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                               UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 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
                        -------------------------------

                         Commission File Number 0-26816

                             IDX SYSTEMS CORPORATION
             (Exact name of registrant as specified in its charter)

     Vermont                                                 03-0222230
 (State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                               1400 Shelburne Road
                           South Burlington, VT 05403
                    (Address of principal executive offices)

          Registrant's telephone number, including area code:  (802-862-1022)

         Indicate  by check mark  whether the  registrant  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).

                            Yes   X           No
                                ----             ----
         Indicate by check mark whether the  registrant has been subject to such
filing requirements for the past 90 days.
                            Yes   X           No
                                ----             ----
        The number of shares outstanding of the registrant's  common stock as of
May 8, 1998 was 26,284,998.

                       [Exhibit index begins on Page 19]
                                                     --  

<PAGE>

                             IDX SYSTEMS CORPORATION
                                    FORM 10-Q
                  For the quarterly Period Ended March 31, 1998

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                           Page
PART I.  FINANCIAL INFORMATION                                             ----
<S>      <C>                                                               <C>


ITEM 1.  Interim Financial Statements:

         a) Condensed consolidated balance sheets as of
            March 31, 1998 and December 31, 1997 (unaudited)...............3

         b) Condensed  consolidated  statements of income and 
            comprehensive income for the three months ended
            March  31, 1998 and 1997(unaudited)............................4

         c) Condensed  consolidated  statements of cash flows for
            the  three  months  ended  March  31,  1998  and 1997
            (unaudited)....................................................5

         d) Notes to condensed consolidated financial statements...........6

ITEM 2.  Management's discussion and analysis of financial
         condition and results of operations...............................9

PART II. OTHER INFORMATION

ITEM 1.  Legal proceedings.................................................17

ITEM 2.  Changes in securities.............................................17

ITEM 3.  Defaults upon senior securities...................................17

ITEM 4.  Submission of matters to a vote of security holders...............17

ITEM 5.  Other information.................................................17

ITEM 6.  Exhibits and reports on Form 8-K..................................17

SIGNATURES.................................................................18

EXHIBIT INDEX..............................................................19

                                  Page 2 of 32
</TABLE>

<PAGE>


PART I.  FINANCIAL INFORMATION

Item 1.  Interim Financial Statements

                             IDX SYSTEMS CORPORATION
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)
                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                            MARCH 31                DECEMBER 31
                                              1998                     1997
                                              ----                     ----
<S>                                         <C>                     <C>

ASSETS
Cash and securities                         $ 115,368               $ 115,887
Accounts receivable, net                       71,078                  66,587
Other current assets                           13,848                  14,718
                                            ---------               ---------
Total current assets                          200,294                 197,192

Property and equipment, net                    29,972                  28,277
Capitalized software costs, net                   839                     368
Other assets                                   11,481                  11,480
                                            ---------               ---------
Total assets                                $ 242,586               $ 237,317
                                            =========               =========

LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable, accrued expenses
  and other liabilities                    $   27,331              $   34,748
Deferred revenue                               19,530                  21,538
                                           ----------              ----------
Total current liabilities                      46,861                  56,286
Long term debt                                      -                   2,508
Minority interest                               8,659                   1,919
Stockholders' equity                          187,066                 176,604
                                           ----------              ----------
Total liabilities and stockholders' equity $  242,586              $  237,317
                                           ==========              ==========
</TABLE>

           See Notes to the Condensed Consolidated Financial Statements

NOTE: The balance sheet at December 31, 1997 has been derived from the audited 
      financial statements at that date.

                                  Page 3 of 32

<PAGE>

PART I.  FINANCIAL INFORMATION

Item 1.  Interim Financial Statements

                                   IDX SYSTEMS CORPORATION
          CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
                       (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                        (UNAUDITED)
<TABLE>
<CAPTION>
                                                     THREE MONTHS ENDED
                                                           MARCH 31
                                                   1998              1997
                                                   ----              ----
<S>                                                <C>               <C>

REVENUES
Systems sales                                      $  38,966         $  33,440
Maintenance and service fees                          33,771            26,119
                                                   ---------         ---------
Total revenues                                        72,737            59,559

OPERATING EXPENSES
Cost of sales                                         37,248            29,964
Selling, general and administrative                   13,752            12,731
Research and development                              10,316             8,478
Write-off of acquired in-process research and
development costs                                      3,201             2,290
                                                   ---------          --------
Total operating expenses                              64,517            53,463

Operating income                                       8,220             6,096
Interest and other income, net                         1,122             1,195
                                                   ---------          --------
Income before income taxes                             9,342             7,291
Income tax provision                                   4,940             2,794
                                                   ---------          --------
Net income                                        $    4,402         $   4,497
                                                   
Unrealized gain (loss) on securities                     (3)                13
   available-for-sale                              ---------         ---------
Comprehensive income                              $    4,399         $   4,510
                                                  ==========         =========

Basic earnings per share                          $     0.17         $    0.18
                                                  ==========         =========
Basic weighted average shares outstanding             26,155            25,485
                                                  ==========         =========
Diluted earnings per share                        $     0.16         $    0.17
                                                  ==========         =========
Diluted weighted average shares outstanding           27,007            26,226
                                                  ==========         =========

</TABLE>

         See Notes to the Condensed Consolidated Financial Statements

                                  Page 4 of 32

<PAGE>

PART I.  FINANCIAL INFORMATION

Item 1.  Interim Financial Statements

                             IDX SYSTEMS CORPORATION
                            STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                  (UNAUDITED)
<TABLE>
<CAPTION>

                      
                                                        THREE MONTHS ENDED
                                                             MARCH 31
                                                   1998               1997
                                                   ----               ----
<S>                                                <C>                <C>

OPERATING ACTIVITIES
Net Income                                         $  4,402           $  4,497
Adjustments   to  reconcile  net  income  to  
  net  cash  provided  by  operating
  activities:
    Depreciation and amortization                     2,490              2,207
    Deferred tax benefit                               (517)               468
    Increase in allowance for doubtful accounts          31                165
    Minority interest                                   241                128
    Write-off of acquired in-process research and
         development costs                            3,201              2,290
    Changes in operating assets and liabilities:
          Accounts receivable                        (4,522)            (7,651)
          Notes receivable                           (1,163)               (36)
          Prepaid expenses and other assets           2,851             (2,257)
          Accounts payable                            5,410                844
          Accrued expenses                           (9,270)             2,611
          Federal and state taxes payable                 0              1,349
          Deferred revenue                           (2,008)             2,538
                                                     -------             -------
           Net cash provided by operating activities  1,146              7,153

INVESTING ACTIVITIES
Purchase of property and equipment, net              (4,156)            (3,731)
Purchase of securities available-for-sale, net      (36,076)           (11,436)
Sale of securities available-for-sale                33,178              9,969
Purchase of certain net assets                       (3,500)            (2,500)
Capitalized software developments costs                (500)              (857)
                                                    -------             ------
          Net cash used in investing activities     (11,054)            (8,555)

FINANCING ACTIVITIES
Proceeds from sale of common stock                    6,060                593
Increase in minority interest                         6,500                  0 
Principal repayments of long-term debt               (6,066)               (25)
                                                    --------           --------
          Net cash provided by financing 
            activities                                6,494                568
                                                    --------           -------
Decrease in cash and cash equivalents                (3,414)              (834)
Cash and cash equivalents at beginning of period     14,061             12,327
                                                    -------            -------
Cash and cash equivalents at end of period        $  10,647          $  11,493
                                                  =========          =========

</TABLE>

       See Notes to the Condensed Consolidated Financial Statements

                                  Page 5 of 32

<PAGE>


PART I.  FINANCIAL INFORMATION

Notes to Condensed Consolidated Financial Statements


Note 1 - Basis of Presentation

All  financial  information  for  previously  reported  periods  included in the
accompanying  interim unaudited condensed  consolidated  financial statements of
IDX Systems  Corporation  ("Company"  or "IDX") has been restated to reflect the
combined  operations  of IDX and  PHAMIS,  Inc.  ("PHAMIS")  as a result  of the
merger,  more  fully  described  in Note 2,  which has been  accounted  for as a
pooling of interests in the quarter ended  September  30, 1997.  No  adjustments
were required to conform the financial  reporting policies of IDX and PHAMIS for
the periods presented.

