<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-Q


  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 0-270576


                    Healthdyne Information Enterprises, Inc.
                    ----------------------------------------
             (Exact name of registrant as specified in its charter)

           Georgia                                          58-2112366
------------------------------------------------------------------------------
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                           Identification No.)


1850 Parkway Place, Suite 1100,  Marietta,  Georgia             30067
------------------------------------------------------------------------------
       (Address of principal executive offices)              (Zip Code)


                                 (770) 423-8450
------------------------------------------------------------------------------
              (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
                               -------           -------

The number of shares outstanding of the issuer's only class of Common Stock, 
$.01 par value, together with associated preferred stock purchase rights (the
"Common Stock") as of July 31, 1998 was 23,978,554 shares.

                      Exhibit Index is on Page 20 herein.
<PAGE>   2


                         PART I - FINANCIAL INFORMATION
                          Item 1. Financial Statements
           Healthdyne Information Enterprises, Inc. and Subsidiaries
                     Consolidated Condensed Balance Sheets
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                                       June 30,     December 31,
                                                                                         1998          1997
                                                                                     --------------------------
                                                                                             (Unaudited)
                                      Assets
<S>                                                                                  <C>                <C>
Current assets:
     Cash and cash equivalents                                                       $ 2,061            $ 7,777
     Trade accounts receivable, less allowance of $570 and $626 at
          June 30, 1998 and December 31, 1997, respectively                            9,078              5,977
     Other current assets                                                              1,426              1,375
                                                                                     -------            -------
          Total current assets                                                        12,565             15,129

Notes receivable                                                                          89                335
Purchased software, net of accumulated amortization of $1,095 and $778
     at June 30, 1998 and December 31, 1997, respectively                              1,927              2,397
Capitalized software, net of accumulated amortization of $213 and $122 at
     June 30, 1998 and December 31, 1997, respectively                                 1,185                564
Property and equipment, net of accumulated depreciation of $1,813 and
     $1,451 at June 30, 1998 and December 31, 1997, respectively                       2,119              1,939
Excess of cost over net assets of businesses acquired, less
     accumulated amortization of $2,287 and $1,939 at June 30, 1998
     and December 31, 1997, respectively                                               8,156              8,503
Other assets                                                                              73                 73
                                                                                     -------            -------
     Total assets                                                                    $26,114            $28,940
                                                                                     =======            =======
                       Liabilities and Shareholders' Equity
Current liabilities:
     Current installments of long-term debt and capital lease obligations            $ 1,476            $ 5,175
     Accounts payable, principally trade                                               1,241                863
     Accrued liabilities                                                               1,834              2,821
     Deferred revenue                                                                  4,385              3,597
                                                                                     -------            -------
          Total current liabilities                                                    8,936             12,456

Long-term debt and capital lease obligations, excluding current installments             529                316
Other liabilities                                                                        407                476
                                                                                     -------            -------
          Total liabilities                                                           9,872             13,248
                                                                                     -------            -------

Shareholders' equity:
     Preferred stock, without par value.  Authorized 20,000 shares;
          designated Series A cumulative preferred stock 500 shares;
          issued none                                                                      0                  0
     Common stock, $.01 par value.  Authorized 50,000 shares; issued and
          outstanding 23,979 and 23,563 shares at June 30, 1998 and
          December 31, 1997, respectively                                                240                236
     Additional paid-in capital                                                       39,490             38,280
     Deferred Compensation                                                                (7)               (73)
     Accumulated deficit                                                             (23,481)           (22,751)
                                                                                     -------            -------
          Total shareholders' equity                                                  16,242             15,692
                                                                                     -------            -------

Commitments

     Total liabilities and shareholders' equity                                      $26,114            $28,940
                                                                                     =======            =======
</TABLE>


     See accompanying notes to Consolidated Condensed Financial Statements.



                                       2
<PAGE>   3

           Healthdyne Information Enterprises, Inc. and Subsidiaries
                Consolidated Condensed Statements of Operations
                    (in thousands, except per share amounts)

<TABLE>
<CAPTION>
                                                              Three Months Ended                      Six Months Ended
                                                                    June 30,                              June 30,
                                                       ------------------------------          -------------------------------
                                                          1998                1997                1998                1997
                                                       ----------          ----------          ----------          -----------
                                                                 (Unaudited)                             (Unaudited)
<S>                                                    <C>                 <C>                 <C>                 <C>
Revenue:
  Software                                             $    2,954          $    1,678          $    4,933          $    3,071
  Services                                                  3,631               2,735               6,853               5,359
                                                       ----------          ----------          ----------          ----------
     Total revenue                                          6,585               4,413              11,786               8,430
                                                       ----------          ----------          ----------          ----------

Cost of revenue:
  Software                                                    257                 163                 479                 685
  Services                                                  1,652               1,468               3,217               3,070
                                                       ----------          ----------          ----------          ----------
     Total cost of revenue                                  1,909               1,631               3,696               3,755
                                                       ----------          ----------          ----------          ----------

