**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      D.C. 20549**

**FORM      10-QSB**

**QUARTERLY      REPORT PURSUANT TO SECTION 13 OR 15(d)**

**OF      THE SECURITIES EXCHANGE ACT OF 1934**

**For      the quarterly period ended June 30, 2006**

**COMMISSION      FILE NUMBER 0-26168**

**CAREADVANTAGE,      INC.**

**(Exact      name of small business issuer as specified in its      charter)**

| **DELAWARE**                                                                                | **52-1849794**                                                        |
|---------------------------------------------------------------------------------------------|-----------------------------------------------------------------------|
| (State                or other jurisdiction ofIncorporation                or organization) | (I.R.S.                Employer Identification                Number) |

| **485-C                Route 1 South, Iselin, New Jersey** | **08830**                 |
|------------------------------------------------------------|---------------------------|
| (Address                of principal executive offices)    | (Zip                Code) |

----

**I      N D E X**

| **Part              I - Financial Information** |                                                                                                                                                                                         |
|-------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                            |                                                                                                                                                                                         |   |
| Item                1.                          | Financial                Statements                                                                                                                                                          |   |
|                                            |                                                                                                                                                                                         |   |
|                                            | ·  Condensed                Consolidated Balance Sheets -                June 30, 2006 (Unaudited) and December 31, 2005                                                      | 2 |
|                                            |                                                                                                                                                                                         |   |
|                                            | ·  Condensed                Consolidated Statements of Operations - Three                and six months ended June 30, 2006 and June 30, 2005                (Unaudited) | 3 |
|                                            |                                                                                                                                                                                         |   |
|                                            | ·  Condensed                Consolidated Statements of Cash Flows - Six months ended June 30,                2006 and                June 30, 2005 (Unaudited)                | 4 |
|                                            |                                                                                                                                                                                         |   |
|                                            | ·  Notes                to Unaudited Condensed Consolidated Financial Statements                                                                                              | 5 |
|                                            |                                                                                                                                                                                         |   |
| Item                2.                          | Management’s                Discussion and Analysis of Financial Condition and Results of                Operations                                                                    | 8 |
|                                            |                                                                                                                                                                                         |   |
| Item                3.                          | Controls                and Procedures                                                                                                                                                       | 11 |
|                                            |                                                                                                                                                                                         |   |
| **Part              II - Other Information**    |                                                                                                                                                                                         |
|                                            |                                                                                                                                                                                         |   |
| Item                1.                          | Legal                Proceedings                                                                                                                                                             | 11 |
|                                            |                                                                                                                                                                                         |   |
| Item                2.                          | Unregistered                Sales of Equity Securities and Use of Proceeds                                                                                                                   | 12 |
|                                            |                                                                                                                                                                                         |   |
| Item                3.                          | Defaults                Upon Senior Securities                                                                                                                                               | 12 |
|                                            |                                                                                                                                                                                         |   |
| Item                4.                          | Submission                of Matters to a Vote of Security Holders                                                                                                                           | 12 |
|                                            |                                                                                                                                                                                         |   |
| Item                5.                          | Other                Information                                                                                                                                                             | 12 |
|                                            |                                                                                                                                                                                         |   |
| Item                6.                          | Exhibits                                                                                                                                                                                     | 12 |
|                                            |                                                                                                                                                                                         |   |
| Signature                                       | 13                                                                                                                                                                                           |

