<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
 
                       SECURITIES AND EXCHANGE COMMISSION
 
                              WASHINGTON, DC 20549
 
                            ------------------------
 
                                   FORM 10-Q
 
            QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
 
                        SECURITIES EXCHANGE ACT OF 1934
 
                 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 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 0-27502
 
                            ------------------------
 
                       HEALTH SYSTEMS DESIGN CORPORATION
 
             (Exact name of registrant as specified in its charter)
 
                  DELAWARE                             94-3235734
      (State or other Jurisdiction of        (I.R.S. Employer Identification
       Incorporation or Organization)                    Number)
 
                   1330 BROADWAY, OAKLAND, CALIFORNIA 94612
             (Address of principal executive offices)  (Zip code)
 
                                (510) 763-2629
             (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
1932 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 _____
 
    The registrant had 6,545,708 shares of common stock outstanding as of March
31, 1998.
 
    Exhibit index is located on page 12
 
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
                       HEALTH SYSTEMS DESIGN CORPORATION
                                     INDEX
 
<TABLE>
<CAPTION>
                                                                                                                 PAGE
                                                                                                                 -----
<S>        <C>                                                                                                <C>
PART I. FINANCIAL INFORMATION
 
Item 1.    Consolidated Financial Statements
 
           Consolidated Balance Sheets--March 31, 1998 and September 30, 1997...............................           2
 
           Consolidated Statements of Operation--Three and Six Months ended March 31, 1998 and 1997.........           3
 
           Consolidated Statements of Cash Flows--Six Months ended March 31, 1998 and 1997..................           4
 
           Notes to Consolidated Financial Statements.......................................................           5
 
Item 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations............           7
 
PART II. OTHER INFORMATION
 
Item 4.    Submission of Matters to a Vote of Security Holders..............................................          10
 
Item 6.    Exhibits and Reports on Form 8-K.................................................................          10
</TABLE>
 
                                       1
<PAGE>
                         PART I. FINANCIAL INFORMATION
                          ITEM 1. FINANCIAL STATEMENTS
 
                       HEALTH SYSTEMS DESIGN CORPORATION
 
                          CONSOLIDATED BALANCE SHEETS
 
                                     ASSETS
 
<TABLE>
<CAPTION>
                                                                                                    SEPTEMBER 30,
                                                                                                        1997
                                                                                       MARCH 31,    -------------
                                                                                         1998
                                                                                     -------------
                                                                                      (UNAUDITED)
<S>                                                                                  <C>            <C>
Current Assets:
  Cash and cash equivalents........................................................  $   9,622,871  $  11,194,757
  Accounts receivable, net of allowance for doubtful accounts of $525,000 at March
    31 1998, and $193,000 at September 30, 1997....................................      4,757,037      5,208,056
  Unbilled revenue.................................................................      2,426,257        994,421
  Prepaid expenses.................................................................        655,263        568,266
                                                                                     -------------  -------------
    Total current assets...........................................................     17,461,428     17,965,500
                                                                                     -------------  -------------
Property and equipment:
  Computer equipment...............................................................      3,515,622      3,636,153
  Office furniture and other.......................................................      1,365,550      1,149,701
                                                                                     -------------  -------------
    Total property and equipment...................................................      4,881,172      4,785,854
Less: Accumulated depreciation.....................................................     (1,694,885)    (1,599,767)
                                                                                     -------------  -------------
    Net property and equipment.....................................................      3,186,287      3,186,087
                                                                                     -------------  -------------
Deposits and other assets..........................................................        122,152        127,000
                                                                                     -------------  -------------
Software development costs, net of accumulated amortization of $669,095 at March
  31, 1998 and $582,752 at September 30, 1997......................................      1,639,215        798,540
                                                                                     -------------  -------------
    Total assets...................................................................  $  22,409,082  $  22,077,127
                                                                                     -------------  -------------
                                                                                     -------------  -------------
 
                                      LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable.................................................................  $     779,522  $   1,202,204
  Accrued liabilities..............................................................      2,447,958      1,740,674
  Unearned revenue.................................................................      3,245,979      1,675,265
                                                                                     -------------  -------------
    Total current liabilities......................................................      6,473,459      4,618,143
 
