<PAGE>
                                          
                                          
                         SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, DC 20549
                                          
                                     FORM 10-Q

(Mark One)
[X] Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange
Act of 1934 For the quarterly period ended June 30, 1998 or
                                                  ------
[ ] Transition report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 For the Transition period from __________ to__________

                                          
                          Commission File Number:  0-19758

                                ACCESS HEALTH, INC.
               (Exact name of registrant as specified in its charter)
                                          
            Delaware                                             68-0163589
(State or other jurisdiction of                               (I.R.S. Employer 
incorporation or organization)                              Identification No.)

     335 Interlocken Parkway, Broomfield, CO                     80021
     (Address of principal executive offices)                 (Zip code)
                                          
                                   (303) 466-9500
                (Registrant's telephone number, including area code)
                                          
                                          
     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

     Yes    X        No   
         -------        -------

            Number of shares of Common Stock Outstanding at July 31, 1998: 
                                   23,578,076 shares

<PAGE>
                                Access Health, Inc.
                                          
                                       INDEX
<TABLE>
<CAPTION>
                                                                                  Page No.
                                                                                  --------
<S>                                                                                 <C>
PART I    FINANCIAL INFORMATION

  Item 1.  Financial Statements

    Condensed consolidated balance sheets (unaudited)- September 30, 1997
    and June 30, 1998. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     4

    Condensed consolidated statements of income (unaudited)  - three months and
    nine months ended June 30, 1997 and 1998 . . . . . . . . . . . . . . . . . .     5

    Condensed consolidated statements of cash flows (unaudited) - nine months
    ended June 30, 1997 and 1998 . . . . . . . . . . . . . . . . . . . . . . . .     6

    Notes to condensed consolidated financial statements . . . . . . . . . . . .     7

    Item 2.  Management's discussion and analysis of financial
    condition and results of operations. . . . . . . . . . . . . . . . . . . . .    12

PART II.     OTHER INFORMATION

  Item 4. Submission of Matters to a Vote of Security Holders. . . . . . . . . .    20

  Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . . .    20

SIGNATURE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    21
</TABLE>

                                       2
<PAGE>








                              PART I.  FINANCIAL INFORMATION



















                                       3
<PAGE>

                                 Access Health, Inc.
                        Condensed Consolidated Balance Sheets
                  (In thousands, except per share and share amounts)
                                     (Unaudited)
<TABLE>
<CAPTION>
                                                                                 September 30,     June 30,
                                                                                     1997            1998
                                                                                 -------------   -----------
<S>                                                                              <C>             <C>
Assets:
  Current assets:
   Cash and equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . .       $ 17,499       $ 46,704
   Available-for-sale securities. . . . . . . . . . . . . . . . . . . . . . .         41,969         30,052
   Accounts and license fees receivable, net of allowance for doubtful 
     accounts of $1,073 at June 30, 1998, and $1,070 at September 30, 1997. .         16,919         26,253
   Deferred income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . .          9,295          9,671
   Income taxes receivable. . . . . . . . . . . . . . . . . . . . . . . . . .          3,231          3,220
   Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          2,456          3,472
   Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . .          1,708          1,814
                                                                                 -------------   -----------
     Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . .         93,077        121,186
  Property and equipment, net . . . . . . . . . . . . . . . . . . . . . . . .         17,766         19,354
  Purchased intangibles, net of accumulated amortization of $5,312, at June 
    30, 1998, and $4,911 at September 30, 1997. . . . . . . . . . . . . . . .          2,894          2,493
  Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . .          1,042          1,042
  Long term equity investment . . . . . . . . . . . . . . . . . . . . . . . .            -            3,011
  Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            773            522
                                                                                 -------------   -----------
                                                                                    $115,552       $147,608
                                                                                 -------------   -----------
                                                                                 -------------   -----------
Liabilities and Stockholders' Equity:
  Current liabilities:
    Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . .        $  4,434       $  5,964
    Accrued payroll and related expenses . . . . . . . . . . . . . . . . . .           4,157          5,610
    Accrued transaction, integration and restructuring costs . . . . . . . .           3,109          9,011
    Taxes and accrued expenses . . . . . . . . . . . . . . . . . . . . . . .           4,874          7,134
    Notes payable to related parties . . . . . . . . . . . . . . . . . . . .           1,264              0
    Current portion of long-term debt. . . . . . . . . . . . . . . . . . . .             209            221
    Current portion of capital lease obligation. . . . . . . . . . . . . . .             470            513
    Deferred revenues. . . . . . . . . . . . . . . . . . . . . . . . . . . .          15,782         16,926
                                                                                 -------------   -----------
      Total current liabilities. . . . . . . . . . . . . . . . . . . . . . .          34,299         45,379
  Capital lease obligations. . . . . . . . . . . . . . . . . . . . . . . . .             542            148
  Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .             217             50

Stockholders' equity:
  Preferred stock, $.001 par value-5,000,000 shares authorized, no shares 
    issued and outstanding . . . . . . . . . . . . . . . . . . . . . . . . .             -              -  
  Common stock, $.001 par value-75,000,000 shares authorized, 23,550,997 
    shares issued and outstanding at June 30, 1998, and 22,786,159 shares 
    issued and outstanding at September 30, 1997 . . . . . . . . . . . . . .              23             24
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . .          80,934         89,752
Retained earnings (deficit). . . . . . . . . . . . . . . . . . . . . . . . .            (463)        12,255
                                                                                 -------------   -----------
  Total stockholders' equity . . . . . . . . . . . . . . . . . . . . . . . .          80,494        102,031
                                                                                 -------------   -----------
                                                                                    $115,552       $147,608
                                                                                 -------------   -----------
                                                                                 -------------   -----------
</TABLE>
                               See accompanying notes.


                                       4
<PAGE>

                                Access Health, Inc.
                    Condensed Consolidated Statements of Income
                      (In thousands, except per share amounts)
                                    (Unaudited)
<TABLE>
<CAPTION>
                                                       Three months ended             Nine months ended
                                                            June 30,                       June 30,
                                                       1997          1998            1997          1998
                                                     --------       --------       --------       --------
<S>                                                  <C>            <C>            <C>            <C>
Revenues:
  Care management services. . . . . . . . . . . .    $23,909        $29,785        $68,326        $84,217
  Licensing and support services. . . . . . . . .      6,555          8,785         19,191         24,974
                                                     --------       --------       --------       --------
        Total revenues. . . . . . . . . . . . . .     30,464         38,570         87,517        109,191
Costs and expenses:
  Cost of revenues:
   Care management services . . . . . . . . . . .     12,795         16,587         35,377         46,473
   Licensing and support services . . . . . . . .      1,743          1,911          5,847          5,869
   Product and other development. . . . . . . . .      2,812          3,223          8,627          8,652
   Sales and marketing. . . . . . . . . . . . . .      2,866          3,277          8,424          9,694
   General and administrative . . . . . . . . . .      3,187          3,482          9,858         11,510
   Transaction costs. . . . . . . . . . . . . . .        -            5,607          6,345          5,607
   Integration and restructuring costs. . . . . .        -            3,393          6,961          3,393
                                                     --------       --------       --------       --------
        Total costs and expenses. . . . . . . . .     23,403         37,480         81,439         91,198
                                                     --------       --------       --------       --------

Income from operations. . . . . . . . . . . . . .      7,061          1,090          6,078         17,993

Other income. . . . . . . . . . . . . . . . . . .        514            910          1,214          2,571
                                                     --------       --------       --------       --------

Income before income taxes. . . . . . . . . . . .      7,575          2,000          7,292         20,564
Provision for income taxes . . . . . . . . . . .      1,872            725          1,915          7,814
                                                     --------       --------       --------       --------

Net income. . . . . . . . . . . . . . . . . . . .     $5,703         $1,275         $5,377        $12,750
                                                     --------       --------       --------       --------
                                                     --------       --------       --------       --------
Net income per share:

  Basic . . . . . . . . . . . . . . . . . . . . .      $0.26          $0.06          $0.25          $0.57
                                                     --------       --------       --------       --------
                                                     --------       --------       --------       --------

  Diluted . . . . . . . . . . . . . . . . . . . .      $0.24          $0.05          $0.23          $0.52
                                                     --------       --------       --------       --------
                                                     --------       --------       --------       --------

Shares used in per share calculations:

  Basic . . . . . . . . . . . . . . . . . . . . .     21,837         22,769         21,634         22,502
                                                     --------       --------       --------       --------
                                                     --------       --------       --------       --------

  Diluted . . . . . . . . . . . . . . . . . . . .     23,558         24,659         23,503         24,661
                                                     --------       --------       --------       --------
                                                     --------       --------       --------       --------
</TABLE>

                             See accompanying notes.