Gross profit                                                4,676               2,782               8,090               4,675
                                                       ----------          ----------          ----------          ----------

Operating expenses:
  Sales and marketing                                       1,627               1,553               3,048               2,873
  Research and development                                    950                 707               1,918               1,420
  General and administrative                                1,448               1,062               2,679               2,164
  Merger costs                                                993                  --                 993                  --
                                                       ----------          ----------          ----------          ----------
     Total operating expenses                               5,018               3,322               8,638               6,457
                                                       ----------          ----------          ----------          ----------

Operating loss                                               (342)               (540)               (548)             (1,782)
Losses of affiliate                                            --                  --                  --                 (31)
Interest income (expense), net                                (31)                 22                 (38)                 69
                                                       ----------          ----------          ----------          ----------

Loss before income taxes                                     (373)               (518)               (586)             (1,744)

Income tax (expense) benefit                                   --                 (69)               (144)                 99
                                                       ----------          ----------          ----------          ----------
Net loss                                               $     (373)         $     (587)         $     (730)         $   (1,645)
                                                       ==========          ==========          ==========          ==========
Net loss per share of common stock:
  Basic                                                $    (0.02)         $    (0.03)         $    (0.03)         $    (0.07)
                                                       ==========          ==========          ==========          ==========
  Diluted                                              $    (0.02)         $    (0.03)         $    (0.03)         $    (0.07)
                                                       ==========          ==========          ==========          ==========

Shares used in the calculation of net loss per share:
     Basic                                                 23,767              22,906              23,697              22,825
                                                       ==========          ==========          ==========          ==========
     Diluted                                               23,767              22,906              23,697              22,825
                                                       ==========          ==========          ==========          ==========
</TABLE>


         See accompanying notes to Consolidated Condensed Financial Statements.



                                       3
<PAGE>   4


           Healthdyne Information Enterprises, Inc. and Subsidiaries
                Consolidated Condensed Statements of Cash Flows
                                 (in thousands)


<TABLE>
<CAPTION>
                                                                              Six Months Ended
                                                                                 June 30,
                                                                          -------------------------
                                                                             1998          1997
                                                                          ----------     ----------
                                                                       
                                                                                 (Unaudited)
<S>                                                                       <C>            <C>
Cash flows from operating activities:
    Net loss                                                              $     (730)    $   (1,645)
    Adjustments to reconcile net loss to net cash used in operating
          activities:
               Merger costs                                                      406             --
               Losses of affiliate                                                --             31
               Provision for doubtful accounts                                   (56)           (36)
               Depreciation and amortization                                   1,118          1,052
               Compensation related to stock options, net                         66            121
               Increase in trade accounts receivable                          (3,109)          (174)
               Increase in other current assets                                  (59)          (269)
               Increase (decrease) in accounts payable                           442           (810)
               Decrease in accrued liabilities                                  (491)          (695)
               Increase in deferred service revenue                              592            486
                                                                          ----------     ----------

                  Net cash used in operating activities                       (1,821)        (1,939)
                                                                          ----------     ----------
Cash flows from investing activities:
    Purchased software                                                          (301)           (68)
    Capitalized software development costs                                      (713)          (360)
    Capital expenditures                                                        (159)          (478)
    Change in other assets                                                       (34)          (415)
                                                                          ----------     ----------
          Net cash used in investing activities                               (1,207)        (1,321)
                                                                          ----------     ----------
Cash flows before financing activities                                        (3,028)        (3,260)
                                                                          ----------     ----------
Cash flows from financing activities:
    Principal payments on long-term debt, net                                     --           (574)
    Net repayments under line of credit                                       (2,996)          (172)
    Proceeds from the issuance of common stock                                   308          1,450
                                                                          ----------     ----------
          Net cash (used in) provided by financing activities                 (2,688)           704
                                                                          ----------     ----------

Net decrease in cash and cash equivalents                                     (5,716)        (2,556)

Cash and cash equivalents at beginning of period                               7,777         10,771
                                                                          ----------     ----------
Cash and cash equivalents at end of period                                $    2,061     $    8,215

                                                                          ==========     ==========
</TABLE>



     See accompanying notes to Consolidated Condensed Financial Statements.



                                       4
<PAGE>   5


           Healthdyne Information Enterprises, Inc. and Subsidiaries
              Notes to Consolidated Condensed Financial Statements
                             June 30, 1998 and 1997
                                  (Unaudited)

1.  General:

The Consolidated Condensed Financial Statements as of June 30, 1998, December
31, 1997 and for the three and six months ended June 30, 1998 and 1997 are
unaudited. In the opinion of management, all adjustments, consisting of normal
recurring accruals, necessary for the fair presentation of the consolidated
financial position and results of operations and cash flows for the periods
presented have been included. Results for the interim periods are not
necessarily indicative of results that may be expected for the full year.

