Edgar Filing: INTEGRAMED AMERICA INC

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2005
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 No. 0-20260

INTEGRAMED AMERICA, INC.
(Exact name of registrant as specified in its charter)

Delaware 06-1150326
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)

Two Manhattanville Road
Purchase, New York 10577
(Address of principal executive offices) (Zip Code)

(914) 253-8000
(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
None

Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.01 par value

Indicate by check mark if the registrant is a well-known seasoned issuer,
as defined in Rule 405 of the Securities Act. Yes _____ No __X__

Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act. Yes _____No __X__

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_____

Indicate by check mark if disclosure of delinquent filer pursuant to Item
405 of Regulation S-K (17 CFR 229.405) is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K [ ]

Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one): Large Accelerated Filer Accelerated Filer Non-Accelerated Filer X .

Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act.
Yes_____ No __X__

Aggregate market value of voting stock (Common Stock, $.01 par value) held
by non-affiliates of the Registrant was approximately $36.8 million on June 30,
2005 based on the closing sales price of the Common Stock on such date.

The aggregate number of shares of the Registrant's Common Stock, $.01 par
value, outstanding was approximately 5,124,205 on March 9, 2006.

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DOCUMENTS INCORPORATED BY REFERENCE

See Part III hereof with respect to incorporation by reference from the
Registrant's definitive proxy statement for the fiscal year ended December
31, 2005 to be filed pursuant to Regulation 14A under the Securities
Exchange Act of 1934 and the Exhibit Index hereto.

PART I

ITEM 1. Business

Overview

IntegraMed America offers products and services to patients and providers
in the fertility industry. We have developed a network comprised of twenty-six
contracted fertility centers as of December 31, 2005 in major markets across the
United States, products and services designed to support fertility center
growth, products and services in the pharmaceutical and patient financing areas,
a Shared Risk Refund(R) program, a Council of Physicians and Scientists, captive
insurance offerings and a leading fertility portal (www.integramed.com), all of
which are more fully described below. Eighteen fertility centers purchase
discrete service packages provided by us under our Affiliate program and eight
fertility centers have access to our entire portfolio of products and services
under our comprehensive FertilityPartners(TM) program. All twenty-six centers
have access to our consumer services, principally pharmaceutical products, our
Shared Risk Refund product and other patient financing products. We were
incorporated in Delaware on June 4, 1985.

We maintain a website at www.integramed.com to provide information to the
general public and our shareholders on our products, resources and services,
along with general information on IntegraMed and its management, financial
results and press releases. Copies of our most recent Annual Report on Form
10-K, our Quarterly Reports on Form 10-Q or our other reports filed with the
Securities and Exchange Commission, or SEC, can be obtained, free of charge as
soon as reasonably practicable after such material is electronically filed with,
or furnished to the SEC, from our Investor Relations Department by calling
914-253-8000, through an e-mail request from our Investor Information web page
at www.integramed.com, through the SEC's website by clicking the direct link
from our website at www.integramed.com or directly from the SEC's website at
www.sec.gov. Our website and the information contained therein or connected
thereto are not intended to be incorporated into this Annual Report on Form
10-K.

Our Board of Directors has adopted a Code of Business Conduct that is
applicable to all of our directors, officers and employees, a copy of which has
previously been filed with the SEC. Any material changes made to our Code of
Business Conduct or any waivers granted to any of our directors and executive
officers will be publicly disclosed by filing a current report on Form 8-K. A
copy of our Code of Business Conduct as well as charters for our Audit
Committee, Compensation Committee and Nominating and Corporate Governance
Committee, which comply with the corporate governance rules of NASDAQ, are
available on our website at www.integramed.com. In addition, copies of such
documents are also available to our shareholders upon request by contacting our
Investor Relations Department at 914-253-8000 or through an e-mail request from
our website at www.integramed.com.

Our Industry -- Reproductive Medicine

Reproductive medicine encompasses the medical discipline that focuses on
male and female reproductive systems and processes. There are many reasons why
couples have difficulty conceiving, and accurate identification of a specific
cause of infertility can be time consuming, expensive and requires access to
specialized diagnostic and treatment services. Reproductive endocrinologists are
specialized physicians who perform these more sophisticated medical and surgical
fertility diagnoses and treatments. Reproductive endocrinologists generally have
completed a minimum of four years of residency training in obstetrics and
gynecology and have at least two years of additional training in an approved
subspecialty fellowship program.

Conventional fertility services include diagnostic tests performed on both
the female and male. Depending on the results of the diagnostic tests performed,
treatment options may include, among others, fertility drug therapy, artificial
insemination and fertility surgeries to correct anatomical problems. Procedures
that require gametes (sperm and eggs) to be handled in vitro (outside the body)
are classified as assisted reproductive technology, or ART, services. Current
types of ART services include in vitro fertilization, or IVF, frozen embryo
transfers, donor egg programs as well as other more specialized treatments. IVF
represents the most frequently employed form of ART with current techniques used
in connection with IVF services including intracytoplasmic sperm injection, or
ICSI, assisted hatching, cryopreservation of embryos and blastocyst culture and
transfer.

There are currently approximately 45,000 obstetricians/gynecologists in the
United States of which approximately 1,200 specialize in providing fertility
services, with about 850 certified as reproductive endocrinologists. There are
approximately 435 centers across the country that provide ART services. These
centers are predominantly staffed by reproductive endocrinologists.
Approximately one-third of the ART centers are hospital-based and two-thirds are
physician-office based. As ART has become more sophisticated, more predictable
and less experimental, there has been a clear shift of services out of hospitals
and into physician offices. Compared to other medical niches, the fertility
services industry is concentrated among relatively few providers and few
manufacturers of medications and devices.

According to The American Society for Reproductive Medicine, it has been
estimated that approximately 10% of couples of reproductive age, or more than 6
million couples, have impaired fertility. According to publications from the
Harvard Business School Press, the annual expenditures relating to fertility
services are approximately $3 billion. We believe that multiple factors over the
past several decades have affected couples fertility levels. A demographic shift
in the United States toward the deferral of marriage and first birth has
increased the age at which women are first having children. This, in turn,
increases the incidence of infertility, making conception more difficult,
thereby increasing the demand for ART services. Fortunately, technological
advances in the treatment of infertility, especially IVF, have enhanced
treatment outcomes and the prognoses for many couples.

Currently, many health plan sponsors provide some level of coverage for the
diagnosis and treatment of infertility. Because patients seeking fertility
treatment often have other gynecological symptoms, health plans may cover
diagnostic expenses even when infertility treatment itself is not a covered
benefit. Currently, there are several states that mandate offering benefits of
varying degrees for fertility services, including ART services. In addition to
various initiatives to broaden coverage, several legislative initiatives are
emerging as a driving force behind making fertility services more readily
available. Most recently, in 2005 Connecticut adopted a law requiring insurance
companies to cover certain fertility services including ART.

ART services are the most rapidly growing segment of the fertility market.
According to the Society of Assisted Reproductive Technology, or SART,
approximately 10,000 ART procedures were performed in 1987, growing to over
112,000 ART procedures in 2003, the most recent year for which national data is
currently available. There is reason to believe that the market will continue to
grow in the future for the following reasons: (i) the quality of ART treatments
is improving, increasing the success of treatment; (ii) improvements in embryo
culture media and implantation rates are leading to the capability of reducing
high order multiple pregnancies - one of the greatest risk factors of ART
services; (iii) with improving pregnancy rates, the cost of treatment is
decreasing thereby making high technology services more affordable; (iv) new ART
services that improve embryo quality and the likelihood of pregnancy, continue
to emerge fueling an expansion of the industry; (v) the improving relationship
between cost and quality is causing physicians to substitute more effective ART
treatments for less effective conventional fertility services; (vi) public
policy initiatives including legislative mandates for insurance coverage and the
definition of reproduction as a major life activity covered by the ADA are
producing a more favorable reimbursement climate; and (vii) demand for ART
services is increasing through greater public awareness and acceptance of ART
services.

Numerous market conditions produce business opportunities for us,
including: (i) the high level of specialized skills and technology required for
comprehensive patient treatment; (ii) the capital-intensive nature of acquiring
and maintaining state-of-the-art medical equipment, laboratory and clinical
facilities; (iii) the need to develop and maintain specialized management
information systems to meet the increasing demands of technological advances,
patient monitoring and third-party payers; (iv) the need for seven-days-a-week
service to respond to patient needs and to optimize the outcomes of patient
treatments; (v) the high cost of treatment with inadequate insurance benefits in
most markets; (vi) increasing competition among medical providers specializing
in fertility treatment and (vii) the high cost of pharmaceutical products
requiring patient education and support.

Our Business Strategy

We view the market for fertility services as comprised of both a provider
segment and a consumer segment. Our business strategy is to develop a national
network of high quality fertility centers who access our business services and
serve as a distribution channel for our consumer products. The primary elements
of our strategy to address the provider segment include: (i) expanding our
network of Affiliated fertility centers into new major markets; (ii) increasing
the number and value of service packages purchased by Affiliates in our network;
(iii) entering into additional FertilityPartners contracts with Affiliated and
non-Affiliated fertility centers; and (iv) increasing revenues and profits at
contracted FertilityPartner centers. The primary elements to address the
consumer segment include (i) increasing penetration of our Shared Risk Refund
treatment program and other patient financing programs throughout the provider
network, and (ii) increasing sales of pharmaceutical products to fertility
patients.

Provider Services

(i) Expand our Network of Affiliated Fertility Centers

Our strategic plan calls for us to expand our provider network to establish
a presence in other major markets across the country. We primarily focus our
network development activities on major metropolitan markets with populations in
excess of one million. Because of the relatively low percentage of the
population that seeks fertility treatment, a large population base is required
to support a sophisticated fertility center. Our high quality fertility centers
are capable of drawing consumers from a large geographic catchment area.
Expanding our provider network to the fifty largest metropolitan markets in the
United States will allow us to cover a large percentage of the national
population, since approximately 80% of fertility services performed in the U.S.
occur in these top 50 markets.

The entry point for fertility centers participating in our provider network
is as an Affiliate clinic. Included in this level of participation are access to
our (i) Shared Risk Refund program (as described below), (ii) pharmaceutical
products, (iii) patient financing and (iv) marketing support activities. While a
primary value proposition for the Affiliate offerings is to help practices
improve their ability to attract and retain patients, the offerings can also be
used to improve operational efficiency and support the provision of superior
care as well. We provide access to these programs on an exclusive basis in each
defined market area to the affiliated clinic.

(ii) Increase the Number and Value of Service Packages sold to
Participating Affiliate Centers

Once an Affiliate practice has demonstrated a commitment to leveraging our
offerings to increase practice profitability, we can offer a wider portfolio of
service packages which can improve performance even more and require more up
front implementation effort. These service offerings include:

ARTworks(R) Clinical Information System - a proprietary clinical
information system focused exclusively on the unique requirements of providing
clinical care to patients seeking fertility treatment. We maintain this
application at our data center in New York, with contracted fertility centers
gaining access via a dedicated communications link. This structure allows our
customers to minimize their investment in information systems and relieves them
of software maintenance obligations. The application is also interfaced with
commonly used laboratory equipment and our practice management systems. In 2005
we contracted with one Affiliate to provide access to our ARTworks Clinical
application.

ARTworks Financial Practice Management Information System - an information
system that enables contracted fertility centers to have a sophisticated
scheduling, billing and accounts receivable system. This system is also hosted
out of our data center, which permits contracted fertility centers to gain
access to a powerful practice management system at a fraction of the cost of a
traditional installation. This system has been customized to the unique
requirements of fertility centers and has helped contracted fertility centers to
effectively manage accounts receivable. In 2005 we contracted with one Affiliate
to provide access to our ARTworks Financial application.

Marketing & Field Sales Support - a package of award-winning marketing and
sales programs that have helped contracted fertility centers to grow faster than
the average rate for the industry. This service includes access to our extensive
proprietary marketing collateral material library of ads, brochures, fliers and
announcements. In addition, IntegraMed conducts quarterly sales and marketing
training seminars, offers a syndicated media buying service and produces radio
ads, television ads and educational videos. In 2005 we contracted with two
Affiliates for Marketing & Field Sales Support.

Assisted Reproductive Technology Insurance Company, or ARTIC, and Risk
Management - ARTIC is a captive malpractice insurance company formed in
conjunction with practices in IntegraMed's network which has the following
features: Comprehensive malpractice coverage - which meets the requirements of
all hospitals and state regulatory bodies; assured availability for member
practices; the goal of lower malpractice insurance costs - Shareholders
participate in underwriting, claims and investment decisions; and the goal of
lower cost increases for malpractice insurance over time - given an expected
strong claims history and industry factors based on reproductive
endocrinologists, not a broader obstetric and gynecological population. Risk
management comprises services associated with minimizing practice risk via: an
audit of a practice's existing risk management policies, procedures and
processes; specific recommendations and tools to introduce improved risk
management to practice operations; and ongoing auditing and review management

(iii) Entering into Additional FertilityPartners Contracts

Fertility centers participating in our FertilityPartners program are
entitled to our full suite of products and services. Recruitment into our
FertilityPartners program has traditionally been focused on fertility clinics
currently participating as Affiliates in our provider network. As Affiliates,
practices have become familiar with the offerings we provide and our commitment

to customer service; also, we have had a chance to assess a practice's
commitment to growth and utilization of our services. FertilityPartner practices
are also recruited from outside the pool of existing Affiliates; to be
considered, non-Affiliate candidates need to meet a stringent set of criteria.

As of December 31, 2005, we had FertilityPartner contracts with eight
leading fertility centers, which in turn employ and/or contract with individual
physicians. These fertility centers had a presence in 44 separate clinical
locations in 10 states and the District of Columbia, as follows:

Initial
Number of Business Services
Fertility Centers State Locations Contract Date
----------------- ----- --------- -------------

Reproductive Science Center of Boston........ MA, NH & RI 10 July 1988

Reproductive Science Center of the Bay Area
Fertility and Gynecology Medical Group.... CA 4 January 1997

Fertility Centers of Illinois................ IL 10 August 1997

Shady Grove Fertility Reproductive
Science Centers........................... MD, VA & DC 8 March 1998

IVF Florida ................................. FL 4 April 2002

Reproductive Endocrine Associates of Charlotte NC 2 September 2003

Seattle Reproductive Medicine................ WA 2 January 2004

Reproductive Partners Medical Group.......... CA 4 January 2005

Establishing FertilityPartner Contracts

In establishing a FertilityPartner contract, we typically acquire the
assets of a fertility center, enter into a long-term comprehensive service
agreement with the center and assume most administrative and financial functions
of the center. In addition, we also typically require that the fertility center
enter into long-term employment agreements containing non-compete provisions
with all key physicians and that each physician shareholder of the medical
practice enter into a personal responsibility agreement with us. Typically, the
fertility center contracting with us is a professional corporation in which the
key physicians are the shareholders.

