29, 2005). (schedules and similar
    attachments to this exhibit have not been filed; Registrant
    agrees to furnish supplementally a copy of any of these
    materials to the Securities and Exchange Commission upon
    request).
|        | 3 | .1       |  |  |  | Restated Certificate of Incorporation of Registrant
    (incorporated by reference to Exhibit 3.1 to Annual Report
    on Form 10-K for the year ended December 31, 1999).                                                                                                                                                                                                                                                                                                                                                                              
|        | 3 | .2       |  |  |  | Restated By-laws of Registrant, as amended (incorporated by
    reference to Exhibit 3.2 to Current Report on Form 8-K
    filed on July 29, 2005).                                                                                                                                                                                                                                                                                                                                                                                                     
|        | 4 | .1       |  |  |  | Rights Agreement dated as of February 11, 1999, between
    Registrant and American Stock Transfer & Trust Company
    (including form of rights certificates). (incorporated by
    reference to Exhibit 4 to Current Report on Form 8-K
    filed on February 12, 1999).                                                                                                                                                                                                                                                                              
|        | 4 | .2       |  |  |  | First Amendment to Rights Agreement dated as of
    February 11, 1999, between Registrant and American Stock
    Transfer & Trust Company, entered into as of
    May 4, 2000 (incorporated by reference to Exhibit 4.4
    to Quarterly Report of Form 10-Q for the quarter ended
    March 31, 2000).                                                                                                                                                                                                                                                 
|        | 4 | .3       |  |  |  | Second Amendment to Rights Agreement dated as of
    February 11, 1999, between Registrant and American Stock
    Transfer & Trust Company, entered into as of
    December 6, 2001, to be effective as of March 6, 2002
    (incorporated by reference to Exhibit 4.12 to Annual Report
    on Form 10-K for the year ended December 31, 2001).                                                                                                                                                                                                        
|        | 4 | .4       |  |  |  | Third Amendment to Rights Agreement dated as of
    February 11, 1999, between Registrant and American Stock
    Transfer & Trust Company, entered into as of
    March 10, 2003 (incorporated by reference to
    Exhibit 4.13 to Annual Report on Form 10-K for the
    year ended December 31, 2002).                                                                                                                                                                                                                                                

39



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##### Table of Contents



|        |    |          |  |   |  |                                                                                                                                                                                                                                                                                                                                                            
|------- | -- | -------- |  | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |         
|Number  |    |         
|        |    |         
|        |    | Document
|        |    |         
|        | 4  | .5       |  |  |  | Fourth Amendment to Rights Agreement dated as of
    February 11, 1999, between Registrant and American Stock
    Transfer & Trust Company, entered into as of
    February 18, 2005 (incorporated by reference to
    Exhibit 4.1 to Current Report on Form 8-K filed on
    February 22, 2005).                                                          
|        | 4  | .6       |  |  |  | Fifth Amendment to Rights Agreement dated as of
    February 11, 1999, between Registrant and American Stock
    Transfer & Trust Company, entered into as of
    August 26, 2005 (incorporated by reference to
    Exhibit 4.1 to Current Report on Form 8-K filed on
    August 26, 2005).                                                               
|        | 4  | .7       |  |  |  | Indenture dated as of June 30, 2004, between Registrant and
    U.S. Bank National Association, as Trustee, relating to
    Registrants 3.25% Convertible Subordinated Debentures
    Due 2024 (incorporated by reference to Exhibit 4.5 to
    Quarterly Report on Form 10-Q for the quarter ended
    June 30, 2004).                                   
|        | 10 | .1       |  |  |  | Amended and Restated Credit Agreement, dated as of
    January 6, 2006, among Registrant, certain domestic
    subsidiaries of Registrant, Bank of America, N.A., Wachovia
    Bank, National Association, and the other lenders party thereto
    (incorporated by reference to Exhibit 10.1 to Current
    Report on Form 8-K filed on January 12, 2006).
|        | 10 | .2       |  |  |  | Data Supply and Services Agreement, dated as of January 6,
    2006, among NDC Health Information Services (Arizona). Inc.,
    NDCHealth Corporation and Registrant (incorporated by reference
    to Exhibit 10.2 to Current Report on Form 8-K filed on
    January 12, 2006).                                                                          
|        | 10 | .3       |  |  |  | Retail Informatics Data and Services Agreement, dated as of
    January 6, 2006, between NDC Health Information Services
    (Arizona). Inc. and NDCHealth Corporation(incorporated by
    reference to Exhibit 10.3 to Current Report on
    Form 8-K filed on January 12, 2006).                                                                         
|        | 10 | .4       |  |  |  | Per-Se Technologies, Inc. 2006 Senior Management Incentive
    Compensation Plan (incorporated by reference to
    Exhibit 10.1 to Current Report on Form 8-K filed on
    March 7, 2006).                                                                                                                                                                 
|        | 31 | .1       |  |  |  | Certification of Chief Executive Officer pursuant to Exchange
    Act Rules 13a-14(a). and 15d-14(a)., as adopted pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                           
|        | 31 | .2       |  |  |  | Certification of Chief Financial Officer pursuant to Exchange
    Act Rules 13a-14(a). and 15d-14(a)., as adopted pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                           
|        | 32 | .1       |  |  |  | Certification of Chief Executive Officer pursuant to
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                 
|        | 32 | .2       |  |  |  | Certification of Chief Financial Officer pursuant to
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                 