----

**PART      I - FINANCIAL INFORMATION**

**ITEM      1. Financial Statements**

**CAREADVANTAGE,      INC AND SUBSIDIARIES**

**CONDENSED      CONSOLIDATED BALANCE SHEETS**

|                                                                                                                                                                                           |   | **June                30,** |        | **December                31,** |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|-------------|---------------------------------|--------|
|                                                                                                                                                                                           |   | **2006****Unaudited**       |        | **2005**                   |   |
|                                                                                                                                                                                           |   |                        |        |                            |   |
| **ASSETS**                                                                                                                                                                                     |   |                        |        |                            |   |
| Current                assets:                                                                                                                                                                 |   |                        |        |                            |   |   |   |
| Cash                and cash equivalents                                                                                                                                                       |   | $                           | 221,000     |                            | $      | 114,000 |   |
| Accounts                receivable, net                                                                                                                                                        |   |                        | 358,000     |                            |   | 457,000 |   |
| Other                current assets                                                                                                                                                            |   |                        | 62,000      |                            |   | 108,000 |   |
| Total                current assets                                                                                                                                                            |   |                        | 641,000     |                            |   | 679,000 |   |
|                                                                                                                                                                                           |   |                        |        |                            |   |   |   |
| Property                and equipment, net                                                                                                                                                     |   |                        | 78,000      |                            |   | 137,000 |   |
| Intangible                assets                                                                                                                                                               |   |                        | 1,000       |                            |   | 2,000 |   |
| Other                assets                                                                                                                                                                    |   |                        | 167,000     |                            |   | 167,000 |   |
|                                                                                                                                                                                           |   |                        |        |                            |   |   |   |
| Total                Assets                                                                                                                                                                    |   | $                           | 887,000     |                            | $      | 985,000 |   |
|                                                                                                                                                                                           |   |                        |        |                            |   |   |   |
| **LIABILITIES                AND STOCKHOLDERS' EQUITY**                                                                                                                                        |   |                        |        |                            |   |   |   |
| Current                liabilities:                                                                                                                                                            |   |                        |        |                            |   |   |   |
|                                                                                                                                                                                           |   |                        |        |                            |   |   |   |
| Accounts                payable                                                                                                                                                                |   | $                           | 114,000     |                            | $      | 139,000 |   |
| Accrued                compensation and related benefits                                                                                                                                       |   |                        | 108,000     |                            |   | 105,000 |   |
| Deferred                revenue                                                                                                                                                                |   |                        | 26,000      |                            |   | - |   |
| Accrued                expenses and other current liabilities                                                                                                                                  |   |                        | 104,000     |                            |   | 112,000 |   |
|                                                                                                                                                                                           |   |                        |        |                            |   |   |   |
| Total                current liabilities                                                                                                                                                       |   |                        | 352,000     |                            |   | 356,000 |   |
|                                                                                                                                                                                           |   |                        |        |                            |   |   |   |
| Long                term liabilities:                                                                                                                                                          |   |                        |        |                            |   |   |   |
|                                                                                                                                                                                           |   |                        |        |                            |   |   |   |
| Deferred                rent                                                                                                                                                                   |   |                        | 264,000     |                            |   | 176,000 |   |
|                                                                                                                                                                                           |   |                        |        |                            |   |   |   |
| Total                Liabilities                                                                                                                                                               |   | $                           | 616,000     |                            | $      | 532,000 |   |
|                                                                                                                                                                                           |   |                        |        |                            |   |   |   |
| Stockholders'                equity:                                                                                                                                                           |   |                        |        |                            |   |   |   |
| Preferred                stock-par value $.10 per share;                                                                                                                                       |   |                        |        |                            |   |   |   |
| authorized                10,000,000 shares; none issued                                                                                                                                       |   |                        |        |                            |   |   |   |
| Common                stock-par value $.001 per share; authorized 200,000,000 shares; issued                108,112,041 shares and outstanding 56,717,221 and 53,417,221                shares |   |                        | 110,000     |                            |   | 107,000 |   |
| Additional                capital                                                                                                                                                              |   |                        | 23,972,000  |                            |   | 23,952,000 |   |
| Deferred                compensation cost                                                                                                                                                      |   |                        | -           |                            |   | (40,000 | ) |
| Accumulated                deficit                                                                                                                                                             |   |                        | (23,549,000 | )                               |   | (23,304,000 | ) |
| Treasury                stock at cost, 53,394,820 shares                                                                                                                                       |   |                        | (262,000    | )                               |   | (262,000 | ) |
|                                                                                                                                                                                           |   |                        |        |                            |   |   |   |
| Total                Stockholders' Equity                                                                                                                                                      |   |                        | 271,000     |                            |   | 453,000 |   |
| Total                Liabilities and Stockholders' Equity                                                                                                                                      |   | $                           | 887,000     |                            | $      | 985,000 |   |

----

**CAREADVANTAGE,      INC. AND SUBSIDIARIES**

**CONDENSED      CONSOLIDATED STATEMENTS OF OPERATIONS**

**(UNAUDITED)**

|                                                                  |   | **Three                Months Ended** |       | **Six                Months Ended** |   |
|-----------------------------------------------------------------------|--------|---------------------------------------|------------|-------------------------------------|--------|
|                                                                  |   | **June                30,**           |       | **June                30,**         |   |
|                                                                  |   | **2006**                              |       | **2005**                            |   | **2006** |   | **2005** |   |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |
| License                fees and service revenue                       |   | $                                     | 1,095,000  |                                | $      | 634,000 |   | $ | 2,040,000 |   | $ | 1,192,000 |   |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Costs                of services                                      |   |                                  | 416,000    |                                |   | 363,000 |   |   | 858,000 |   |   | 674,000 |   |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Gross                profit                                           |   |                                  | 679,000    |                                |   | 271,000 |   |   | 1,182,000 |   |   | 518,000 |   |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Operating                cost and expenses:                           |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Selling,                general and administration                    |   |                                  | 720,000    |                                |   | 764,000 |   |   | 1,426,000 |   |   | 1,535,000 |   |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Operating                (loss)                                       |   |                                  | 41,000     |                                |   | (493,000 | ) |   | (244,000) |   |   | (1,017,000 | ) |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Interest                income                                        |   |                                  | -          |                                |   | 3,000 |   |   | - |   |   | 8,000 |   |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Provision                for income taxes                             |   |                                  | -          |                                |   | - |   |   | 1,000 |   |   | 3,000 |   |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Net                (loss)                                             |   | $                                     | (41,000    | )                                   | $      | (490,000 | ) | $ | (245,000 | ) | $ | (1,012,000 | ) |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Net                (loss) per share of common stock                   |   | $                                     | .00        |                                | $      | (.01 | ) | $ | .00 |   | $ | (.02 | ) |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Weighted                average number of common shares outstanding - |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
|                                                                  |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Basic                and diluted                                      |   |                                  | 55,862,000 |                                |   | 46,400,000 |   |   | 54,646,000 |   |   | 46,400,000 |   |