These Consolidated Condensed Financial Statements should be read in conjunction
with the consolidated financial statements and notes included in the Annual
Report on Form 10-K of Healthdyne Information Enterprises, Inc. ("HIE" or the
"Company") for the year ended December 31, 1997, as well as the supplemental
consolidated financial statements and notes included in the Form 8-K of HIE
dated June 1, 1998 which give retroactive effect to the merger with HUBLink,
Inc. which was accounted for as a pooling of interests as discussed in Note 2.

2.  Merger

On May 12, 1998, the Company completed a stock-for-stock merger (the "Merger")
through a wholly-owned subsidiary with HUBLink, Inc. ("HUBLink"), a
privately-held integration software tool company. In connection with the
Merger, the Company issued an aggregate of 2.8 million shares of its Common
Stock. The business combination has been accounted for as a pooling of
interests and, accordingly, the consolidated financial statements for periods
prior to the Merger have been restated to include the accounts and results of
operations of HUBLink. In addition, the Company issued 100,000 shares of its
Common Stock to a financial advisor, which was engaged by HUBLink to assist
with possible business combinations.



                                       5
<PAGE>   6


The results of operations previously reported by the separate enterprises prior
to the combination and the combined amounts included in the accompanying
consolidated condensed financial statements are summarized below:


<TABLE>
<CAPTION>
                                                    Three Months       Three Months          Six Months 
                                                      Ended                Ended                Ended
                                                   March 31, 1998      June 30, 1997        June 30, 1997
                                                   ------------------------------------------------------
                                                                       (Unaudited)
<S>                                                <C>                  <C>                 <C>
Revenue:
     HIE                                           $   4,701            $  3,844                $ 7,204
     HUBLink                                             500                 569                  1,226
                                                   ---------            -------------------------------
        Combined revenue                           $   5,201            $  4,413                $ 8,430
                                                   =========            ===============================

Net earnings (loss):
     HIE                                           $     352            $    213                $  (290)
     HUBLink                                            (709)               (800)                (1,355)
                                                   ---------            -------------------------------
          Combined net earnings (loss)             $    (357)           $   (587)               $(1,645)
                                                   =========            ===============================
</TABLE>



3.  Major Customers:

No single customer accounted for more than 10% of the Company's revenue for the
three or six months ended June 30, 1998. One customer accounted for 13% of the
Company's revenue during the six months ended June 30, 1997. No single customer
accounted for 10% or more of the Company's revenue for the three months ended
June 30, 1997. No single distributor provided customers to the Company that
accounted for more than 10% of the Company's revenue for the three and six
months ended June 30, 1998 and 1997.

4.  Earnings (Loss) Per Share of Common Stock:

         On December 31, 1997, the Company adopted Statement of Financial
Accounting Standards No. 128, Earnings Per Share ("SFAS 128"), which prescribes
the calculation methodology and financial reporting requirements for basic and
diluted earnings per share. Basic earnings (loss) per common share available to
common shareholders are based on the weighted average number of common shares
outstanding. Diluted earnings (loss) per common share available to common
shareholders are based on the weighted average number of common shares
outstanding and dilutive potential common shares, such as dilutive stock
options. The computation of diluted net loss per share was anti-dilutive in
each of the periods presented, therefore, the amounts reported for basic and
diluted loss per share are the same. All prior period net loss 



                                       6
<PAGE>   7

data presented in these Consolidated Condensed Financial Statements have been
restated to conform to the provisions of SFAS 128.


5.   Recent Accounting Pronouncements

     Revenue Recognition
         On January 1, 1998, the Company adopted Statement of Position 97-2,
     Software Revenue Recognition, issued by the Accounting Standards Executive
     Committee in October 1997, effective for financial statements for fiscal
     years beginning after December 15, 1997. The implementation of this
     statement has not had a material impact on the Company's unaudited
     Consolidated Condensed Financial Statements.

     Comprehensive Income
         On January 1, 1998, the Company adopted Statement of Financial
     Accounting Statndards No. 130, Reporting Comprehensive Income, issued by
     the Financial Accounting Standards Board ("FASB") in June 1997, effective
     for fiscal years beginning after December 15, 1997. Comprehensive income
     includes all changes in equity during a period except those resulting in
     investments by owners and distributions to owners. The implementation of
     this statement has had no impact on the Company's unaudited Consolidated
     Condensed Financial Statements.

     Other
         The Company continues to evaluate the requirements of Statement of
     Financial Accounting Standards No. 131, Disclosures about Sements of an
     Enterprise and Related Information, issued by the FASB in June 1997,
     effective for fiscal years beginning after December 15, 1997. The
     provisions of this standard do not apply to interim periods in the year of
     adoption.