FertilityPartner contracts provide that all patient medical care is to be
provided by the physicians and that we are responsible for providing defined
business services to the center. We provide the equipment, facilities and
support necessary to operate the center, and employ substantially all
non-physician personnel. Under the agreements, we may also advance funds to the
fertility center to provide new services, utilize new technologies, fund
projects, provide working capital or fund mergers with other physicians or
physician groups.

FertilityPartner contracts generally obligate us to pay a fixed sum for the
exclusive right to service the fertility center. These agreements are typically
for terms of 10 to 25 years and may contain early termination clauses.
Generally, no shareholder of contracted fertility centers may assign his/her
interest in the fertility center without IntegraMed's written consent.

Under all eight current FertilityPartners agreements, we receive as
compensation for our services a three-part fee comprised of: (i) a tiered
percentage of net revenues generally between 3% and 6%; (ii) reimbursed costs of
services (costs incurred in providing services to a fertility center and any
costs paid on behalf of the fertility center); and (iii) a percentage of the
center's earnings, which currently ranges from 10% to 20%, but may be subject to
limits.

(iv) Increasing Revenues and Profits at Contracted FertilityPartners

Given our fee structure as described above, we have a significant incentive
to assist in the profitable growth of each FertilityPartner. To achieve this
objective we (i) help them formulate and execute longer-term planning
activities, such as investment/development via facility build-out and in-market
mergers with other practices and planning and budgeting support; (ii) put in
place products and services that help them attract and retain patients,
including the offerings included in our Affiliate relationship - e.g., access to
the Shared Risk Refund Program, internet marketing, patient financing, etc., -
along with proven field sales programs and direct-to-consumer advertising
capabilities and resources; (iii) enable them to enhance their ability to
provide superior care via usage of our ARTworks Clinical application which
provides electronic medical record, workflow management and decision support

functionality, along with clinical risk management auditing services and access
to the Council of Physicians and Scientists, a forum set up to enable sharing
thinking regarding care and research; and (iv) enhance their operating
efficiency through the implementation of an infrastructure focused on improved
accounts receivables management along with business continuity and other IT
support, human resource, legal and procurement support that leverages our
economies of scale and deep expertise in these areas.

Consumer Services

(i) Increased penetration of our Shared Risk Refund Treatment Program

We continuously seek to increase the number of Shared Risk Refund treatment
packages sold directly to consumers. Our Shared Risk Refund program consists of
a package that includes up to three cycles of in vitro fertilization with fresh
embryos and three cycles with frozen embryos for one fixed price with a
significant refund if the patient does not take home a baby. Under this
innovative financial program, we receive payment directly from consumers who
qualify for the program and pay contracted fertility centers a defined
reimbursement for each treatment cycle performed. The benefit to providers is
increased patient volume, and the benefit to consumers is a significant
financial refund should treatment be unsuccessful.

(ii) Increased Sales of Pharmaceutical Products

We also offer a range of complementary pharmaceutical products to fertility
patients. These products are offered in conjunction with ivp care, inc., our
marketing and fulfillment partner in the pharmaceutical industry. Access to our
pharmaceutical products are offered to patients of both our Affiliated and
FertilityPartner clinics, with patients receiving their orders via mail-order
shipments.

Through September 30, 2005, we marketed pharmaceutical products directly to
patients throughout our network and we had contracted with ivpcare, inc. to
provide certain business services related to the distribution of and accounting
for these sales. Effective October 1, 2005, this agreement was terminated and
replaced by a new agreement between us and ivpcare, inc. Under the terms of the
new agreement, we are no longer a direct distributor of pharmaceutical products
to patients as this function is being performed directly by ivpcare. Our
responsibilities are limited to marketing the products for which we will be
compensated. This compensation will approximate our previous contribution from
those pharmaceutical sales and services, and will be shown on a "net" rather
than "gross" basis. As a result, as of October 1, 2005, we no longer record
pharmaceutical sales, the related cost of sales and other costs related to
pharmaceutical distribution. We anticipate a significant decreased in revenues
and cost of sales; however (assuming the same volume of pharmaceutical products
is distributed) contribution from operations and income before income taxes, as
well as net income, will be virtually unaffected from this contract change.

Our Core Competencies

Our service packages are constructed from investments we have made to
develop core competencies in specific areas. In particular, our core
competencies include: (i) administrative services (finance, accounting, human
resource and purchasing support); (ii) access to capital for financing fertility
center operations; (iii) traditional marketing and sales support; (iv) internet
marketing and website support; (v) integrated information systems; and (vi)
shared risk case management.

By providing access to these resources we enable contracted fertility
centers to achieve improved efficiencies and business outcomes.

(i) Administrative Services

Our administrative services to FertilityPartner centers include: (i)
accounting and financial services, such as billing and collections, accounts
payable, payroll, and financial reporting and planning; (ii) recruiting, hiring,
training and supervising all non-medical personnel; and (iii) purchasing of
supplies, pharmaceuticals, equipment, services and insurance.

(ii) Access to Capital

We provide FertilityPartners with a significant competitive advantage
through immediate access to capital for expansion and growth. We are also able
to offer physician providers in our network rapid access to the latest
technologies and facilities in order for them to provide a full spectrum of
services and compete effectively for patients in the marketplace. For example,
we have built new clinical facilities housing state of the art embryology
laboratories for several FertilityPartners, which enable them to expand their
offerings to include a number of services, which they had previously outsourced.

We also provide FertilityPartners with immediate operating capital through
our accounts receivable financing program which offers interest free financing
within preset limits. For a fertility center, this means access to funds upon
billing for services rather than waiting for the collection of the accounts
receivable which normally occurs 15 to 60 days after treatment. Our financing of

a clinic's accounts receivable is also done with full recourse, so that we are
not at risk for uncollectible balances. As a result, we do not purchase the
accounts receivable, but rather advance funds to the clinic which are repaid the
following month.

(iii) Traditional Marketing and Sales

Our marketing department specializes in the development of sophisticated
marketing and sales programs that give fertility centers access to
business-building techniques designed to facilitate growth and development. In
today's highly competitive health care environment, marketing and sales are
essential for the growth and success of all fertility centers. However, these
marketing and sales efforts are often too expensive for many individual
physician practice groups. Affiliation with us provides physicians access to
significantly greater marketing and sales capabilities than would otherwise be
available. Our marketing services focus on revenue and referral enhancement,
relationships with local physicians, media and public relations.

(iv) Internet Marketing and Website support

We operate an industry leading web portal which allows visitors (i) access
to educational material concerning infertility issues; (ii) provides links to
our Partner and Affiliate practices; (iii) allows prospective patients to
request appointments and follow-up contact; (iv) request information on our
Shared Risk Refund program; and (v) apply for treatment financing.

We also assist individual network members with the development, deployment
and hosting of their own unique websites through which they can customize their
on-line message for their practice strengths and local market characteristics.

(v) Integrated Information System

Using our established base of fertility centers, we are continuously
developing a nationwide, integrated information system, called ARTWorks, to
collect and analyze clinical, patient, financial and marketing data. Our goal is
to use this data to control treatment expenses, measure patient outcomes,
improve patient care, develop and manage utilization rates and maximize
reimbursements. We also believe that this integrated information system allows
fertility centers to more effectively compete for and price managed care
contracts, in large part because our information network can provide these
managed care organizations with access to patient outcomes and cost data.

(vi) Shared Risk Case Management

Our Shared Risk Refund program offers multiple treatment cycles for one
fixed price, with the opportunity for a significant refund if the patient does
not take home a baby. Due to the characteristics of the program, we assume risk
for unsuccessful treatment cycles. In order to moderate and manage this risk, we
have developed a sophisticated case management program in which Shared Risk
patients are medically pre-approved prior to enrollment in this program. We also
continuously review their clinical criteria as they undergo treatment cycles.
If, while undergoing treatment, a patient's clinical response falls outside our
criteria for participation in the Shared Risk refund program, we have the right
to remove them from the program, with an applicable refund to the patient. To
date, our case management process has helped manage the risks associated with
our Shared Risk Refund program within expected limits.

Council of Physicians and Scientists

In 1996, we established a Council of Physicians and Scientists, or the
Council, comprised mostly of representatives from our network, to bring together
leaders in reproductive medicine and embryology with the goal of promoting a
high quality clinical environment throughout the network. The Council meets
regularly and conducts bi-monthly teleconferences on topics related to improving
infertility diagnosis and treatment.

Assisted Reproductive Technology Insurance Company

We assisted in the organization of, and obtained a minority equity interest
in, an offshore captive insurance company designed to moderate the cost of
malpractice insurance to members of our network. The majority of the equity of
the captive insurance company is owned by various physician practices which are
members of our network. Beginning January 1, 2005, this captive insurance
company began providing the majority of the malpractice insurance coverage to
physicians within our FertilityPartner network.

Employees

As of March 1, 2006, we had 881 employees. Of these, 839 are employed at
our FertilityPartners fertility centers and 42 are employed at our headquarters,
including 7 who are executive management. Of these employees, 190 persons at the

FertilityPartners fertility centers are employed on a part-time basis. We are
not a party to any collective bargaining agreement and we believe that our
employee relationships are good.

Segment Information

We follow the requirements contained in Statement of Financial Accounting
Standards (SFAS) No.131, "Disclosures about Segments of an Enterprise and
Related Information", with respect to identifying and reporting business
segments. This statement requires that segment reporting reflect our
organizational structure, major revenue sources, line's of responsibility and
senior management's perspective of an organization. In order to better execute
our business strategy and prepare for opportunities offered in the healthcare
marketplace, we modified our reporting segments in 2005. We currently report two
major lines of business, our Provider Services, which is comprised of our
FertilityPartners and Affiliate segments, and our Consumer Services, which is
comprised of our Shared Risk and Pharmaceutical segments. Our 2004 and 2003
results have also been restated to reflect our new reporting segments as
follows, (dollars in thousands):

Fertility Shared
Corporate Partners Affiliates Risk Pharmaceutical Consolidated
--------- -------- ---------- --------- -------------- ------------

For the Year ended December 31, 2005
Revenues .......................... $ -- $ 105,358 $ 952 $ 8,391 $ 14,189 $ 128,890
Cost of Services .................. -- 94,763 86 5,760 13,480 114,089
--------- --------- --------- --------- --------- ---------
Contribution ...................... -- 10,595 866 2,631 709 14,801
Operating Margin .................. 10.1% 91.0% 31.4% 5.0% 11.5%

General and administrative ........ 12,205 -- -- -- -- 12,205
Interest, net ..................... (192) -- -- -- -- (192)
--------- --------- --------- --------- --------- ---------
Income before income taxes ........ $ (12,013) $ 10,595 $ 866 $ 2,631 $ 709 $ 2,788
========= ========= ========= ========= ========= =========
Depreciation expense included above $ 421 $ 3,538 $ -- $ -- $ -- $ 3,959
Capital expenditures .............. $ 871 $ 3,097 $ -- $ -- $ -- $ 3,968
Total assets ...................... $ 21,934 $ 41,207 $ 46 $ 241 $ 2,147 $ 65,575

For the Year ended December 31, 2004
Revenues .......................... $ -- $ 86,080 $ 1,287 $ 4,548 $ 15,738 $ 107,653
Cost of Services .................. -- 76,706 393 3,557 15,189 95,845
--------- --------- --------- --------- --------- ---------
Contribution ...................... -- 9,374 894 991 549 11,808
Operating Margin .................. 10.9% 69.5% 21.8% 3.5% 11.0%

General and administrative ........ 9,789 -- -- -- -- 9,789
Interest, net ..................... 36 -- -- -- -- 36
--------- --------- --------- --------- --------- ---------
Income before income taxes ........ $ (9,825) $ 9,374 $ 894 $ 991 $ 549 $ 1,983
========= ========= ========= ========= ========= =========
Depreciation expense included above $ 352 $ 2,660 $ -- $ -- $ -- $ 3,012
Capital expenditures .............. $ 543 $ 7,119 $ -- $ -- $ -- $ 7,662
Total assets ...................... $ 12,857 $ 38,456 $ 87 $ 285 $ 2,117 $ 53,802

For the Year ended December 31, 2003
Revenues .......................... $ -- $ 74,408 $ 563 $ 2,418 $ 16,301 $ 93,690
Cost of Services .................. -- 65,479 60 1,864 15,830 83,233
--------- --------- --------- --------- --------- ---------
Contribution ...................... -- 8,929 503 554 471 10,457
Operating Margin .................. 12.0% 89.3% 22.9% 2.9% 11.2%

General and administrative ........ 8,761 -- -- -- -- 8,761
Interest, net ..................... (16) -- -- -- -- (16)
--------- --------- --------- --------- --------- ---------
Income before income taxes ........ $ (8,745) $ 8,929 $ 503 $ 554 $ 471 $ 1,712
========= ========= ========= ========= ========= =========
Depreciation expense included above $ 317 $ 1,846 $ -- $ -- $ -- $ 2,163
Capital expenditures .............. $ 440 $ 7,195 $ -- $ -- $ -- $ 7,635
Total assets ...................... $ 8,436 $ 36,167 $ 63 $ 211 $ 1,562 $ 46,439

Significant Service Contracts

For the years ended December 31, 2005, 2004, and 2003 the following
fertility centers each individually provided greater than 10% of our revenues,
net and/or contribution as follows:

Percent of Company Percent of
Revenues, net Contribution
--------------------------- ---------------------------
2005 2004 2003 2005 2004 2003
------- ------ ------ ------- ------ ------

R.S.C. of Boston............... 9.6 11.3 10.4 10.8 13.4 13.9
Fertility Centers of Illinois.. 20.2 25.6 27.9 11.6 22.3 26.4
Shady Grove Fertility Center... 21.1 21.5 20.7 21.4 24.9 25.0

ITEM 1A. Risk Factors

Risk Factors

The following risk factors, while not intended to be all inclusive, could
individually or in combination have a material adverse effect on our business,
financial condition, results of operation and market price of our common stock.