----

**CAREADVANTAGE,      INC. AND SUBSIDIARIES**

**CONDENSED      CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(UNAUDITED)**

|                                                                                                                      |   | **Six                Months Ended June 30,** |     |
|---------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------|----------|
|                                                                                                                      |   | **2006**                                     |     | **2005** |   |
|                                                                                                                      |   |                                         |     |   |   |
| **Cash                flows from operating activities:**                                                                  |   |                                         |     |   |   |
|                                                                                                                      |   |                                         |     |   |   |
| Net                (loss)                                                                                                 |   | $                                            | (245,000 | ) | $ | (1,012,000 | ) |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| Adjustments                to reconcile net (loss) to net cash provided by/(used in) operating                activities: |   |                                         |     |   |   |   |   |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| Depreciation                and amortization                                                                              |   |                                         | 60,000   |   |   | 109,000 |   |
| Employee                stock compensation cost                                                                           |   |                                         | 50,000   |   |   | 37,000 |   |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| **Change                in assets and liabilities:**                                                                      |   |                                         |     |   |   |   |   |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| Accounts                receivable                                                                                        |   |                                         | 99,000   |   |   | (126,000 | ) |
| Other                assets                                                                                               |   |                                         | 46,000   |   |   | (90,000 | ) |
| Accounts                payable                                                                                           |   |                                         | (25,000  | ) |   | 6,000 |   |
| Deferred                rent                                                                                              |   |                                         | 88,000   |   |   | 88,000 |   |
| Deferred                revenue                                                                                           |   |                                         | 26,000   |   |   | - |   |
| Accrued                expenses and other liabilities                                                                     |   |                                         | (5,000   | ) |   | (26,000 | ) |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| Net                cash provided by/(used in) operating activities                                                        |   |                                         | 94,000   |   |   | (1,014,000 | ) |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| **Cash                flows from investing activity:**                                                                    |   |                                         |     |   |   |   |   |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| Capital                expenditures                                                                                       |   |                                         | -        |   |   | (27,000 | ) |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| **Cash                flows from financing activity:**                                                                    |   |                                         |     |   |   |   |   |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| Proceeds                from issuance of common stock                                                                     |   |                                         | 13,000   |   |   | - |   |
| Transfer                from restricted cash                                                                              |   |                                         | -        |   |   | 100,000 |   |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| Net                increase/(decrease) in cash                                                                            |   |                                         | 107,000  |   |   | (941,000 | ) |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| Cash                and cash equivalents - beginning of period                                                            |   |                                         | 114,000  |   |   | 1,488,000 |   |
|                                                                                                                      |   |                                         |     |   |   |   |   |
| Cash                and cash equivalents - end of period                                                                  |   | $                                            | 221,000  |   | $ | 547,000 |   |

----

**Note      A--Basis of presentation: **

**[1] **
**Business:**

**[2]**
**Basis      of presentation:**

**Note      B--Per share data:**

|                                           |   | **June                30,** |           |
|------------------------------------------------|--------|-----------------------------|----------------|
|                                           |   | **2006**                    |           | **2005** |   |
|                                           |   |                        |           |   |   |
| Options                                        |   |                        | **20,110,000** |   |   | 19,775,000 |   |
|                                           |   |                        |           |   |   |   |   |
| Total                Potential Dilutive shares |   |                        | **20,110,000** |   |   | 19,775,000 |   |

**Note      C-- Stock-Based Compensation:**

----

|                                                                                                                                    |   | **Three                Months Ended** |     | **Six                Months Ended** |   |
|-----------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|----------|-------------------------------------|--------|
|                                                                                                                                    |   | **June                30,**           |     | **June                30,**         |   |
|                                                                                                                                    |   | **2005**                              |     | **2005**                            |   |
| Reported                net (loss)                                                                                                      |   |                                  | (490,000 | )                                   |   | (1,012,000 | ) |
|                                                                                                                                    |   |                                  |     |                                |   |   |   |
| Stock-based                employee compensation included in reported net (loss)                                                        |   |                                  | 37,000   |                                |   | 37,000 |   |
| Stock-based                employee compensation determined under the fair value based method,                net of                tax |   |                                  | (42,000  | )                                   |   | (47,000 | ) |
| Pro                forma net (loss)                                                                                                     |   |                                  | (495,000 | )                                   |   | (1,022,000 | ) |
|                                                                                                                                    |   |                                  |     |                                |   |   |   |
| Basic                and diluted (loss) per share:                                                                                      |   |                                  |     |                                |   |   |   |
| As                reported                                                                                                              |   |                                  | (.01     | )                                   |   | (.02 | ) |
| Pro                forma                                                                                                                |   |                                  | (.01     | )                                   |   | (.02 | ) |