The interim unaudited  consolidated  financial  statements have been prepared by
the Company pursuant to the rules and regulations of the Securities and Exchange
Commission and in accordance  with  generally  accepted  accounting  principles.
Accordingly,  certain information and footnote  disclosures normally included in
annual  financial  statements have been omitted or condensed.  In the opinion of
management,  all  necessary  adjustments  have  been  made  to  provide  a  fair
presentation.  The  operating  results for the three months ended March 31, 1998
are not necessarily  indicative of the results that may be expected for the year
ending  December 31, 1998. For further  information,  refer to the  consolidated
financial  statements  and  footnotes  included in the  Company's  latest annual
report on Form 10-K.

Note 2 - Business Acquisitions

On February 23, 1998, the Company  recorded  charges of $3.2 million  related to
the  acquisition of contract  management  system  technology from Trego Systems,
Inc. for cash of $4.0  million.  The  acquisition  was  accounted  for under the
purchase  method.   The  charges  were  expensed  as  in-process   research  and
development  in  connection  with  the  Company's  development  of a  healthcare
contract management system.

In July 1997,  the  Company  completed  the Merger with  PHAMIS  which  became a
wholly-owned  subsidiary of the Company.  The transaction was accounted for as a
pooling-of-interests  and  accordingly,  the accompanying  financial  statements
include the accounts of PHAMIS for all periods presented. 


                                  Page 6 of 32


<PAGE>

PART I.  FINANCIAL INFORMATION

Note 3 - Income Taxes

The provision for income taxes for the quarter ended March 31, 1998 was provided
for at the taxable  income  rate of  approximately  50%,  which is more than the
Company's  historical  rate of 40%.  This higher rate is due to a portion of the
charges incurred in the acquisition of Trego Systems,  Inc. being non-deductible
for income tax purposes.

Note 4 - Earnings Per Share Information

In February 1997, the Financial  Accounting Standards Board issued Statement No.
128, EARNINGS PER SHARE, which the Company adopted on December 31, 1997. At that
time, the Company  changed the method used to compute  earnings per share and 
restated all prior periods. Under the new requirements  for calculating  primary
earnings  per share,  the  dilutive  effect of stock  options is  excluded.  The
following sets forth the computation of basic and diluted earnings per share:
<TABLE>
<CAPTION>

                                                       THREE MONTHS ENDED
                                                           MARCH 31
                                                    1998               1997
                                                    ----               ----
<S>                                                 <C>                <C>

 Numerator:
   Net income                                      $  4,402            $  4,497
                                                   --------            --------
    Numerator for basic and 
      diluted earnings per share                   $  4,402            $  4,497
 Denominator:
   Denominator for basic earnings per share--
     weighted-average shares                         26,155              25,485
   Effect of employee stock options                     852                 741
                                                   --------            ---------
    Denominator for diluted earnings per share       27,007              26,226
                                                   ========            ========
 Basic earning per share                              $0.17               $0.18
                                                      =====               =====
 Diluted earnings per share                           $0.16               $0.17
                                                      =====               ======    

</TABLE>

Note 5 - Reporting Comprehensive Income

In June 1997,  the  Financial  Accounting  Standards  Board issued SFAS No. 130,
"Reporting  Comprehensive  Income,"  which the Company  adopted on  January 1,
1998.  Comprehensive income is reported in the Company's Condensed  Consolidated
Statements  of Income and Comprehensive Income,  and  presents  the effect of  
unrealized  gain (loss) on securities available for sale to net income.

Note 6 - Reclassifications

Certain  prior  period  amounts have been  reclassified  to conform with current
period presentations.

                                  Page 7 of 32

<PAGE>

PART I.  FINANCIAL INFORMATION

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

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

GENERAL

The  Company  reported  net income of $4.4  million,  or $0.16 per share for the
three  months  ended March 31,  1998 as compared to $4.5  million , or $0.17 per
share for the three months ended March 31, 1997. Excluding nonrecurring expenses
for costs  associated with the  acquisition of Trego Systems,  Inc., the Company
reported net income of $7.5 million,  or $0.28 per share,  for the first quarter
of 1998 as compared to net income of $5.7 million,  or $0.22 per share,  for the
first quarter of 1997.

This Management's Discussion and Analysis of Financial Conditions and Results of
Operations  includes a number of  forward-looking  statements  which reflect the
Company's current views with respect to future events and financial performance.
These forward-looking  statements are subject to certain risks and uncertainties
including  those  discussed  below that  could  cause  actual  results to differ
materially  from  historical  results  or those  anticipated.  The  Company  has
identified by italics or all capital letters,  various,  but not all,  sentences
within this Quarterly Report which contain such forward-looking  statements.  In
addition,  words such as "believes," "may," "plans," "anticipates,"  "expects,"
"intends,"  and similar  expressions  are  intended to identify  forward-looking
statements,  but are not the exclusive means of identifying such statements.  In
addition,  the disclosures in the section on page 12 under the caption  "Factors
Affecting  Future  Results,"  which is not italicized for improved  readability,
consists  principally  of a discussion of risks which may affect future  results
and, are thus, in their entirety forward-looking in nature. Readers are urged to
carefully  review and  consider the various  disclosures  made by the Company in
this report and in the Company's  other reports  filed with the  Securities  and
Exchange  Commission that attempt to advise interested  parties of the risks and
factors that may affect the Company's business.

RESULTS OF OPERATIONS

THREE MONTHS ENDED MARCH 31, 1998 COMPARED TO THREE MONTHS ENDED MARCH 31, 1997.

REVENUES
The Company's total revenues  increased to $72.7 million during the three months
ended March 31, 1998 from $59.6 million in the corresponding  period in 1997, an
increase of $13.1 million or 22.0%.  Revenues  from systems  sales  increased to
$39.0  million  during the three  months  ended  March 31,  1998 (53.6% of total
revenues)  from $33.4  million  (56.1% of total  revenues) in the  corresponding
period in 1997, an increase of $5.6 million or 16.5%. The increase was primarily
due to an  increase in  installations  of certain of the  Company's  IDXtend and
LastWord systems.  Revenues from maintenance and service fees increased to $33.7
million  during the three months ended March 31, 1998 (46.4% of total  revenues)
from $26.2  million  (43.9% of total  revenues) in the  corresponding  period in
1997,  an  increase of $7.5  million or 29.3%.  The  increase  in revenues  from
maintenance  and service  fees was due  principally  to  additional  maintenance
revenues  resulting from the continued growth in the Company's  installed client
base.

                                  Page 8 of 32

<PAGE>

PART I.  FINANCIAL INFORMATION

COST OF SALES
The cost of sales and  services  increased  to $37.2  million  during  the three
months ended March 31, 1998 from $30.0  million in the  corresponding  period in
1997,  an increase of $7.2 million or 24.3%.  The gross profit margin on systems
sales and  services  decreased  to 48.8% during the three months ended March 31,
1998 from  49.7% in the  corresponding  period in 1997.  The  decrease  in gross
profit was due  primarily to an increase in client  service staff to install and
support the Company's products.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling,  general and administrative  expenses increased to $13.8 million during
the three  months ended March 31, 1998 from $12.7  million in the  corresponding
period in 1997,  an increase of $1.1 million or 8.0%.  As a percentage  of total
revenues, selling, general and administrative expenses decreased to 18.9% during
the three months ended March 31, 1998 from 21.4% in the corresponding  period in
1997. The increase in selling,  general and  administrative  expenses during the
three  months  ended  March 31, 1998 was  principally  due to an increase in the
Company's sales and marketing staff which will allow for the continued growth of
the Company.