Competition - Our industry is highly competitive and subject to continual
change. New health care providers entering the market may reduce our market
share, patient volume and growth rates. Additionally, increased competitive
pressures may require us to commit more resources to our marketing efforts,
thereby increasing our cost structure and impacting our profitability. There can
be no assurance that we will be able to compete effectively with our current
competitors. Nor can there be assurance that additional competitors will not
enter the market, or that such competition will not make it more difficult for
us to enter into Affiliate or FertilityPartner contracts.

Alternative treatments - In addition to the services provided by our
clinics, alternative treatments are available to patients with infertility
issues. To the extent that these treatments are successful, or perceived as
viable alternatives by prospective patients, our ability to attract and retain
patients may be impacted.

Supply disruptions - Our industry relies on a relatively few number of
manufacturers of specialty fertility equipment. A disruption on the part of an
equipment provider may render the medical providers within our network without
the means to treat patients.

Management turnover - The success of our business strategy depends upon the
continued contribution of key members of our management team. The loss of key
members of this team may adversely affect our ability to implement that
strategy.

Third-party payors - A significant portion of our FertilityPartners revenue
depends upon reimbursements from third-party payors. Disruption of this
relationship, whether in the form of changes to reimbursement contracts or
solvency issues on the part of the payors, may lower our Service fees and
therefore affect our cash flows and financial position.

Reliance on third party vendors - Our pharmaceutical sales and fertility
clinics are dependent on a limited number of third-party vendors that produce
medications vital to treating infertility. Should any of these vendors
experience a supply shortage, it may have an adverse impact on the operations of
our pharmaceutical sales and our network members. To date, no shortage or
disruption has been experienced.

State and Federal laws - Our business practices may be found to be in
violation of State or Federal laws. These include, but are not limited to,
Federal and State Anti-Kickback Laws, Federal and State Self-Referral Laws,
False Claim Laws, Federal and State Controlled Substances laws, HIPAA (Health
Insurance Portability and Accountability Act) regulations and Anti-Trust Laws.
Remedial efforts could result in a discontinuance of portions of our business or
burdensome compliance efforts. The laws and regulations in this area are
extremely complex and subject to interpretation and many aspects our business
have not been the subject of federal or state regulatory review. Accordingly,
there is no assurance that our operations have been in compliance at all times
with all such laws and regulations. In addition, there is no assurance that a
court or regulatory authority will not determine that our past, current or
future operations violate applicable laws or regulations. If our operations were
determined to violate laws or regulations, it could have a material adverse
effect on our business, financial condition and operating results. In addition,
state corporate practice of medical laws vary from state to state. There can be
no assurance that these laws will be interpreted in a manner consistent with our
practices or that other laws or regulations will not be enacted in the future
that could have a material adverse effect on our business, financial condition
and operating results.

Corporate practice of medicine laws - Our operations may also be subject to
state laws relating to the corporate practice of medicine. State laws may
prohibit corporations other than medical professional corporations or

associations from practicing medicine or exercising control over physicians, and
may prohibit physicians from practicing medicine in partnership with, or as
employees of, any person not licensed to practice medicine. State laws may also
contain fee-splitting prohibitions or may prevent corporations from acquiring
the goodwill of a medical practice. We believe that our operations are in
material compliance with all applicable state laws relating to the corporate
practice of medicine. We perform only non-medical administrative services, and
in some circumstances, clinical laboratory services. In each FertilityPartner
agreement, the fertility center is the sole employer of the physicians, and the
fertility center retains the full authority to direct the medical, professional
and ethical aspects of its medical practice.

Liability insurance - Providing health care services entails a substantial
risk of medical malpractice and similar claims. While we do not engage in the
practice of medicine, or assume responsibility for compliance with regulatory
requirements directly applicable to physicians, we do require our fertility
centers to maintain medical malpractice insurance. However, in the event that
services provided at one of our fertility centers results in injury or other
adverse effects, we are likely to be named as a party in any legal proceeding.
Although we currently maintain liability insurance that we believe is adequate,
successful malpractice claims could exceed the limits of our insurance and could
have a material adverse effect on our business. Moreover, there is no assurance
that we will be able to obtain such insurance on commercially reasonable terms
in the future or that such insurance will provide adequate coverage against
potential claims. In addition, a malpractice claim asserted against us could be
costly to defend, could consume management resources and could adversely affect
our reputation and business, regardless of the merit or eventual outcome of such
claim. In addition, in connection with our acquisition of the assets of a
fertility centers, we may also assume some of the center's liabilities.
Therefore, an entity may assert claims against us for events related to the
fertility center prior to its becoming a FertilityPartner. We maintain insurance
coverage related to these risks that we believe is adequate as to the risks and
amounts, although there is no assurance that any successful claims will not
exceed applicable policy limits.

Contract termination - One or more of our FertilityPartner practices may
terminate their membership in our network. Such an occurrence would
significantly reduce our revenues without a corresponding reduction in our cost
structure.

Physician resignation - The departure of one or more key medical providers
may negatively impact the ability of our FertilityPartners to generate
sufficient revenues. A reduction in FertilityPartner revenue would reduce our
revenues and may require us to advance funds to the fertility center.

Technology risks - The treatment of infertility is a technologically
intensive area of medicine. There is no guarantee that our investments in
fertility technology will remain at the level of sophistication necessary for
our clinics to remain competitive in the marketplace.

Financial results - Our quarterly results and stock price may fluctuate
over time based on our business risk factors, seasonal influences, market
expectations or other factors over which we have limited control. In addition
changes to financial variables over which we do exercise some control, such as
dividend policy, stock dilution, banking and credit facilities, etc., may be
perceived differently by different stakeholders, and thereby influence our stock
price.

ITEM 1B. Unresolved Staff Comments

Not applicable.

ITEM 2. Properties

Our headquarters and executive offices are located in Purchase, New York,
where we occupy approximately, 18,600 square feet under a lease expiring in
2012. Future lease payments will range from $46,280 to $51,100 per month.

We also lease or sublease locations for our FertilityPartners clinics.
Costs associated with these agreements are reimbursed to us as part of our fee
for the applicable fertility center.

We believe that our executive offices and the space occupied by our
fertility centers are adequate for our operations.

ITEM 3. Legal Proceedings

From time to time, we are party to legal proceedings in the ordinary course
of business. None of these proceedings is expected to have a material adverse
effect on our financial position, results of operations or cash flow.

ITEM 4. Submission of Matters to a Vote of Security Holders

None.

PART II

ITEM 5. Market for Registrant's Common Equity, Related Stockholder Matters and
Issuer Purchases of Equity Securities

Our common stock is traded on the NASDAQ National Market under the symbol
"INMD" The following table sets forth the high and low closing sales price for
our common stock, as reported on the NASDAQ National Market.

Common Stock
----------------------
High Low
----------------------
2004
First Quarter........................ 8.44 6.12
Second Quarter....................... 8.25 5.71
Third Quarter........................ 7.31 5.50
Fourth Quarter....................... 13.26 5.91

2005
First Quarter........................ 13.00 8.58
Second Quarter....................... 12.01 7.35
Third Quarter........................ 13.48 8.00
Fourth Quarter....................... 13.80 10.18

On March 17, 2005, there were approximately 80 holders of record of the
Common Stock and approximately 2,200 beneficial owners of shares registered in
nominee or street name.

Dividend Policy

We have not paid cash dividends on our common stock during the last two
fiscal years, and we currently anticipate retaining all available funds for use
in the operation and expansion of the business. Therefore, we do not anticipate
paying any cash dividends on our common stock for the foreseeable future.

Selected Equity Transactions

We have two stock option plans which have been approved by our
shareholders. The following table sets forth certain information relative to
these stock option plans.

Number of securities
Number of Securities remaining available for
to be issued upon Weighted-average future issuance under
exercise of exercise price of equity compensation plans
outstanding options, outstanding options, (excluding securities
Plan Category warrants and rights warrants and rights reflected in column (a)
------------- ------------------- ------------------- -----------------------

(a) (b) (c)
Equity compensation
plans approved by
security holders........ 250,340 $3.46 172,420

Equity compensation
plans not approved
by security holders..... -- - --
------- ----- -------

Total................ 250,340 $3.46 172,420
======= ===== =======

During 2003, we issued 58,345 shares of restricted Common Stock to members
of our Board of Directors and various company officers. These shares had a
market value on the date of issuance of $417,000.

During 2004, we issued 33,000 shares of restricted Common Stock to members
of our Board of Directors and various company officers. These shares had a
market value on the date of issuance of $211,000.

During 2005, we issued 40,200 shares of restricted Common Stock to members
of our Board of Directors and various company officers. These shares had a
market value on the date of issuance of $437,000.

During 2005, we issued 1,129,141 shares of Common Stock as a 30% stock
split effected in the form of a stock dividend to current holders of our stock.
The issuance of these shares had no direct financial impact on our results of
operations or financial position and did not alter the market capitalization of
our common shares outstanding.

ITEM 6. Selected Financial Data

The following selected financial data (for the years ended December 31,
2005, 2004, 2003, 2002 and 2001) are derived from our consolidated financial
statements and should be read in conjunction with the financial statements,
related notes, and other financial information included elsewhere in this Annual
Report on Form 10-K. Earnings per share and average share values for the years
2004, 2003, 2002 and 2001 have been restated to reflect the 30% stock split
effected in the form of a stock dividend declared in June 2005.

Statement of Operations Data :

December 31,
----------------------------------------------------------
2005 2004 2003 2002 2001
-------- -------- --------- --------- ---------
(in thousands, except per share amounts)

Revenues, net ........................ $ 128,890 $ 107,653 $ 93,690 $ 88,200 $ 73,898
Costs of services incurred ........... 114,089 95,845 83,233 78,349 64,013
--------- --------- --------- --------- ---------
Contribution ......................... 14,801 11,808 10,457 9,851 9,885
General and administrative expenses .. 12,205 9,789 8,761 8,097 7,827
Total other expenses, net ............ (192) 36 (16) 52 102
--------- --------- --------- --------- ---------
Income before taxes .................. 2,788 1,983 1,712 1,702 1,956
Provision (benefit) for income taxes . 1,065 797 668 562 (4,557)
--------- --------- --------- --------- ---------
Net income ........................... 1,723 1,186 1,044 1,140 6,513
Less: Dividends paid and/or accrued on
Preferred Stock ................... -- -- -- 69 133
--------- --------- --------- --------- ---------
Net income applicable to Common
Stock ............................. $ 1,723 $ 1,186 $ 1,044 $ 1,071 $ 6,380
========= ========= ========= ========= =========

Basic EPS ............................ $ 0.36 $ 0.26 $ 0.24 $ 0.26 $ 1.59
========= ========= ========= ========= =========
Diluted EPS .......................... $ 0.34 $ 0.25 $ 0.22 $ 0.24 $ 1.55
========= ========= ========= ========= =========

Weighted average shares - basic ...... 4,839 4,620 4,437 4,154 4,005
========= ========= ========= ========= =========
Weighted average shares - diluted ... 5,003 4,831 4,662 4,508 4,128
========= ========= ========= ========= =========

Balance Sheet Data:

December 31,
--------------------------------------------------------
2005 2004 2003 2002 2001
------ ------- ------- ------- -------
(in thousands)

Working capital (1)..................... $6,731 $ 301 $ 3,294 $ 3,511 $ 4,208
Total assets ........................... 65,575 53,802 46,439 42,165 39,687
Total indebtedness...................... 10,147 5,239 7,511 1,410 2,691
Accumulated deficit..................... (11,707) (13,430) (14,616) (15,660) (16,800)
Shareholders' equity.................... 36,800 34,443 32,850 31,557 30,615

(1) Represents current assets less current liabilities.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

The following is a discussion of our financial condition and results of
operations for the three years ended December 31, 2005. It should be read in
conjunction with our Consolidated Financial Statements, the related notes
thereto and other financial and operating information included in this Form
10-K.

Overview

IntegraMed America, Inc. offers products and services to patients and
providers in the fertility industry. We have developed a network comprised of
twenty-six contracted fertility centers in major markets across the United
States, products and services designed to support fertility center growth,
products in the pharmaceutical and patient financing areas, a Shared Risk Refund
program and captive insurance offerings. Eighteen affiliate fertility centers
purchase discrete service packages provided by us and eight fertility centers
have access to our entire portfolio of products and services under our
comprehensive FertilityPartners(TM) program. All twenty-six centers have access
to our consumer services, principally pharmaceutical products, our Shared Risk
Refund product and patient financing products.

Our business strategy is to align our information, technology and financial
strengths for the benefit of both providers and consumers of fertility services.
The primary elements of this strategy include: (i) expanding our network of
Affiliated fertility centers; (ii) entering into additional FertilityPartners
contracts; (iii) increasing revenues and profits at contracted FertilityPartners
centers; (iv) increasing the number and value of service packages purchased by
members of our network; (v) increasing penetration of our Shared Risk Refund
treatment program throughout the network, and (vi) increasing sales of
pharmaceutical products to fertility patients.

Major events impacting financial condition and results of operations

In December 2005, we amended our existing credit agreement with Bank of
America. The amended agreement is comprised of a renewal and increase in our
three year revolving credit line to $10 million, and a new $10 million five year
term loan, of which approximately $3.2 million was used to retire the
outstanding balance on our previous term loan. We believe that these credit
facilities will be sufficient to fund our current operational, capital
investment and acquisition plans.

Through September 30, 2005, we marketed pharmaceutical products directly to
patients throughout our network and we had contracted with ivpcare, inc. to
provide certain business services related to the distribution of and accounting
for these sales. Effective October 1, 2005, this agreement was terminated and
replaced by a new agreement between us and ivpcare, inc. Under the terms of the
new agreement, we are no longer a direct distributor of pharmaceutical products
to patients as this function is being performed directly by ivpcare. Our
responsibilities are limited to marketing the products for which we will be
compensated. This compensation will approximate our previous contribution from
those pharmaceutical sales and services, and will be shown on a "net" rather
than "gross" basis. As a result, as of October 1, 2005, we no longer record
pharmaceutical sales, the related cost of sales and other costs related to
pharmaceutical distribution. We anticipate significant decreases in revenues and
cost of sales; however (assuming the same volume of pharmaceutical products is
distributed) contribution from operations and income before income taxes, as
well as net income, will be virtually unaffected from this contract change.