|                                            |   | **Shares** |       | **Weighted                Average Exercise Price** |   | **Weighted                Average Remaining Contractual Term** |   | **Aggregate                Intrinsic Value** |   |
|-------------------------------------------------|--------|------------|------------|----------------------------------------------------|--------|----------------------------------------------------------------|--------|----------------------------------------------|--------|
|                                            |   |       |       |                                               |   |                                                           |   |                                         |   |
| Number                of shares under option:   |   |       |       |                                               |   |                                                           |   |                                         |   |
| Outstanding                at December 31, 2005 |   |       | 12,832,000 |                                               | $      | 0.010                                                          |   |                                         |   |   |   |   |   |
| Granted                                         |   |       | 8,578,000  |                                               | $      | 0.015                                                          |   |                                         |   |   |   |   |   |
| Exercised                                       |   |       | (1,300,000 | )                                                  | $      | 0.010                                                          |   |                                         |   |   |   |   |   |
| Canceled                or expired              |   |       | -          |                                               |   | -                                                              |   |                                         |   |   |   |   |   |
| Outstanding                as of June 30, 2006  |   |       | 20,110,000 |                                               | $      | 0.012                                                          |   |                                         | 8.87   |   | $ | 64,000 |   |
|                                            |   |       |       |                                               |   |                                                           |   |                                         |   |   |   |   |   |
| Exercisable                at June 30, 2006     |   |       | 5,439,000  |                                               | $      | 0.010                                                          |   |                                         | 7.62   |   | $ | 28,000 |   |

----

|                                         |   | **Shares** |       | **Weighted                Average Exercise Price** |   |
|----------------------------------------------|--------|------------|------------|----------------------------------------------------|--------|
|                                         |   |       |       |                                               |   |
| Non-vested                at January 1, 2006 |   |       | 9,155,000  |                                               | $      | 0.010 |   |
| Granted                                      |   |       | 8,578,000  |                                               | $      | 0.015 |   |
| Exercised                                    |   |       | (1,300,000 | )                                                  | $      | 0.010 |   |
| Canceled                or expired           |   |       | -          |                                               |   | - |   |
| Vested                                       |   |       | (1,762,000 | )                                                  | $      | 0.009 |   |
| Non-vested                at June 30, 2006   |   |       | 14,671,000 |                                               | $      | 0.013 |   |

|                                   |   | **June                30,** |   |
|----------------------------------------|--------|-----------------------------|--------|
|                                   |   | **2006**                    |   |
|                                   |   |                        |   |
| Risk                free interest rate |   |                        | 4.99   | % |
| Dividend                yield          |   |                        | 0      | % |
| Volatility                factor       |   |                        | 91     | % |
| Expected                life in years  |   |                        | 5      |   |

**Note      D--Contingencies: **

*Alan      Fontes v. CareAdvantage, Inc.*

----

**Note      E—Concentration of Credit Risk**

**Note      F--Exercise of Stock Options**

**Note      G—Restricted Stock**

**Note      H—Recent Accounting Pronouncements**

**ITEM      2. Management’s Discussion and Analysis of Financial Condition and Results of      Operations**

**Cautionary      Statements: **

**GENERAL      OVERVIEW:**

----

***RESULTS      OF OPERATIONS:***

|  | • | track                population and member-related disease progression changes over time; |
|--|---------|-------------------------------------------------------------------------------------------|

|  | • | compare                health plan sub-populations on a valid and reliable basis; |
|--|---------|-----------------------------------------------------------------------------------|

|  | • | profile                providers using case mix and severity-adjusted techniques; |
|--|---------|-----------------------------------------------------------------------------------|

|  | • | select                and prioritize members to optimize the allocation and assess the                impact of                care management resources, direct interventions and initiatives;                and |
|--|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | • | reduce                client dependence on internal information technology resources. |
|--|---------|---------------------------------------------------------------------------------------|

***Three      Months Ended June 30, 2006, Compared to Three Months Ended June 30,      2005***

**Revenues:      **

**Cost      of services: **

**.      **

----

**Selling,      general and administrative expenses: **

***Six      Months Ended June 30, 2006, Compared to Six Months Ended June 30,      2005***

**Revenues:      **

**Cost      of services: **

**.      **

**Selling,      general and administrative expenses: **

***LIQUIDITY,      FINANCIAL CONDITION AND CAPITAL RESOURCES***
*:*

**General      overview:**

**Financial      condition:**

----

**Application      of Critical Accounting Policies:**

**ITEM      3. Controls and Procedures**

**PART      II—OTHER INFORMATION**

**Item      1. Legal Proceedings**

*CareAdvantage,      Inc. v. Blue Cross & Blue Shield of Rhode Island and Coordinated Health      Partners*