                                       5
<PAGE>
                                          Access Health, Inc.
                            Condensed Consolidated Statements of Cash Flows
                                            (In thousands)
                                              (Unaudited)
<TABLE>
<CAPTION>
                                                                      Nine months ended
                                                                           June 30, 
                                                                     --------------------
                                                                      1997           1998
                                                                     --------------------
<S>                                                                  <C>           <C>
Cash flows from operating activities:
  Net income. . . . . . . . . . . . . . . . . . . . . . . .          $5,377        $12,750
  Adjustments to reconcile net income to net cash 
    provided by operations:
    Allowance for doubtful accounts . . . . . . . . . . . .             134             23
    Depreciation and amortization . . . . . . . . . . . . .           4,762          6,141
    Deferred stock compensation . . . . . . . . . . . . . .             443            -  
    Common stock issued for services rendered . . . . . . .           2,233            -  
    Changes in:
      Accounts and license fees receivable. . . . . . . . .            (537)       (10,272)
      Prepaid expenses and other current assets . . . . . .          (1,154)        (2,089)
      Accounts payable. . . . . . . . . . . . . . . . . . .            (620)         1,860
      Accrued payroll and related expenses. . . . . . . . .             540          1,285
      Accrued transaction, integration, and restructure
        costs . . . . . . . . . . . . . . . . . . . . . . .           2,901          5,902
      Taxes and other accrued expenses. . . . . . . . . . .           1,221          1,764
      Deferred revenues . . . . . . . . . . . . . . . . . .           2,309          3,660
                                                                    --------       -------
        Net cash provided by operating activities . . . . .          17,609         21,024
                                                                    --------       -------

Cash flows from investing activities:
  Sale of available-for-sale securities, net. . . . . . . .             208         11,917
  Purchase of property and equipment. . . . . . . . . . . .          (4,696)        (7,367)
  Notes receivable from AHN . . . . . . . . . . . . . . . .          (5,000)           -  
  Long term equity investment . . . . . . . . . . . . . . .             -           (3,011)
  Other assets. . . . . . . . . . . . . . . . . . . . . . .             258            276
                                                                    --------       -------
        Net cash provided by (used in) by investing
          activities. . . . . . . . . . . . . . . . . . . .          (9,230)         1,815
                                                                    --------       -------
Cash flows from financing activities:
  Notes payable to related parties. . . . . . . . . . . . .            (653)        (1,264)
  Payment of long-term debt and capital leases. . . . . . .            (514)          (581)
  Sale of common stock. . . . . . . . . . . . . . . . . . .           1,559          8,818
                                                                    --------       -------
        Net cash provided by financing activities . . . . .             392          6,973
                                                                    --------       -------

Net increase in cash and equivalents. . . . . . . . . . . .           8,771         29,812
Elimination of InterQual net cash activity for the 
  three months ended December 31, 1997. . . . . . . . . . .             -             (607)
Cash and equivalents at beginning of period . . . . . . . .          26,976         17,499
                                                                    --------       -------

Cash and equivalents at end of period . . . . . . . . . . .         $35,747        $46,704
                                                                    --------       -------
                                                                    --------       -------
</TABLE>

                             See accompanying notes.


                                       6
<PAGE>
                                 Access Health, Inc.
                Notes to Condensed Consolidated Financial Statements
                                   June 30, 1998
                                    (Unaudited)
                                          

Note 1: Summary of Significant Accounting Policies

INTERIM FINANCIAL STATEMENTS

The accompanying consolidated condensed interim financial statements have 
been prepared by the Company, without audit, pursuant to the rules and 
regulations of the Securities and Exchange Commission (the "Commission").  
Certain information and footnote disclosures normally included in financial 
statements prepared in accordance with generally accepted accounting 
principles have been omitted pursuant to such rules and regulations. The 
accompanying consolidated condensed interim financial statements should be 
read in conjunction with the financial statements and notes thereto included 
in the Company's Form 10-K for the fiscal year ended September 30, 1997.

In the opinion of management, the unaudited interim financial statements 
reflect all adjustments, consisting of only normal recurring adjustments, 
necessary to present fairly the Company's consolidated financial position at 
September 30, 1997 and June 30, 1998, consolidated results of operations for 
the three month and nine month periods ended June 30, 1997 and 1998 and cash 
flows for the nine month periods ended June 30, 1997 and 1998.  Results for 
the periods ended June 30, 1998 are not necessarily indicative of the results 
to be expected for the entire fiscal year. 

The unaudited interim financial statements for all periods presented have 
been restated to reflect the merger with InterQual, Inc. which has been 
accounted for as a pooling of interests, effective June 30, 1998. 
Accordingly, InterQual's December 31, 1997 balance sheet has been combined 
with Access Health's September 30, 1997 balance sheet, InterQual's statement 
of operations for three and nine months ended September 30, 1997 have been 
combined with Access Health's statements of operations for the three and nine 
months ended June 30, 1997, and InterQual's cash flows for the nine months 
ended September 30, 1997 have been combined with Access Health's cash flows 
for the nine months ended June 30, 1997.

For the quarter ended June 30, 1998, Access Health announced a strategic 
relationship with MEDCAN Health Management, Inc. ("MEDCAN") of Toronto, 
Canada. Access Health also made a minority preferred stock investment in 
MEDCAN. 

IMPAIRMENT OF LONG-LIVED ASSETS

The Company reviews its long-lived assets for impairment whenever events or 
changes in circumstances indicate that the carrying amount of an asset may 
not be recoverable from future undiscounted cash flows.  Impairment losses 
are recorded for the difference between the carrying value and fair value of 
the long-lived asset.

REVENUE RECOGNITION

Revenues include care management services, which consist of program 
membership, member communications and teleservicing fees from the Company's 
Personal Health Advisor/FirstHelp and ASK-A-NURSE contracts with managed care 
organizations, self-insured employers and hospitals. Revenues also include 
licensing and support services related to certain of the Company's products 
including InterQual Clinical Decision Support Criteria, ASK-A-NURSE, 
FirstHelp, patient education software, Access Care Management System, 
HealthSelect, and CANCER HELPLINK.  

Program membership fees from Personal Health Advisor/FirstHelp contracts are 
recognized ratably in accordance with contract terms typically on the basis 
of per-member fees. Member communications fees are recognized upon 


                                       7
<PAGE>
the delivery of services.  Teleservicing fees are recognized in accordance 
with contract terms on the basis of per-call fees or fees based on phone 
counselor staffing.

License revenues from InterQual Clinical Decision Support Criteria, 
ASK-A-NURSE, FirstHelp, and CANCER Helplink products are recognized ratably 
over the term of the contract. HealthSelect and patient education software 
revenue is recognized upon delivery of the software. Support revenues are 
comprised of ASK-A-NURSE, CANCER HELPLINK, and Access Care Management System 
support revenue, LIFE MATCH software support revenue and direct marketing 
fees. Revenue from support contracts and software maintenance contracts is 
recognized ratably over the contract term. Direct marketing fees are 
recognized upon the delivery of services.