RESEARCH AND DEVELOPMENT
Research and  development  expenses  increased to $10.3 million during the three
months  ended March 31, 1998 from $8.5  million in the  corresponding  period in
1997,  an increase of $1.8 million or 21.7%.  The increase is  attributed  to an
increase  in  personnel   expenses  and  outside   consultants  to  support  the
development  of  additional  products for the Company.  As a percentage of total
revenues,  research and development  expenses  remained constant at 14.2% during
the three  months  ended March 31, 1998  compared  to March 31,  1997.  Software
development  costs incurred  subsequent to the  establishment  of  technological
feasibility until general release of the related products are capitalized. Prior
to the merger, technological  feasibility was determined  differently by IDX and
PHAMIS.  Subsequent to the merger the Company's  determination  of technological
feasibility for all product  development is based on the completion of a working
model which has been approved for beta site testing. Historically costs incurred
during beta site testing have not been material.  Although the Company presently
expects costs to complete  beta site testing in the future to be  insignificant,
as the Company develops  products to operating using other  technologies as well
as more comprehensive clinical systems, the time and effort required to complete
beta site testing may be significantly more extensive. Consequently, capitalized
software development costs may become material in future reporting periods.

WRITE-OFF OF ACQUIRED IN-PROCESS RESEARCH AND DEVELOPMENT
On February 23, 1998, the Company recorded  nonrecurring charges of $3.2 million
related to the acquisition of contract management technology from Trego Systems,
Inc. for cash of $4.0  million.  The  acquisition  was  accounted  for under the
purchase  method.   The  charges  were  expensed  as  in-process   research  and
development  in  connection  with  the  Company's  development  of a  healthcare
contract management system.

LIQUIDITY AND CAPITAL RESOURCES
Since its  inception  in 1969,  the Company has funded its  operations,  working
capital needs and capital  expenditures  primarily from  operations,  except for
real estate owned by certain partnerships and trusts financed through industrial
development  bonds.  The  proceeds  from its initial  public  offering  were (i)
distributed  to  stockholders  of the Company in  connection  with the 

                                  Page 9 of 32

<PAGE>

PART I. FINANCIAL INFORMATION

Company's  prior status as an S corporation  under the Internal  Revenue Code of
1986,  as  amended,  and (ii) used for  general  corporate  purposes,  including
working   capital   purposes,   payment  of  current   expenses  and   strategic
transactions, including acquisitions of businesses, products and technologies.

Cash  flows  from  operations  are  principally  comprised  of  net  income  and
depreciation  and are  primarily  affected  by the net  effect of the  change in
accounts receivable, accounts payable and accrued expenses. Due to the nature of
the  Company's  business,  accounts  receivable,  deferred  revenue and accounts
payable  fluctuate  considerably  due to, among other things,  the length of the
sales cycle and  installation  efforts which are dependent  upon the size of the
transaction,  the changing business plans of the customer,  the effectiveness of
customers'  management  and general  economic  conditions.  In general  accounts
receivable from customers have been collected consistently within 95 days.

Cash flows related to investing  activities have principally been related to the
purchase of  computer  and office  equipment,  leasehold  improvements,  and the
purchase and sale of investment grade marketable securities. THE COMPANY EXPECTS
THESE ACTIVITIES TO CONTINUE. INVESTING ACTIVITIES MAY ALSO INCLUDE PURCHASES OF
INTERESTS  IN AND  ACQUISITIONS  OF  COMPLEMENTARY  PRODUCTS,  TECHNOLOGIES  AND
BUSINESSES.  There  can be no  assurance  that  the  Company  will  be  able  to
successfully complete any such purchases or acquisitions in the future.

Cash, cash  equivalents and marketable  securities at March 31, 1998 were $115.4
million,  a slight  decrease from the March 31, 1997 balaqnce of $115.9 million.
The Company has a revolving  line of credit with a bank  allowing the Company to
borrow up to $5.0  million  bearing  interest at the prime  rate.  There were no
borrowings as of March 31, 1998 or 1997.

THE COMPANY EXPECTS THAT ITS REQUIREMENTS FOR OFFICE FACILITIES AND OTHER OFFICE
EQUIPMENT WILL GROW AS STAFFING  REQUIREMENTS  DICTATE.  The Company's operating
lease  commitments  consist  primarily  of  office  leasing  for  the  Company's
operating facilities. THE COMPANY PLANS TO CONTINUE INCREASING THE NUMBER OF ITS
PROFESSIONAL  STAFF DURING 1998 TO MEET ANTICIPATED  SALES VOLUME AND TO SUPPORT
RESEARCH AND DEVELOPMENT  EFFORTS.  TO THE EXTENT NECESSARY TO SUPPORT INCREASES
IN STAFFING, THE COMPANY INTENDS TO OBTAIN ADDITIONAL OFFICE SPACE.

THE COMPANY BELIEVES THAT CURRENT  OPERATING FUNDS WILL BE SUFFICIENT TO FINANCE
ITS OPERATING  REQUIREMENTS AT LEAST THROUGH  DECEMBER 1998. To date,  inflation
has not had a material impact on the Company's revenues or income.

INCOME TAXES
The provision for income taxes for the quarter ended March 31, 1998 was provided
for at the taxable  income rate of  approximately  50%, which is higher than the
historical  rate of 40%.  This  higher  rate is due to a portion of the  charges
incurred in the acquisition of Trego Systems,  Inc. which are non-deductible for
income tax purposes.  FOR 1998, THE COMPANY 


                                 Page 10 of 32

<PAGE>

PART I.  FINANCIAL INFORMATION

ANTICIPATES AN EFFECTIVE TAX RATE OF APPROXIMATELY 40% OF PRE-TAX INCOME.

NEW ACCOUNTING STANDARDS
In October,  1997, the American Institute of Certified Public Accountants issued
Statement of Position  ("SOP")  97-2,  Software  Revenue  Recognition,  revising
certain  aspects of SOP 91-1,  which the Company adopted on January 1, 1998. SOP
97-2 did not materially affect the Company's revenue  recognition  policies with
respect to software license fees which are based upon vendor-specific  objective
information  and relate  principally to its proprietary  systems  software which
generally  requires no significant  production,  modification or  customization.
License revenue,  accordingly,  is deferred and recognized as customer  payments
become due based upon  specified  milestones and due dates  including  delivery,
installation and final systems acceptance.

In June 1997, the Financial  Accounting  Standards Board issued SFAS No. 130 and
No. 131, "Reporting  Comprehensive Income" and "Disclosures About Segments of an
Enterprise  and Related  Information,"  which the Company  adopted on Janaury 1,
1998.  The adoption of these new  accounting  standards did not have a material
impact on the Company's financial statements.

In February 1997, the Financial  Accounting Standards Board issued SFAS No. 128,
Earnings per Share, which the Company adopted on December 31, 1997. SFAS No. 128
replaced the  calculation  of primary and fully diluted  earnings per share with
basic and diluted earnings per share.  Unlike primary earnings per share,  basic
earnings  per share  excludes  any  dilutive  effects of options,  warrants  and
convertible  securities.  Diluted earnings per share is not materially different
from the previously reported fully diluted earnings per share.

YEAR 2000

THE COMPANY HAS ASSESSED ITS  INTERNAL USE SYSTEMS AND ITS  CURRENTLY  SUPPORTED
PRODUCTS, AND PRODUCTS SUPPLIED TO OR BY THE COMPANY BY THIRD PARTIES FOR USE IN
CONNECTION  WITH THE COMPANY'S  PRODUCTS,  FOR POSSIBLE  PROBLEMS IN PROCESSING,
REPORTING,  DISPLAYING AND OTHERWISE HANDLING DATE DATA CONTAINING THE YEAR 2000
AND BEYOND.  THE COMPANY  BELIEVES  IT HAS  FORMULATED  AND IS IN THE PROCESS OF
IMPLEMENTING  OR HAS  COMPLETED  ALL PLANS TO MAKE  YEAR  2000  READY ALL OF ITS
CRITICAL INTERNAL USE SYSTEMS AND ALL OF ITS CURRENTLY SUPPORTED PRODUCTS.