40



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##### Table of Contents



SIGNATURES






| |                          
| | -------------------------
| | Per-Se Technologies, Inc.
| | (Registrant)             



| |     |                     
| | --- | --------------------
| | By: | /s/ Chris E. Perkins

| |                                
| | -------------------------------
| |                                
| | Chris E. Perkins               
| | Executive Vice President,      
| | Chief Operating Officer and    
| | Interim Chief Financial Officer



| |     |                     
| | --- | --------------------
| | By: | /s/ Richard A. Flynt

| |                                               
| | ----------------------------------------------
| |                                               
| | Richard A. Flynt                              
| | Senior Vice President and Corporate Controller
| | (Principal Accounting Officer)                



41



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##### Table of Contents



INDEX TO EXHIBITS


|        |    |          |  |   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|------- | -- | -------- |  | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |         
|Number  |    |         
|        |    |         
|        |    | Document
|        |    |         
|        | 2  | .1       |  |  |  | Agreement and Plan of Merger, dated as of August 26, 2005,
    among Registrant, Royal Merger Co. and NDCHealth Corporation
    (incorporated by reference to Exhibit 2.1 to Current Report
    on Form 8-K filed on August 30, 2005) (schedules and
    similar attachments to this exhibit have not been filed;
    Registrant agrees to furnish supplementally a copy of any of
    these materials to the Securities and Exchange Commission upon
    request).                                                                               
|       
|        | 2  | .2       |  |  |  | Stock Purchase Agreement, dated as of August 26, 2005,
    among Wolters Kluwer Health, Inc., NDC Health Information
    Services (Arizona) Inc., and NDCHealth Corporation (incorporated
    herein by reference to Exhibit 2.1 to NDCHealth
    Corporations Current Report on Form 8-K filed on
    August 29, 2005) (schedules and similar attachments to this
    exhibit have not been filed; Registrant agrees to furnish
    supplementally a copy of any of these materials to the
    Securities and Exchange Commission upon request).
|       
|        | 3  | .1       |  |  |  | Restated Certificate of Incorporation of Registrant
    (incorporated by reference to Exhibit 3.1 to Annual Report
    on Form 10-K for the year ended December 31, 1999).                                                                                                                                                                                                                                                                                                                                                                        
|       
|        | 3  | .2       |  |  |  | Restated By-laws of Registrant, as amended (incorporated by
    reference to Exhibit 3.2 to Current Report on Form 8-K
    filed on July 29, 2005).                                                                                                                                                                                                                                                                                                                                                                                               
|       
|        | 4  | .1       |  |  |  | Rights Agreement dated as of February 11, 1999, between
    Registrant and American Stock Transfer & Trust Company
    (including form of rights certificates) (incorporated by
    reference to Exhibit 4 to Current Report on Form 8-K
    filed on February 12, 1999).                                                                                                                                                                                                                                                                         
|       
|        | 4  | .2       |  |  |  | First Amendment to Rights Agreement dated as of
    February 11, 1999, between Registrant and American Stock
    Transfer & Trust Company, entered into as of
    May 4, 2000 (incorporated by reference to Exhibit 4.4
    to Quarterly Report of Form 10-Q for the quarter ended
    March 31, 2000).                                                                                                                                                                                                                                           
|       
|        | 4  | .3       |  |  |  | Second Amendment to Rights Agreement dated as of
    February 11, 1999, between Registrant and American Stock
    Transfer & Trust Company, entered into as of
    December 6, 2001, to be effective as of March 6, 2002
    (incorporated by reference to Exhibit 4.12 to Annual Report
    on Form 10-K for the year ended December 31, 2001).                                                                                                                                                                                                  
|       