PRODUCT AND OTHER DEVELOPMENT COSTS

Product and other development costs are expensed as incurred and consist 
primarily of salaries, supplies and contract services related to the 
development of the Company's products and services.

TRANSACTION COSTS AND INTEGRATION AND RESTRUCTURING COSTS

Transaction costs of $6.3 million in the nine months ended June 30, 1997 
reflect charges associated directly with the merger of the Company with 
Informed Access and CRS and included professional fees of approximately $5.2 
million. Also related to the mergers were integration and restructuring costs 
recorded in the first and fourth quarters of fiscal 1997, which included 
approximately $6.3 million for severance and related expenses, approximately 
$400,000 for elimination of redundant technology, approximately $1.2 million 
for discontinuation of facilities, approximately $900,000 for disposal of 
assets and approximately $900,000 for relocation and other costs.

During the third quarter of fiscal 1998, transaction costs of $5.6 million 
were recorded reflecting charges associated directly with the merger of the 
Company with InterQual, Inc. and included professional fees of approximately 
$4.7 million.  Integration and restructuring costs related to the merger of 
InterQual, Inc. are reflected in the third quarter of fiscal 1998 results in 
the amount of $3.4 million. These costs reflect the integration of management 
and sales teams of Access Health, Inc. and InterQual, Inc.

NEW ACCOUNTING PRONOUNCEMENTS

STATEMENT OF ACCOUNTING STANDARDS NO. 128

During fiscal 1998, Access Health, Inc. adopted Statement of Financial 
Accounting Standards ("SFAS") No. 128, "Earnings Per Share." This statement 
establishes standards for computing and presenting basic and diluted earnings 
per share. Under this statement, basic earnings or loss per share is computed 
by dividing the net earnings or loss by the weighted average number of shares 
of common stock outstanding. Diluted earnings or loss per share is determined 
by dividing the net earnings or loss by the sum of (1) the weighted average 
number of common shares outstanding, (2) if not anti-dilutive, the number of 
shares of convertible preferred stock as if converted upon issuance, and (3) 
if not anti-dilutive, the effect of outstanding stock options determined 
utilizing the treasury stock method. 

A reconciliation of the numerator and denominators used in computing per 
share net income (loss) from continuing operations is as follows (in 
thousands):


                                       8
<PAGE>
<TABLE>
<CAPTION>
                                                            Three months ended       Nine months ended
                                                                 June 30,                 June 30,
                                                             1997        1998        1997          1998   
                                                           -----------------------------------------------
<S>                                                        <C>         <C>         <C>          <C>
 Numerator for basic and diluted net income per share:
     Net income                                            $ 5,703     $ 1,275      $ 5,377     $ 12,750
                                                           -----------------------------------------------
                                                           -----------------------------------------------

 Denominator for basic net income per share:
     Weighted average common shares outstanding             21,837      22,769       21,634       22,502
                                                           -----------------------------------------------
                                                           -----------------------------------------------


 Denominator for diluted net income per share:
     Weighted average common shares outstanding             21,837      22,769       21,634       22,502
     Dilutive effect of outstanding stock options            1,721       1,890        1,869        2,159
                                                           -----------------------------------------------
        Denominator for diluted net income per share        23,558      24,659       23,503       24,661
                                                           -----------------------------------------------
                                                           -----------------------------------------------
</TABLE>

STATEMENT OF FINANCIAL ACCOUNTING STANDARDS NO. 130

In June 1997, the Financial Accounting Standards Board issued SFAS No. 130, 
"Reporting Comprehensive Income," which is required to be adopted for fiscal 
years beginning after December 15, 1997. This statement establishes standards 
for reporting and display of comprehensive income and its components in a 
full set of general-purpose financial statements. This statement requires 
that all items that are required to be recognized under accounting standards 
as components of comprehensive income be reported in a financial statement 
that is displayed with the same prominence as other financial statements. 
Reclassification of financial statements for earlier periods provided for 
comparative purposes is required.  The Company expects to adopt SFAS No. 130 
beginning in the first quarter of fiscal 1999.

STATEMENT OF FINANCIAL ACCOUNTING STANDARDS NO. 131

In June 1997, the Financial Accounting Standards Board issued SFAS No. 131, 
"Disclosures about Segments of an Enterprise and Related Information," 
effective for fiscal years beginning after December 15, 1997. This statement 
requires that a public company report financial and descriptive information 
about its reportable operating segments using the management approach.  The 
Company expects to adopt Statement No. 131 in the first quarter of fiscal 
1999.

STATEMENT OF FINANCIAL ACCOUNTING STANDARDS NO. 133

In June 1998, the Financial Accounting Standards Board issued SFAS No. 133, 
"Accounting for Derivative Instruments and Hedging Activities" effective for 
fiscal years beginning after June 15, 1999. SFAS No. 133 establishes 
accounting and reporting standards requiring that every derivative instrument 
(including certain derivative instruments embedded in other contracts) be 
recorded in the balance sheet as either an asset or liability measured at its 
fair value. It also requires that changes in the derivative's fair value be 
recognized currently in earnings unless specific hedge accounting criteria 
are met. Special accounting for qualifying hedges allows a derivative's gains 
and losses to offset related results on the hedged item in the income 
statement, and requires that a company must formally document, designate, and 
assess the effectiveness of transactions that receive hedge accounting. 

SFAS No. 133 may not be applied retroactively, and must be applied to (a) 
derivative instruments and (b) certain derivative instruments embedded in 
hybrid contracts that were issued, acquired, or substantively modified after 
December 31, 1997 (and, at the company's election, before January 1, 1998). 
Because the Company has not historically entered into such arrangements, 
management believes that the impact of SFAS No. 133 will not significantly 
affect its financial reporting.


                                       9
<PAGE>
STATEMENT OF POSITION 98-1

In March 1998, the AICPA issued Statement of Position ("SOP") 98-1, 
"Accounting for the Costs of Computer Software Developed or Obtained for 
Internal Use". This statement is effective for fiscal years beginning after 
December 15, 1998, although earlier application is permitted.  In general, 
SOP 98-1 requires that certain costs to develop software for internal use be 
capitalized.  These requirements are to be applied prospectively from the 
date of the Company's adoption. To date, the Company has not historically 
capitalized such costs.

STATEMENT OF POSITION 98-5

In April 1998, the AICPA issued SOP 98-5, "Reporting on the Costs of Start-Up 
Activities". This statement is effective for financial statements for fiscal 
years beginning after December 15, 1998. In general, SOP 98-5 requires costs 
of start-up activities and organization costs to be expensed as incurred. 
Initial application of SOP 98-5 should be reported as the cumulative effect 
of a change in accounting principle. Management believes that SOP 98-5 will 
not have a material impact on its financial statements.

Note 2: Business combinations

During November 1996, the Company consummated business combinations with 
Informed Access which included the exchange of 5,375,000 shares of Access 
Health, Inc. common stock (including 4,778,317 shares issued to Informed 
Access shareholders and 596,683 shares reserved for future grant to Informed 
Access option holders) and Clinical Reference Systems, which included the 
exchange of 170,000 shares of Access Health common stock.  These business 
combinations were accounted for as pooling-of-interests and, accordingly, the 
historical financial statements of the Company have been restated to include 
the consolidated financial statements of Access Health, Informed Access and 
Clinical Reference Systems for all periods presented.

As of June 30, 1998, the Company consummated a business combination with 
InterQual, Inc. of Marlborough, Massachusetts. Under the terms of the 
acquisition, 4,540,000 shares of Access Health, Inc.'s common stock were 
exchanged for the outstanding shares of InterQual, Inc. The business 
combination was accounted for as a pooling-of-interests and, accordingly, the 
historical financial statements of Access Health and InterQual, Inc. have 
been restated as though the companies had been combined for all periods 
presented.