Stockholders' equity:
  Preferred stock, $.001 par value, 1,000,000 shares authorized, none
    outstanding....................................................................       --             --
  Common stock, $.001 par value, 20,000,000 shares authorized, 6,545,708 and
    6,533,406 shares issued and outstanding at March 31, 1998 and September 30,
    1997, respectively                                                                       6,555          6,533
  Additional paid-in capital.......................................................     23,050,390     23,029,552
  Treasury stock, 2,054 shares.....................................................        (28,500)       (28,500)
  Deferred compensation............................................................        (35,399)       (43,279)
  Retained deficit.................................................................     (7,057,424)    (5,505,322)
                                                                                     -------------  -------------
  Total stockholders' equity.......................................................     15,935,623     17,458,984
                                                                                     -------------  -------------
    Total liabilities and stockholders' equity.....................................  $  22,409,082  $  22,077,127
                                                                                     -------------  -------------
                                                                                     -------------  -------------
</TABLE>
 
                                       2
<PAGE>
                       HEALTH SYSTEMS DESIGN CORPORATION
 
                     CONSOLIDATED STATEMENTS OF OPERATIONS
 
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                              THREE MONTHS ENDED            SIX MONTHS ENDED
                                                                  MARCH 31,                    MARCH 31,
                                                          --------------------------  ----------------------------
                                                              1998          1997          1998           1997
                                                          ------------  ------------  -------------  -------------
<S>                                                       <C>           <C>           <C>            <C>
Revenues:
  System sales..........................................  $  5,678,975  $  3,502,613  $  10,224,823  $   6,360,827
  Services and other....................................       762,140       619,682      1,507,034      1,084,008
                                                          ------------  ------------  -------------  -------------
    Total revenues......................................     6,441,115     4,122,295     11,731,857      7,444,835
Cost of revenues........................................     2,730,931     1,391,125      4,932,330      2,726,898
                                                          ------------  ------------  -------------  -------------
    Gross margin........................................     3,710,184     2,731,170      6,799,527      4,717,937
                                                          ------------  ------------  -------------  -------------
Operating expenses:
  General and administrative............................     2,039,738     1,443,849      3,913,209      2,777,707
  Sales and marketing...................................     1,199,848       977,802      2,175,189      2,047,533
  Product development...................................       943,562       930,716      2,459,657      1,787,446
                                                          ------------  ------------  -------------  -------------
    Total operating expenses............................     4,183,148     3,352,367      8,548,055      6,612,686
                                                          ------------  ------------  -------------  -------------
    Loss from operations................................      (472,964)     (621,197)    (1,748,528)    (1,894,749)
Interest income (expense), net..........................       108,448       177,764        230,023        361,227
                                                          ------------  ------------  -------------  -------------
    Loss before provision for income taxes..............      (364,516)     (443,433)    (1,518,505)    (1,533,522)
Provision for income taxes..............................        33,596       --              33,597       --
                                                          ------------  ------------  -------------  -------------
Net loss................................................  $   (398,112) $   (443,433) $  (1,552,102) $  (1,533,522)
                                                          ------------  ------------  -------------  -------------
                                                          ------------  ------------  -------------  -------------
Net loss per share......................................  $      (0.06) $      (0.07) $       (0.24) $       (0.24)
                                                          ------------  ------------  -------------  -------------
                                                          ------------  ------------  -------------  -------------
Weighted average common shares outstanding..............     6,545,465     6,456,108      6,540,129      6,446,240
                                                          ------------  ------------  -------------  -------------
                                                          ------------  ------------  -------------  -------------
</TABLE>
 