                                       7
<PAGE>   8

Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations

         Except for the historical information contained herein, this report
contains forward-looking statements that involve risks and uncertainties. The
Company's actual results could differ materially from those discussed herein.
Factors that could cause or contribute to such differences include, but are not
limited to, the Company's limited operating history and lack of profitability in
the six months ended June 30, 1998 and the years ended December 31, 1997 and
1995, the Company's change in strategic direction, competitive pressures, the
mix of software and service revenue, the mix of direct and indirect sales, sales
timing, changes in pricing policies, undetected errors or bugs in the software,
delays in product development, lower-than-expected demand for the Company's
software tools or services, business conditions in the integrated healthcare
delivery network market and other markets, the Company's ability to modify its
software for use in non-healthcare industries, risks associated with possible
acquisitions, risks related to intangible assets, general economic conditions 



                                       8
<PAGE>   9

and the risk factors detailed from time to time in the Company's periodic
reports and registration statements filed with the Securities and Exchange
Commission, including the Company's Annual Report on Form 10-K for the year
ended December 31, 1997 and the Company's Registration Statement on Form S-3,
as amended (Registration No. 333-55703).

Overview

Healthdyne Information Enterprises, Inc. ("HIE" or the "Company") was
incorporated in Georgia on June 15, 1994 and was a wholly-owned subsidiary of
Healthdyne, Inc. ("Healthdyne") until November 6, 1995, at which time
Healthdyne distributed all of the outstanding shares of HIE to Healthdyne's
shareholders (the "Spin-Off"). HIE's common stock is publicly traded on the
Nasdaq National Market under the symbol "HDIE." The Company provides software
tools and services to achieve the enterprise-wide integration of information.

The Company generates revenue from licensing integration software tools and
providing integration services, such as education, consulting, project
management, information integration, technology-driven re-design, software
maintenance, implementation and expert-sourcing.

Software licenses are generally granted on a perpetual basis for a one-time,
up-front fee. A standard per-student amount is charged for education classes.
Consulting services are generally provided for a fixed fee based on estimated
hours of service to be provided at standard hourly rates. Project management,
information integration, technology-driven re-design and implementation fees
are generally based on actual hours of service at standard hourly rates.
Software maintenance agreements are generally one-year renewable service
contracts for a prepaid standard fee. Expert-sourcing agreements are generally
multiple-year renewable service contracts for a negotiated monthly fee.

On May 12, 1998, the Company completed a stock-for-stock Merger through a
wholly-owned subsidiary with HUBLink, a privately-held integration software
tool company. In connection with the Merger, the Company issued an aggregate of
2.8 million shares of its Common Stock. The business combination has been
accounted for as a pooling of interests and, accordingly, the consolidated
financial statements for periods prior to the Merger have been restated to
include the accounts and results of operations of HUBLink. In addition, the
Company issued 100,000 shares of its Common Stock to a financial advisor, which
had been engaged by HUBLink to assist with possible business combinations.

On December 31, 1997, the Company exercised its option to acquire the remaining
50% ownership interest of Criterion Health Strategies, Inc. ("CHS") it did not
already own. CHS licenses the Criterion data integration software tool and
provides project management, information integration and technology-driven
re-design services. Since 



                                       8
<PAGE>   10

HIE did not have a majority ownership interest in CHS in 1997 and prior years,
the operating results of CHS were not consolidated with the Company's
consolidated operating results. HIE's share of CHS' operating results are
presented as Losses of Affiliate in the accompanying Consolidated Condensed
Statements of Operations. CHS's operating results were combined with the
Company's beginning on January 1, 1998.

In the fourth quarter of 1997, the Company redefined its strategic direction as
The Integration Solutions Company and focused on providing software tools and
services to achieve the enterprise-wide integration of information. Prior to
making this shift in strategic direction, the Company sold and distributed
certain proprietary and third-party clinical workstation tools including, among
others, the Clinical Assessment and Support System ("CASS"), Document Image
Management, Workflow Management, Intranet and Internet Workflow Management,
Teleradiology Computer Systems and Clinical Image Management tools. The Company
no longer actively sells and distributes the software tools referred to in the
preceding sentence, since such tools are outside the scope of the Company's
redefined strategic direction referred to above.

In addition, effective November 21, 1997, HIE combined the operations of its
three subsidiaries (CHS, Integrated Healthcare Solutions, Inc. and Healthcare
Communications, Inc.) with the parent company under a functional organization
structure, i.e., sales, service, research and development and finance. Prior to
that time, each subsidiary operated as an independent, but interrelated, entity
referred to by the Company as an Entrepreneurial Business unit. As of June 30,
1998, these three subsidiaries had been merged with and into the Company. The
Company changed to the present organizational structure in an attempt to be
more responsive to the marketplace and to streamline operations. The Company
believes that the current organizational structure will expand the depth and
breadth of its integration software tool distribution capability, improve the
productivity of its integration software tool development efforts, enhance the
efficiency and effectiveness of its customer service operations and eliminate
duplicate efforts throughout the organization.