The following table provides a reconciliation of revenues and earnings 
reported by the Company to the combined amounts presented for, or included in 
the period indicated (periods ended June 30, 1997 below include three and 
nine month data for InterQual, Inc. for the respective three and nine month 
periods ended September 30, 1997):

<TABLE>
<CAPTION>
                        Three months ended June 30, 1997
                                   (Unaudited)

                         Access Health, Inc.   InterQual, Inc.        Total
                         -----------------------------------------------------
<S>                         <C>                <C>                <C>
 Revenues                   $ 26,485,000       $  3,979,000       $ 30,464,000
                         -----------------------------------------------------
                         -----------------------------------------------------
 Net income                 $  5,576,000       $    127,000       $  5,703,000
                         -----------------------------------------------------
                         -----------------------------------------------------

                        Three months ended June 30, 1998
                                   (Unaudited)

                         Access Health, Inc.   InterQual, Inc.        Total
                         -----------------------------------------------------
<S>                         <C>                <C>                <C>
 Revenues                   $ 32,414,000       $  6,156,000       $ 38,570,000
                         -----------------------------------------------------
                         -----------------------------------------------------
 Net income                 $    383,000       $    892,000       $  1,275,000
                         -----------------------------------------------------
                         -----------------------------------------------------
</TABLE>


                                       10
<PAGE>
<TABLE>
<CAPTION>
                         Nine months ended June 30, 1997
                                   (Unaudited)

                         Access Health, Inc.   InterQual, Inc.        Total
                         -----------------------------------------------------
<S>                         <C>                <C>               <C>
 Revenues                   $ 76,227,000       $  11,290,000     $  87,517,000
                         -----------------------------------------------------
                         -----------------------------------------------------
 Net income                 $  5,047,000       $     330,000     $   5,377,000
                         -----------------------------------------------------
                         -----------------------------------------------------
<CAPTION>
                         Nine months ended June 30, 1998
                                   (Unaudited)

                         Access Health, Inc.   InterQual, Inc.        Total
                         -----------------------------------------------------
<S>                         <C>                <C>               <C>
 Revenues                   $ 92,679,000       $  16,512,000     $ 109,191,000
                         -----------------------------------------------------
                         -----------------------------------------------------
 Net income                 $ 11,569,000       $   1,181,000     $  12,750,000
                         -----------------------------------------------------
                         -----------------------------------------------------
</TABLE>

Note 3: Notes payable to related parties

Notes payable to related parties arising from bonuses were payable to members 
of management, who are also stockholders of the Company. The final 
installment was paid in January 1998.

Note 4:  Long-term debt

The Company has a term facility agreement (the "Term Agreement") consisting 
of note payable and capital lease facilities. At June 30, 1998, principal 
balances under the note payable facility and capital lease facility totaled 
$248,000 and $442,000, respectively.  Principal balances under the Term 
Agreement are secured by certain of the Company's equipment with an aggregate 
carrying value of approximately $466,000 at June 30, 1998.  Amounts payable 
under the Term Agreement bear interest at 14.48%, are due at varying dates 
through September 1999, and require monthly payments of principal and 
interest totaling approximately $52,000.  Payments due under the note payable 
facility of the Term Agreement for the next twelve months are approximately 
$557,000. 

Note 5: Income taxes

The Company's state net operating loss carryforwards of approximately $6.7 
million as of September 30, 1997 expire between 2007 and 2011. The Company 
also has approximately $161,000 of federal research and development tax 
credits available, which expire between 2007 and 2011. 

Realization of the Company's net deferred tax assets is dependent upon the 
Company generating sufficient taxable income in future years in the United 
States to obtain benefit from the reversal of temporary differences and from 
tax credit and state net operating loss carryforwards. The amount of deferred 
tax assets considered realizable is subject to adjustment in future periods 
if estimates of future taxable income are reduced.

Note 6: Commitments

OPERATING LEASES

The Company leases its offices under the terms of operating leases that 
expire between September 1998 and December 2012. Annual minimum rental 
payments for the remainder of fiscal 1998, and for fiscal 1999, 2000, 2001, 
2002 and thereafter are $1,023,000, $3,355,000, $3,143,000, $3,102,000, 
$2,060,000 and $19,656,000 respectively. Rental expenses are recorded on a 
straight-line basis over the respective lease terms.


                                      11
<PAGE>
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

THIS DISCUSSION CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS, INCLUDING BUT 
NOT LIMITED TO STATEMENTS IDENTIFIED BY AN ASTERISK, WHICH INVOLVE RISKS AND 
UNCERTAINTIES.  THE COMPANY'S ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THE 
RESULTS ANTICIPATED IN THESE FORWARD-LOOKING STATEMENTS AS A RESULT OF 
CERTAIN FACTORS SET FORTH HEREUNDER AND IN THE COMPANY'S ANNUAL REPORT AS 
FILED ON FORM 10-K/A FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1997 AS WELL AS 
IN THE COMPANY'S REGISTRATION STATEMENT ON FORM S-4, AS AMENDED, FILED ON JUNE
10, 1998.

RESULTS OF OPERATIONS

REVENUES. Revenues consist of revenues from care management services and 
licensing and support services.  Revenues increased from $30.5 million during 
the three months ended June 30, 1997 to $38.6 million during the three months 
ended June 30, 1998, or 26.6%, and increased from $87.5 million for the nine 
months ended June 30, 1997 to $109.2 million, or 24.8% for the nine months 
ended June 30, 1998.

Revenues from care management services increased from $23.9 million during 
the third quarter of fiscal 1997 to $29.8 million during the third quarter of 
fiscal 1998, or 24.6%, and increased from $68.3 million during the first nine 
months of fiscal 1997 to $84.2 million, or 23.3% during the first nine months 
of fiscal 1998, due to increases in membership levels related to the 
Company's contracts during these periods. As of June 30, 1998, approximately 
27.5 million members were enrolled compared to approximately 19.8 million 
members enrolled as of June 30, 1997. Average revenue per-member per-month 
was $0.41 for the third quarter of fiscal 1997 compared to $0.37 for the 
third quarter of fiscal 1998. Average revenue per-member per-month was $0.43 
for the first nine months of fiscal 1997 compared to $0.38 for the first nine 
months of fiscal 1998. The decrease in average revenue per-member was 
primarily due to contract rationalizations where actual utilization was 
meaningfully below the contract minimum. The Company believes that the 
decline in average revenue per-member has ended and average revenue 
per-member will stabilize during the remainder of fiscal 1998. Revenue from 
the Company's contracts is recognized ratably in accordance with contract 
terms on the basis of per-member fees.

Revenues from licensing and support services increased from $6.6 million 
during the third quarter of fiscal 1997 to $8.8 million, or 34.0%, during the 
third quarter of fiscal 1998, and from $19.2 million during the first nine 
months of fiscal 1997 to $25.0 million, or 30.1%, for the first nine months 
of fiscal 1998. This increase was primarily attributable to increases in 
license revenue related to the InterQual Clinical Decision Support Criteria. 
Licensing and support services revenues include licensing implementations and 
program support activities for InterQual Clinical Decision Support Criteria, 
FirstHelp, the ASK-A-NURSE-Registered Trademark- family of products, CANCER 
HelpLink-Registered Trademark-, Access Care Management System-Registered 
Trademark- ("ACMS"), the LIFE MATCH-Registered Trademark- family of products, 
and patient education software.