Effective January 1, 2005, we signed a FertilityPartner agreement to supply
a complete range of business, marketing and facility services to the
Reproductive Partners Medical Group, Inc., or RPMG, a fertility practice
comprised of six physicians in the Southern California market. Under the terms
of this 25-year agreement, our service fees are comprised of reimbursed costs of
services, a tiered percentage of revenues, and an additional fixed percentage of
RPMG's earnings. We also committed up to $0.5 million to fund any necessary
capital needs of the practice.

On January 1, 2004, we signed a FertilityPartners agreement with the
Seattle, Washington based Seattle Reproductive Medicine, Inc., P.S., or SRM,
physician practice. Under the terms of this 15-year agreement, our service fees
are comprised of reimbursed costs of services, a tiered percentage of revenues,
and an additional fixed percentage of SRM's earnings. We also committed up to $2
million to fund the construction and equipping of a new state-of-the-art
facility to house the clinical practice and embryology laboratory for SRM and
its patients. Based on the terms of this transaction, we were paid a fixed
service fee for approximately eleven months of 2004 until the new facility was
fully operational in December 2004. Upon becoming fully operational, our service
fees reverted to the fee structure described above.

On September 1, 2003, we signed a FertilityPartners agreement with the
Charlotte, North Carolina based Reproductive Endocrinology and Andrology of
Charlotte, or REACh, physician practice. Under the terms of this 15-year
agreement, our service fees are comprised of reimbursed costs of services, a

tiered percentage of revenues, and an additional fixed percentage of REACh's
earnings. We also committed up to $2 million to fund the construction and
equipping of a new state-of-the-art facility to house the clinical practice and
embryology laboratory for REACh and its patients.

During 2003, we negotiated revised fee structures on three of our existing
FertilityPartner contracts. All three of these revisions provided for phased-in
fee reductions, or fee capitations, on that portion of our fee structure which
is based on the earnings of the underlying fertility centers. We believe that
these fee limitations will be offset by volume based increases in fees due to
organic growth at FertilityPartner locations, the sale of new FertilityPartner
contracts and growth in our Shared Risk Refund business unit.

Critical Accounting Policies

The preparation of financial statements in conformity with generally
accepted accounting principles requires estimates and assumptions which affect
the reporting of the results of operations, financial position and related cash
flows. We believe that the accounting policies described below are both
important to the portrayal of the company's financial condition and operating
results and requires management's most critical estimates and judgment. We base
these estimates on historical experience, and various other assumptions that we
believe to be reasonable under the circumstances, the results of which forms the
basis for making judgments about the carrying value of assets and liabilities
that are not readily apparent from other sources. Our actual results may differ
from these estimates. We also continue to evaluate our estimates and assumptions
on an on-going basis and may revise them as conditions warrant.

Basis of consolidation --

The consolidated financial statements comprise the accounts of IntegraMed
America, Inc. and its wholly owned subsidiaries. We principally derive our
revenues from contracts with fertility centers, fees from patients enrolled in
our Shared Risk Refund program and the sale of pharmaceutical products. We do
not have a controlling financial interest in any of the medical practices to
which we provide services and as such do not consolidate their results.

Financial Statement reclassifications --

As our business grows, it is often necessary to modify the organizational
structure and adopt new business concepts. These changes are reflected in the
presentation of our current financial statements and, for comparative purposes,
require us to reclassify information from our prior year financial statements to
our current presentation. Among the prior year statements which have been
reclassified to our current presentation are our Consolidated Balance Sheets,
Consolidated Statements of Operations, Consolidated Statements of Shareholders'
Equity and various supporting schedules.

Revenue and cost recognition --

FertilityPartners service fees

Under all eight of our FertilityPartner agreements, we receive as
compensation for our services a three-part fee comprised of: (i) a tiered
percentage of the fertility centers net revenues, (ii) reimbursed costs of
services (costs incurred in servicing a fertility center and any costs paid on
behalf of the fertility center) and (iii) a fixed percentage of the fertility
centers earnings after services fees, which may be subject to limits. All
revenues from FertilityPartners contracts are recorded in the period services
are rendered. Direct costs incurred by us in performing our services and costs
incurred on behalf of the medical practices are reported as costs of services.
Revenue and costs are recognized in the same period in which the related
services have been performed.

Affiliate Service Fees

Under all eighteen of our Affiliate agreements, we receive as compensation
for our services a fixed fee dependent upon the level of service provided. All
revenues and costs from Affiliate contracts are recorded in the period services
are rendered.

Shared Risk Refund Program

The Shared Risk Refund program consists of a fertility treatment package
that includes a fixed number of treatment cycles for one fixed price with a
significant refund if the patient does not take home a baby. We receive payment
directly from consumers who qualify for the program and pay contracted fertility
centers a defined reimbursement for each treatment cycle performed. Partial
revenue is recorded upon the initiation of treatment, with remaining revenues
recorded upon patients becoming pregnant. A reserve is maintained for
potentially refundable amounts if patients do not take home a baby. Expenses
related to the program are recorded as incurred.

Pharmaceutical Sales

Revenues and related expenses from pharmaceutical sales are recorded upon
shipment to customers. Prior to October 1, 2005, these revenues represented the
actual sales value of the pharmaceuticals sold and we recorded cost of sales
equal to the product cost. Subsequent to the October 1, 2005 amendment to our
marketing agreement, our revenues are comprised of marketing fees related to
these pharmaceutical sales as previously described in Item 7, under the caption
"Major events impacting financial condition and results of operations."

Use of Estimates --

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America, requires
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting periods. Our most significant estimates include a reserve
for estimated refunds due to pregnancy loss in our Shared Risk Refund Program
and the valuation allowance related to our deferred tax assets.

Due to Medical Practices --

Due to Medical Practices represents the net amounts owed by us to medical
practices contracted as FertilityPartners. This balance is comprised of amounts
due to us by the medical practices for funds which we advanced for use in
financing their accounts receivable, less balances owed to the medical practices
by us for undistributed physician earnings and patient deposits we hold on
behalf of the medical practices.

Exclusive Service Rights --

Exclusive service rights represent payments we made for the right to
service certain fertility centers and are valued at cost less accumulated
amortization. Costs are amortized on a straight-line basis over the length of
the service contract, usually ten to twenty-five years. We periodically review
our exclusive business service rights to assess recoverability; a charge would
be recognized in the consolidated statement of operations if an impairment was
determined to have occurred. Recoverability is determined based on undiscounted
expected earnings from the related business over the remaining amortization
period.

Long Lived Assets --

Under current accounting standards our long lived assets are subject to
annual impairment testing and we may be subject to impairment losses as a
result. If we record an impairment loss, it could have a material adverse effect
on our results of operations for the year in which the impairment is recorded.

Results of Operations

The following table shows the percentage of net revenue represented by
various expenses and other income items reflected in our statement of operations
for the years ended December 31, 2005, 2004 and 2003:

2005 2004 2003
---- ---- -----
Revenues, net:
Provider services ...................... 82.5% 81.2% 80.0%
Consumer services ...................... 17.5% 18.8% 20.0%
----- ----- -----
Total revenues ..................... 100.0% 100.0% 100.0%

Costs of services incurred:
Provider services ...................... 73.6% 71.6% 70.0%
Consumer services ...................... 14.9% 17.4% 18.9%
----- ----- -----
Total costs of service ............. 88.5% 89.0% 88.9%

Contribution:
Provider services ...................... 8.9% 9.6% 10.0%
Consumer services ...................... 2.6% 1.4% 1.1%
----- ----- -----
Total contribution ................. 11.5% 11.0% 11.1%

General and administrative expenses ....... 9.5% 9.1% 9.3%
Interest income ........................... (0.4)% (0.2)% (0.1)%
Interest expense .......................... 0.3% 0.3% 0.1%
----- ----- -----
Total other expenses ............... 9.4% 9.2% 9.3%

Income from operations before income taxes 2.1% 1.8% 1.8%
Income tax provision ...................... 0.8% 0.7% 0.7%
----- ----- -----
Net income ................................ 1.3% 1.1% 1.1%

2005 Compared to 2004

Our revenues increased by $21.2 million, or 19.7%, to $128.9 million for
the year ended December 31, 2005, as compared to $107.7 million in 2004.
Significant factors contributing to this increase were:

(i) Provider Services -

Revenues from our FertilityPartners centers increased by $19.3
million, or 22.4% from the prior year. Approximately $12.2 million
of this increase came from our two most recently added
FertilityPartners in Seattle and Southern California who joined
our network on January 1, 2004, and January 1 2005, respectively.
Organic growth of 8.2% at our other six FertilityPartner clinics,
including $0.1 million in service fees earned from the captive
insurance company, accounted for the remaining $7.1 million of
revenue growth in 2005 versus 2004. We attribute much of this
organic growth to targeted marketing campaigns directed towards
prospective patients.

Revenues from our Affiliate clinics were approximately $1.0
million in 2005, slightly below revenues of $1.3 million in 2004.
While the number of affiliated clinics grew from 17 in December
2004, to 18 by December 2005, reported revenues for 2005 are
slightly below the prior year figure due to a decrease in certain
marketing related services.

(ii) Consumer Services -

Our Shared Risk Refund program continued to see significant year
to year growth with 2005 revenues of $8.4 million, an increase of
$3.8 million, or 84.5%, above 2004 revenues of $4.5 million. The
prospect of a potential refund, coupled with good treatment
outcomes, as compared to industry averages, has resulted in
continued strong patient enrollment in this program throughout our
network.

Pharmaceutical revenue was $14.2 million for the year ended
December 31, 2005, compared to $15.7 million for the prior year.
This reduction in revenue is entirely the result of a change in
contract terms we initiated with our strategic partner in the
pharmaceutical business. While these new contract terms will

affect our revenue and related costs, it will have no impact on
our margins or income. As a result, reported revenues for 2005 are
not directly comparable with 2004 results.

Our 2005 contribution of $14.8 million increased approximately $3.0
million, or 25.3% from 2004. As a percentage of revenue, our contribution margin
increased to 11.5% in 2005 versus 11.0% in 2004. The following factors had a
significant impact on contribution:

(i) Provider Services -

Contribution from our FertilityPartners centers increased by $1.2
million, or 13.0%, to $10.6 million in 2005, from $9.4 million in
the prior year. Our two most recently added FertilityPartners
locations in Seattle and Southern California generated $1.4
million of increased contribution. Contribution at our remaining
six FertilityPartners was approximately $0.2 million less in 2005
than in 2004. Despite higher revenues, due to the planned phase in
of fee reductions at three clinics which has been previously
disclosed, the contribution declined. Contribution earned from
providing certain administrative services to the captive insurance
company totaled approximately $0.1 million in 2005, its first year
of operation.

Our Affiliate clinics generated contribution of $0.9 million in
2005, consistent with their contribution in 2004, despite slightly
lower revenue resulting from a reporting change.

(ii) Consumer Services -

Contribution from our Shared Risk Refund program rose by $1.6
million, or 165.8%, to $2.6 million for the year ended December
31, 2005, from $1.0 million in 2004. Higher patient volume and
favorable pregnancy outcomes, especially during early treatment
cycles, helped drive this performance.

Pharmaceutical contribution was $0.7 million in 2005, up $0.2
million, or 28.9%, from $0.5 million in 2004. This increase in
contribution, driven by increased product shipments, is a result
of our continuing efforts to distribute our pharmaceutical
services throughout our expanding network base.

General and Administrative expenses are comprised of salaries, benefits,
corporate regulatory, operational and support costs not specifically related to
our clinics or other product offerings. These expenses increased $2.4 million in
2005, over 2004 levels. Approximately $1.7 million of this increase relates to
planned headcount and compensation increases required to generate and support
our growing revenue streams. Sarbanes-Oxley and other regulatory compliance
efforts contributed an additional $0.4 million of increased costs in 2005 versus
2004. As a percentage of revenue, General and Administrative expenses were 9.5%
of revenues in 2005, up slightly from 9.1% in 2004.

Interest income increased to $520,000 for the year ended December 31, 2005,
from $259,000 in 2004. This increase is primarily attributed to interest income
earned on capital investments at several FertilityPartner clinics. Interest
expense increased to $328,000 for the year ended December 31, 2005 from $295,000
in 2004, primarily as a result of interest charges on the outstanding portion of
our revolving line of credit, and increases in the general level of interest
rates.

Our provision for income tax was approximately $1.1 million in 2005,
compared to $0.8 million in 2004. We paid no Federal income tax in either 2005,
or 2004, as we were able to utilize some of our net operating loss generated in
prior years. Our effective tax rate for 2005 was approximately 38.2% and
reflects a provision for both state and Federal taxes.

2004 Compared to 2003

Revenues for the year ended December 31, 2004, increased by $14.0 million,
or 14.9%, from the year ended 2003. The main factors contributing to this
increase were:

(i) Provider Services -

Revenues from our FertilityPartners centers increased by $11.7
million, or 15.7% from the same period in 2003. Revenues for 2003
include $4.8 million from a FertilityPartner agreement we
terminated on June 30, 2003, and $1.2 million from a new
FertilityPartner in Charlotte, N.C., which was signed on September
1, 2003. Revenues in 2004 include $5.0 million from our Charlotte,
N.C., FertilityPartner, and $1.9 million from a new
FertilityPartner in Seattle, W.A., who joined our network on
January 1, 2004. The five FertilityPartners who were members of
our network for the full reporting periods of 2003 and 2004, had

organic revenue growth of $10.8 million, or 15.8% in 2004, versus
2003. We attribute much of this growth to our direct to consumer
marketing efforts, backed up by our published laboratory success
rates.

Revenues from our Affiliate clinics totaled $1.3 million in 2004,
up from $0.6 million in 2003. This increase in revenue is
primarily the result of an increase in program membership fees
instituted in January 2004, as well as a net increase of one
clinic participating in our Affiliate program between December
2004 and December 2003.

(ii) Consumer Services -

Shared Risk Refund revenue grew by $2.1 million, or 88.1%, to $4.5
million for the year ended December 31, 2004, from $2.4 million in
the year earlier period. We credit this sales growth to strong
consumer acceptance and our continued market penetration of this
innovative program.