The Company is aware of the potential issues associated with the programming
code in existing computer systems as the year 2000 approaches. The primary
issue is whether or not computer systems will properly recognize date-sensitive
information when the year changes to 2000. Systems that do not properly
recognize such information could generate erroneous data or cause the system to
fail. Management does not anticipate that the Company will incur either
significant operating expenses or significant capital expenditures to be year
2000 compliant with respect to both its internal systems and the software tools
that it markets. In fact, the Company's software tools and services could be
utilized by HIE's customers and prospects to enable their systems to become
year 2000 compliant.

                                       9
<PAGE>   11
The Company expects the following external factors to affect the market for
integration software tools and integration services in future years: (1) the
continued consolidation of enterprises within various industries to achieve
economies of scale; (2) the growing importance of information for the survival
and prosperity of various enterprises; (3) the increasing complexity of
information technology; and (4) the year 2000 issue referred to above.

Software revenue is generally recognized upon shipment and the performance of
certain other criteria in accordance with Statement of Position ("SOP") 97-2,
"Software Revenue Recognition" in 1998 and SOP 91-1, "Software Revenue
Recognition" in 1997. Service revenue is recognized as the work is performed
or, in the case of a fixed-fee contract, on the percentage of completion basis,
even though some services are prepaid.

The Company's Consolidated Condensed Balance Sheets include assets designated
as purchased software and capitalized software development costs. Purchased
software includes the cost of purchased integration software tools and the cost
of software acquired in connection with business combinations. It also includes
the cost of licenses to use, embed and sell software tools developed by others.
Certain costs of HIE proprietary software developed internally are capitalized
in accordance with generally accepted accounting principles. The costs of
individual software tools are being amortized ratably based on the projected
revenue associated with the related software or on a straight-line basis over
not more than five years, whichever method results in a higher level of annual
amortization.

The excess of cost over net assets of businesses acquired (goodwill) is being
amortized over a period of fifteen years. At each balance sheet date, the
Company assesses the recoverability of this intangible asset by determining
whether the amortization of the goodwill balance over its remaining life can be
recovered through undiscounted future operating cash flows of the acquired
operation. The amount of goodwill impairment, if any, is measured based on
projected discounted future operating cash flows using a discount rate
reflecting the Company's average cost of funds.



                                      10
<PAGE>   12

Results of Operations

The following table sets forth for the periods indicated (1) the Company's
total revenue and (2) unless otherwise indicated, the percentage of total
revenue for each component included in the Company's Consolidated Condensed
Statements of Operations:


<TABLE>
<CAPTION>
                                                       Percent of Revenue (unless otherwise indicated)
                                                      Three Months Ended              Six Months Ended
                                                           June 30,                        June 30,
                                                  ----------------------------   ----------------------------
                                                       1998            1997         1998             1997
                                                  ------------    ------------   ------------    ------------
<S>                                               <C>             <C>            <C>             <C>
Total HIE revenue (in 000's)                      $      6,585    $      4,413   $     11,786    $      8,430
                                                  ============    ============   ============    ============

Revenue:
     Software                                               45%             38%            42%             36%
     Services                                               55%             62%            58%             64%
                                                  ------------    ------------   ------------    ------------
          Total revenue                                    100%            100%           100%            100%
                                                  ------------    ------------   ------------    ------------

Cost of revenue:
     Software (as a percent of software revenue)             9%             10%            10%             22%
     Services (as a percent of services revenue)            45%             54%            47%             57%
          Total cost of revenue                             29%             37%            31%             44%
                                                  ------------    ------------   ------------    ------------

Gross profit                                                71%             63%            69%             56%
                                                  ------------    ------------   ------------    ------------

Operating expenses:
     Sales and marketing                                    25%             35%            26%             34%
     Research and development                               14%             16%            16%             17%
     General and administrative                             22%             24%            23%             26%
     Merger costs                                           15%              0%             9%              0%
                                                  ------------    ------------   ------------    ------------
          Total operating expenses                          76%             75%            74%             77%
                                                  ------------    ------------   ------------    ------------

Operating loss                                              -5%            -12%            -5%            -21%
Losses of affiliate                                          0%              0%             0%              0%
Interest income (expense), net                              -1%              0%             0%              0%
                                                  ------------    ------------   ------------    ------------

Loss before income taxes                                    -6%            -12%            -5%            -21%

Income tax (expense) benefit                                 0%             -1%            -1%              1%
                                                  ------------    ------------   ------------    ------------

Net loss                                                    -6%            -13%            -6%            -20%
                                                  ============    ============   ============    ============
</TABLE>

Comparison of Three Months Ended June 30, 1998 and 1997

         Revenue. Total revenue was $6.6 million for the three months ended
June 30, 1998 compared to $4.4 million for the three months ended June 30,
1997, an increase of 49%. The increase of $1.3 million, or 76%, in software
revenue was primarily due to an increase in Cloverleaf integration engine and
OM3 message broker software license 



                                      11
<PAGE>   13

fee revenue. The increase of $896,000, or 33%, in services revenue was due
primarily to higher service personnel productivity as well as an increase in
the number of service personnel. HIE added eight new distributors in the second
quarter of 1998.