COST OF REVENUES.  The cost of care management services revenues includes the 
costs of operating the Company's services centers, on-going client 
consultation, and charges for providing care management member communications 
services. The gross margins for care management services were 46.5% during 
the third quarter of fiscal 1997 and 44.3% during the third quarter of fiscal 
1998, and 48.2% during the first nine months of fiscal 1997 compared to 44.8% 
for the first nine months of fiscal 1998.  The decrease in gross margin 
during the third quarter of fiscal 1998 and for the nine months ended June 
30, 1998 compared to the same periods in fiscal 1997, is primarily due to 
adjusting pricing terms on older contracts typically effective upon renewal 
dates during fiscal 1997. The Company does not anticipate that downward price 
adjustments to contracts during the remainder of fiscal 1998 will have a 
material effect on operating results. * Additional factors contributing to 
the decrease in gross margin were operational inefficiencies experienced as a 
result of implementing a common service platform in all care centers and 
absorbing the costs associated with new product beta sites. The Company 
expects that gross margins for care management services will continue to be 
lower during the fourth quarter of fiscal 1998 compared with the first nine 
months of the fiscal 1998 due primarily to operating inefficiencies related 
to the implementation of the common system platform and costs related to new 
product initiatives.


                                      12
<PAGE>

The cost of licensing and support services revenues includes the costs of 
license implementations, on-going client consultation, annual users' 
conferences, advertising materials, and other support services for InterQual 
Decision Support Criteria, FirstHelp, ASK-A-NURSE, CANCER HelpLink, Access 
Care Management System, LIFE MATCH licensees, and patient education software 
licensees. The gross margin percentages for licensing and support services 
increased from 73.4% during the third quarter of fiscal 1997 to 78.2% during 
the third quarter of fiscal 1998, and from 69.5% during the first nine months 
of fiscal 1997 to 76.5% for the first nine months of fiscal 1998 due to 
changes in product licensing mix and increased efficiency resulting from 
organizational adjustments. While gross margins for licensing and support 
services can fluctuate, the Company believes it is currently operating near 
targeted gross margin levels for licensing and support services.

PRODUCT AND OTHER DEVELOPMENT EXPENSES.  Product and other development 
expenses were $2.8 million, or 9.2% of revenues, during the third quarter of 
fiscal 1997 and $3.2 million, or 8.4% of revenues, during the third quarter 
of fiscal 1998. For the first nine months of fiscal 1997, product and other 
development expenses totaled $8.6 million, or 9.9% of revenues compared to 
$8.7 million, or 7.9% of revenues during the first nine months of fiscal 
1998. As a percent of revenue, product and other development expenses 
decreased by 8.7% during the third quarter of fiscal 1998 and 20.2% for the 
first nine months of fiscal 1998 when compared to the prior fiscal year due 
to realizing costs savings from the integration of the development teams of 
Access Health and Informed Access Systems. The Company expects product and 
other development expenses to increase in coming quarters, but generally 
consistent with the current percentage of revenues. *

SALES AND MARKETING EXPENSES.  Sales and marketing expenses were $2.9 
million, or 9.4% of revenues, during the third quarter of fiscal 1997 and 
$3.3 million, or 8.5% of revenues, during the third quarter of fiscal 1998. 
For the first nine months of fiscal 1997, sales and marketing expenses 
totaled $8.4 million, or 9.6% of revenues, compared to  $9.7 million, or 8.9% 
of revenues for the first nine months of fiscal 1998.  As a percent of 
revenue, sales and marketing expenses decreased by 9.6% during the third 
quarter of fiscal 1998 and 7.3% for the first nine months of fiscal 1998 when 
compared to the prior fiscal year due to cost savings from the integration of 
the sales teams of Access Health and Informed Access Systems. The Company 
expects sales and marketing expenses to increase in coming quarters, but 
generally consistent with the current percentage of revenues. *

GENERAL AND ADMINISTRATIVE EXPENSES.  General and administrative expenses 
were $3.2 million, or 10.5% of revenues, during the third quarter of fiscal 
1997 and $3.5 million, or 9.0% of revenues, during the third quarter of 
fiscal 1998. For the first nine months of fiscal 1997, general and 
administrative expenses totaled $9.9 million, or 11.3% of revenues, compared 
to $11.5 million, or 10.5% of revenues for the first nine months of fiscal 
1998. As a percent of revenue, general and administrative expenses decreased 
by 14.3% during the third quarter of fiscal 1998 and 7.1% for the first nine 
months of fiscal 1998 when compared to the prior fiscal year due to realizing 
cost savings from the integration of Access Health and Informed Access 
Systems' management teams. The Company expects general and administrative 
expenses to increase in coming quarters, but generally consistent with the 
current percentage of revenues. *

TRANSACTION COSTS.  Transaction costs of $6.3 million were one-time charges 
recorded in the first quarter of fiscal 1997 associated directly with the 
merger of the Company with Informed Access and CRS and consists primarily of 
professional fees and services of approximately $5.2 million.

Transaction costs of $5.6 million are one-time charges recorded in the third 
quarter of fiscal 1998 associated directly with the merger of the Company 
with InterQual, Inc. and consists primarily of professional fees and services 
of approximately $4.7 million.

INTEGRATION AND RESTRUCTURING COSTS.  Integration and restructuring costs 
related to the mergers of Informed Access and CRS were recorded in the amounts 
of $7.0 million and $2.7 million during the first and fourth quarters of fiscal
1997, respectively.  Integration and restructuring costs include: $7.1 million 
for severance, outplacement and relocation costs specifically related to the 
merger; $1.2 million related to the closure and elimination of duplicate 


                                      13
<PAGE>

leased facilities, primarily corporate headquarters, a sales office and a 
call center; and $1.3 million related to the write-off of computer hardware 
and other assets which were made obsolete as a result of the merger and 
duplicate information systems.  The remaining merger-related accrual at June 
30, 1998 was approximately $1.5 million and includes $.9 million for 
severance, outplacement and relocation costs: $0.4 million related to the 
closure and elimination of duplicate leased facilities: and $0.2 million 
related to the write-off of computer hardware and other assets. Total 
expected cash expenditures relating to the merger charge are estimated to be 
approximately $6.7 million of which approximately $5.2 million was disbursed 
prior to June 30, 1998.  Termination benefits received by employees 
terminated through September 30, 1997 were approximately $5.6 million. The 
remaining severance and outplacement amounts are expected to be paid during 
the current fiscal year.

Integration and restructuring costs related to the merger of InterQual, Inc. 
are reflected in the third quarter of fiscal 1998 results in the amount of 
$3.4 million. These costs reflect the integration of management and sales 
teams of Access Health, Inc and InterQual, Inc.

INCOME FROM OPERATIONS.  Operating income decreased from $7.1 million during 
the third quarter of fiscal 1997 to $1.1 million during the third quarter of 
fiscal 1998 due to the transaction and restructuring charges related to the 
InterQual merger, and increased from $6.1 million for the first nine months 
of fiscal 1997 to $18.0 million during the same period in fiscal 1998. The 
changes for the first nine months of fiscal 1997 to the first nine months of 
fiscal 1998 are attributable to increasing revenues and decreased ongoing 
operating expenses, and to the transaction, integration and restructuring 
expenses recorded during the first nine months of fiscal 1997, which were 
approximately $4.3 million greater than the transaction, integration, and 
restructuring expenses recorded during the first nine months of fiscal 1998.

INCOME TAXES.  The Company recorded an income tax provision of approximately 
$1.9 million and $.7 million for the three months ended June 30, 1997 and 
1998, respectively, an income tax provision of approximately $1.9 million for 
the nine months ended June 30, 1997 and an income tax provision of 
approximately $7.8 million for the nine months ended June 30, 1998, 
respectively. During fiscal 1997, the Company, for tax purposes, liquidated 
one of its subsidiaries, allowing it to utilize the net operating loss of the 
subsidiary and reduce the valuation allowance by $3,368,000. During fiscal 
1997, the Company recorded a deferred tax asset of approximately $6.0 million 
resulting from temporary differences in the recognition of certain expenses 
for book and tax purposes.