Pharmaceutical revenue was $15.7 million for the year ended
December 31, 2004, down $0.6 million from revenue of $16.3 million
in the prior year. This decline was due to our decision to
de-emphasize the sale of certain high volume products due to
adverse product cost and pricing issues within the market. These
issues primarily impacted results during the first two quarters of
2004, and sales of these products were reintroduced during the
second half of the year.

Our contribution for 2004 was $11.8 million, up approximately $1.4 million,
or 12.9% from a contribution of $10.5 million in 2003. As a percentage of
revenue, our contribution margin was 11.0% in 2004 versus 11.1% in 2003. The
following factors had a significant impact on contribution:

(i) Provider Services -

Contribution at our FertilityPartner program of $9.4 million in
2004 was $0.4 million, or 5.0% higher, than 2003 contribution of
$9.0 million. Contribution for 2003 includes $0.7 million from a
FertilityPartner agreement we terminated on June 2003, and $0.1
million from a the FertilityPartner in Charlotte, N.C., signed on
September 1, 2003. Results in 2004 also include contribution of
$0.3 million from our Charlotte, N.C., FertilityPartner, and $0.3
million from the FertilityPartner in Seattle, W.A., who joined our
network in January 2004. The five FertilityPartners who were
members of our network for the full reporting periods of 2003 and
2004 had contribution growth of $0.6 million, or 7.1% in 2004,
versus 2003. As with increases in revenue, we attribute much of
this growth to our consumer marketing efforts and laboratory
success rates.

Contribution from Affiliate clinics was $0.9 million for the year
ended December 31, 2005, up $0.4 million, or 77.7% from $0.5
million in the prior year. This increase is primarily the result
of membership fee increases instituted in January 2004.

(ii) Consumer Services -

Contribution from our Shared Risk Refund program was $1.0 million
for the twelve months ended December 31, 2004, an increase of $0.4
million, or 78.6%, from its 2003 level of $0.6 million. This
increase was the result of higher patient enrollment in the
program, coupled with pregnancy success rates which met or
exceeded, our expectations.

Pharmaceutical contribution was $0.5 million in 2004, was
approximately equal with contribution in 2003. Contribution growth
was hampered by our decision to de-emphasize the sale of certain
high volume products due to adverse product cost and pricing
issues within the market, which have since been resolved.

General and Administrative expenses were $9.8 million in 2004, up
approximately $1.0 million, or 11.7%, from $8.8 million in 2003. Increased
General and Administration costs were largely the result of additional marketing
expenses designed to boost patient volume at out FertilityPartner locations, as
well as costs associated with new regulatory compliance requirements. As a
percentage of revenue, General and Administrative expenses were 9.1% of revenues
in 2004, down slightly from 9.3% in 2003.

Interest income increased to $259,000 for the twelve months ended December
31, 2004, from $125,000 in 2003. This increase is primarily the result of to
interest earned on capital investments at several FertilityPartner clinics which
experienced new facility build-outs, or extensive facility expansions, in 2004.
Interest expense increased to $295,000 for the year ended December 31, 2004 from
$109,000 in 2003, primarily as a result of interest charges on the outstanding
portion of our revolving line of credit.

Our provision for income tax was approximately $0.8 million in 2004, and
$0.7 million in 2003. We made no Federal income tax payments in either 2004, or
2003, due to the utilization of net operating losses generated in prior years.
Our effective tax rate for 2004 was approximately 40.2%, which reflects a
provision for both state and Federal taxes.

Off-balance Sheet Arrangements

In December 2003, the FASB issued FASB Interpretation No. 46 (FIN 46R
revised December 2003), "Consolidation of Variable Interest Entities," ("VIE's")
which replaced FASB Interpretation No. 46, "Consolidation of Variable Interest
Entities," issued in January 2003. FIN 46R addresses how a business enterprise
should evaluate whether it has a controlling financial interest in an entity
through means other than voting rights and accordingly should consolidate the
entity. As part of our ongoing business, we do not participate in transactions
that generate relationships with unconsolidated entities or financial
partnerships, such as entities often referred to as structured finance or VIE's,
which would have been established for the purpose of facilitating off-balance
sheet arrangements or other contractually narrow or limited purposes. As of
December 31, 2005, we were not involved in any unconsolidated VIE transactions.

Liquidity and Capital Resources

As of December 31, 2005, we had approximately $22.5 million of cash and
cash equivalents on hand as compared to $11.3 million at December 31, 2004.
Additionally, we had working capital of approximately $6.7 million, at December
31, 2005, an increase of $6.4 million from working capital of $0.3 million as of
December 31, 2004. Our increased liquidity is partially attributed to our
renewed financing agreement with Bank of America which was signed December 23,
2005, and increased our term loan outstanding by approximately $6.8 million.

Shared Risk Refund patient deposits, which are reflected as a current
liability, represent funds received from patients in advance of treatment
cycles. These deposits, which represent prepayments of future revenues from
patients without full insurance coverage totaled approximately $4.7 million and
$2.8 million as of December 31, 2005 and 2004, respectively. These deposits are
a significant source of recurring cash flow and represent interest free
financing for us.

As of December 31, 2005, we did not have any significant contractual
commitments for the acquisition of fixed assets or construction of leasehold
improvements, however, we have budgeted upcoming capital expenditures of
approximately $3.0 million for 2006. These expenditures are primarily related to
the expansion of our existing FertilityPartners centers. We believe that working
capital and, specifically, cash and cash equivalents remain at adequate levels
to fund our operations. We also believe that the cash flows from our operations
plus our available credit facility will be sufficient to provide for our future
liquidity needs for the next twelve months.

In December 2005, we amended our existing credit facility with Bank of
America. The amended facility is comprised of a $10.0 million three-year
revolving line of credit and a $10.0 million 5 year term loan. As of December
31, 2005, the full $10.0 million of the term loan was outstanding with a
remaining term of 5 years. Proceeds of approximately $3.2 million from the new
term loan were used to repay the outstanding balance on our previous term loan
with Bank of America.

Each component of this amended credit facility bears interest by reference
to Bank of America's prime rate or LIBOR, at our option, plus a margin, which is
dependent upon a leverage test, ranging from 1.75% to 2.50% in the case of
LIBOR-based loans. Prime based loans are made at Bank of America's prime rate
and do not contain an additional margin. Interest on the prime-based loans is
payable monthly and interest on LIBOR-based loans is payable on the last day of
each applicable interest period. As of December 31, 2005, interest on both the
term loan and revolving credit line were payable at a rate of approximately
6.12%. Unused amounts under the working capital revolver bear a commitment fee
of 0.25% and are payable quarterly. Availability of borrowings under the working
capital revolver is based on eligible accounts receivable, as defined in the
credit agreement. As of December 31, 2005, under the revolving line of credit
the full amount of $10.0 million was available, of which none was outstanding.
The Bank of America credit facility is collateralized by all of our assets. As
of December 31, 2005, we were in full compliance with all applicable debt
covenants.

We are also continuously reviewing our credit agreements and may renew,
revise or enter into new agreements from time to time as deemed necessary.

Significant Contractual Obligations and Other Commercial Commitments:

The following summarizes our contractual obligations and other commercial
commitments at December 31, 2005, and the effect such obligations are expected
to have on our liquidity and cash flows in future periods.

Payments Due by Period
----------------------

Total Less than 1 year 1 - 3 years 4 - 5 years After 5 years
-------------- ---------------- ---------------- ----------- -------------

Notes Payable................. $10,000,000 $1,428,000 $ 2,858,000 $ 5,714,000 $ --
Capital lease obligations..... 147,000 72,000 75,000 -- --
Operating leases.............. 45,657,000 6,324,000 14,855,000 8,206,000 16,272,000
FertilityPartners capital and
other obligations......... 500,000 500,000 -- -- --
Total contractual cash
obligations............... $56,304,000 $8,324,000 $17,788,000 $13,920,000 $16,272,000

Amount of Commitment Expiration Per Period
------------------------------------------

Total Less than 1 year 1 - 3 years 4 - 5 years After 5 years
------------- ---------------- ------------- ------------- -------------

Lines of credit............... $ 10,000,000 $ -- $10,000,000 $ -- $ --

We also have commitments to provide working capital financing to our
FertilityPartners locations. A significant portion of this commitment is our
transactions with the medical practices themselves. Our responsibilities to the
medical practices are to provide financing for their accounts receivable and to
hold patient deposits on their behalf as well as undistributed physician
earnings. Disbursements to the medical practices generally occur on or before
the 20th business day of each month. The medical practice's repayment hierarchy
consists of the following:

(i) We provide a cash credit to the practice for billings to patients and
insurance companies;

(ii) We reduce the cash credit for clinic expenses that we have incurred on
their behalf;

(iii) We reduce the cash credit for the base portion of our Service Fee which
relates to the FertilityPartners revenues;

(iv) We reduce the cash credit for the variable portion of our Service Fee which
relates to the FertilityPartners earnings; and

(v) We disburse to the medical practice the remaining cash amount which
represents the physicians undistributed earnings.

We are also responsible for the collection of the FertilityPartners
accounts receivables, which we finance with full recourse. We continuously fund
these needs from our cash flow from operations and the collection of the prior
month's receivables. If delays in repayment are incurred, which have not as yet
been encountered, we could draw on our existing working capital line of credit.
We also make payments on behalf of the FertilityPartners for which we are
reimbursed in the short-term. Other than these payments, as a general course, we
do not make other advances to the medical practice. We have no other funding
commitments to the FertilityPartners.

New Accounting Pronouncements

Share-Based Payments

In December 2004, the FASB issued Statement of Financial Accounting
Standards (SFAS) No. 123R, "Share-Based Payment," which is a revision of SFAS
No. 123, "Accounting For Stock-Based compensation." SFAS 123R requires that all
share based compensation, including current grants and the unvested portion of
stock options previously issued, is to be recognized in the income statement
based on their fair value as of date of issue. This Statement is effective for
the fiscal year beginning January 1, 2006, and is expected to increase our
General and Administrative expense, and reduce pre-tax income by approximately
$87,000 for the year ending December 31, 2006, based on unvested stock options
currently outstanding.

Non-monetary Assets

In December 2004, the FASB issued Statement of Financial Accounting
Standards (SFAS) No. 153, "Exchanges of Non--monetary Assets - an amendment of
APB Opinion No. 29. SFAS 153 is based on the principle that exchanges of
non-monetary assets should be measured based on the fair value of the assets
exchanged. SFAS 153 eliminates the exception for non-monetary exchanges of
similar productive assets and replaces it with a general exception for exchanges
of non-monetary assets that do not have commercial substance. A non-monetary
exchange has commercial substance if the future cash flows of the entity are
expected to change significantly as a result of the exchange. SFAS 153 is
effective for non-monetary asset exchanges in fiscal periods beginning after
June 15, 2005. We do not believe the adoption of SFAS 153 will have a material
impact on our consolidated financial position, results of operations or cash
flows.

Accounting Changes

In May 2005, the FASB issued Statement of Financial Accounting Standards
(SFAS) No. 154, "Accounting Changes and Error Corrections" which replaces APB
Opinions No. 20 and SFAS No. 3. SFAS 154 provides guidance on the accounting for
and reporting of accounting changes and error corrections. It establishes
retrospective application, or the latest practicable date, as the required
method for reporting a change in accounting principle and the reporting of a
correction of an error. SFAS 154 is effective for accounting changes and
corrections of errors made in fiscal years beginning after December 15, 2005. We
do not believe the adoption of SFAS 154 will have a material impact on our
consolidated financial position, results of operations or cash flows.

Forward Looking Statements

This Form 10-K contains certain forward-looking statements regarding events
and/or anticipated results within the meaning of the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995, the attainment of which
involve various risks and uncertainties. Forward-looking statements may be
identified by the use of forward-looking terminology such as, "may", "will",
"expect", "believe", "estimate", "anticipate", "continue", or similar terms,
variations of those terms or the negative of those terms. Our actual results may
differ materially from those described in these forward-looking statements due
to the following factors: our ability to acquire additional FertilityPartners
agreements, including our ability to raise additional debt and/or equity capital
to finance future growth, the loss of significant FertilityPartners
agreement(s), the profitability or lack thereof at fertility centers serviced
us, increases in overhead due to expansion, the exclusion of fertility and ART
services from insurance coverage, government laws and regulation regarding
health care, changes in managed care contracting, the timely development of and
acceptance of new fertility, and ART and/or genetic technologies and techniques,
as well as the other risk factors set forth in Item 1A of this annual report.

ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk

Our interest expense is sensitive to changes in the general level of
interest rates. At December 31, 2005 we had an oustanding balance of $10,000,000
on our term loan. This borrowing has a remaining term of approximately 5 years,
and bears interest at either the Prime Rate, or at LIBOR plus a margin. As of
December 31, 2005, this borrowing had an interest rate of approximately 6.12%. A
one percent change in interest rates would impact our pre-tax and net income by
less than $10,000. As of December 31, 2005, we have not entered into any
interest rate swap transactions.

ITEM 8. Financial Statements and Supplementary Data

See Index to Financial Statements on page F-1.

ITEM 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure

In the first quarter of 2005, we hired the firm of Amper, Politziner &
Mattia to provide professional independent public accounting services. This
change from our previous independent public accounting firm of
PricewaterhouseCoopers, LLP, was the result of a competitive process directed by
our Audit Committee which was designed to ensure that we receive the highest
level of professional services at competitive rates. We had no disagreements
with PricewaterhouseCoopers, LLP.

ITEM 9A. Controls and Procedures

Disclosure controls and procedures are defined by the Securities and
Exchange Commission as those controls and other procedures that are designed to
ensure that information required to be disclosed in the Company's filings under
the Securities Exchange Act of 1934 is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commission's rules and forms. The Company's Chief Executive Officer and Chief
Financial Officer have evaluated the Company's disclosure controls and
procedures as of December 31, 2005, and, based on the material weakness in our
internal control over financial reporting described below, have determined that

such disclosure controls and procedures were ineffective. In response to this
material weakness, management performed additional analysis and other procedures
to ensure that our consolidated financial statements included in this Form 10-K
were prepared in accordance with generally accepted accounting principles.
Accordingly, management, including our Chief Executive Officer and Chief
Financial Officer, believes that the consolidated financial statements included
in this Form 10-K fairly present in all material respects our financial
condition, results of operations and cash flows for the periods presented.

