IntegraMed(R) Q3 EPS Rose 18% to $0.13 as Revenues Grew 30% to $52.3 Million

IntegraMed America, Inc. (NASDAQ: INMD):

IntegraMed America, Inc. (NASDAQ: INMD), the nation’s leading provider of specialty healthcare services in emerging, technology-focused segments, today announced results for the third quarter and nine months ended September 30, 2008 demonstrating continuing growth across all three business units.

Q3 2008 revenues and contribution for each business unit increased over Q2 2008 and year-ago third quarter levels, reflecting continued demand for fertility and vein care services and good business execution.

"IntegraMed continues to achieve solid operating performance in the face of the impact of the weakening economy. Our performance during these increasingly challenging times illustrates both the strong acceptance of our company’s services and our continued commitment to creating shareholder value through operational excellence,” commented IntegraMed CEO, Jay Higham.

IntegraMed was also successful in achieving operating efficiencies in G&A expense, which as a percentage of total contribution declined to 56% in Q3 2008, versus 59% in Q2 2008 and 64% in Q3 2007. On a year-to- date basis, G&A costs are 1% lower than the prior year.

IntegraMed’s improved Q3 2008 bottom-line results versus the year ago period were achieved despite a $274,000 (approximately $0.02 per share after tax) negative swing in net interest income/expense as a result of higher debt levels resulting from the Vein Clinics of America acquisition and lower rates of return on investable cash.

Fertility Centers

IntegraMed’s managed network of fertility centers in 13 major markets, spanning 57 locations and 95 physicians and scientists, is the most extensive consolidated group of its kind. Same-center revenue increased 11% on a year-over-year basis. Q3 2008 results also benefited from the additions of the Orlando fertility center in September 2007, the Southeastern Fertility Center in April 2008 and Arizona Reproductive Medical Associates in July 2008. So far in 2008, IntegraMed has already achieved its annual forecast of 1-2 new Fertility Center contract acquisitions as it is increasingly being sought out by successful fertility centers regarding a range of opportunities.

While consumers and the US economy continue to face a series of challenges, the fundamental desire to initiate or to expand a family has historically remained a high priority in consumer decision-making.

Consumer Services

Applications for IntegraMed’s Shared Risk® Refund program for in vitro fertilization (IVF) rose 26% and enrollments climbed 24% in Q3 2008 compared to Q3 2007. Shared Risk is a unique program pioneered by IntegraMed to reduce a patient’s financial risk when embarking on a series of IVF treatments by entitling patients to a refund of up to 100% of their fees should their treatments not result in a take home baby. While the Shared Risk Refund program has a relatively high cost of entry, the multiple treatment package and refund provisions have strong consumer appeal.

Consumer Services Q3 2008 contribution margin of 26% equaled the level achieved in Q3 2007 as pregnancy success rates improved by 11% over the prior year results, remaining above the national average and offsetting the impact of ongoing infrastructure investments being made to support long-term growth.

Reflecting the success of the Shared Risk Refund program in attracting new IVF patients, IntegraMed has already added four Affiliates to its network in 2008, achieving its goal for the year, and bringing the total number of affiliates to 22, spanning 52 locations and 96 physicians and scientists under the program. Going forward, IntegraMed remains active in its pursuit of additional affiliate opportunities.

Vein Clinics

The integration of the Vein Clinics business unit is progressing on schedule and nearing completion. IntegraMed has invested in a range of management functions including new revenue cycle management, financial management, marketing and sales and regional management infrastructure, and continues to fine-tune these functions.

While these initiatives have lowered near-term contribution from the Vein Clinics business, they have improved the capability to grow this business in a controlled and predictable manner. Importantly, the benefit of these investments has already begun to yield improvements in performance. For the first nine months of this year, revenues have increased 18% to $29.3 million from $24.8 million in the same period of the prior year, which includes the approximately seven months of operations prior to the acquisition. For the same periods, income from operations has increased 36% to $1.9 million from $1.4 million, demonstrating the strong leverage available in this business.