----

**Item      2. Unregistered Sales of Equity Security and Use of      Proceeds**

**Item      3. Defaults Upon Senior Securities**

**Item      4. Submission of Matters to a Vote of Security Holders**

**Item      5. Other Information**

**Item      6. Exhibits **

| (a)   | Exhibits |
|-----------------|----------|

----

**SIGNATURES**

|                               |                                                                                         |                              |
|------------------------------------|----------------------------------------------------------------------------------------------|-----------------------------------|
|                               | CareAdvantage,                Inc                                                            |
|                          |                                                                                    |                         |
| August              14, 2006  |                                                                                         | /s/              Dennis J. Mouras |
|                               | Dennis                J. Mouras                                                              |
|                               | Chief                Executive Officer and acting Principal Financial                Officer |

----

| Exhibit                No. | Description                of Exhibit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|----------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 2.1                        | Deposit                Agreement dated October 31, 1994 among Midlantic Bank, N.A., PMDX                and the                Registrant incorporated by reference to Exhibit 2.1 filed with the                Company's Registration Statement on Form S-1 (File No.                33-89176).                                                                                                                                                                                                                                                                 |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 2.2                        | Certificate                of Merger of Care Advantage Health Systems (f/k/a Advantage Health                Systems, Inc.), a Georgia corporation into CareAdvantage Health Systems,                Inc., a Delaware corporation incorporated by reference to Exhibit                2.2                filed with the Company's Registration Statement on Form S-1 (File                No.                33-89176).                                                                                                                                           |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 3.1                        | Registrant's                Certificate of Incorporation incorporated by reference to Exhibit                3.1                filed with the Company's Registration Statement on Form S-1 (File                No.                33-89176).                                                                                                                                                                                                                                                                                                                    |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 3.1(a)                     | Amended                and Restated Certificate of Incorporation incorporated by reference                to the                Company's Information Statement dated September 1996.                                                                                                                                                                                                                                                                                                                                                                             |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 3.1(b)                     | Amendment                to Amended and Restated Certificate of Incorporation incorporated                by                reference to the Company’s Information Statement dated December 29,                2000.                                                                                                                                                                                                                                                                                                                                        |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 3.2                        | Registrant's                By-Laws incorporated by reference to Exhibit 3.2 filed with the Company's                Registration Statement on Form S-1 (File No. 33-89176).                                                                                                                                                                                                                                                                                                                                                                                      |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 10.1                       | Letter                of intent dated September 30, 1994 between the Registrant and New                Jersey                BCBS, amendments thereto of December 29, 1994, February 27, 1995                and April                4, 1995 and Interim Services Agreement as of April 1, 1995 between                the                Registrant and New Jersey BCBS incorporated by reference to Exhibit                10.12                filed with the Company's Registration Statement on Form S-1 (File                No.                33-89176). |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 10.1(a)                    | December                22, 1995 Letter Agreement between the Registrant and New Jersey BCBS                extending the Letter of Intent and Interim Services Agreement to                March 31,                1996 incorporated by reference to Exhibit 10.12(a) filed with the                Company's Annual Report on Form 10-KSB for the year ended October                31,                1996.                                                                                                                                                   |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 10.2                       | Lease                Agreement dated April 14, 1995 between the Registrant and Metropolitan                Life Insurance Company incorporated by reference to Exhibit 10.13                filed                with the Company's Registration Statement on Form S-1 (File No. 33-89176).                                                                                                                                                                                                                                                                       |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 10.3                       | Letter                of Intent dated January 2, 1996 between CW Ventures II, L.P., the                Registrant and its CareAdvantage Health Systems, Inc. subsidiary                incorporated by reference to Exhibit 10.14 filed with the Company's                Annual                Report on Form 10-KSB for the year ended October 31,                1996.                                                                                                                                                                                         |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 10.4                       | Securities                Purchase Agreement dated February 22, 1996 among CW Ventures, CAHS                and the                Registrant incorporated by reference to Exhibit 10.15 filed with                the                Company's Annual Report on Form 10-KSB for the year ended October                31,                1996.                                                                                                                                                                                                                   |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 10.5                       | CW                Exchangeable Note incorporated by reference to Exhibit 10.16 filed                with                the Company's Annual Report on Form 10-KSB for the year ended October                31,                1996.                                                                                                                                                                                                                                                                                                                             |
|                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 10.6                       | Stock                Acquisition Agreement dated February 22, 1996 among EHC, CHCM, CAHS                and                the Registrant incorporated by reference to Exhibit 10.17 filed with                the                Company's Annual Report on Form 10-KSB for the year ended October                31,                1996.                                                                                                                                                                                                                       |