AT MARCH 31, 1998, ALL OF THE CORE DATA BASES AND DATA  PROCESSING  FUNCTIONS OF
THE COMPANY'S  SIGNIFICANT  PRODUCTS WERE YEAR 2000 READY.  THE COMPANY  EXPECTS
THAT  ELEMENTS OF THE  COMPANY'S  PRODUCTS  OTHER THAN CORE  DATABASES  AND DATA
PROCESSING  FUNCTIONS,  SUCH AS CERTAIN  SCREENS AND REPORTS,  WILL BE YEAR 2000
READY IN 1998. THE COMPANY HAS EXPENSED AMOUNTS INCURRED AS OF MARCH 31, 1998 TO

                                 Page 11 of 32

<PAGE>

PART I.  FINANCIAL INFORMATION


MAKE SUCH PRODUCTS YEAR 2000 READY, AND SUCH AMOUNTS HAVE NOT BEEN MATERIAL. THE
ADDITIONAL  COSTS TO MAKE ALL SUCH REMAINING  SYSTEMS YEAR 2000 READY BY THE END
OF 1998 WILL BE EXPENSED AS  INCURRED,  ARE  EXPECTED TO BE INCURRED IN 1998 AND
ARE NOT EXPECTED TO BE MATERIAL.

THE COMPANY UNDER ITS MAINTENANCE AGREEMENTS EXPECTS TO COMMENCE DELIVERY TO ITS
INSTALLED  CUSTOMERS  OF YEAR  2000  READY  VERSIONS  OF ALL OF ITS  SIGNIFICANT
PRODUCTS  IN 1998 AND TO COMPLETE  MOST  INSTALLATIONS  OF SUCH  VERSIONS BY MID
1999. THE COSTS TO INSTALL YEAR 2000 READY VERSIONS OF THE COMPANY'S PRODUCTS AT
CUSTOMER SITES, AS WELL AS THE ABILITY OF THE COMPANY TO ASSIST CUSTOMERS IN THE
INSTALLATION OF YEAR 2000 READY VERSIONS OF ITS PRODUCTS, WILL DEPEND IN PART ON
THE READINESS, ABILITY AND COOPERATION OF CUSTOMERS TO INSTALL SUCH VERSIONS.

ANY OF THE  COMPANY'S  INTERNAL USE SYSTEMS AND ANY OF THE PRODUCTS  SUPPLIED BY
THE  COMPANY TO ITS  CUSTOMERS,  AND  PRODUCTS  SUPPLIED TO OR BY THE COMPANY BY
THIRD PARTIES FOR USE IN CONNECTION WITH THE COMPANY'S  PRODUCTS,  COULD FAIL TO
ADEQUATELY OR PROPERLY PROCESS,  DISPLAY,  REPORT, OR OTHERWISE HANDLE DATE DATA
CONTAINING  THE YEAR 2000 AND  BEYOND.  ANY FAILURE OF A CUSTOMER TO BE READY OR
ABLE TO TIMELY  INSTALL YEAR 2000 READY  VERSIONS OF THE  COMPANY'S  PRODUCTS OR
PRODUCTS  SUPPLIED TO OR BY THE COMPANY BY THIRD  PARTIES FOR USE IN  CONNECTION
WITH THE COMPANY'S PRODUCTS,  COULD CAUSE SIGNIFICANT  OPERATIONAL  PROBLEMS FOR
THE CUSTOMER.  FURTHER,  A FAILURE OF THE COMPANY TO TIMELY MAKE  AVAILABLE YEAR
2000 READY  VERSIONS  OF ITS  PRODUCTS,  OR A FAILURE  OF THE  COMPANY TO TIMELY
PROVIDE ADEQUATE RESOURCES TO ASSIST ITS CUSTOMERS IN INSTALLING YEAR 2000 READY
VERSIONS OF ITS PRODUCTS, COULD RESULT IN CLAIMS BY CUSTOMERS,  WHICH MAY HAVE A
MATERIAL  ADVERSE  EFFECT ON THE  BUSINESS,  OPERATIONS,  AND  FUTURE  FINANCIAL
RESULTS OF THE COMPANY.

FACTORS AFFECTING FUTURE RESULTS
The Company's revenues and operating results can vary significantly from quarter
to quarter as a result of a number of factors,  including  the volume and timing
of systems sales and installations,  and length of sales cycles and installation
efforts.  The timing of revenues  from  systems  sales is  difficult to forecast
because the Company's  sales cycle can vary  depending  upon factors such as the
size of the  transaction,  the  changing  business  plans of the  customer,  the
effectiveness  of customer's  management,  and general economic  conditions.  In
addition,   because   revenue  is  recognized  at  various   points  during  the
installation  process,  the timing of revenue  recognition  varies  considerably
based on a number of factors, including availability of personnel,  availability
of the  customer's  resources  and  complexity  of the  needs of the  customer's
organization. The Company's initial contact with a potential customer depends in
significant part on the customer's decision to replace, expand, or substantially
modify its existing  information systems, or modify or add business processes or
lines of business. How and when to implement,  replace,  expand or substantially
modify an  information  system or modify or add  business  processes or lines of

                                 Page 12 of 32

<PAGE>

PART I.  FINANCIAL INFORMATION


business,  are major decisions for healthcare  organizations.  Accordingly,  the
sales cycle for the Company's  systems is typically  three to eighteen months or
more from contract  execution to completion  of  installation.  During the sales
cycle and the installation  cycle, the Company expends  substantial time, effort
and  funds   preparing   contract   proposals,   negotiating  the  contract  and
implementing  the system.  Because a  significant  percentage  of the  Company's
expenses are  relatively  fixed,  a variation in the timing of systems sales and
installation can cause significant  variations in operating results from quarter
to quarter.  The Company's future operating results may fluctuate as a result of
these and other factors, such as customer purchasing patterns, and the timing of
new product and service introductions and product upgrade releases.  The Company
believes that  quarterly  results of  operations  will continue to be subject to
significant  fluctuations  and that its results of operations for any particular
quarter or fiscal year may not be indicative of results of operations for future
periods.  There can be no assurance  that future  period to period  fluctuations
will  continue  and will not have a  material  adverse  effect on the  Company's
results of operations, financial condition or business.

The  Company  intends  to  continue  to  grow in part  through  acquisitions  of
complementary   products,   technologies   and   businesses  or  alliances  with
complementary  businesses.  The Company's ability to expand successfully through
acquisitions  or alliances  depends on many factors,  including  the  successful
identification  and  acquisition  of products,  technologies  or businesses  and
management's  ability to  effectively  integrate  and  operate  the  acquired or
aligned products,  technologies or businesses.  There is significant competition
for acquisition and alliance opportunities in the healthcare information systems
industry,  which may intensify  due to  consolidation  in the industry,  thereby
increasing the costs of capitalizing on such opportunities. The Company competes
for  acquisition  and  alliance  opportunities  with other  companies  that have
significantly  greater  financial  and  management  resources.  There  can be no
assurance  that the Company will be successful in acquiring or aligning with any
complementary products,  technologies or businesses;  or, if acquired or aligned
with, that the Company will be able to successfully integrate any such products,
technologies or businesses into its current business and operations. The failure
to successfully  integrate any significant products,  technologies or businesses
could have a material  adverse  effect on the Company's  results of  operations,
financial condition or business.

Integrating the operations and management of the Company and PHAMIS has been and
will continue to be a time-consuming process, and will require the dedication of
management  resources,  which  has  and may  continue  to  temporarily  distract
attention from the day-to-day business of the combined Company.  There can be no
assurance that this integration will be completed smoothly or successfully,  and
the  inability  of  management  to  successfully  integrate  the  operations  or
management of the two companies could have a material adverse effect on the
business,  results of operations or financial condition of the combined Company.
As previously  discussed in the section  "Merger and Related  Costs" the Company
has incurred  significant  merger and related  costs.  Additional  unanticipated
expenses may be incurred in  connection  with the continued  integration  of the
business of the Company and PHAMIS.