         Cost of revenue. Cost of revenue includes, among other things,
compensation of service personnel, travel and software royalties and
amortization. The cost of revenue was $1.9 million for the three months ended
June 30, 1998 compared to $1.6 million for the three months ended June 30,
1997, an increase of 17%. However, as a percentage of revenue, cost of revenue
decreased to 29% from 37% primarily due to the sub-licensing by the Company of
significantly less third-party software tools, as well as an increase in the
level of service personnel productivity in the second quarter of 1998 compared
to the second quarter of 1997. Third-party software tools, such as imaging,
workflow and COLD, typically have a higher cost of revenue than proprietary
software tools, such as the Cloverleaf integration engine and OM3 message
broker and the EMerge enterprise master person index software tool. The Company
discontinued the marketing, sale and distribution of imaging, workflow, COLD and
certain other software tools that no longer fit its redefined strategic
direction in the fourth quarter of 1997.

         Gross profit. The Company's gross profit was $4.7 million for the
three months ended June 30, 1998 compared to $2.8 million for the three months
ended June 30, 1997, an increase of 68%. The increased gross profit in the
second quarter of 1998 was due to the significant increase in the more
profitable Cloverleaf integration engine and OM3 message broker software
license fee revenue discussed above, as well as the higher level of service
personnel productivity also discussed above.

         Sales and marketing. Sales and marketing expense includes, among other
things, compensation of sales and marketing personnel, sales commissions,
travel and advertising. Sales and marketing expense was $1.6 million for the
three months ended June 30, 1998 and 1997. A slight increase of $74,000 in
sales and marketing expense between the periods was due primarily to the
increase in sales personnel costs associated with increased sales staffing,
offset somewhat by lower marketing personnel costs. The decrease in sales and
marketing expense from 35% of revenue in the three months ended June 30, 1997
to 25% in the three months ended June 30, 1998 was due to the significant
increase in software and services revenue discussed above.

         Research and development. Research and development expense includes,
among other things, compensation of research and development personnel,
depreciation and lease expense of research and development equipment and
travel. Research and development expense was $950,000 or 14% of revenue for the
three months ended June 30, 1998 compared to $707,000 or 16% of revenue for the
three months ended June 30, 1997, an increase of 34%. Cash expenditures for
research and development increased $580,000, while the level of capitalization
of internally developed software increased to 33% in the second quarter of 1998
from 15% in the second quarter of 1997, due primarily to increased staffing for
various research and development projects.



                                      12
<PAGE>   14

         General and administrative. General and administrative expense
includes, among other things, compensation of finance, human resources and
administrative personnel, goodwill amortization, office rent and insurance.
General and administrative expense was $1.4 million or 22% of revenue for the
three months ended June 30, 1998, compared to $1.1 million or 24% of revenue
for the three months ended June 30, 1997, an increase of 36%. The increase was
due primarily to increased recruiting and outside contractor costs associated
with the Company's increased revenue and personnel growth.

         Merger costs. Merger costs, which resulted from the Company's
acquisition of HUBLink, includes, among other things, investment banking,
attorney and accounting fees, travel and severance costs. The total merger costs
were $993,000 in the second quarter of 1998. The Company has accrued for all of
the anticipated merger costs in the second quarter, and anticipates transition
costs of approximately $500,000 to be incurred over the next two quarters.

         Interest income (expense), net. Net interest expense was $31,000 for
the three months ended June 30, 1998 compared to net interest income of $22,000
for the three months ended June 30, 1997, representing a change of $53,000. The
change in net interest income (expense) is due primarily to a decrease in
interest income resulting from lower cash balances and increased short-term
borrowings, some of which were repaid by the Company in the second quarter.

         Income tax (expense) benefit. The Company did not record any income
tax benefit for the three months ended June 30, 1998 because losses exceeded
allowable carryback The Company recorded an income tax expense of $69,000 for
the three months ended June 30, 1997 based on management's belief at the time
that the Company would generate taxable income above the net operating loss
carryforward benefits for the year ended December 31, 1997.


Comparison of Six Months Ended June 30, 1998 and 1997

         Revenue. Total revenue was $11.8 million for the six months ended June
30, 1998 compared to $8.4 million for the six months ended June 30, 1997, an
increase of 40%. The increase of $1.9 million, or 61%, in software revenue was
primarily due to an increase in Cloverleaf integration engine and OM3 message
broker software license fee revenue, offset somewhat by a reduction in
third-party software tool revenue. The increase of $1.5 million, or 28%, in
services revenue was due primarily to higher service personnel productivity as
well as an increase in the number of service personnel. HIE added fourteen new
distributors in the six months ended June 30, 1998.