----

| 10.7   | EHC                Exchangeable Note incorporated by reference to Exhibit 10.18 filed                with                the Company's Annual Report on Form 10-KSB for the year ended October                31,                1996.                                                                                                                                                                |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.8   | Services                Agreement dated February 22, 1996 among Horizon BCBSNJ, CHCM, CAHS                and the                Registrant incorporated by reference to Exhibit 10.19 filed with                the                Company's Annual Report on Form 10-KSB for the year ended October                31,                1996.                                                         |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.9   | Stockholders’                Agreement dated February 22, 1996 among EHC, CW Ventures and the                Registrant incorporated by reference to Exhibit 10.20 filed with                the                Company's Annual Report on Form 10-KSB for the year ended October                31,                1996.                                                                       |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.10  | Joint                Services Agreement, dated May 29, 1997, among Allied Health Group,                Inc.,                CAHS, Inc. and the Company incorporated by reference to Exhibit 10(c)                filed with the Company's Form 10-QSB for the quarter ended April                30,                1997.                                                                             |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.11  | Agreement,                dated as of January 1, 1997 between Blue Cross and Blue Shield of                Rhode                Island (“BCBSRI”) and CAHS, Inc. incorporated by reference to Exhibit                10(a) filed with the Company's Form 10-QSB for the quarter ended                July 31,                1997.                                                        |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.12  | Consultant                Agreement dated March 17, 1997, between Coordinated Health Partners,                Inc.                d/b/a Blue Chip, and CAHS, Inc. incorporated by reference to Exhibit                10(d)                filed with the Company's Form 10-QSB for the quarter ended April                30,                1997.                                                   |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.13  | Letter                Agreement, dated as of March 1, 1997, between Medigroup of New Jersey,                Inc. d/b/a HMO Blue, the Company and Allied Health Group, Inc.                incorporated by reference to Exhibit 10(e) filed with the Company's                Form                10-QSB for the quarter ended April 30, 1997.                                                         |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.14  | First                Amendment and Restatement of Services Agreement, dated as of June                13,                1997, among CAHS, Inc., CHCM, the Company and Horizon BCBSNJ incorporated                by reference to Exhibit 10(b) filed with the Company's Form 10-QSB                for the                quarter ended April 30, 1997.                                              |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.15  | Credit                Agreement among Summit Bank, the Company and Horizon BCBSNJ, dated                June                13, 1997 incorporated by reference to Exhibit 10(f) filed with the                Company's Form 10-QSB for the quarter ended April 30,                1997.                                                                                                              |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.16  | Revolving                Credit Note, dated June 13, 1997 by the Company in favor of Summit                Bank in                the original principal amount of $1,500,000 incorporated by reference                to                Exhibit 10(f)(1) filed with the Company's Form 10-QSB for the quarter                ended April 30, 1997.                                                   |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.17  | Term                Note, dated June 13, 1997, by the Company in favor of Summit Bank                in the                original principal amount of $1,500,000 incorporated by reference                to                Exhibit 10(f)(2) filed with the Company's Form 10-QSB for the quarter                ended April 30, 1997.                                                              |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.18  | Promissory                Note and Security Agreement, dated April 1, 1997, by CHCM in favor                of                Horizon BCBSNJ, in the original principal amount of $1,862,823                incorporated by reference to Exhibit 10(f)(3) filed with the Company's                Form 10-QSB for the quarter ended April 30, 1997.                                                   |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.19  | Employment                Agreement between the Company and Thomas Riley, dated June 10, 1997,                as                supplemented by a side agreement with CW and Horizon BCBSNJ, of even                date                therewith incorporated by reference to Exhibit 10(a) filed with the                Company's Form 10-QSB for the quarter ended April 30,                1997. |
|   |                                                                                                                                                                                                                                                                                                                                                                                                  |
| 10.20  | Services                Agreement as of January 5, 1998, by and between New York Care Plus                Insurance Company, Inc. and the Company, incorporated by reference                to                Exhibit 10.20 filed with the Company's Form 10KSB for the year ended                October 31, 1997.                                                                                   |