                                       3
<PAGE>
                       HEALTH SYSTEMS DESIGN CORPORATION
 
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
 
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                                                           SIX MONTHS ENDED
                                                                                              MARCH 31,
                                                                                     ----------------------------
                                                                                         1998           1997
                                                                                     -------------  -------------
<S>                                                                                  <C>            <C>
Cash flows from operating activities:
  Net loss.........................................................................  $  (1,552,102) $  (1,533,522)
  Adjustments to reconcile net loss to net cash and cash equivalents provided by
    (used in) operating activities:
    Allowance for doubtful accounts................................................        332,000         75,000
    Depreciation and amortization..................................................        678,527        542,820
    Loss on disposal of property and equipment.....................................        178,788          5,835
    Changes in current assets and liabilities:
      Accounts receivable..........................................................        119,019       (177,639)
      Unbilled revenue.............................................................     (1,431,836)      (196,970)
      Prepaid expenses.............................................................        (86,997)      (114,636)
      Accounts payable.............................................................       (422,682)       (75,664)
      Accrued liabilities..........................................................        707,284        217,864
      Unearned revenue.............................................................      1,570,714        907,590
                                                                                     -------------  -------------
        Net cash provided by (used in) operating activities........................         92,715       (349,322)
                                                                                     -------------  -------------
Cash flows from investing activities:
  Purchases of property and equipment..............................................       (782,214)      (644,225)
  Proceeds from sale of property and equipment.....................................         18,922          2,939
  Capitalization of software development costs.....................................       (927,018)      (360,037)
  Other assets.....................................................................          4,848        (35,644)
                                                                                     -------------  -------------
    Net cash used in investing activities..........................................     (1,685,462)    (1,036,967)
                                                                                     -------------  -------------
Cash flows from financing activities:
  Payments under capital leases....................................................       --               (3,505)
  Proceeds from exercise of common stock options...................................         20,861         53,251
                                                                                     -------------  -------------
    Net cash provided by financing activities......................................         20,861         49,746
                                                                                     -------------  -------------
    Net increase (decrease) in cash and cash eqivalents............................     (1,571,886)    (1,336,543)
Cash and cash equivalents at beginning of period...................................     11,194,757     15,254,042
                                                                                     -------------  -------------
Cash and cash equivalents at end of period.........................................  $   9,622,871  $  13,917,499
                                                                                     -------------  -------------
                                                                                     -------------  -------------
Supplemental disclosure of cash flow information:
  Interest paid....................................................................  $    --        $          21
  Taxes paid.......................................................................  $      33,596  $         800
</TABLE>
 
                                       4
<PAGE>
                       HEALTH SYSTEMS DESIGN CORPORATION
 
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
                                 MARCH 31, 1998
 
1. BASIS OF PRESENTATION
 
    The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information on substantially the same basis as the annual audited
financial statements. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments considered
necessary for a fair presentation have been included. Operating results for the
three and six month period ended March 31, 1998 are not necessarily indicative
of the results that may be expected for the year ended September 30, 1998. These
consolidated financial statements should be read in conjunction with the
financial statements and footnotes thereto for the year ended September 30, 1997
included in the Company's Form 10-K Annual Report.
 
2. REVENUE RECOGNITION
 
    The Company licenses its internally developed software products and other
software products to healthcare organizations under the terms of product license
contracts. Individual sales may include, among others, a combination of software
license, implementation, program modifications, training, and support. Contracts
with customers could be terminated under certain circumstances and revenues
recognized could be refundable upon termination in certain cases, including
breach of contract.
 
    In October, 1997, the AICPA issued SOP 97-2, "Software Revenue Recognition,"
which the Company was required to adopt as of October 1, 1999. SOP 97-2 provides
guidance on applying generally accepted accounting principles in recognizing
revenue on software transactions and supercedes the guidance contained in SOP
91-1. The Company elected to adopt the provisions of the statement effective
October 1, 1997.
 
    The Company generates revenues from licensing the rights to use its software
products directly to end users and indirectly through distributors. The Company
also generates revenues from sales of post-contract support, implementation and
modification services, and training services performed for customers who license
the Company's products.
 
    If the contract does not require significant production, modification or
customization of software, revenue is recognized when all the following
conditions are met: a signed contract is obtained, delivery has occurred, the
fee is fixed and determinable, and collectibility is probable. Effective October
1, 1997, the Company generally recognizes Diamond 725 license revenue upon
shipment of the software to end users, as no significant production,
modification or customization of this software is required, and the installation
period is relatively short. The Company generally recognizes Diamond 950C/S
license revenue on a percentage of completion basis based on the labor hours
required to implement the system, as this software generally requires an
extended installation period and can require significant modifications. If the
software license agreement provides for acceptance criteria that extend beyond
the published specifications of the applicable product, then revenues are
recognized upon the earlier of customer acceptance or the expiration of the
acceptance period.
 