Cash Flow and Balance Sheet

IntegraMed increased its cash position slightly in Q3 2008, ending the period with cash and equivalents totaling $22.4 million. Cash provided by operating activities was $1.2 million in Q3 2008, versus $6.7 million in Q3 2007, principally reflecting the Company’s investment in a number of growth related items. Approximately $3 million of the swing is related to investments in working capital in the form of training compensation advances to new VCA physicians, the stocking of new clinics with small equipment items and supplies, and growth in patient receivables resulting from VCA’s significant revenue growth. In light of infrastructure improvements, VCA’s days sales outstanding (DSO) has declined by 5 days.

The other $2.5 million change in cash flow from operations comes from the Fertility Division as physicians have steadily drawn most of their undistributed earnings ($4.5 million) on a current basis rather than wait until the following year as was their previous practice. Compounding that outflow, the Company has also experienced an $3.0 million increase in patient receivables from higher volumes and new practices, even as DSO for the division has declined 3 days. Partially offsetting the cash outflow is a $5 million increase in patient deposits, providing increased visibility of the future demand for patient services.

Management Comments

Mr. Higham, added, "We continued to implement our long term strategic plan in a disciplined manner during a challenging economic environment in the third quarter. We remain focused on connecting with consumers, maintaining financial discipline, and leveraging our strong financial position to capitalize on new opportunities for growth. As we have noted in the past, our business has shown little correlation with economic cycles, as patients seeking fertility or vein care typically do not view such treatments as optional.

"In the fertility field, our substantial reach, extensive performance record and financial strength has made us an attractive partner for independent clinics. Our contracted fertility centers perform one out of every four IVF procedures nationwide and have proven, cost effective practice-building programs that benefit both practitioners and patients. As independent fertility centers face their own financial, management, marketing or succession challenges, they increasingly seek out IntegraMed to help them foster growth and improve operating performance. During 2009 we plan to add at least one new fertility center partner, as well as continue to expand our affiliate relationships by targeting the addition of at least four new affiliates.

"IntegraMed’s Shared Risk Refund program has also continued to show strong consumer demand across the country, supported by the recent expansion of the program’s scope of services available for donor egg recipients as well as our increased consumer marketing initiatives. Despite recent tightening of credit available to consumers, Shared Risk applications and enrollments have thus far exhibited little or no effect from the change in market dynamics.

"Our Vein Clinic business continues to grow at a healthy pace as patients seek relief from the pain associated with varicose vein disease. More than 80% of our Vein Clinic patients are now covered by third party insurance, helping to sustain demand for these services. To exploit the substantial vein care opportunity nationwide, we plan to increase our base of Vein Clinics in 2009, with two additional new clinic openings slated for the fourth quarter this year and at least five new clinics next year, bringing us to a total of 38 clinics by year-end 2009.

"In summary, we are very pleased with the performance of our businesses year-to-date and so far in the fourth quarter, as well as their long term outlook. We remain strongly committed to supporting their growth through continued investment in acquiring and building new clinics. Taking a longer term view, we remain confident in the ongoing investments we are making to support our future growth.”

About IntegraMed America, Inc.

IntegraMed America, Inc. is a leading provider of specialty health care services in emerging, technology-driven, niche segments of the health care market. The Company currently operates in the fertility and varicose vein care segments. IntegraMed supports its provider networks with clinical and business information systems, marketing and sales, facilities and operations management, finance and accounting, human resources, legal services, risk management and quality assurance. IntegraMed also offers treatment-financing programs for self-pay patients. Please visit www.integramed.com for more information.

The IntegraMed Fertility network consists of 33 contracted centers in 109 locations across the United States, including 191 physicians and Ph.D. scientists. Nearly one of every four IVF procedures in the U.S. is performed in an IntegraMed fertility practice. The IntegraMed Vein Clinic network is the leading provider of varicose vein care services in the US and operates 30 centers in 11 states, principally in the Midwest and Southeast. Please visit www.veinclinics.com for more information.

Statements contained in this press release that are not based on historical fact, including statements concerning future results, performance, expectations and expansion of IntegraMed are forward-looking statements that may involve a number of risks and uncertainties. Actual results may differ materially from the statements made as a result of various factors, including, but not limited to, the risks associated with IntegraMed's ability to finance future growth; changes in insurance coverage, government laws and regulations regarding health care or managed care contracting; and other risks, including those identified in the company's most recent Form 10-K and in other documents filed by IntegraMed with the U.S. Securities and Exchange Commission. All information in this press release is as of September 30, 2008 and IntegraMed undertakes no duty to update this information.