Realization of the Company's net deferred tax asset is dependent upon Access 
Health generating sufficient United States federal taxable income 
(approximately $17.0 million) in future years to obtain benefit from the 
reversal of net deductible differences and from tax credit carryforwards. The 
Company's management believes that, on a more likely than not basis, the 
Company's recorded net deferred tax asset is realizable. The amount of 
deferred tax assets considered realizable is subject to adjustment in future 
periods if estimates of future United States federal taxable income are 
reduced.

OTHER INCOME.  The Company generates interest and other income from cash 
balances and available-for-sale securities. Interest and other income 
increased from $514,000 to $910,000, or 77.0% in the third quarter of fiscal 
1997 and 1998, respectively, and from $1,214,000 to $2,571,000, or 111.8% for 
the first nine months of fiscal 1997 and 1998, respectively due to the 
increase in cash and equivalents and available for sale securities from $59.5 
million at June 30, 1997 to $76.8 million at June 30, 1998. 

EFFECTS OF INFLATION AND CHANGING PRICES.  Inflation and changing prices have 
not had a material effect on the Company's operations and, at current levels, 
are not expected to in future years*. 

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 1998, the Company held cash and equivalents and 
available-for-sale securities totaling $76.8 million compared to a balance of 
$59.5 million as of September 30, 1997.  Net cash provided by operating 
activities during 


                                      14
<PAGE>

the first nine months of fiscal 1998 was $21.0 million compared with $17.6 
million for the first nine months of fiscal 1997.

The Company believes its current capital resources are adequate to fund cash 
needs for anticipated operating levels for at least the next twelve months*. 
The Company also may use capital resources in connection with business 
expansion that may include the acquisition of complementary product lines or 
businesses during fiscal 1998 or beyond*.

During the first nine months of fiscal 1998, the Company purchased 
approximately $7.4 million of property and equipment. The Company expects to 
purchase additional capital equipment during the balance of fiscal 1998 to 
further integrate and expand call centers and system capacity, and to expand 
the Company's corporate infrastructure*.

IMPACT OF THE YEAR 2000 ON COMPUTER SYSTEMS.  

The architectural design of the Company's computer systems and infrastructure 
have taken into account the effect of integrating existing date data with 
date data from the Year 2000 and beyond.  As a result, the Company believes 
it will address and resolve any possible issue associated with the 
integration of Year 2000 date data in a timely fashion and will not 
materially affect future financial results or cause reported financial 
information to be inaccurate. * Nevertheless, unforeseen internal problems or 
unanticipated events including the inability of third party vendors to 
integrate Year 2000 date data could occur causing a material adverse effect 
on the Company's business, results of operations and financial condition. 

* THIS STATEMENT IS A FORWARD-LOOKING STATEMENT REFLECTING CURRENT 
EXPECTATIONS. THERE CAN BE NO ASSURANCE THAT THE COMPANY'S ACTUAL FUTURE 
PERFORMANCE WILL MEET THE COMPANY'S CURRENT EXPECTATIONS.  INVESTORS ARE 
STRONGLY ENCOURAGED TO REVIEW THE SECTION ENTITLED "RISK FACTORS THAT MAY 
AFFECT FUTURE OPERATING PERFORMANCE."

RISK FACTORS THAT MAY AFFECT FUTURE OPERATING PERFORMANCE

The following factors should be carefully considered in evaluating the 
Company and its business.

UNCERTAINTY RELATED TO OBTAINING, EXPANDING AND RETAINING CONTRACTS MAY 
IMPACT RESULTS OF OPERATIONS. The Company's ability to increase revenues and 
profitability is largely dependent on the Company's ability to secure 
additional care management contracts and to retain and expand existing 
contracts. The Company could be adversely affected by the termination or 
non-renewal of any of the Company's contracts, or by renegotiation of the 
terms of contracts, particularly if the affected contracts cover a large 
number of members or represent a significant portion of the Company's care 
management revenue.  For example, in fiscal 1997, the Company renegotiated 
various older care management contracts, typically upon renewal, to bring 
price terms based on minimum membership and utilization rates previously 
negotiated in line with actual membership and utilization rates. Such 
rationalizations resulted in a decrease of revenue by approximately $7.0 
million in fiscal 1997.  During the first nine months of fiscal 1998 contract 
rationalizations decreased by approximately $4.3 million and for the balance 
of the year, the Company expects contract rationalizations to reduce revenue 
under such contracts by approximately $1.9 million. Any factors adversely 
affecting the market for the care management product or the licensing and 
support services products, including factors outside of the Company's 
control, such as adverse publicity or government regulatory action, could 
have a material adverse effect on the Company.

DEPENDENCE ON PRINCIPAL CUSTOMERS. Significant portions of the Company's 
revenues are generated by a limited number of customers. The Company's care 
management contracts range from approximately 800 members to 3.0 million 
members per contract. In fiscal 1997, the five largest single care management 
enrollments totaled 3.0 million, 2.4 million, 1.9 million, 1.5 million and 
1.5 million members. In fiscal 1997, the Company's three largest customers 
accounted for approximately 8.0%, 7.8%, and 6.9% of the Company's total 
revenues and the Company's 


                                      15
<PAGE>

top five customers, in the aggregate, accounted for approximately 33.4% of 
the Company's total revenues. After an initial term of approximately one to 
four years, contracts generally can be terminated upon 60 to 360 days notice 
to the Company. Three of the Company's five largest contracts are up for 
renewal in the second half of fiscal year 1998. The Company's contracts could 
be subject to early termination by its customers if the Company were not in 
compliance with any applicable government regulation. The termination, 
non-renewal or renegotiation of any such agreements could have a material 
adverse effect on the Company's operating results. See "Government 
Regulation."

UNCERTAINTY OF FUTURE OPERATING RESULTS. The Company's quarterly operating 
results may fluctuate significantly in the future as a result of a variety of 
factors, many of which are outside the Company's control. There can be no 
assurance that the Company's revenues and profitability will increase during 
fiscal 1998 and beyond. The Company's revenues may be materially adversely 
affected by the termination or non-renewal of the Company's contracts or by 
the renegotiation of the terms of such contracts. The Company may incur 
significantly increased sales, marketing, and promotional expenses, and may 
devote additional resources to the further development of care management or 
other new products. To the extent that the Company incurs increased expenses, 
the Company's operating results will be adversely affected unless revenues 
and operating margins increase sufficiently to offset such expenditures. See 
"Management's Discussion and Analysis of Financial Condition and Results of 
Operations."

COMPETITION.  The market for the Company's products and services is highly 
competitive. There are a number of competitors that offer products or 
services that compete with some or all of those offered by the Company. 
Existing and potential clients may also evaluate the Company's products or 
services against internally developed programs. Increased competition could 
result in pricing pressure and margin erosion. In its existing business and 
as the Company offers new products or services, or enters new markets, it may 
face increased competition from competitors, some of which may have 
substantially greater financial, marketing and technical resources than the 
Company. In particular, several small competitors have recently been acquired 
by companies with substantially greater financial, marketing and technical 
resources than the Company, and this could lead to increased competition. 
There can be no assurance that the Company will continue to compete 
successfully.

CHANGING HEALTH CARE MARKET AND NEW PRODUCT DEVELOPMENT.  The health care 
industry has undergone significant changes in recent years, and changes are 
expected to continue. Containing health care costs has become a national 
priority. As a result, the health care industry has become increasingly 
dominated by managed health care plans, causing cost containment pressure to 
rise. To address these changes, the Company shifted its business focus in 
1993 to payors from providers and developed its personal health management 
services. There is no assurance that the Company's existing products and 
services will achieve continued success or that its new products and services 
will succeed. There also can be no assurance that continued industry change 
will not adversely affect the Company's ability to compete. Continued change 
may cause the Company to incur significant product development and marketing 
expenses. The Company's future success will depend on the Company's ability 
to adapt to the changing needs of the health care industry. 