3. EARNINGS PER SHARE
 
    In the fiscal year ending September 30, 1998, the Company will report its
earnings per share based on the recently issued Statement of Financial
Accounting Standards No. 128 (SFAS No. 128), "Earnings per
 
                                       5
<PAGE>
                       HEALTH SYSTEMS DESIGN CORPORATION
 
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 
                                 MARCH 31, 1998
 
3. EARNINGS PER SHARE (CONTINUED)
Share". The pro forma effect of this accounting change on the three months ended
March 31, 1998 and 1997 is:
 
<TABLE>
<CAPTION>
                                                                MARCH 31, 1998     MARCH 31, 1997
                                                               -----------------  -----------------
<S>                                                            <C>                <C>
Primary EPS, as reported.....................................          (0.06)             (0.07)
Pro forma effect SFAS No. 128................................         -0-                -0-
Basic EPS, pro forma.........................................          (0.06)             (0.07)
Fully diluted EPS, as reported...............................          (0.06)             (0.07)
Pro forma effect of SFAS No. 128.............................         -0-                -0-
Diluted EPS, pro forma.......................................          (0.06)             (0.07)
</TABLE>
 
                                       6
<PAGE>
                ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 
OVERVIEW
 
    The Company provides managed care information systems software to healthcare
organizations that use managed care techniques to deliver services, manage
financial risk and control costs. The Company introduced its first internally
financed and developed application, Diamond 725, in fiscal 1992, followed by
Diamond 950C/S in fiscal 1995.
 
    The Company's revenues are derived from licensing these products, providing
the associated implementation, modification, support and consulting services,
and reselling hardware and third party products. If collection is probable, the
Company generally recognizes Diamond 950C/S license revenue on a percentage of
completion basis based on the labor hours required to implement the system. If
collectibility is probable and there are no uncertainties surrounding a
contract, the Company generally recognizes Diamond 725 license revenue upon
shipment of the software to end users. Implementation, modification, support and
consulting fees are billed either on an hourly or monthly basis and are
recognized as services are rendered. Hardware and third party software fees are
typically billed and recognized as revenues when delivered to the client.
 
RESULTS OF OPERATIONS
 
    REVENUES
 
    Total revenues were $6,441,000 and $4,122,000 for the three months ended
March 31, 1998 and 1997, respectively, representing an increase of 56%. Total
revenues were $11,732,000 and $7,445,000 for the six months ended March 31, 1998
and 1997, respectively, representing an increase of 58%. The growth in total
revenues is attributable primarily to an increase in the number and size of
Diamond 950C/S implementations in progress during the period. Approximately 26%
of total revenues were from two customers.
 
    SYSTEM SALES.  System sales revenues were $5,679,000 and $3,503,000 for the
three months ended March 31, 1998 and 1997, respectively, representing an
increase of 62%. System sales revenues were $10,225,000 and $6,361,000 for the
six months ended March 31, 1998 and 1997 respectively, representing an increase
of 61%. The increase in system sales was due primarily to the increase in
Diamond 950C/S license and implementation fees.
 
    SERVICES AND OTHER.  Services and other revenues were $762,000 and $620,000
for the three months ended March 31, 1998 and 1997, respectively, representing
an increase of 23%. Services and other revenues were $1,507,000 and $1,084,000
for the six months ended March 31, 1998 and 1997, respectively, representing an
increase of 39%. Support fees continued to account for the majority of services
and other revenues. As a result, the increase in services and other revenues was
due primarily an increase in the Company's installed base, as well as an
increase in group training fees.
 
    COST OF REVENUES.  Cost of revenues was $2,731,000 and $1,391,000 for the
three months ended March 31, 1998 and 1997, respectively, representing an
increase of 96%. Cost of revenues was $4,932,000 and $2,727,000 for the six
months ended March 31, 1998 and 1997, respectively, representing an increase of
81%. Cost of revenues increased primarily as a result of the increased number of
personnel, both HSD employees and independent contractors, required to implement
and support the larger client base. Cost of revenues increased from 34% of total
revenues in the three months ended March 31, 1997 to 42% of total revenues in
the three months ended March 31, 1998. Cost of revenues increased from 37% of
total revenues in the six months ended March 31, 1997 to 42% of total revenues
in the six months ended March 31, 1998, although no long-term trend should be
implied from this period to period comparison. The cost of revenues as a
percentage of sales is dependent on the mix of license, service, and hardware
and third party software revenues, and may fluctuate over time as these revenue
sources fluctuate. The increase
 
                                       7
<PAGE>
in the percentage was primarily due to the increased number of personnel
required to implement and support the larger client base.
 