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| 10.21             | Consultation                Agreement dated October 1, 1997 by and between the Company and David                McDonnell, an independent director of the Company, incorporated by                reference to Exhibit 10.21 filed with the Company's Form 10KSB for                the                year ended October 31, 1997.               |
|-------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.22             | Mutual                Release Agreement dated as of January 6, 1998 between the Company                and                MEDecision, Inc., incorporated by reference to Exhibit 10.22 filed                with                the Company's Form 10KSB for the year ended October 31,                1997.                                      |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.23             | Separation                Agreement dated April 20, 1995 between PMDX and the Registrant                incorporated by reference to Exhibit 10.1 filed with the Company's                Registration Statement on Form S-1 (File No. 33-89176).                                                                                                 |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.24             | Agreement                dated as of January 1, 1995, between Maine BCBS and CAHS incorporated                by                reference to Exhibit 10.2 filed with the Company's Registration Statement                on Form S-1 (File No. 33-89176).                                                                                         |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.25             | Products                and Services Agreement dated November 7, 1994 between MEDecision,                Inc. and                CAHS incorporated by reference to Exhibit 10.3 filed with the Company's                Registration Statement on Form S-1 (File No. 33-89176).                                                                   |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.26             | Registrant’s                1995 Comprehensive Stock Incentive Plan incorporated by reference                to                Exhibit 4.2 filed with the Company's Registration Statement on Form                S-1                (File No. 33-89176).                                                                                   |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.27             | Registrant’s                1996 Stock Option Plan incorporated by reference to the Company's                Information Statement dated September 1996.                                                                                                                                                                                    |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.28             | Registrant’s                1996 Director Stock Option Plan incorporated by reference to the                Company's                Information Statement dated September 1996.                                                                                                                                                            |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.29             | Option                Agreement between CW Ventures and Horizon BCBSNJ incorporated by                reference                to Exhibit 5 of Schedule 13(d) of Horizon BCBSNJ respecting beneficial                ownership of Common Stock of the Company dated June                1997.                                                     |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.30             | Settlement                and Release Agreement dated January 13, 1998 between the Company                and John                Petillo incorporated by reference to Exhibit 10.30 filed with the                Company's Form 10KSB for the year ended October 31,                1997.                                                       |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.31             | Settlement                and Release Agreement dated December 19, 1997 between the Company                and                Vince Achilarre incorporated by reference to Exhibit 10.31 filed                with the                Company's Form 10KSB for the year ended October 31,                1997.                                    |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.32             | Employment                Agreement between the Company and David Noone, dated January 8, 1999,                incorporated by reference to Exhibit 10.32 filed with the Company’s Form                10KSB for the year ended September 30, 1998.                                                                                         |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.33   | Confidentiality,                Invention, and Non-Compete Agreement between the Company and David                Noone,                dated as of January 8, 1999, incorporated by reference to Exhibit                10.33                filed with the Company’s Form 10KSB for the year ended September 30,                1998.     |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.34   | Settlement                and Release Agreement entered into among Horizon BCBSNJ, the Company,                CAHS, and CHCM, Enterprise Holding Company, Inc. ("EHC") and CW Ventures,                incorporated by reference to Exhibit 10(a) filed with the Company’s Form                10-QSB for the quarter ended July 31, 1998. |
|              |                                                                                                                                                                                                                                                                                                                                              |
| 10.35   | Services                Agreement dated as of January 1, 1999, by and between HealthNow New                York,                Inc. ("HNNY") and the Company, incorporated by reference to Exhibit                10.35                filed with the Company’s Form 10KSB for the year ended September 30,                1998            |

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| 10.36             | Amended                and Restated Employment Agreement, dated as of September 29, 1998,                with                Richard W. Freeman, M.D., CAHS and the Company (the “Freeman Employment                Agreement”), incorporated by reference to Exhibit 10.36 filed with the                Company’s Form 10KSB for the year ended September 30,                1998.                                                                                                                                  |
|-------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.37             | Employment                Agreement, dated as of March 25, 1997, by and between the Company                and                Elaine del Rossi, incorporated by reference to Exhibit 10.37 filed                with                the Company’s Form 10KSB for the year ended September 30,                1998.                                                                                                                                                                                                                |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.38             | Confidentiality,                Invention and Non-Compete Agreement dated as of March 25, 1998 between                the                Company and Elaine del Rossi, incorporated by reference to Exhibit                10.38                filed with the Company’s Form 10KSB for the year ended September 30,                1998.                                                                                                                                                                                         |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.39             | Employment                Agreement, effective as of April 28, 1998, by and among Stephan D.                Deutsch, M.D., the Company and CAHS, incorporated by reference to                Exhibit                10.39 filed with the Company’s Form 10KSB for the year ended September 30,                1998.                                                                                                                                                                                                               |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.40             | Employment                Agreement, effective as of April 19, 1999, between Dennis M. Mouras,                and                the Company, incorporated by reference to Exhibit 10.40 filed with                the                Company’s Form 10KSB for the year ended December 31,                1999.                                                                                                                                                                                                                   |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.41             | Settlement                Agreement dated August 9, 2000 among the Company, Horizon Healthcare                of                New Jersey, Inc. and Allied Specialty Care Services, Inc., incorporated                by                reference to Exhibit 10.1 filed with the Company’s Form 10QSB for the                quarter ended September 30, 2000.                                                                                                                                                                   |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.42             | Employment                Agreement, effective as of April 17, 2000, between Christopher Minor                and                the Company, incorporated by reference to Exhibit 10.2 filed with                the                Company’s Form 10QSB for the quarter ended September 30,                2000.                                                                                                                                                                                                                |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.43             | Satisfaction                of Debt Agreement among Horizon Blue Cross Blue Shield of New Jersey,                Horizon Healthcare of New Jersey, Inc., CareAdvantage Inc., CareAdvantage                Health Systems, Inc. and Contemporary Healthcare Management, Inc.,                incorporated by reference to Exhibit 10.1 filed on the Company’s Form 8-K                dated December 5, 2000 and filed on December 13, 2000.                                                                                       |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.44   | Amendment                dated March 26, 2001 to Satisfaction of Debt Agreement dated as of                November 1, 2000 among Horizon BCBSNJ, Horizon Healthcare of New                Jersey,                Inc., CareAdvantage, Inc., CareAdvantage Health Systems, Inc. and                Contemporary HealthCare Management, Inc, incorporated by reference                to                Exhibit 10.1 filed with the Company’s Form 10-QSB for the quarter ended                March 31, 2001.                     |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.45   | Service                Agreement dated as of January 1, 2000 between Blue Cross Blue Shield                of                Rhode Island, Coordinated Health Partners, Inc. and CareAdvantage                Health                Systems, Inc., incorporated by reference to Exhibit 10.2 filed with                the                Company’s Form 10-QSB for the quarter ended March 31,                2001.                                                                                                              |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.46   | Amendment                dated as of August 9, 2001 to Satisfaction of Debt Agreement dated                as of                November 1, 2000 among Horizon BCBSNJ, Horizon Healthcare of New                Jersey,                Inc., CareAdvantage, Inc., CareAdvantage Health Systems, Inc. and                Contemporary Healthcare Management, Inc. incorporated by reference                to                Exhibit 10.1 filed with the Company’s Form 10-QSB for the quarter ended                June 30, 2001. |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.47   | Settlement                Agreement between CareAdvantage, Inc. and Horizon Blue Cross Blue                Shield                of New Jersey, effective as of October 1, 2004, incorporated by reference                to Exhibit 10.1 filed on the Company’s Form 8-K filed on October 1,                2004.                                                                                                                                                                                                                |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.48   | Second                Amendment to Lease Agreement between CareAdvantage Health Systems,                Inc.                and Corporate Plaza Associates, L.L.C., incorporated by reference                to                Exhibit 10.1 filed on the Company’s Form 8-K filed on January 11,                2005.                                                                                                                                                                                                             |