                                      13
<PAGE>   15

         Cost of revenue. The cost of revenue was $3.7 million for the six
months ended June 30, 1998 compared to $3.8 million for the six months ended
June 30, 1997, a decrease of 2%. As a percentage of revenue, cost of revenue
decreased to 31% from 44%, primarily due to the sub-licensing by the Company of
significantly less third-party software tools, as well as an increase in the
level of service personnel productivity in the six months ended June 30, 1998
compared to the six months ended June 30, 1997. The Company discontinued the
marketing, sale and distribution of imaging, workflow, COLD and certain other
software tools that no longer fit its redefined strategic direction in the
fourth quarter of 1997.

         Gross profit. The Company's gross profit was $8.1 million for the six
months ended June 30, 1998 compared to $4.7 million for the six months ended
June 30, 1997, an increase of 73%. The increased gross profit in the first six
months of 1998 was due to the significant increase in the more profitable
Cloverleaf integration engine and OM3 message broker software license fee
revenue discussed above, as well as the higher level of service personnel
productivity also discussed above.

         Sales and marketing. Sales and marketing expense was $3.0 million or
26% of revenue for the six months ended June 30, 1998 compared to $2.9 million
or 34% of revenue for the six months ended June 30, 1997, an increase of 6%.
The increase in sales and marketing expense between the periods was due
primarily to the increase in sales personnel costs associated with increased
sales staffing, offset somewhat by lower marketing personnel costs. As a
percentage of revenue, sales and marketing decreased due to the significant
increase in software and services revenue discussed above.

         Research and development. Research and development expense was $1.9
million or 16% of revenue for the six months ended June 30, 1998 compared to
$1.4 million or 17% of revenue for the six months ended June 30, 1997, an
increase of 35%. Cash expenditures for research and development increased
$851,000 between the two periods, while the level of capitalization of
internally developed software increased to 27% in the six months ended June 30,
1998 from 20% in the six months ended June 30, 1997, due primarily to increased
staffing for various research and development projects.

         General and administrative. General and administrative expense was
$2.7 million or 23% of revenue for the six months ended June 30, 1998, compared
to $2.2 million or 26% of revenue for the six months ended June 30, 1997, an
increase of 24%. The increase was due primarily to increased recruiting and
outside contractor costs associated with the Company's increased revenue and
personnel growth.

         Merger costs. Merger costs, which resulted from the Company's
acquisition of HUBLink, includes, among other things, investment banking,
attorney and accounting fees, travel and severance costs. The total merger costs
were $993,000 in the six months ended June 30, 1998. The Company has accrued for
all of the anticipated merger costs in the second quarter, and anticipates
transition costs of approximately $500,000 to be incurred over the next two
quarters. 

         Losses of affiliate. Losses of affiliate, which resulted from the
Company's commitment to fund CHS, totaled $31,000 in the first half of 1997.
CHS's operating results were consolidated with the Company's beginning on
January 1, 1998.



                                      14
<PAGE>   16

         Interest income (expense), net. Net interest expense was $38,000 for
the six months ended June 30, 1998 compared to net interest income of $69,000
for the six months ended June 30, 1997, representing a change of $107,000. The
change in net interest income (expense) is due primarily to a decrease in
interest income resulting from lower cash balances and increased short-term
borrowings, some of which were repaid by the Company in the second quarter.

         Income tax (expense) benefit. The Company recorded an income tax
expense of $144,000 for the six months ended June 30, 1998 based on the
inability of a profitable subsidiary to utilize the group's net operating
losses for state reporting purposes. The Company recorded an income tax benefit
of $99,000 for the six months ended June 30, 1997 based on the projected
effective tax rate for the year ended December 31, 1997.

Liquidity and Capital Resources

         The Company had working capital of $3.6 million at June 30, 1998
compared to $2.7 million at December 31, 1997. Cash decreased $5.7 million
during the six months ended June 30, 1998 compared to a $2.6 million decrease
during the six months ended June 30, 1997 for the reasons discussed below.

         Net cash used in operating activities totaled $1.8 million for the six
months ended June 30, 1998 compared to $1.9 million for the six months ended
June 30, 1997. The $118,000 total variance between the two periods is primarily
attributable to an increase in accounts receivable offset by the increased cash
flow resulting from the lower net loss recorded during the six months ended
June 30, 1998 compared to the six months ended June 30, 1997 and increased
accounts payable.

         Net cash used in investing activities was $1.2 million for the six
months ended June 30, 1998 compared to $1.3 million for the six months ended
June 30, 1997. The decrease was due primarily to a $350,000 investment in CHS
in February 1997 which was nonrecurring in 1998 and lower capital expeditures
in the six months ended June 30, 1998, both offset somewhat by an increased
investment in software during the six months ended June 30, 1998.

         Net cash used in financing activities was $2.7 million for the six
months ended June 30, 1998 and net cash provided by financing activities was
$704,000 for the six months ended June 30, 1997. Most of the variance between
the two periods is attributable to the payment of $3.3 million of debt
financing that matured on January 2, 1998. In addition, HUBLink obtained
proceeds of $1.2 million from the issuance of common stock during the six
months ended June 30, 1997.