    OPERATING EXPENSES.
 
    GENERAL AND ADMINISTRATIVE.  General and administrative expenditures were
$2,040,000 and $1,444,000 for the three months ended March 31, 1998 and 1997,
respectively, representing an increase of 41%. General and administrative
expenditures were $3,913,000 and $2,778,000 for the six months ended March 31,
1998 and 1997, respectively, representing an increase of 41%. The increase in
general and administrative expenses was due primarily to staff additions and
investment in infrastructure to support the Company's expanded operations, as
well as an additional allowance for doubtful accounts of $330,000 and the
retirement of approximately $178,000 in equipment during the quarter. The
Company believes that the level of general and administrative expenses will
continue to be higher than the previous fiscal year. General and administrative
expenses include the salaries and benefits associated with general management,
finance and administration, as well as costs associated with recruiting and
facilities. General and administrative expenditures as a percentage of revenues
for the three and six months ended March 31, 1998 were 32% and 33%, respectively
compared to 35% and 37% for the three and six months ended March 31, 1997,
respectively.
 
    SALES AND MARKETING.  Sales and marketing expenditures were $1,200,000 and
$978,000 for the three months ended March 31, 1998 and 1997, respectively,
representing an increase of 23%. Sales and marketing expenditures were
$2,175,000 and $2,048,000 for the six months ended March 31, 1998 and 1997,
respectively, representing an increase of 6%. The increase was mainly due to the
Company's continued emphasis on the expansion of its sales and marketing
department to better address market demand for its products, as well as the
effects of a new commission plan for sales personnel. Sales and marketing
expenditures as a percentage of revenues for the three and six months ended
March 31, 1998 were 19% for both periods as compared to 24% and 28% for the
three and six months ended March 31, 1997, respectively.
 
    PRODUCT DEVELOPMENT.  Product development expenditures, net of software
capitalization, were $944,000 and $931,000 for the three months ended March 31,
1998 and 1997, respectively, representing an increase of 1%. Product development
expenditures, net of software capitalization, were $2,460,000 and $1,787,000 for
the six months ended March 31, 1998 and 1997, respectively, representing an
increase of 38%. The Company capitalized $762,000 and $221,000 of product
development costs in the three months ended March 31, 1998 and 1997,
respectively and $927,000 and $360,000 in the six months ended March 31, 1998
and 1997, respectively. The flatness of product development expenditures and the
related increase in capitalized software, is due primarily to the Company's
focus on the development of major releases of Diamond 950C/S and Diamond 725,
which are being capitalized. The Company believes that research and development
expenditures are essential to maintaining its competitive position and expects
these costs to continue to constitute a significant percentage of total revenues
in the near future. Product development expenditures as a percentage of revenues
for the three and six months ended March 31, 1998 were 15% and 21%, respectively
compared to 23% and 24% for the three and six months ended March 31, 1997,
respectively.
 
    INTEREST INCOME AND EXPENSE.  Interest income, net of interest expense, was
$108,000 and $178,000 for the three months ended March 31,1998 and 1997,
respectively. Interest income, net of interest expense, was $230,000 and
$362,000 for the six months ended March 31, 1998 and 1997, respectively.
Interest income represents interest earned on the Company's excess cash
balances, which are generally placed in short term investments, money market
funds, and government securities. Interest expense during the prior year period
consisted primarily of interest on capital leases.
 
                                       8
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
 
    Net cash provided by (used in) operating activities was $93,000 and
$(349,000) during the six months ended March 31, 1998 and 1997, respectively. In
the six months ended March 31, 1998, net cash provided by operating activities
consisted primarily of depreciation and an increase in accrued liabilities and
unearned revenue offset by an increase in unbilled revenue.
 
    Net cash used in investing activities was $1,685,000 and $1,037,000 during
the six months ended March 31, 1998 and 1997, respectively, and consisted
primarily of purchases of computer and office equipment and capitalization of
software development costs.
 