Our management is responsible for establishing and maintaining adequate
internal control over financial reporting as defined in Rule 13a-15(f) under the
Exchange Act. Our internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. Because of its
inherent limitations, internal control over financial reporting may not prevent
or detect material misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with policies and procedures may deteriorate.

A material weakness is a significant deficiency, or combination of
significant deficiencies, that results in more than a remote likelihood that a
material misstatement of the annual or interim financial statements will not be
prevented or detected. As of the end of the period covered by this Form 10-K, we
identified the following material weakness in our internal control over
financial reporting: a lack of sufficient oversight over and the proper
segregation of duties with respect to the processes of initiating, authorizing,
recording and processing certain period end closing transactions, as well as the
design effectiveness of related fraud detection controls at one of our
FertilityPartner locations.

We have evaluated the processes related to period end closing transactions
at our other locations and have found the control weakness is isolated to the
one FertilityPartner location.

To remediate the material weakness referred to above, we are in the process
of making personnel changes and changes in assigned roles and responsibilities,
which we believe will correct the control weaknesses we have identified.

Other than the changes referred to above, there has been no change in the
Company's internal control over financial reporting during the fourth quarter
ended December 31, 2005, that has materially affected, or is reasonably likely
to materially affect, the Company's internal control over financial reporting.

ITEM 9B. Other Information

None.

PART III

ITEM 10. Directors and Executive Officers of the Registrant

The information required by this Item is incorporated by reference to the
applicable information in the definitive proxy statement for our 2006 annual
meeting of shareholders, which is to be filed with the SEC within 120 days after
our fiscal year end.

ITEM 11. Executive Compensation

ITEM 12. Security Ownership of Certain Beneficial Owners and Management, and
Related Stockholder Matters

ITEM 13. Certain Relationships and Related Transactions

ITEM 14. Principal Accountant Fees and Services

PART IV

ITEM 15. Exhibits and Financial Statement Schedule

(a) (1) Financial Statements.

(2) The exhibits that are listed on the Index to Exhibits
herein which are filed herewith as a management agreement
or compensatory plan or arrangement are: 3.2 (d); 10.21
(e); 10.23 (h); and 10.24 (l).

(b)Exhibits. The list of exhibits required to be filed with this Annual
Report on Form 10-K is set forth in the Index to Exhibits herein.

FINANCIAL STATEMENTS

Item 8 and 15 (a)(1)

Contents

Page
INTEGRAMED AMERICA, INC.

Report of Independent Registered Public Accounting Firm - 2005.... F-2
Reports of Independent Registered Public Accounting Firm - 2004
and 2003........................................................ F-2
Consolidated Balance Sheets as of December 31, 2005 and 2004...... F-3
Consolidated Statements of Operations for the years ended
December 31, 2005, 2004 and 2003............................... F-4
Consolidated Statements of Shareholders' Equity for the
years ended December 31, 2005, 2004 and 2003................... F-5
Consolidated Statements of Cash Flows for the years ended
December 31, 2005, 2004 and 2003............................... F-6
Notes to Consolidated Financial Statements........................ F-7

FINANCIAL STATEMENT SCHEDULE

Reports of Independent Registered Public Accounting Firm
on Financial Statement Schedule II............................. S-1
Valuation and Qualifying Accounts................................. S-2

F-1

Report of Independent Registered Public Accounting Firms

To the Board of Directors and Shareholders of
IntegraMed America, Inc.:

In our opinion, financial statements listed in the accompanying index present
fairly, in all material respects, the financial position of IntegraMed America,
Inc. and its subsidiaries at December 31, 2004 and 2003, and the results of
their operations and their cash flows for each of the two years in the period
ended December 31, 2004 in conformity with accounting principles generally
accepted in the United States of America. In addition, in our opinion, the
financial statement schedule listed in the index appearing under Item 8 and 15
(a) (1) presents fairly, in all material respects, the information set forth
therein when read in conjunction with the related consolidated financial
statements. These financial statements and financial statement schedule are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements and financial statement schedule based on
our audits. We conducted our audits of these statements in accordance with the
standards of the Public Company Accounting Oversight Board (United States).
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

Boston, Massachusetts
February 16, 2005, except for Note 3 as to which the date is March 24, 2006 and
except for the effects of a stock split described in Note 12 as to which the
date is March 24, 2006

To the Board of Directors and Shareholders of
IntegraMed America, Inc.:

We have audited the accompanying consolidated balance sheet of IntegraMed
America, Inc. as of December 31, 2005, and the related consolidated statement of
operations, shareholders' equity, and cash flows for the year ended December 31,
2005. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of IntegraMed America,
Inc., at December 31, 2005, and the results of its operations and its cash flows
for the year ended December 31, 2005, in accordance with accounting principles
generally accepted in the United States of America.

/s/Amper, Politziner & Mattia, P.C.

Edison, New Jersey
March 23, 2006

F-2

INTEGRAMED AMERICA, INC.
CONSOLIDATED BALANCE SHEETS
(all amounts in thousands, except share amounts)

December 31,
-------------------
2005 2004
--------- -------
ASSETS

Current assets:
Cash and cash equivalents ........................................................ $ 22,521 $ 11,300
Pharmaceutical and other receivables, net ........................................ 490 1,346
Deferred income taxes, net ....................................................... 1,080 1,950
Prepaids and other current assets ................................................ 2,768 2,043
-------- --------
Total current assets ......................................................... 26,859 16,639

Fixed assets, net ................................................................ 14,877 14,868
Exclusive Service Rights and other intangibles, net .............................. 22,434 20,519
Deferred income taxes, net ....................................................... 815 1,366
Other assets ..................................................................... 590 410
-------- --------
Total assets ................................................................. $ 65,575 $ 53,802
======== ========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable ................................................................. $ 917 $ 519
Accrued liabilities .............................................................. 8,023 7,451
Current portion of long-term notes payable and other obligations ................. 1,500 2,218
Due to medical practices ......................................................... 4,949 3,378
Shared Risk Refund program patient deposits ...................................... 4,739 2,772
-------- --------
Total current liabilities .................................................... 20,128 16,338

Long-term notes payable and other obligations ....................................... 8,647 3,021
-------- --------

Total Liabilities ................................................................... 28,775 19,359

Commitments and Contingencies

Shareholders' equity:
Common Stock, $.01 par value - 15,000,000 shares authorized in 2005 and 2004
respectively; 5,102,627 and 4,741,467 shares issued and
outstanding in 2005 and 2004, respectively ..................................... 51 47
Capital in excess of par ......................................................... 49,747 48,456
Deferred Compensation ............................................................ (354) (293)
Treasury stock, at cost - 105,768 and 52,711 shares in 2005 and 2004, respectively (937) (337)
Accumulated deficit .............................................................. (11,707) (13,430)
-------- --------
Total shareholders' equity ................................................... 36,800 34,443
-------- --------

Total liabilities and shareholders' equity ................................... $ 65,575 $ 53,802
======== ========

See accompanying notes to the consolidated financial statements.

F-3

INTEGRAMED AMERICA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(all amounts in thousands, except per share amounts)

For the years ended December 31,
----------------------------------
2005 2004 2003
-------- ------- --------

Revenues, net
Provider Services ..................... $ 106,310 $ 87,367 $ 74,971
Consumer Services ..................... 22,580 20,286 18,719
--------- --------- ---------
Total revenues ................... 128,890 107,653 93,690

Costs of services and sales:
Provider Services costs ............... 94,849 77,099 65,539
Consumer Services costs ............... 19,240 18,746 17,694
--------- --------- ---------
Total costs of services and sales .. 114,089 95,845 83,233
--------- --------- ---------

Contribution
Provider Services contribution ........ 11,461 10,268 9,432
Consumer Services contribution ........ 3,340 1,540 1,025
--------- --------- ---------
Total contribution ................. 14,801 11,808 10,457

General and administrative expenses ...... 12,205 9,789 8,761
Interest income .......................... (520) (259) (125)
Interest expense ......................... 328 295 109
--------- --------- ---------
Total other expenses .................. 12,013 9,825 8,745
--------- --------- ---------

Income before income taxes ............... 2,788 1,983 1,712
Income tax provision ..................... 1,065 797 668
--------- --------- ---------

Net income ............................... $ 1,723 $ 1,186 $ 1,044
========= ========= =========

Basic and diluted net earnings per share :
Basic earnings per share ............ $ 0.36 $ 0.26 $ 0.24
========= ========= =========
Diluted earnings per share .......... $ 0.34 $ 0.25 $ 0.22
========= ========= =========

Weighted average shares - basic ..... 4,839 4,620 4,437
========= ========= =========
Weighted average shares - diluted ... 5,003 4,831 4,662
========= ========= =========

See accompanying notes to the consolidated financial statements.

F-4

INTEGRAMED AMERICA, INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(all amounts in thousands)

Common Stock Capital in Accumulated Treasury Stock Deferred Total
Shares Amount Excess of Par Deficit Shares Amount Compensation Equity
------ ------ ------------- ------- ------ ------ ------------ ------

BALANCE AT DECEMBER 31, 2002 4,360 $44 $47,172 $(15,660) -- $ -- $ -- $31,556
Issuance of Restricted Stock Grants 75 1 417 -- -- -- (440) (22)
Stock grant amortization -- -- -- -- -- -- 125 125
Options and warrants exercised 172 1 146 -- -- -- -- 147
Treasury Stock transactions, net -- -- 426 -- 90 (426) -- --
Net income for the year ended 12/31/2003 -- -- -- 1,044 -- -- -- 1,044
----- -- ------ ------- -- ---- ---- ------

BALANCE AT DECEMBER 31, 2003 4,607 46 48,161 (14,616) 90 (426) (315) 32,850
Issuance of Restricted Stock Grants 43 -- 211 -- -- -- (219) (8)
Stock grant amortization -- -- -- -- -- -- 241 241
Options and warrants exercised 273 2 907 -- -- -- -- 909
Treasury Stock transactions, net (182) (1) (823) -- (49) 89 -- (735)
Net income for the year ended 12/31/04 -- -- -- 1,186 -- -- -- 1,186
----- -- ------ ------- -- ---- ---- ------

BALANCE AT DECEMBER 31, 2004 4,741 47 48,456 (13,430) 41 (337) (293) 34,443
Issuance of Restricted Stock Grants 52 1 436 -- -- -- (451) (14)
Stock grant amortization -- -- -- -- -- -- 390 390
Options and warrants exercised 308 3 855 -- -- -- -- 858
Treasury Stock transactions, net 2 -- -- -- 65 (600) -- (600)
Net income for the year ended 12/31/05 -- -- -- 1,723 -- -- -- 1,723
----- -- ------ ------- -- ---- ---- ------

BALANCE AT DECEMBER 31, 2005 5,103 $ 51 $49,747 $(11,707) 106 $(937) $(354) $36,800
===== === ======= ======== === ==== ===== =======

See accompanying notes to the consolidated financial statements.

F-5

INTEGRAMED AMERICA, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(all amounts in thousands)

For the years ended December 31,
-----------------------------------
2005 2004 2003
------- --------- ---------

Cash flows from operating activities:
Net income ..................................................... $ 1,723 $ 1,186 $ 1,044
Adjustments to reconcile net income to
Net cash provided by operating activities:
Depreciation and amortization ................................ 5,373 4,239 3,342
Deferred income tax provision ................................ 1,421 427 537
Deferred compensation ........................................ 390 241 125
Changes in assets and liabilities Decrease (increase) in assets:
Pharmaceutical and other accounts receivable .............. 856 201 108
Prepaids and other current assets ......................... (725) 1,214 (699)
Other assets .............................................. (180) (132) 1
Increase (decrease) in liabilities:
Accounts payable .......................................... 398 (741) (656)
Accrued liabilities ....................................... 531 3,269 (1,172)
Due to medical practices .................................. 1,571 4,364 (2,140)
Shared Risk Refund program patient deposits ............... 1,967 1,149 848
-------- -------- --------
Net cash provided by operating activities .......................... 13,325 15,417 1,338
-------- -------- --------
Cash flows from investing activities:
Payment for exclusive FertilityPartners service rights ......... (3,329) (1,203) (2,290)
Acquisition of trademark rights ................................ -- (38) --
Proceeds from sale of fixed assets ............................. -- -- 395
Proceeds from sale of intangible assets ........................ -- -- 136
Purchase of fixed assets and leasehold improvements ............ (3,968) (7,662) (7,635)
-------- -------- --------
Net cash used in investing activities .............................. (7,297) (8,903) (9,394)
-------- -------- --------
Cash flows from financing activities:

Issuance of Debt ............................................... 10,000 -- 8,028
Principal repayments on debt ................................... (5,026) (2,213) (1,884)
Principal repayments under capital lease obligations ........... (66) (59) (43)
Exercise of common stock options and warrants .................. 285 173 147
-------- -------- --------
Net cash (used in) provided by financing activities ................ 5,193 (2,099) 6,248
-------- -------- --------
Net increase (decrease) in cash and cash equivalents ............... 11,221 4,415 (1,808)
Cash and cash equivalents at beginning of period ................... 11,300 6,885 8,693
-------- -------- --------
Cash and cash equivalents at end of period ......................... $ 22,521 $ 11,300 $ 6,885
======== ======== ========

See accompanying notes to the consolidated financial statements.

F-6

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -- THE COMPANY:

NOTE 2 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Basis of consolidation --

The consolidated financial statements comprise the accounts of IntegraMed
America, Inc. and its wholly owned subsidiaries. We principally derive our
revenues from contracts with fertility centers, fees from patients enrolling in
our Shared Risk Refund program and the sale of pharmaceutical products. We do
not have a controlling financial interest in any of the medical practices to
which we provide services and as such do not consolidate their results.

Financial Statement reclassifications --

Stock split effected in the form of a stock dividend --

In June 2005, we issued 1,129,141 shares of Common Stock as a 30% stock
split effected in the form of a stock dividend. Where applicable we have
restated our capital accounts, shares outstanding, weighted average shares and
earnings per share calculations for all years in these financial statements and
related footnotes to reflect this transaction.