         As of June 30, 1998, the Company had $1.5 million of debt financing
scheduled for payment over the next twelve months. The Company negotiated a new
$5.0 million line of credit from a bank which it expects to finalize in
mid-August 1998. The line of 



                                      15
<PAGE>   17

credit is for a one year term, with borrowings bearing interest at the bank's
prime rate plus 1% (approximately 9.5% as of August 12, 1998). The Company
plans to maintain the $5.0 million line of credit for unanticipated needs and
financial flexibility. Based on its current business plan and business model
projections, the Company believes that currently available cash, anticipated
cash flow from operating activities, especially the collection of accounts
receivable, and cash available from the line of credit mentioned above will be
sufficient to meet the Company's capital requirements for at least the next
twelve months and for the foreseeable future.

Recent Accounting Pronouncements

         On January 1, 1998, the Company adopted Statement of Position 97-2,
Software Revenue Recognition, issued by the Accounting Standards Executive
Committee, and Statement of Financial Accounting Standards No. 130, Reporting
Comprehensive Income, issued by the Financial Accounting Standards Board. The
Company continues to evaluate the requirements of Statement of Financial
Accounting Standards No. 131, Disclosures about Segments of an Enterprise and
Related Information, which does not apply to interim periods in the year of
adoption.



                                      16
<PAGE>   18

                          PART II - OTHER INFORMATION
Item 4.  Submission of Matters to a Vote of Security Holders

The Company's annual meeting of shareholders was held on May 19, 1998. At the
annual meeting, the Company's shareholders voted on the election of nine
Directors. The results of the voting were as follows:

<TABLE>
<CAPTION>
                                        For            Vote Withheld
                                    --------------------------------
<S>                                 <C>                <C>
Class I Directors
William J. Gresham, Jr.             19,541,715            424,847
Charles R. Hatcher, Jr., M.D.       19,546,522            420,040
Donald W. Weber                     19,554,322            412,240

Class II Directors
Joseph G. Bleser                    19,566,493            400,069
J. Terry Dewberry                   19,555,501            411,061
Carl E. Sanders                     19,533,622            432,940

Class III Directors
Parker H. Petit                     19,528,803            437,759
Robert I. Murrie                    19,562,593            403,969
John W. Lawless                     19,559,993            406,569
</TABLE>


The meeting was adjourned and reconvened on June 5, 1998 to provide
shareholders with additional time to vote their shares only with respect to the
proposal to amend the Company's Articles of Incorporation to provide for
classification of the Board of Directors into three classes serving staggered
terms of three years. The results of the voting were as follows:

<TABLE>
<CAPTION>
                                                  Number of Shares
                <S>                               <C>
                For                               10,913,708
                Against                            1,548,973
                Withheld                             138,884
</TABLE>



                                      17
<PAGE>   19

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

         (a)  Exhibits

<TABLE>
<CAPTION>
         Exhibit No.    Description
         -----------    -----------
         <S>            <C>
             3          Articles of Incorporation (as restated).

            11          Statements of Computation of Per Share Earnings (Loss).

            27.1        Financial Data Schedule (for SEC use only).

            27.2        Restated Financial Data Schedule (for SEC use only).
</TABLE>

         (b)  Reports on Form 8-K

              During the quarter ended June 30, 1998, the Company filed the
following reports on Form 8-K:

         Current Report on Form 8-K dated May 7, 1998, reporting information
         under Item 7 with respect to the restatement of Financial Data
         Schedules to comply with the Statement of Financial Accounting
         Standards No. 128, "Earnings Per Share."

         Current Report on Form 8-K dated May 12, 1998, reporting information
         under Items 2 and 7 with respect to the stock-for-stock merger of
         HUBLink, Inc.

         Current Report on Form 8-K dated June 1, 1998, reporting information
         under Item 5 with respect to restated financial statements in
         conjunction with the pooling-of-interests merger of HUBLink, Inc.

         Current Report on Form 8-K dated June 8, 1998, reporting information
         under Item 5 with respect to the election of Scott A. Jones and Mark
         D. Shary to the Company's Board of Directors.



                                      18
<PAGE>   20

                                   SIGNATURES

      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.

                                    Healthdyne Information Enterprises, Inc.


August 14, 1998                     By:  /s/ Cheryl N. Blanco
                                       -----------------------
                                         Cheryl N. Blanco
                                         Vice President - Controller,
                                         Chief Accounting Officer,
                                         Assistant Treasurer and
                                         Assistant Secretary 
                                         (duly authorized and principal
                                         accounting officer)



                                      19
<PAGE>   21

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
         Exhibit No.      Description
         -----------      -----------
         <S>              <C>
              3           Articles of Incorporation (as restated).

             11           Statements of Computation of Per Share Earnings (Loss).

             27.1         Financial Data Schedule (for SEC use only).

             27.2         Restated Financial Data Schedule (for SEC use only).
</TABLE>



                                      20