    Net cash provided by financing activities was $21,000 and $50,000 during the
six months ended March 31, 1998 and 1997, respectively, consisting primarily of
proceeds from the exercise of common stock options by employees.
 
    As of March 31, 1998 and 1997, the Company had cash and cash equivalents in
the amounts of $9,623,000 and $13,917,000, respectively. The company believes
that available funds and its cash flow from operations will be adequate to fund
its presently anticipated working capital requirements for at least the next 12
months.
 
    "Safe Harbor" Statement under the Private Securities Litigation Reform Act
of 1995: The statements contained in this report which are not historical facts
are forward-looking statements that are subject to risks and uncertainties that
could cause actual results to differ materially from those set forth in or
implied by forward-looking statements, including the Company's dependence on a
single product line, the recent introduction of Diamond 950C/S, which is based
on client/server technology, dependence of the Company's results of operations
on its relationship with certain large customers, the variable nature of the
Company's operating results, the length of the Company's sales cycle, the
Company's dependence on key personnel, intense competition, and other risks
described in the Company's Securities and Exchange filings.
 
                                       9
<PAGE>
PART II. OTHER INFORMATION
 
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 
(a) The annual meeting of shareholders was held on March 24, 1998.
 
(b) The following directors were elected at the meeting:
 
           Richard Auger
 
           Catherine Roth
 
           J. Matthew Mackowski
 
           Arthur M. Southam, M.D.
 
           Christopher Herron
 
    The foregoing constitute all members of the Board of Directors of the
Company.
 
(c) At the annual meeting, the shareholders voted to approve a proposal to amend
    the 1996 Omnibus Equity Incentive Plan to increase the number of shares
    authorized for issuance thereunder by 500,000.
 
    Set forth below is a tabulation with respect to the matters voted on at the
meeting:
 
<TABLE>
<CAPTION>
                                      AGAINST OR                    BROKER
                             FOR       WITHHELD     ABSTENTIONS   NON-VOTES
                          ----------  -----------  -------------  ----------
<S>                       <C>         <C>          <C>            <C>
PROPOSAL TO AMEND THE      4,172,248     595,620         1,600     1,198,207
  1996 OMNIBUS EQUITY
  INCENTIVE PLAN
</TABLE>
 
<TABLE>
<CAPTION>
                                   FOR ALL NOMINEES  INSTRUCTED      WITHHELD FROM ALL NOMINEES
                                   ----------------  -----------  ---------------------------------
<S>                                <C>               <C>          <C>
ELECTION OF DIRECTORS:
 
  RICHARD AUGER                         5,868,850        98,820                       5
  CATHERINE ROTH                        5,868,850        98,820                       5
  J. MATTHEW MACKOWSKI                  5,868,850        98,820                       5
  ARTHUR M. SOUTHAM, M.D.               5,868,850        98,820                       5
  CHRISTOPHER HERRON                    5,868,850        98,820                       5
</TABLE>
 
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
 
    (a) Exhibits
 
<TABLE>
<C>        <S>
     11.1  Statement re: computation of earnings per share
</TABLE>
 
    (b) Reports on Form 8-K
 
    No reports on Form 8-K have been filed during the quarter for which this
report is filed.
 
                                       10
<PAGE>
                                   SIGNATURES
 
    Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
 
<TABLE>
<S>                             <C>  <C>
                                HEALTH SYSTEMS DESIGN CORPORATION
 
Date: May 15, 1998              By:           /s/ RUSSELL J. HARRISON
                                     -----------------------------------------
                                                RUSSELL J. HARRISON,
                                       President and Chief Executive Officer
 
                                By:             /s/ STEVEN L. MOORE
                                     -----------------------------------------
                                                  Steven L. Moore,
                                              CHIEF FINANCIAL OFFICER
</TABLE>
 
                                       11
<PAGE>
                       HEALTH SYSTEMS DESIGN CORPORATION
                               INDEX TO EXHIBITS
 
<TABLE>
<CAPTION>
   EXHIBIT   DESCRIPTION
-----------  -----------------------------------------------------------------------------------------------
<C>          <S>
      11.1   Computation of net loss per share
</TABLE>
 
                                       12