Revenue and cost recognition --

FertilityPartners service fees

Affiliate Service Fees

F-7

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Shared Risk Refund Program

The Shared Risk Refund program consists of a fertility treatment package
that includes a fixed number of treatment cycles for one fixed price with a
significant refund if the patient does not take home a baby. We receive payment
directly from consumers who qualify for the program and pay contracted fertility
centers a defined reimbursement for each treatment cycle performed. Partial
revenue is recorded upon the initiation of treatment, with remaining revenues
recorded upon patient's becoming pregnant. A reserve is maintained for
potentially refundable amounts if patients do not take home a baby. This reserve
is calculated based on the clinical outcomes of current and former patients
enrolled in the program and had a balance of $293,000 and $171,000 as of
December 31, 2005 and 2004, respectively. Expenses related to the program are
recorded as incurred.

Pharmaceutical Sales

Revenues and related expenses from pharmaceutical sales are recorded upon
shipment to customers. Prior to October 1, 2005, these revenues represented the
actual sales value of the pharmaceuticals sold and we recorded cost of sales
equal to the product cost. Subsequent to October 1, 2005 our revenues are
comprised of marketing fees related to these pharmaceutical sales, and we not
longer have a cost of sales component.

This change in the composition of our revenues and costs was a result of a
contractual change in the way we manage our pharmaceutical business. Through
September 30, 2005, we marketed pharmaceutical products directly to patients
throughout our network and we had contracted with ivpcare, inc., to provide
certain business services related to the distribution of and accounting for
these sales. Effective October 1, 2005, this agreement was terminated and
replaced by a new agreement between us and ivpcare, inc. Under the terms of the
new agreement, we are no longer a direct distributor of pharmaceutical products
to patients as this function is being performed directly by ivpcare. Our
responsibilities are limited to marketing the products for which we will be
compensated. This compensation will approximate our previous contribution from
those pharmaceutical sales and services, and will be shown on a "net" rather
than "gross" basis. As a result, as of October 1, 2005, we no longer record
pharmaceutical sales, the related cost of sales and other costs related to
pharmaceutical distribution. We anticipate a significant decrease in revenues
and cost of sales; however (assuming the same volume of pharmaceutical products
is distributed) contribution from operations and income before income taxes, as
well as net income, will be virtually unaffected by this contract change.

Patient Financing

A fertility treatment cycle can be an expensive process for which many
patients do not have full medical insurance coverage. As a service to these
patients, we can arrange financing to qualified patients of our network at rates
significantly lower than credit cards and other finance companies. Our financing
operations are administered by a third party vendor and loans are made to
qualified patients by an independent bank or finance organization. We are not at
risk for loan losses and receive a placement fee from the lender involved. Since
many financing transactions are closely associated with our Shared Risk Refund
program, financing revenues, which we receive and record at the time the loans
are closed, are reported as part of that program.

Use of Estimates -

Due to Medical Practices --

F-8

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Exclusive Service Rights --

Exclusive service rights represent payments we made for the right to
service certain fertility centers and are valued at cost less accumulated
amortization, which is provided on a straight-line basis over the service length
of the contract, usually ten to twenty-five years. We periodically review our
exclusive business service rights to assess recoverability; a charge would be
recognized in the consolidated statement of operations if an impairment was
determined to have occurred. Recoverability is determined based on undiscounted
expected earnings from the related business over the remaining amortization
period.

Long Lived Assets --

Cash and cash equivalents --

Cash and cash equivalents primarily include all highly liquid debt
instruments with original maturities of three months or less, recorded at cost,
which approximates market.

Stock based employee compensation --

We follow Financial Accounting Standards No. 123, "Accounting for Stock
Based Compensation" (FAS 123). Under FAS 123, companies can, but are not
required to, elect to recognize compensation expense for all stock based awards,
using a fair value method.

We account for our stock option plans under the recognition and measurement
principles of APB Opinion No. 25, Accounting for Stock Issued to Employees, and
related Interpretations. Under this standard, no stock option-based employee
compensation cost is reflected in net income, as all options granted under the
plans had an exercise price equal to the market value of the underlying common
stock on the date of grant. Effective January 1, 2003, we adopted the fair value
recognition provisions of FAS No. 148. Under the Prospective transition method
we selected, fair value accounting is applied to all new stock grants and
modifications to old grants since January 1, 2003. Disclosure of pro-forma net
income and EPS is continued for any pre-adoption grants.

The following table illustrates the effect on net income and earnings per
share as if we had applied the fair value recognition provisions of FASB No.
123, Accounting for Stock-Based Compensation, to stock-based employee
compensation. (000's omitted, except per share amounts). There were no stock
options issued during fiscal years 2005, 2004 or 2003.

F-9

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For the
twelve-month period
ended December 31,
---------------------------------
2005 2004 2003
------- ------- -------

Net Income, as reported....................................... $1,723 $1,186 $1,044

Add: Stock-based employee compensation expense
included in reported net income, net of related tax
effects....................................................... 233 144 76

Deduct: Total stock-based employee compensation
expense determined under fair value based method
for all awards, net of related tax effects.................... (409) (388) (383)
------- ------ ------

Pro forma net income.......................................... $1,547 $ 942 $ 737
====== ====== ======

Earnings per share:
Basic-as reported........................................ $0.36 $0.26 $0.24
===== ===== =====
Basic-pro forma.......................................... $0.32 $0.20 $0.17
===== ===== =====

Diluted-as reported...................................... $0.34 $0.25 $0.22
===== ===== =====
Diluted-pro forma........................................ $0.31 $0.20 $0.16
===== ===== =====

The above stock-based employee compensation values represent the vesting of
options issued prior to 2003. As no options have been issued during the
reporting period, disclosures for the weighted average fair value of options
granted, dividend yield, volatility, risk free rate and expected term are all
either zero or not applicable.

Concentrations of credit risk --

Financial instruments, which potentially expose us to concentrations of
credit risk consist primarily of pharmaceutical and other trade receivables
which totaled $606,000 and $1,505,000 as of December 31, 2005 and 2004
respectively. Our related reserves for uncollectible accounts totaled $116,000
and $159,000 as of December 31, 2005 and 2004 respectively.

Income taxes --

We account for income taxes utilizing the asset and liability approach in
accordance with Financial Accounting Standards No. 109, "Accounting For Income
Taxes" (FAS 109). Deferred tax assets and liabilities are recognized on
differences between the book and tax basis of assets and liabilities using
presently enacted tax rates. The income tax provision is the sum of the amount
of income tax paid or payable for the year as determined by applying the
provisions of enacted tax laws to the taxable income for that year and the net
change during the year in the Company's deferred tax assets and liabilities.
(See Note10).

Earnings per share --

We determine earnings per share in accordance with Financial Accounting
Standards No. 128, "Earnings Per Share" (FAS 128). Basic earnings per share is
calculated by dividing net income by the weighted average number of common
shares outstanding during the reporting period. Diluted earnings per share is
calculated by dividing net income by the weighted average number of common
shares, and potential common shares, outstanding during the reporting period
(See Note 11).

F-10

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Fair value of financial instruments --

The fair value of a financial instrument, such as notes payable, represents
the amount at which the instrument could be exchanged in a current transaction
between willing parties, other than in a forced sale or liquidation. Significant
differences can arise between the fair value and carrying amounts of financial
instruments that are recorded at historical cost amounts. We believe that the
carrying amounts of cash and cash equivalents, our accounts receivable and
accounts payable approximate fair value due to their short-term nature.

The carrying amount of our long-term liabilities approximates the fair
value of such instruments based upon our best estimate of interest rates that
would be available to us for similar debt obligations with similar maturities as
of December 31, 2005 and 2004.

New accounting pronouncements --

Share-Based Payments

Non-monetary Assets

Accounting Changes

F-11

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 -- SEGMENT INFORMATION:

Fertility Shared
Corporate Partners Affiliates Risk Pharmaceutical Consolidated
--------- -------- ---------- ---- ---------------------------

F-12

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4 -- SIGNIFICANT SERVICE CONTRACTS:
For the years ended December 31, 2005, 2004, and 2003 the following
fertility centers each individually provided greater than 10% of the Company's
Revenues, net and/or contribution as follows:

Percent of Company Percent of
Revenues, net Contribution
--------------------------- ---------------------------
2005 2004 2003 2005 2004 2003
------- ------ ------ ------- ------ ------

R.S.C. of Boston............... 9.6 11.3 10.4 10.8 13.4 13.9
Fertility Centers of Illinois.. 20.2 25.6 27.9 11.6 22.3 26.4
Shady Grove Fertility Center... 21.1 21.5 20.7 21.4 24.9 25.0

NOTE 5 -- EXCLUSIVE SERVICE RIGHTS AND OTHER INTANGIBLES:

Exclusive Service Rights and other intangibles at December 31, 2005 and
2004 consisted of the following (000's omitted):
2005 2004
------ ------

Exclusive Service rights........... $30,609 $27,280
Trademark rights................... 38 38
Less accumulated amortization...... (8,213) (6,799)
------ -------
Total.......................... $22,434 $20,519
======= =======

For the twelve months ended December 31, 2005 and 2004, amortization
expense related to our Exclusive Service Rights totaled approximately $1.4
million and $1.2 million, respectively. We do not amortize our Trademark Rights
as they have an indefinite useful life.

Amortization expense of our Exclusive Service Rights in future years are as
follows (000's omitted):

2006........................................... $ 1,414
2007........................................... 1,406
2008........................................... 1,398
2009........................................... 1,397
2010........................................... 1,397
Thereafter..................................... 15,384
-------
Total payments................................. $22,396
=======

On January 1, 2005, we acquired the right to provide business services to
Reproductive Partners Medical Group, Inc., a six physician fertility practice in
the Southern California area, for $3.3 million in cash.

On September 1, 2004, we acquired the right to provide business services to
Seattle Reproductive Medicine, Inc., P.S., a four physician fertility practice
in the Seattle, Washington area, for $1.2 million in cash.

NOTE 6 -- FIXED ASSETS, NET:

Fixed assets, net at December 31, 2005 and 2004 consisted of the following
(000's omitted):
2005 2004
------ ------

Furniture, office and computer equipment........... $8,460 $6,254
Medical equipment.................................. 4,902 4,425
Leasehold improvements............................. 15,484 14,199
Assets under capital leases........................ 810 810
------- -------
Total............................................ 29,656 25,688
Less -- Accumulated depreciation and amortization..(14,779) (10,820)
------- -------
$14,877 $14,868
======= =======

F-13

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Our fixed assets are depreciated on a straight line basis. We generally
assign useful lives of five years to assets classified as furniture, fixtures,
office and medical equipment. Assets classified as computer hardware and
software are generally assigned a three year useful life and leasehold
improvements are depreciated over the lesser of their useful life, or the term
of the lease.

Depreciation expense on fixed assets for the years ended December 31, 2005
and 2004 was $3,959,000, and $3,012,000, respectively. Assets under capital
leases primarily consist of computer and medical equipment. Accumulated
amortization related specifically to capital leases at December 31, 2005 and
2004 was $674,000 and $603,000, respectively.

NOTE 7 -- ACCRUED LIABILITIES:

Accrued liabilities at December 31, 2005 and 2004 consisted of the
following (000's omitted):

2005 2004
------ ------

Accrued costs on behalf of Medical Practices....... $2,760 $2,689
New physician recruitment commitment............... 243 50
Reserves for estimated Shared Risk patient refunds. 714 533
Accrued incentives and benefits.................... 2,223 1,536
Accrued state taxes................................ 109 481
Accrued rent ...................................... 755 642
Accrued professional fees.......................... 526 316
Malpractice insurance deposits..................... 13 398
Business insurance reserve......................... 125 114
Other.............................................. 555 692
------ ------
Total accrued liabilities.......................... $8,023 $7,451
====== ======

NOTE 8 - DUE TO MEDICAL PRACTICES

Due to Medical Practices is comprised of the net amounts owed by us to
medical practices contracted as FertilityPartners. This balance is comprised of
amounts due to us by the medical practices for funds which we advanced for use
in financing their accounts receivable, less balances owed to the medical
practices by us for undistributed physician earnings and patient deposits we
hold on behalf of the medical practices.

As of December 31, 2005 and December 31, 2004, Due to Medical Practices was
comprised of the following balances:

2005 2004
------- -------

Advances to FertilityPartners.............. $(12,727) $(12,073)
Undistributed Physician Earnings........... 3,721 4,030
Physician practice patient Deposits........ 13,955 11,421
-------- --------
Due to Medical Practices, net.............. $ 4,949 $ 3,378
======== ========

F-14

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9 -- NOTES PAYABLE AND OTHER OBLIGATIONS:

Debt at December 31, 2005 and 2004 consisted of the following (000's
omitted):

2005 2004
-------- --------

Note payable to bank ........................ $ 10,000 $ 5,025
Obligations under capital lease ............. 147 214
-------- --------

Total notes payable and other obligations ... $ 10,147 $ 5,239
Less -- Current portion ..................... (1,500) (2,218)
-------- --------

Long-term notes payable and other obligations $ 8,647 $ 3,021
======== ========

Note payable to Bank --

We consider our cash flow leverage ratio requiring that EBITDA (earnings
before interest, taxes, depreciation and amortization) maintain a minimum ratio
relative to our outstanding debt, to be our most restrictive debt covenant. In
addition to cash flow leverage, our EBITDA measurement also forms the basis of
additional covenants.

Debt Maturities --

At December 31, 2005, aggregate note payments, including capital lease
obligation payments, in future years were as follows (000's omitted):

2006........................................... $ 1,500
2007........................................... 1,504
2008........................................... 1,429
2009........................................... 1,429
2010........................................... 4,285
Thereafter..................................... --
-------

Total payments................................. $10,147
=======

F-15

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Leases --

Our capital lease obligation relates to computer and medical equipment
acquired for certain FertilityPartners.

We maintain operating leases for our corporate headquarters and for medical
office space for our FertilityPartners centers. We also have operating leases
covering certain medical equipment. Aggregate rental expense under operating
leases was approximately $8.0 million, $7.0 million, and $4.8 million, for the
years ended December 31, 2005, 2004 and 2003, respectively.