The stock market has,  from time to time,  experienced  extreme price and volume
fluctuations,  particularly  in the high  technology and healthcare  information
technology sectors, which have often been unrelated to the operating performance
of particular companies. The Company 

                                 Page 13 of 32

<PAGE>

PART I.  FINANCIAL INFORMATION


experiences  fluctuations  in its stock price  related to these  general  market
swings  as well as  announcements  of  technological  innovations,  new  product
introductions  by the  Company  or its  competitors,  market  conditions  in the
computer software or hardware  industries and healthcare reform measures.  These
fluctuations  could have a significant  impact on the future market price of the
Company's Common Stock.

As a developer of information  systems, the Company must anticipate and adapt to
evolving industry standards and new technological  developments.  The market for
the Company's  products is  characterized  by continued and rapid  technological
advances  in  both  hardware  and  software   development,   requiring   ongoing
expenditures  for research and  development  and the timely  introduction of new
products and enhancements to existing  products.  The establishment of standards
is largely a function of user acceptance.  Therefore, such standards are subject
to change.  The Company's future success will depend in part upon its ability to
enhance its existing products,  to respond effectively to technology changes, to
migrate  its clients to new  technologies,  to sell  additional  products to its
existing client base and to introduce new products and  technologies to meet the
evolving needs of its clients in the healthcare  information systems market. The
Company is currently  devoting  significant  resources toward the development of
enhancements to its existing  products and the migration of existing products to
new hardware and software platforms.  There can be no assurance that the Company
will  successfully  complete the development of these products or this migration
in a timely  fashion  or that the  Company's  current  or future  products  will
satisfy the needs of the healthcare  information systems market.  Further, there
can be no assurance that products or  technologies  developed by others will not
adversely  affect the Company's  competitive  position or render its products or
technologies noncompetitive or obsolete.

Any of the  Company's  internal use systems and any of the products  supplied by
the Company to its  customers  could fail to  adequately  or  properly  process,
display,  report,  or otherwise  handle date data  containing  the year 2000 and
beyond.  Any  failure of a customer to be ready or able to timely  install  year
2000  ready  versions  of  the  Company's   products  could  cause   significant
operational  problems  for the  customer.  Further,  a failure of the Company to
timely make available year 2000 ready versions of its products,  or a failure of
the Company to timely  provide  adequate  resources  to assist its  customers in
installing  year 2000 ready versions of its products,  could result in claims by
customers, which may have a material adverse effect on the business, operations,
and future financial results of the Company.

The Company  currently  derives a  significant  percentage  of its revenues from
sales of financial and administrative healthcare information systems and related
services.  As a result,  any factor adversely  affecting sales of these products
and services could have a material  adverse  effect on the Company's  results of
operations,   financial   condition  or  business.   Although  the  Company  has
experienced  increasing annual sales, revenues associated with existing products
may decline as a result of several factors,  including price competition.  There
can be no assurance that the Company will continue to be successful in marketing
its current products or any new or enhanced  products or maintaining the current
pricing for its existing products.

Certain of the Company's  products provide  applications  that relate to patient
medical histories and treatment plans. Any failure by the Company's  products to
provide  accurate,  secure  and  timely  information  could  result  in  product
liability  claims  against  the Company by its  clients or 

                                 Page 14 of 32

<PAGE>

PART I.  FINANCIAL INFORMATION


their affiliates or patients.  The Company maintains  insurance that it believes
is adequate to protect  against claims  associated with the use of its products,
but there can be no assurance that its insurance coverage would adequately cover
any claim asserted  against the Company.  A successful claim brought against the
Company in excess of its insurance coverage could have a material adverse effect
on the Company's results of operations,  financial  condition or business.  Even
unsuccessful  claims could result in the expenditure of funds in litigation,  as
well as diversion of management  time and  resources.  There can be no assurance
that the  Company  will not be subject to product  liability  claims,  that such
claims will not result in liability in excess of its insurance  coverage or that
the Company's  insurance  will cover such claims or that  appropriate  insurance
will  continue  to be  available  to the  Company in the future at  commercially
reasonable rates.

The  success of the  Company is  dependent  to a  significant  degree on its key
management,  sales and marketing,  and technical personnel. The Company believes
that its continued  future success will also depend upon its ability to attract,
motivate  and  retain  highly  skilled,  managerial,  sales and  marketing,  and
technical  personnel,  including  software  programmers  and systems  architects
skilled in the  computer  languages  in which the  Company's  products  operate.
Competition  for  such  personnel  in  the  software  and  information  services
industries is intense.  The loss of key  personnel,  or the inability to hire or
retain  qualified  personnel,  could  have  a  material  adverse  effect  on the
Company's results of operations,  financial condition or business.  Although the
Company  has  been  successful  to  date in  attracting  and  retaining  skilled
personnel,  there can be no  assurance  that the  Company  will  continue  to be
successful in attracting and retaining the personnel it requires to successfully
develop  new  and  enhanced  products  and  to  continue  to  grow  and  operate
profitably.

The healthcare  industry in the United States is subject to changing  political,
economic and regulatory influences that may affect the procurement practices and
operations of healthcare  organizations.  The Company's products are designed to
function  within the structure of the  healthcare  financing  and  reimbursement
system currently being used in the United States. During the past several years,
the healthcare  industry has been subject to increasing  levels of  governmental
regulation  of,  among other  things,  reimbursement  rates and certain  capital
expenditures.  From time to time,  certain  proposals  to reform the  healthcare
system have been  considered  by  Congress.  These  proposals,  if enacted,  may
increase  government  involvement in healthcare,  lower  reimbursement rates and
otherwise change the operating environment for the Company's clients. Healthcare
organizations may react to these proposals and the uncertainty  surrounding such
proposals  by  curtailing  or  deferring  investments,  including  those for the
Company's  products and services.  The Company cannot predict with any certainty
what impact,  if any,  such  proposals or  healthcare  reforms might have on its
results of operations, financial condition or business.

The U.S. Food and Drug Administration (the "FDA") has promulgated a draft policy
for the  regulation of certain  computer  software  products as medical  devices
under the 1976 Medical Device  Amendments to the Federal Food, Drug and Cosmetic
Act (the "FDC Act") and has  recently  indicated it may modify such draft policy
or create a new policy. To the extent that computer software is a medical device
under  the  policy,  the  manufacturers  of such  products  could  be  required,
depending on the product,  to (i) register and list their products with the FDA,


                                 Page 15 of 32

<PAGE>

PART I.  FINANCIAL INFORMATION


(ii) notify the FDA and demonstrate substantial equivalence to other products on
the market  before  marketing  such  products,  or (iii)  obtain FDA approval by
demonstrating  safety and  effectiveness  before marketing a product.  Depending
upon the  intended  use of a device,  IDX could be required by the FDA to obtain
extensive data from clinical studies to demonstrate safety or effectiveness,  or
substantial equivalence. If the FDA requires such data, IDX would be required to
obtain  approval  of an  investigational  device  exemption  before  undertaking
clinical  trials.  Clinical trials can take extended periods of time to complete
and there can be no assurance  that the FDA will approve or clear a device after
the  completion of such trials.  In addition,  such products would be subject to
FDC Act's  general  controls,  including  those  relating to good  manufacturing
practices  and adverse  experience  reporting.  Although  it is not  possible to
anticipate the final form of the FDA's policy with regard to computer  software,
the Company expects that, whether or not the draft is finalized or changed,  the
FDA is likely to become increasingly active in regulating computer software that
is  intended  for use in  healthcare  settings.  The FDA  can  impose  extensive
requirements   governing  pre-  and  post-market   conditions  such  as  service
investigation,  approval,  labeling and manufacturing.  In addition, the FDA can
impose  extensive   requirements  governing  development  controls  and  quality
assurance processes.  There can be no assurance that actions taken by the FDA to
regulate  computer  software products will not have a material adverse effect on
the Company's results of operations, financial condition or business.