|        | 4  | .4       |  |  |  | Third Amendment to Rights Agreement dated as of
    February 11, 1999, between Registrant and American Stock
    Transfer & Trust Company, entered into as of
    March 10, 2003 (incorporated by reference to
    Exhibit 4.13 to Annual Report on Form 10-K for the
    year ended December 31, 2002).                                                                                                                                                                                                                                          
|       
|        | 4  | .5       |  |  |  | Fourth Amendment to Rights Agreement dated as of
    February 11, 1999, between Registrant and American Stock
    Transfer & Trust Company, entered into as of
    February 18, 2005 (incorporated by reference to
    Exhibit 4.1 to Current Report on Form 8-K filed on
    February 22, 2005).                                                                                                                                                                                                                                                 
|       
|        | 4  | .6       |  |  |  | Fifth Amendment to Rights Agreement dated as of
    February 11, 1999, between Registrant and American Stock
    Transfer & Trust Company, entered into as of
    August 26, 2005 (incorporated by reference to
    Exhibit 4.1 to Current Report on Form 8-K filed on
    August 26, 2005).                                                                                                                                                                                                                                                      
|       
|        | 4  | .7       |  |  |  | Indenture dated as of June 30, 2004, between Registrant and
    U.S. Bank National Association, as Trustee, relating to
    Registrants 3.25% Convertible Subordinated Debentures
    Due 2024 (incorporated by reference to Exhibit 4.5 to
    Quarterly Report on Form 10-Q for the quarter ended
    June 30, 2004).                                                                                                                                                                                                                          
|       
|        | 10 | .1       |  |  |  | Amended and Restated Credit Agreement, dated as of
    January 6, 2006, among Registrant, certain domestic
    subsidiaries of Registrant, Bank of America, N.A., Wachovia
    Bank, National Association, and the other lenders party thereto
    (incorporated by reference to Exhibit 10.1 to Current
    Report on Form 8-K filed on January 12, 2006).                                                                                                                                                                                       
|       
|        | 10 | .2       |  |  |  | Data Supply and Services Agreement, dated as of January 6,
    2006, among NDC Health Information Services (Arizona) Inc.,
    NDCHealth Corporation and Registrant (incorporated by reference
    to Exhibit 10.2 to Current Report on Form 8-K filed on
    January 12, 2006).                                                                                                                                                                                                                                                                  
|       
|        | 10 | .3       |  |  |  | Retail Informatics Data and Services Agreement, dated as of
    January 6, 2006, between NDC Health Information Services
    (Arizona) Inc. and NDCHealth Corporation(incorporated by
    reference to Exhibit 10.3 to Current Report on
    Form 8-K filed on January 12, 2006).                                                                                                                                                                                                                                                                 



---



##### Table of Contents



|        |    |          |  |   |  |                                                                                                                                                                                           
|------- | -- | -------- |  | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |         
|Number  |    |         
|        |    |         
|        |    | Document
|        |    |         
|        | 10 | .4       |  |  |  | Per-Se Technologies, Inc. 2006 Senior Management Incentive
    Compensation Plan (incorporated by reference to
    Exhibit 10.1 to Current Report on Form 8-K filed on
    March 7, 2006).
|       
|        | 31 | .1       |  |  |  | Certification of Chief Executive Officer pursuant to Exchange
    Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.            
|       
|        | 31 | .2       |  |  |  | Certification of Chief Financial Officer pursuant to Exchange
    Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.            
|       
|        | 32 | .1       |  |  |  | Certification of Chief Executive Officer pursuant to
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.                                
|       
|        | 32 | .2       |  |  |  | Certification of Chief Financial Officer pursuant to
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.