----

| 10.49             | Services                and License Agreement between the Company and Kaiser Foundation Health                Plan of the Northwest ("Kaiser"), effective as of January 1, 2005,                incorporated by reference to Exhibit 10.49 filed with the Company’s Form                10-KSB for the year ended December31, 2004. Portions of this exhibit                (indicated by asterisks) have been omitted pursuant to a request                for                confidential treatment pursuant to Rule 24b-2 of the Securities Exchange                Act of 1934.                                                               |
|-------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.50   | Amendment                to Employment Agreement between the Company and Dennis J. Mouras,                dated as                of November 11, 2005, and Employment Agreement between the Company                and                Dennis J. Mouras, dated as of October 25,2000, incorporated by reference                to Exhibit 10.50 filed with the Company’s Form 10-QSB for the quarter                ended September 30, 2005.                                                                                                                                                                                                     |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.51   | First                Amendment to Services and License Agreement between the Company and                Kaiser                Foundation Health Plan of the Northwest (“Kaiser”), effective as of                January 1, 2006, incorporated by reference to Exhibit 10.51 filed                with the                Company’s Form 10-KSB for the year ended December 31, 2005. Portions of                this exhibit (indicated by asterisks) have been omitted pursuant                to a                request for confidential treatment pursuant to Rule 24b-2 of the                Securities Exchange Act of 1934. |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.52   | Second                Amendment to Services and License Agreement between the Company and                Kaiser, effective as of April 1, 2006, incorporated by reference                as                Exhibit 10.52 filed with the Company’s Form 10-KSB for the year ended                December 31, 2005. Portions of this exhibit (indicated by asterisks)                have                been omitted pursuant to a request for confidential treatment pursuant                to                Rule 24b-2 of the Securities Exchange Act of 1934.                                                                                |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.53   | Services                and License Agreement between the Company and Blue Cross Blue Shield                of                Texas (“BCBSTX”), effective as of August 18, 2003. Portions of this                exhibit (indicated by asterisks) have been omitted pursuant to a                request                for confidential treatment pursuant to Rule 24b-2 of the Securities                Exchange Act of 1934.*                                                                                                                                                                                                           |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.54             | Amendment                to Services and License Agreement between the Company and BCBSTX,                effective as of June 1, 2006. Portions of this exhibit (indicated                by                asterisks) have been omitted pursuant to a request for confidential                treatment pursuant to Rule 24b-2 of the Securities Exchange Act of                1934.*                                                                                                                                                                                                                                                                |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 16.1              | Letter                regarding change in accountants, incorporated by reference to Exhibit                16.1                filed on the Company’s Form 8-K dated June 6, 1996.                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 16.2    | Letter                regarding change in accountants, incorporated by reference to Exhibit                16                filed on the Company’s Form 8-K dated July 31, 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 16.3    | Letter                regarding change in accountants, incorporated by reference to Exhibit                16.1                filed on the Company’s Form 8-K dated June 6, 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 31      | Certifications                pursuant to Rule 13a-14(a), promulgated under the Securities Exchange                Act                of 1934, as amended, and Section 302 of the Sarbanes-Oxley Act of                2002*                                                                                                                                                                                                                                                                                                                                                                                                                            |
|              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 32                | Certifications                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section                906 of                the Sarbanes-Oxley Act of 2002 **                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |

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