Because of these and other  factors,  past financial  performance  should not be
considered  an  indicator  of  future  performance.  Investors  should  not  use
historical trends to anticipate future results.

                                 Page 16 of 32


<PAGE>


PART II. OTHER INFORMATION


Item 1.  LEGAL PROCEEDINGS

                  None.


Item 2.  CHANGES IN SECURITIES

                  None.


Item 3.  DEFAULTS UPON SENIOR SECURITIES

                  Not applicable.


Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

                  None.


Item 5.  OTHER INFORMATION

                  None.


Item 6.  EXHIBITS AND REPORTS ON FORM 8-K.

                  (a) The exhibits filed as part of this Form 10-Q are listed on
the Exhibit Index  immediately  preceding such exhibits,  which Exhibit Index is
incorporated herein by reference.

                  (b) No Current  Reports on Form 8-K were filed by the  Company
during the last quarter of the period covered by this report.

                                 Page 17 of 32


<PAGE>



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.

                                            IDX SYSTEMS CORPORATION


Date: May 14, 1998                          By:/s/ John A. Kane
                                               __________________________
                                               John A. Kane,
                                               Vice President, Finance and
                                               Administration, Chief Financial
                                               Officer and Treasurer
                                               (Principal Financial and
                                               Accounting Officer)

                                 Page 18 of 32


<PAGE>


                                  Exhibit Index
                                  -------------

         The following  exhibits are filed as part of this  Quarterly  Report on
Form 10-Q:


<TABLE>
<CAPTION>

Exhibit No.       Description                                              Page
-----------       -----------                                              ----
<S>               <C>                                                      <C>

10A               Second Addendum to Lease Agreement between 4901 LBJ        20
                  Limited Partnership and IDX Systems Corporation

10B               Third Amendment to Lease between Huntington Avenue         23
                  Limited Partnership and IDX Systems Corporation

10C               Fourth Amendment to Lease between Huntington Avenue        28
                  Limited Partnership and IDX Systems Corporation

27                Financial Data Schedule                                    33

</TABLE>

                                 Page 19 of 32

 
<PAGE>

                                  EXHIBIT 10A

                       SECOND ADDENDUM TO LEASE AGREEMENT

         THIS ADDENDUM is made as of the 21st day of April, 1997, by and between

4901 LBJ Limited Partnership ("Lessor") and IDX Systems Corporation ("Lessee").

         IN CONSIDERATION of the premises,  the covenants set forth herein,  and

other   consideration,   the  receipt  and   sufficiency  of  which  are  hereby

acknowledged, the parties agree as follows:

         1.       SCOPE AND EFFECT

                  This Addendum modifies,  supplements and becomes a part of the

Lease and in the event of any  express  conflict  or  inconsistency  between the

express  terms  hereof  and the terms of the Lease,  the terms of this  Addendum

shall govern and control.  In all other respects,  the Lease shall be and remain

in full force and effect.

         2.       PREMISES

                  To the end of Section 1 of the Lease, entitled "Premises," add

the following clause:

          From and after April 21, 1997, the premises leased to the
          Lessee shall be described as follows: ten thousand eight
          hundred eighty-five (10,885) rentable square feet of office
          space, representing the entire fourth (4th) floor of the
          office building at a rate of $11.23 per square foot. The third
          (3rd) floor shall be divided as eight thousand seven hundred
          ninty-three (8,793) rentable square feet at the rate of
          $11.23 per square foot and a new additional two thousand
          ninty-two (2,092) square feet at the rate of $14.50 per
          square foot of office space for a total of ten thousand eight
          hundred eighty-five (10,885) rentable square feet,
          representing the entire (3rd) floor of the office building.
          (See attached Exhibit "A" for Base Monthly Rent and additional
          charges).

                                 Page 20 of 32

<PAGE>


         3.       MISCELLANEOUS
         
        Lessor  will  allow  $10.00 per square  foot  tenant  finish on the new

additional  two thousand  ninty-two  square feet (2,092).  Each party agrees to

execute and deliver all such  additional  documents and  instruments and perform

such  additional  acts as may be  necessary or  appropriate  to  effectuate  and

perform all of the terms, provisions and conditions of this Agreement.

         IN  WITNESS  WHEREOF,  the  parties  hereto  have  duly  executed  this

instrument on the date(s) indicated below.


WITNESS/ATTEST:                    4901 LBJ LIMITED PARTNERSHIP

                                   By:  IDX Systems Corporation, General Partner

----------------------             By:/s/ John A. Kane 
                                      ----------------------------------------- 

                                   Date: October 7, 1997


                                   IDX SYSTEMS CORPORATION

----------------------             By:/s/ Michelle Russo  
                                      -----------------------------------------

                                   Date: October 21, 1997


                                 Page 21 of 32

<PAGE>


                                   EXHIBIT "A"

<TABLE>
<CAPTION>


Suite Number    Square Footage            Base Rent                  CAM
------------    --------------            ---------                  ---
<S>             <C>                       <C>                        <C>

300             2,092/$14.50 psf          $2,527.83
350             8,793/$11.23 psf           8,228.19
400            10,885/$11.23 psf          10,185.81                  1,934.99
                                          ---------                  --------

                TOTAL                     20,941.83                  1,934.99
         
</TABLE>


Parking Fee                                  420.00


         GRAND TOTAL                     $23,296.82
         -----------



                                 Page 22 of 32




<PAGE>
                                   EXHIBIT 10B

                            THIRD AMENDMENT TO LEASE

         This Third  Amendment to Lease is entered into as of October 1, 1996 by
and between Huntington Avenue Limited Partnership, a Vermont limited partnership
("Landlord") and IDX Systems Corporation, a Vermont corporation ("Tenant").

                                    RECITALS

         A.  Landlord and Tenant  entered  into that  certain  Lease dated as of
April 13, 1994, as amended by an Addendum to Office Lease  Agreement dated as of
June 30, 1994 and by a Second Amendment to Lease dated as of January 1, 1995 (as
so amended, the "Lease"), with respect to certain space (the "Premises") located
in  the  building  known  and  numbered  as  116  Huntington   Avenue,   Boston,
Massachusetts, all as more particularly set forth therein.

         B.  Landlord  and Tenant have agreed to expand the  Premises  leased to
Tenant pursuant to the Lease to include certain space located on the ninth floor
of the  Building and formerly  occupied by the American  Association  of Retired
Persons,  which space includes  approximately 11,670 rentable square feet and is
more fully shown on the floor plan attached hereto as EXHIBIT A and incorporated
herein (the "Ninth Floor Expansion Space"). Accordingly, the parties desire that
the Lease be appropriately  amended, all on the terms and conditions hereinafter
set forth.

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein  contained,  and other good and  valuable  consideration  the  receipt of
sufficiency of which are hereby  acknowledged,  the parties agree that the Lease
shall be amended as follows:

         1.  EXPANSION  OF  PREMISES.  Effective as of the first day of October,
1996 (the  "Expansion  Commencement  Date") and  continuing  for the Ninth Floor
Expansion  Term (as defined  below),  the Ninth Floor  Expansion  Space shall be
added to and become a part of the  Premises,  subject to and with the benefit of
all of the terms and  conditions of the Lease  currently in effect,  as the same
may be  modified  by the  terms of this  Third  Amendment.  From and  after  the
Expansion  Commencement  Date,  and until  the  expiration  of the  Ninth  Floor
Expansion  Term, all references to the Premises  contained in the Lease shall be
deemed to include the Ninth Floor  Expansion  Space.  Landlord and Tenant hereby
acknowledge that, as a result of this Third Amendment,  the Premises now contain
approximately 116,973 rentable square feet.