CARE CENTER OPERATIONS.  The Company maintains member service and data 
centers ("care centers") in Rancho Cordova, California; Chicago, Illinois; 
Broomfield, Colorado; Phoenix, Arizona; San Juan, Puerto Rico, and Great 
Missenden, England. The Company's operations depend on the adequate 
functioning of the computer and telephone systems in its call centers. 
Although the Company has taken precautions to provide for power, computer, 
and telephone systems redundancy, there can be no assurance that a fire or 
other disaster affecting the centers or an equipment failure would not 
disable the Company's systems for a significant period of time. Any 
significant damage to the Company's facilities or an equipment failure could 
have a material adverse effect on the Company's results of operations. 

The successful operation of the Company's care centers is based on a 
networked information system. The information system provides care center 
nurses and health care counselors with access to care management applications 
and a database of information including member information, plan rules, 
physician information and clinical algorithms and guidelines. The Company is 
in the process of implementing a new information system which combines 
certain aspects of the different systems developed by Access Health and 
Informed Access. The 


                                      16
<PAGE>

implementation of this new information system could delay revenues or 
increase operating costs and could have a material adverse effect on the 
Company. The ability to continue to develop, implement and support the 
Company's information systems is dependent on its ability to employ and 
retain experienced technical personnel. If the Company is unable to hire and 
retain required personnel or is required to pay compensation at significantly 
higher levels to attract and retain technical personnel it could have a 
material adverse effect on the Company's financial results.

LIMITATIONS ON PROTECTION OF PROPRIETARY RIGHTS. The Company regards its 
software, clinical algorithms and nursing assessment tools, clinical 
operational expertise and marketing and program operation materials as 
proprietary and takes action to protect its intellectual property with 
patents, copyrights, trademarks, trade secret laws and restrictions on 
disclosure, copying and transferring title. Despite the Company's 
precautions, it may be possible for unauthorized third parties to copy 
aspects of the Company's products or to obtain and use information that the 
Company regards as proprietary. There can be no assurance that competitors, 
some of which have substantial resources and have made substantial 
investments in competing technologies, will not seek to apply for and obtain 
patents that will prevent, limit or interfere with the Company's ability to 
market its products and services either in the United States or in 
international markets. The Company could incur substantial costs defending 
itself in suits against the Company or its proprietary rights or in bringing 
suits against those parties to enforce the Company's proprietary rights. The 
Company has been issued patents on its clinical algorithms in the United 
States and has filed for patent protection in some foreign countries. There 
is no assurance that such patents will not be challenged or invalidated. 
Existing copyright laws afford only limited practical protection. In 
addition, the laws of some foreign countries do not protect the Company's 
proprietary rights to the same extent as do the laws of the United States, 
which could be a factor depending upon into which countries outside the 
United States the Company expands. 
 
MANAGEMENT OF GROWTH.  The Company has experienced rapid growth in recent 
years. Continued rapid growth may place a significant strain on the Company's 
management, telecommunications systems, operational infrastructure, working 
capital and financial and management control systems.  The difficulties of 
managing growth may be increased by the necessity of coordinating 
geographically separated organizations. In order for the Company to manage 
its client base successfully, management will be required to anticipate the 
changing demands of their growing operations and to adopt systems and 
procedures accordingly. Failure to effectively implement or maintain such 
systems and procedures could adversely affect the Company's business, results 
of operation and financial condition.  Further, there can be no assurance 
that the Company's current information systems, telecommunications systems 
and operational infrastructure will be adequate for its future needs, or that 
the Company will be successful in implementing new systems.  Failure to 
upgrade its information systems, telecommunications systems and operational 
infrastructure or unexpected difficulties encountered with these systems 
during expansion could adversely affect the Company's business, financial 
condition and results of operations.

ACQUISITION-RELATED RISKS.   The Company has grown in part through mergers 
and acquisitions. The Company merged with InterQual, Inc. effective June 30, 
1998 and intends to evaluate acquisitions of other product lines and 
businesses as part of its business strategy. The process of integrating an 
acquired company's business into the Company's operations may result in 
unforeseen operating difficulties and expenditures and may absorb significant 
management attention that would otherwise be available for the ongoing 
development of the Company's existing business.  Moreover, there can be no 
assurance that the anticipated benefits of an acquisition will be realized.  
Future acquisitions by the Company could result in potentially dilutive 
issuance of equity securities, the incurrence of debt and contingent 
liabilities and amortization expenses related to goodwill and other 
intangible assets, which could materially adversely affect the Company's 
operating results and financial condition.  In addition, acquisitions involve 
numerous risks, including difficulties in managing diverse geographic 
operations, the diversion of management's attention from other business 
concerns, risks of entering markets in which the Company has no or limited 
direct prior experience, the addition of unanticipated administrative and 
other expense, and the potential loss of key employees of the acquired 
company.  The inability of the Company's management to respond to changing 
business conditions effectively, including the changes associated with its 
acquired businesses and product lines could have a material adverse effect on 
the Company's results of operations.


                                      17
<PAGE>

KEY EMPLOYEES AND MANAGEMENT OF CHANGE.  The Company's success depends on a 
limited number of key management employees, most of whom are subject to 
post-employment non-competition restrictions. The loss of the services of one 
or more of these employees could have a material adverse effect on the 
Company. The Company believes that its continued success also will depend in 
large part on its ability to attract and retain highly skilled management, 
nursing, technical, marketing, and sales personnel. Competition for such 
personnel is intense, and there can be no assurance that the Company will be 
successful in attracting and retaining such personnel as necessary. 
Furthermore, the Company's ability to manage change and growth successfully 
will require the Company to continue to improve its management expertise as 
well as its financial systems and controls.

VOLATILITY OF STOCK PRICE. The market for the Company's stock is highly 
volatile. The trading price of the Company's common stock is subject to wide 
fluctuations in response to a variety of factors including the signing or 
loss of a major contract, changes in market analyst estimates and 
recommendations for the Company's common stock, fluctuations in operating 
results, the failure of operating results to meet market analyst's estimates, 
changes in government regulation and general conditions in the health care 
industry and the economy, any of which could cause the price of the Company's 
common stock to fluctuate, perhaps substantially. In addition, in recent 
years stock prices have experienced significant fluctuations, which have 
particularly affected the market price for the securities of health care 
companies and which often have been unrelated to the operating performance of 
these companies.

GOVERNMENT REGULATION.  The health care industry is subject to extensive and 
evolving government regulation at both the Federal and state levels relating 
to many aspects of the Company's and its clients' businesses in use of the 
Company's programs, including the provision of health care services, 
teleservicing, and health care referral programs. These statutes and 
regulations in many cases predate the development of telephone-based health 
care information and other interstate transmission and communication of 
medical information and services. The literal language of certain of these 
statutes and regulations governing the provision of health care services, 
including the practice of nursing and the practice of medicine, could be 
construed by regulatory authorities to apply to certain of the Company's 
activities, including without limitation teleservicing activities which use 
California, Illinois, Arizona, and Colorado registered nurses to provide 
out-of-state care management services such as nursing assessments and 
information regarding appropriate sources of care and treatment time frames. 
These statutes and regulations could also apply to certain activities of the 
Company's health service customers when operating the Company's programs.  
The Company understands that state regulators in some states have informed 
some entities that they are adopting such a construction. The Company has 
taken steps to comply with such regulatory interpretation, but there can be 
no assurance that such steps will be sufficient to protect the Company from 
the effects of any such regulatory action. In addition, the literal language 
of the statutes and regulations governing health maintenance organizations 
and other plans that provide or arrange for the provision of health care 
services for a prepaid or periodic charge could be construed by regulatory 
authorities to apply to certain activities of the Company that are provided 
on a per-member, per-month basis. The Company has not been made, nor is it 
aware that any other company providing out-of-state teleservicing has ever 
been made the subject of such requirements by a regulatory authority. 
However, if regulators seek to enforce any of the foregoing statutory and 
regulatory requirements, the Company, its employees and/or its clients could 
be required to obtain additional licenses or registrations, to modify or 
curtail the operation of the Company's programs, to modify the method of 
payment for the Company's programs, or to pay fines or incur other penalties. 