         2. EXPANSION TERM; OPTIONS TO EXTEND. Landlord hereby leases such Ninth
Floor  Expansion  Space to Tenant  pursuant to this Third  Amendment  for a term
commencing as of the Expansion  Commencement  Date and continuing  through April
30, 

                                 Page 23 of 32

<PAGE>

2004,  unless  sooner  terminated  or hereafter  extended,  each as provided
herein (the "Ninth Floor Expansion  Term").  In addition,  Tenant shall have the
right  to  extend  the  Ninth  Floor  Expansion  Term for one or both of two (2)
successive five (5) year option terms, such option rights to be exercised in the
case of the first such option term pursuant to written  notice to Landlord given
not less than one (1) year prior to the  expiration of the original  Ninth Floor
Expansion  Term and,  in the case of the second such  option  term,  pursuant to
written  notice  given to  Landlord  not less  than one (1) year  following  the
expiration of the first option term. All  references to the "Term"  contained in
the Lease shall,  with respect to the Ninth Floor Expansion Space,  refer to the
Ninth Floor Expansion  Terms, as the same may be extended to include one or both
of the foregoing  option terms.  Any such option term shall be on the same terms
and conditions set forth in the Lease, as herein modified,  except that the Base
Rent shall be as  provided  in  Paragraph  3 below and there shall be no further
right of Tenant to extend the Ninth Floor  Expansion  Term beyond the expiration
of the second such option term.

         3. BASE RENT.  The definition of Basic Rent set forth in Paragraph 3 of
the Lease is hereby  amended by  inserting  the  following  paragraph at the end
thereof:

        "Effective   as  of  the  Expansion   Commencement   Date  and
        continuing  with respect to each lease year or portion thereof
        contained in the Ninth Floor Expansion Term,  Tenant shall pay
        Base Rent with respect to the Ninth Floor Expansion Space (and
        in addition to the Base Rent set forth above) as follows:


Lease Year                           Yearly Rent               Monthly Rent
----------                           -----------               ------------


October 1, 1996 -                    $247,404.00               $20,617.00
December 31, 1997

January 1, 1998-April 30, 2004       $270,744.00               $22,562.00

May 1, 2004 - April 2014             $315,090.00               $26,257.50"
(Extension Terms, if applicable)


         4.  OPERATING  EXPENSES.  Landlord  and  Tenant  hereby  agree that the
Operating  Expenses (as defined in the Lease)  incurred by Landlord with respect
to calendar  year 1992 shall serve as the base for purposes of  determining  the
"Expense  Adjustment  Amount" (as  defined in the Lease)  payable by Tenant with
respect to the Ninth Floor  Expansion  Space.  Accordingly,  the  definition  of
Expense  Adjustment  Amount  set forth in  Paragraph  4.3 of the Lease is hereby
amended by inserting the following sentence immediately after the first sentence
of said Paragraph 4.3:

       "Notwithstanding  the  foregoing,  for purposes of determining
       the Expense  Adjustment  Amount due and payable by Tenant with
       respect  to the Ninth  Floor  Expansion  Space,  such  Expense
       Adjustment  Amount shall equal  Tenant's Pro Rata Share of the
       amount by which the Operating  Expenses 

                                 Page 24 of 32

<PAGE>

       (subject to adjustment pursuant  to  Section  4.4)  incurred  
       with  respect  to  each Calendar  Year  exceeds  the  Operating  
       Expenses  incurred by Landlord  with respect to Calendar Year 
       19962 as determined in accordance with the Lease."

         5. TENANT'S PRO RATA SHARE.  The  definition of Tenant's Pro Rata Share
set forth in Paragraph 4.2.2 of the Lease is hereby amended to add the following
sentence immediately  following the end thereof:  "In addition,  with respect to
the Ninth Floor  Expansion  Space the term  "Tenant's Pro Rate Share" shall mean
4.95%."

         6. TENANT  ALLOWANCE.  Landlord  hereby  agrees to provide to Tenant an
Allowance  equal to $15,000 (the "Tenant  Allowance") in connection with certain
fit up work being  performed  in the Ninth  Floor  Expansion  Premises  by or on
behalf of Tenant.  The Tenant Allowance shall be paid by Landlord to Tenant upon
the completion of such work to Landlord's reasonable satisfaction.

         7. POSSESSION. Tenant has inspected the Ninth Floor Expansion Space and
agrees to  accept  the same "as is"  without  any  agreements,  representations,
understandings   or   obligations  on  the  part  of  Landlord  to  perform  any
alterations, repairs or improvements.

         8. BROKER.  Tenant and Landlord  each  represent  that it has not dealt
with any broker in connection  with this Third  Amendment to Lease and the Ninth
Floor Expansion  Space and insofar as it knows, no broker  negotiated this Third
Amendment or is entitled to any commission in connection  therewith.  Tenant and
Landlord  each  agree to  indemnify,  defend  and hold the  other  party and its
beneficiaries, employees, agents, their officers and partners, harmless from and
against  any  claims  made by any broker or finder  for a  commission  or fee in
connection  with this  Third  Amendment  to Lease or the Ninth  Floor  Expansion
Space, as a result of the breach of the foregoing representation by such party.

         9. WHOLE AGREEMENT. This Third Amendment to Lease sets forth the entire
agreement between the parties with respect to the matters set forth herein.There
have been no  additional  oral or  written  representations  or  agreements.  As
amended  herein,  the Lease  between the parties  shall remain in full force and
effect and, as so amended, is hereby ratified and confirmed by both Landlord and
Tenant.  In case of any  inconsistency  between the  provisions of the Lease and
this Third  Amendment,  the provisions of this Third  Amendment shall govern and
control.


                                 Page 25 of 32

<PAGE>



         10. DEFINED TERMS. All capitalized  terms used herein and not otherwise
defined shall have the meaning ascribed to such term in the Lease.

         EXECUTED  under  seal  as of the  day  and  year  first  above written.



                                    LANDLORD:

                                    HUNTINGTON AVENUE LIMITED PARTNERSHIP

                                    By:  Huntington Real Estate Inc., 
                                         its general partner


                                    By:/s/ John A. Kane              
                                       -----------------------------
                                       Name:
                                       Title: Treasurer 



                                    TENANT:

                                    IDX SYSTEMS CORPORATION

                                    By:/s/ John A. Kane
                                       --------------------------------- 
                                       Name:
                                       Title: CFO




                                 Page 26 of 32


<PAGE>


                                 EXHIBIT A



                                 [SKETCH]



                                 Page 27 of 32


<PAGE>


                                EXHIBIT 10C

                        FOURTH AMENDMENT TO LEASE

         This Fourth  Amendment  to Lease is entered into as of February 1, 1997
by  and  between  Huntington  Avenue  Limited  Partnership,  a  Vermont  limited
partnership  ("Landlord")  and IDX Systems  Corporation,  a Vermont  corporation
("Tenant").

                                 RECITALS

         A.  Landlord and Tenant  entered  into that  certain  Lease dated as of
April 13, 1994, as amended by an Addendum to Office Lease  Agreement dated as of
June 30, 1994, by a Second Amendment to Lease dated as of January 1, 1995 and by
a Third  Amendment  to Lease  dated as of  October 1, 1996 (as so  amended,  the
"Lease"), with respect to certain space (the "Premises") located in the building
known and numbered as 116 Huntington Avenue, Boston, Massachusetts,  all as more
particularly set forth therein.

         B.  Landlord  and Tenant have agreed to expand the  Premises  leased to
Tenant  pursuant  to the Lease to include  certain  space  located on the eighth
floor of the Building containing approximately 3,412 rentable square feet and is
more fully shown on the floor plan attached hereto as EXHIBIT A and incorporated
herein (the "Eighth Floor  Expansion  Space").  Accordingly,  the parties desire
that  the  Lease be  appropriately  amended,  all on the  terms  and  conditions
hereinafter set forth.