The payment of remuneration to induce the referral of health care business 
has been a subject of increasing governmental and regulatory focus in recent 
years. Section 1128B(b) of the Social Security Act (sometimes referred to as 
the "Federal anti-kickback statute") provides criminal penalties for 
individuals or entities that knowingly and willfully offer, pay, solicit or 
receive remuneration in order to induce referrals for items or services for 
which payment may be made under the Medicare and Medicaid programs and 
certain other government-funded programs. The Social Security Act provides 
authority to the Office of the Inspector General through civil proceedings to 
exclude an individual or entity from participation in the Medicare and state 
health programs if it is determined any such party has violated Section 
1128B(b) of the Social Security Act. Regulations have been promulgated 
specifying certain payment practices, which will not be subject to criminal 
prosecution or civil exclusion. These regulations, 


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<PAGE>

commonly referred to as the "safe harbor" regulations, do not expand the 
scope of the Federal anti-kickback statute, and the fact that a business 
arrangement does not fit within a safe harbor does not mean the business 
arrangement violates the Federal anti-kickback statute. The Company's 
programs do not meet the requirements of the safe harbor for referral 
services. A number of states in which the Company operates have anti-kickback 
statutes similar to the Federal statute as well as statutory and regulatory 
requirements governing referral agencies and regulating franchising and 
business opportunity ventures. In addition, the Federal government and a 
number of states have enacted statutes which contain outright prohibitions on 
referrals for specified services which are made by referring providers who 
have an ownership interest in, or compensation arrangement with, the entity 
to which the referral is made. If the Company or the use of its products and 
services were to be found in violation of such statutes, the Company or its 
clients could be required to modify or curtail the operation of the Company's 
programs, or to pay fines or incur other penalties, and the Company's clients 
could be excluded from participation in the Medicare and Medicaid programs 
and could be precluded from charging fees and obtaining reimbursement for 
specified services. 

There can be no assurance that the Company or the use of its products and 
services will not be subject to review or challenge by government regulators 
under any of the foregoing statutes and regulations that apply to health care 
services and products. In addition, additional laws and regulations could be 
enacted in the future that would regulate the Company or the use of its 
products and services. Any government investigative or enforcement actions 
with respect to the Company or the use of its products or services could 
generate adverse publicity irrespective of the final outcome, and could have 
a material adverse effect on the Company. 

RISK MANAGEMENT.  In recent years, participants in the health care industry, 
including physicians, nurses and other health care professionals, have been 
subject to an increasing number of lawsuits alleging malpractice, product 
liability and related legal theories, many of which involve large claims and 
significant defense costs. Due to the nature of its business, the Company 
could become involved in litigation regarding the telephone information given 
by its registered nurses or those of its licensees with the risk of adverse 
publicity, significant defense costs and substantial damage awards. The 
Company has established policies and procedures that limit the information 
provided by its registered nurses to that contained in its clinical 
algorithms and protocols and in other approved reference sources. In 
connection with its teleservices operations, the Company has a quality 
assurance program that includes real-time audits of calls and post call 
reviews to monitor compliance with established policies and procedures. 
Generally, clients review and approve the Company's clinical algorithms, 
protocols and guidelines prior to program implementation and do not modify 
them without medical approval. To date, the Company has not been the subject 
of any claim involving either its clinical assessment systems, the operation 
of its teleservicing centers or the operation by hospital or other clients of 
on-site call centers. However, there can be no assurance that claims will not 
be brought against the Company. Even if such claims ultimately prove to be 
without merit, defending against them can be time consuming and expensive, 
and any adverse publicity associated with such claims could have a material 
adverse effect on the Company. Further, there can be no assurance that the 
Company has appropriate or sufficient coverage under the existing insurance 
plans or that they will be able to obtain appropriate or sufficient amounts 
of insurance in the future to address the foregoing risks on terms that are 
commercially reasonable.


                                      19
<PAGE>

                            PART II - OTHER INFORMATION
                                          
ITEM  4.  SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS

     a)   A special meeting of Stockholders of Access Health, Inc. was held on
          June 30, 1998 to vote upon the approval of the issuance of shares of
          Access Health Common Stock pursuant to the terms of an Amended and
          Restated Agreement and Plan of Reorganization by and among Access
          Health, Inc., Access Acquisition Corp. 98A, and InterQual, Inc.

     b)   The matters voted upon at the meeting and the results of the voting
          with respect to those matters were as follows:

<TABLE>
<CAPTION>
                                           Shares Entitled
                                               To Vote         Shares Voting          For             Against           Abstain
--------------------------------------------------------------------------------------------------------------------------------
<S>                                          <C>                 <C>               <C>                <C>                <C>
 1) Approval of Issuance of Shares           18,993,742          13,905,822        13,864,135         32,062             9,625
      % of Shares Voted                                           100.0 %            99.7%              .2%               .1%
</TABLE>


          The foregoing matters are described in detail in the Registrant's
          definitive proxy statement dated June 10, 1998 for the special meeting
          of Stockholders held on June 30, 1998.

     c)   Not applicable.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

     a)   Exhibits:


EXHIBIT DESCRIPTION
<TABLE>
<CAPTION>
<S>  <C>       <C>
3.1  (A)       Amended and Restated Certificate of Incorporation
3.2  (A)       Amended and Restated Bylaws
3.3  (B)       Certificate of Designation of Rights, Preferences and Privileges of Series A 
                   Participating Preferred Stock of Access Health, Inc. filed on March 13, 1997.
4.1  (A)       Specimen Stock Certificate
4.2  (C)       1998 Stock Option Plan 
          
4.3  (A)       Shareholder's Representation Statement and Registration Rights Agreement dated as of 
                   November 25, 1996 between Registrant and various investors
4.4  (A)       Registration Rights Agreement dated November 18, 1996
4.5  (C)       Form of Preferred Shares Rights Agreement, dated as of March 12, 1997 as amended on December 8, 1997 between the 
                   Company and First Chicago Trust Company of New York
4.6  (D)       Amended and Restated Plan of Reorganization among Access Health, Inc., Access Acquisition Corp. 98A and InterQual,
                   Inc.
 27            Financial Data Schedule.

     (A)  Incorporated by reference to Registrant's Form 10-K for the year ended September 30, 1996.
     (B)  Incorporated by reference to Registrant's Registration Statement on Form 8-A filed March 13, 1997 (No. 000-19758). 
     (C)  Incorporated by reference to Registrant's Form 10-Q for the quarter ended March 31, 1998.
     (D)  Incorporated by reference to Registrant's Registration Statement on S-4/A filed June 10, 1998 (No. 333-56253).     
     
     b)        Reports on Form 8-K.  Form 8-K relating to the InterQual merger was filed on July 10, 1998.
</TABLE>

                                      20

<PAGE>
                                  Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the 
registrant has duly caused this report to be signed on its behalf by the 
undersigned thereunto duly authorized.

                          ACCESS HEALTH, INC.




Date: August 14, 1998               /s/ Timothy H. Connor
                                    ---------------------
                                    Timothy H. Connor
                                    Senior Vice President and Chief 
                                      Financial Officer (principal financial 
                                      officer of Registrant)


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