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein  contained,  and other good and  valuable  consideration  the  receipt of
sufficiency of which are hereby  acknowledged,  the parties agree that the Lease
shall be amended as follows:

         1.  EXPANSION OF  PREMISES.  Effective as of the first day of February,
1997 (the "Eighth Floor  Expansion  Commencement  Date") and  continuing for the
Eighth Floor Expansion Term (as defined below), the Eighth Floor Expansion Space
shall be added to and  become a part of the  Premises,  subject  to and with the
benefit of all of the terms and conditions of the Lease currently in effect,  as
the same may be modified by the terms of this Fourth  Amendment.  From and after
the Eighth Floor  Expansion  Commencement  Date, and until the expiration of the
Eighth Floor  Expansion  Term, all  references to the Premises  contained in the
Lease shall be deemed to include the Eighth Floor Expansion Space.  Landlord and
Tenant  hereby  acknowledge  that,  as a result of this  Fourth  Amendment,  the
Premises now contain approximately 120,385 rentable square feet.

         2.  EXPANSION  TERM.  Options to Extend.  Landlord  hereby  leases such
Eighth Floor Expansion  Space to Tenant pursuant to this Fourth  Amendment for a
term  commencing  as  of  the  Eighth  Floor  Expansion  Commencement  Date  and
continuing  through  April 30,  2004,  unless  sooner  terminated  or  hereafter
extended,  each as provided  herein (the  "Eighth  Floor  Expansion  Term").  In
addition,  Tenant shall have the right to 


                                 Page 28 of 32

<PAGE>


extend the Eighth  Floor  Expansion  Term for one or both of two (2)  successive
five (5) year option  terms,  such option  rights to be exercised in the case of
the first such option term pursuant to written notice to Landlord given not less
than one (1) year prior to the expiration of the original Eighth Floor Expansion
Term and, in the case of the second such option term, pursuant to written notice
given to Landlord not less than one (1) year  following  the  expiration  of the
first option term.  All  references to the "Term"  contained in the Lease shall,
with  respect to the Eighth  Floor  Expansion  Space,  refer to the Eighth Floor
Expansion  Term,  as the  same may be  extended  to  include  one or both of the
foregoing  option  terms.  Any such  option  term shall be on the same terms and
conditions set forth in the Lease, as herein modified, except that the Base Rent
shall be as provided in Paragraph 3 below and there shall be no further right of
Tenant to extend the Eighth Floor  Expansion  Term beyond the  expiration of the
second such option term.

         3. BASE RENT.  The definition of Basic Rent set forth in Paragraph 3 of
the Lease is hereby  amended by  inserting  the  following  paragraph at the end
thereof:

           "Effective as of the Eighth Floor Expansion  Commencement Date
           and  continuing  with  respect  to each  lease year or portion
           thereof  contained in the Eighth Floor Expansion Term,  Tenant
           shall pay Base Rent with respect to the Eighth Floor Expansion
           Space (and in  addition  to the Base Rent set forth  above) as
           follows:


Lease Year                              Yearly Rent               Monthly Rent
----------                              -----------               ------------
February 1, 1997 - April 30, 2004       $85,300.00                $7,108.33

May 1, 2004 - April 2014                $92,124.00                $7,677.00"
(Extension Terms, if applicable)


         4.  OPERATING  EXPENSES.  Landlord  and  Tenant  hereby  agree that the
Operating  Expenses (as defined in the Lease)  incurred by Landlord with respect
to calendar  year 1997 shall serve as the base for purposes of  determining  the
"Expense  Adjustment  Amount" (as  defined in the Lease)  payable by Tenant with
respect to the Eighth Floor  Expansion  Space.  Accordingly,  the  definition of
Expense  Adjustment  Amount  set forth in  Paragraph  4.3 of the Lease is hereby
amended by deleting the second  sentence of said  Paragraph 4.3 and inserting in
its place the following:

         "Notwithstanding   the   foregoing,   (i)  for   purposes   of
         determining the Expense  Adjustment  Amount due and payable by
         Tenant with respect to the Ninth Floor Expansion  Space,  such
         Expense  Adjustment Amount shall equal Tenant's Pro Rata Share
         of the  amount by which the  Operating  Expenses  (subject  to
         adjustment  pursuant to Section 4.4)  incurred with respect to
         each Calendar Year exceeds the Operating  Expenses incurred by
         Landlord  with respect to Calendar Year 1992, as determined in
         accordance with the Lease and (ii) for purposes of determining
         the Expense  Adjustment  Amount due and payable by Tenant with
         respect to the Eighth  Floor  

                                 Page 29 of 32

<PAGE>


          Expansion Space,  such Expense  Adjustment Amount shall equal 
          Tenant's Pro Rata Share of the amount by which the  Operating 
          Expenses  (subject to adjustment  pursuant to Section 4.4) 
          incurred with respect to each Calendar Year exceeds the  
          Operating  Expenses  incurred by Landlord with respect to
          Calendar Year 1997, as determined in accordance with the Lease."

         5. TENANT'S PRO RATA SHARE.  The  definition of Tenant's Pro Rata Share
set forth in Paragraph 4.2.2 of the Lease is hereby amended by deleting the last
sentence of said Paragraph  4.2.2 and inserting in its place the following:  "In
addition, (i) with respect to the Ninth Floor Expansion Space the term "Tenant's
Pro Rata Share"  shall mean  4.95%,  and (ii) with  respect to the Eighth  Floor
Expansion Space the term "Tenant's Pro Rata Share" shall mean 1.44%."

         6. TENANT  ALLOWANCE.  Landlord  hereby  agrees to provide to Tenant an
Allowance  equal to  $17,060.00  (the "Tenant  Allowance")  in  connection  with
certain fit up work being performed in the Eighth Floor Expansion Premises by or
on behalf of Tenant.  The Tenant  Allowance  shall be paid by Landlord to Tenant
upon the completion of such work to Landlord's reasonable satisfaction.

         7.  POSSESSION.  Tenant has inspected the Eighth Floor  Expansion Space
and agrees to accept the same "as is" without any  agreements,  representatives,
understandings   or   obligations  on  the  part  of  Landlord  to  perform  any
alterations, repairs or improvements.

         8. BROKER.  Tenant and Landlord  each  represent  that it has not dealt
with any broker in connection with this Fourth Amendment to Lease and the Eighth
Floor Expansion Space and insofar as it knows, no broker  negotiated this Fourth
Amendment or is entitled to any commission in connection  therewith.  Tenant and
Landlord  each  agree to  indemnify,  defend  and hold the  other  party and its
beneficiaries, employees, agents, their officers and partners, harmless from and
against  any  claims  made by any broker or finder  for a  commission  or fee in
connection  with this Fourth  Amendment to Lease or the Eighth  Floor  Expansion
Space, as a result of the breach of the foregoing representation by such party.

         9.  WHOLE  AGREEMENT.  This  Fourth  Amendment  to Lease sets forth the
entire  agreement  between  the  parties  with  respect to the matters set forth
herein.  There  have  been no  additional  oral or  written  representations  or
agreements.  As amended  herein,  the Lease  between the parties shall remain in
full force and effect and, as so amended,  is hereby  ratified and  confirmed by
both Landlord and Tenant. In case of any inconsistency between the provisions of
the Lease and this Fourth  Amendment,  the  provisions of this Fourth  Amendment
shall govern and control.

         10. DEFINED TERMS. All capitalized  terms used herein and not otherwise
defined shall have the meaning ascribed to such term in the Lease.


                                 Page 30 of 32

<PAGE>


         EXECUTED under seal as of the day and year first above written.

                                    LANDLORD:

                                    HUNTINGTON AVENUE LIMITED PARTNERSHIP

                                    By: Huntington Real Estate Inc., 
                                        its general partner


                                    By:/s/ John A. Kane
                                       ------------------------------
                                       Name:
                                       Title: Treasurer



                                     TENANT:

                                     IDX SYSTEMS CORPORATION


                                     By:/s/ John A. Kane
                                        -----------------------------
                                        Name
                                        Title: CFO




                                 Page 31 of 32


<PAGE>



                                    EXHIBIT A



                                    [SKETCH]


                                 Page 32 of 32