At December 31, 2005, the minimum lease payments for assets under capital
and non-cancelable operating leases in future years were as follows (000's
omitted):
Capital Operating
------- ---------

2006 ................................... 78 6,324
2007 ................................... 77 5,651
2008 ................................... -- 4,924
2009 ................................... -- 4,280
2010 ................................... -- 4,150
Thereafter ............................. -- 20,328
------- -------
Total minimum lease payments ........... $ 155 $45,657
=======
Less -- Amount representing interest ... 8
-------
Present value of minimum lease payments $ 147
=======

NOTE 10 -- INCOME TAXES

The provision for income taxes consisted of:

For the years ended December 31,
--------------------------------
2005 2004 2003
------- ------- -------
Current taxes (benefits):
Federal ................ $ (393) $ 199 $ --
State .................. 37 172 104
------- ------- -------
Total Current Taxes .. $ (356) $ 371 $ 104
------- ------- -------

Deferred taxes (benefits):
Federal ................ $ 1,247 $ 399 $ 599
State .................. 174 27 (35)
------- ------- -------
Total Deferred Taxes . $ 1,421 $ 426 $ 564
------- ------- -------

Total tax provision ...... $ 1,065 $ 797 $ 668
======= ======= =======

The financial statement income tax provision differed from income taxes
determined by applying the statutory federal income tax rate to the financial
statement income before income taxes for the years ended December 31, 2005, 2004
and 2003 primarily as a result of the following (000's omitted):

For the years ended December 31,
-------------------------------
2005 2004 2003
------ ------ -------

Tax expense at Federal statutory rate ....... $ 948 $ 683 $ 582
State income taxes, net of federal tax effect 138 111 60
Non-deductible expenses ..................... 60 15 34
Write-off of deferred tax assets ............ 338 407 --
Other ....................................... -- (12) (8)
Change in valuation allowance ............... (419) (407) --
------- ------- -------
Income tax expense .......................... $ 1,065 $ 797 $ 668
======= ======= =======

F-16

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Significant components of the deferred tax assets (liabilities) at December
31, 2005 and 2004 were as follows (000's omitted):

December 31,
---------------------
2005 2004
------ ------
Deferred tax assets
Net operating loss carry forwards...... $3,299 $3,991
Temporary book to tax differences...... 756 1,203
Other.................................. 660 328
------ ------
Total deferred tax assets.......... 4,715 5,522
------ ------
Deferred tax liabilities
Depreciation and amortization.......... (1,993) (1,019)
Other.................................. (59) --
------ ------
Total deferred tax liabilities..... (2,052) (1,019)
------ ------
Deferred tax asset....................... 2,663 4,503
Valuation allowance...................... (768) (1,187)
------ ------
Net total deferred tax asset............. $1,895 $3,316
====== ======

At December 31, 2005, we had Federal net operating loss carry forwards of
approximately $9.7 million, which expire in 2005 through 2019. For tax purposes,
we have an annual limitation of approximately $1.5 million on the utilization of
these loss carry forwards. For the years ended December 2005, 2004 and 2003, we
were able to utilize net operating loss carry forwards of approximately $0.6
million, $1.5 million and $1.0 million, respectively. Valuation allowances have
been recorded for net operating loss carry forwards that may expire prior to
utilization due to the annual limitation or for lack of sufficient taxable
income. Our Valuation Allowances were calculated based upon projected taxable
income, the amount of our loss carry forwards and their expiration date, all
subject to the annual limitation. As a result of the expected utilization of our
net operating loss carry forwards, we anticipate that our future cash outlays
for tax payments will be less than our reported tax expense.

NOTE 11 - EARNINGS PER SHARE:

The reconciliation of the numerators and denominators of the basic and
diluted EPS computations for the years ended December 31, 2005, 2004 and 2003 is
a follows (000's omitted, except for per share amounts):

For the years ended December 31,
--------------------------------
2005 2004 2003
------ ------ ------
Numerator
Net Income ................................... $1,723 $1,186 $1,044
====== ====== ======
Denominator
Weighted average shares outstanding .......... 4,839 4,620 4,437
Effect of dilutive options and warrants ...... 164 211 225
------ ------ ------
Weighted average shares and dilutive potential
Common shares .............................. 5,003 4,831 4,662
====== ====== ======
Basic earnings per common share .............. $ 0.36 $ 0.26 $ 0.24
====== ====== ======
Diluted earnings per common share ............ $ 0.34 $ 0.25 $ 0.22
====== ====== ======

For the years ended December 31, 2005 and 2004, there were no outstanding
options to purchase shares of common stock which were excluded from the
computation of the diluted earnings per share amount as the exercise price of
all outstanding options was less than the average market price of the shares of
common stock. For the year ended December 31, 2003, options to purchase
approximately 119,500 shares of common stock at exercise prices ranging from
$5.98 to 6.15 per share were excluded in computing the diluted per share amounts
as they were anti-dilutive.

For the year ended December 31, 2005, there were no outstanding warrants to
purchase shares of common stock which were excluded from the computation of the
diluted earnings per share amount as the exercise price of all outstanding
warrants were less than the average market price of the shares of common stock.

F-17

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For the years ended December 31, 2004 and 2003, warrants to purchase
approximately 49,600 and 105,600 shares, respectively, of common stock at
exercise prices ranging from $9.00 and $6.25 to $9.00 per share, respectively,
were excluded in computing the diluted per share amounts as they were
anti-dilutive.

NOTE 12 -- SHAREHOLDERS' EQUITY:

During 2005, 2004 and 2003, we issued 40,200, 33,000 and 58,345 shares,
respectively, of restricted common stock as deferred compensation to several of
our officers and directors for an aggregate amount of $437,000, $211,000 and
$417,000 respectively. These shares were valued at their fair value on the date
of grant, and are amortized to expense over their vesting period.

During 2005 and 2004, we received 65,221 and 83,708, respectively, shares
of our common stock in consideration for the exercise of common stock options on
behalf of various officers and individuals. These shares were received in lieu
of cash for the exercise price of the options pursuant to terms allowed under
our stock option plans. As of the dates the underlying options were exercised,
these shares were valued at approximately $600,000 and $688,000, respectively,
and were accounted for as Treasury Stock.

During 2005, we issued 1,129,141 shares of common stock as a 30% stock
split effected in the form of a stock dividend to current holders of our stock.
The issuance of these shares had no direct financial impact on our results of
operations or financial position and did not alter the market capitalization of
our common shares outstanding. All share and per share data have been adjusted
as applicable for all periods presented to reflect this stock dividend.

During 2004, our Board of Directors authorized the retirement of 140,116
shares of common stock held as Treasury Shares. These shares were cancelled by
our transfer agent in early 2005.

During 2003, we issued 44,970 shares of common stock as Treasury Stock in
conjunction with the income tax withholdings on stock awards granted to officers
during the years 2003 and 2002.

As of December 31, 2005, 2004 and 2003, warrants to purchase an aggregate
of 14,561, 52,240 and 105,600, respectively, shares of common stock were
outstanding at weighted average exercise prices of $6.93, $8.86 and $8.54,
respectively.

NOTE 13 -- STOCK-BASED EMPLOYEE COMPENSATION:

We currently have two active stock option plans which have been previously
approved by the stockholders. Under the 1992 Stock Option Plan (the "1992 Plan")
and the 2000 Stock Option Plan (the "2000 Plan"), 500,000 and 600,000 shares of
common stock, respectively, were reserved for issuance of incentive and
non-incentive stock options. Under the 1992 and 2000 Plans stock options may be
granted to employees, directors and such other persons as the Board of Directors
determines will contribute to the our success. Vesting periods are set by the
Board of Directors and stock options are generally exercisable during a ten-year
period following the date of grant. However, the Board of Directors has the
authority to accelerate the maturity of any stock option at its discretion.
Under both plans, options expire three months from the date of the holder's
termination of employment or twelve months in the event of disability or death.

F-18

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Stock option activity, under the 1992 and 2000 Plans combined, is
summarized as follows:

Number of
shares of
Common Stock
underlying Weighted Average
options exercise price
----------- ----------------

Options outstanding at December 31, 2002............. 1,108,432 $3.30
Granted.............................................. -- $0.00
Exercised............................................ (35,708) $2.35
Canceled............................................. (248,789) $3.96
--------- -----
Options outstanding at December 31, 2003............. 823,935 $3.35
Granted.............................................. -- $0.00
Exercised............................................ (273,138) $3.55
Canceled............................................. (10,608) $4.35
--------- -----
Options outstanding at December 31, 2004............. 540,189 $3.30
Granted.............................................. -- $0.00
Exercised............................................ (285,401) $3.16
Canceled............................................. (4,448) $4.46
--------- -----
Options outstanding at December 31, 2005............. 250,340 $3.46
Options exercisable at:
December 31, 2003............................... 693,603 $3.22
December 31, 2004............................... 472,329 $3.17
December 31, 2005............................... 239,134 $3.41

Included in options that were canceled during 2005, 2004, and 2003, were
forfeitures of 163, 4,592 and 77,721 with weighted average exercise prices of
$4.60, $4.35 and $3.94 respectively.

As of December 31, 2005, stock options outstanding and exercisable by price
range were as follows:

OPTIONS OUTSTANDING OPTIONS EXERCISABLE
------------------------------------------------------------------------ ---------------------------------
Outstanding Weighted-Average Exercisable
Range of as of Remaining Weighted-Average as of Weighted-Average
Exercise Prices 12/31/2005 Contractual Life Exercise Price 12/31/2005 Exercise Price
--------------- ---------- ---------------- -------------- ---------- --------------

$0.00 - $2.50 64,838 3.9 $2.39 64,838 $2.39
$2.51 - $4.00 116,646 3.3 $3.38 115,833 $3.38
$4.01 - $6.00 68,856 6.2 $4.61 58,463 $4.61
------- --- ----- ------- -----
250,340 4.3 $3.46 239,134 $3.41
======= =======

We account for our stock option plans under the recognition and measurement
principles of APB Opinion No. 25, Accounting for Stock Issued to Employees, and
related Interpretations. Under this standard, no stock option-based employee
compensation cost is reflected in net income, as all options granted under the
plans had an exercise price equal to the market value of the underlying common
stock on the date of grant. Effective July 1, 2003, we adopted the fair value
recognition provisions of FAS No. 148. Under the Prospective transition method
we selected, fair value accounting is applied to all new stock grants and
modifications to old grants since January 1, 2003. Disclosure of pro-forma net
income and EPS is continued for any pre-adoption grants. No options have been
granted in the years ended December 31, 2005, 2004 or 2003, as such no pro forma
values have been calculated.

During the years ended December 31, 2005, 2004 and 2003, we did issue
restricted stock grants to several officers and members of the Board of
Directors. For the stock grants issued during the years 2001 and 2002, shares
vested at the grant date and we recognized the related compensation expense in
those years. For stock grants issued during the years 2003, 2004 and 2005,
shares vest over a three-year period for officers and one year for directors and
compensation expense is recognized ratably over the period. Compensation expense

F-19

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

recognized in connection with the restricted stock grants for the years ended
December 31, 2005, 2004 and 2003 was $390,000, $241,000 and $125,000,
respectively.

NOTE 14 -- QUARTERLY FINANCIAL DATA (UNAUDITED):

Summarized quarterly financial data 2005 and 2004 (in thousands, except per
share data) appear below:

Diluted net
Revenues, net Contribution Net income income per share (1)
----------------- ------------------ ----------------- --------------------
2005 2004 2005 2004 2005 2004 2005 2004
------ -------- ------- ------- ------ ------ ------ ------

First quarter........ $31,983 $25,394 $3,353 $2,475 $314 $187 $0.06 $0.03
Second quarter ...... 32,217 26,893 3,595 2,771 467 320 0.09 0.06
Third quarter........ 33,976 27,216 3,920 3,133 478 340 0.10 0.07
Fourth quarter....... 30,714 28,150 3,933 3,429 464 339 0.09 0.09
-------- -------- ------- ------- ------ ------ ---- -----
Total year .......... $128,890 $107,653 $14,801 $11,808 $1,723 $1,186 $0.34 $0.25

(1) The sum of the quarterly earnings per share may not equal the full year
earnings per share as the computations of the weighted average shares
outstanding for each quarter and the full year are made independently.

NOTE 15 -- COMMITMENTS AND CONTINGENCIES:

Operating Leases --

Refer to Note 9 for a summary of lease commitments.

Reliance on Third Party Vendors --

Our pharmaceutical sales and fertility clinics are dependent on a limited
number of primary third-party vendors that produce such medications vital to
treating infertility. Should any of these vendors experience a supply shortage,
it may have an adverse impact on the operations of our pharmaceutical sales and
network members. To date, no shortage or disruption has been experienced.

Employment Agreements --

We have entered into employment and change in control severance agreements
with certain of our management employees, which include, among other terms,
noncompetitive provisions and salary and benefits continuation. Our minimum
aggregate commitment under these agreements at December 31, 2005 was
approximately $2.0 million.

Commitments to FertilityPartners --

In accordance with the majority of our FertilityPartners agreements, we are
obligated to: (i) on an ongoing basis, advance funds to the fertility centers to
fund operations and provide services; and (ii) on a monthly basis, transfer to
the fertility centers funds equal to the net accounts receivable generated that
month to finance those receivables less any amounts owed to us for services fees
and/or advances.

Litigation --

F-20

INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Insurance --

As of December 31, 2005 and December 31, 2004, we and our affiliated
fertility centers were insured with respect to medical malpractice risks on a
claims made basis. Effective January 1, 2005, we had assisted in the
organization of, and obtained a minority equity interest in, an offshore captive
insurance company designed to offer malpractice insurance to members of our
network. The majority of the equity of the captive insurance company is owned by
physician practices, which are members of our network. Beginning January 1,
2005, this captive insurance company began providing the majority of the
malpractice insurance coverage to FertilityPartner members of our network. We
believe, either through this captive insurance company, or on the open market,
we will be able to obtain renewal coverage in the future. We are not aware of
any claims against us or our affiliated medical practices, which would expose
us, or our affiliated medical practices to liabilities in excess of insured
amounts. Therefore, none of these claims is expected to have a material impact
on our financial position, results of operations or cash flows.

As of December 31, 2005, and December 31, 2004, we also carried policies to
insure against liability, theft, property loss, business interruption and a
variety of other business risks. We also maintain an appropriate insurance
reserve to cover estimated deductible amounts should a claim be filed under our
policies.

NOTE 16 -- RELATED PARTY TRANSACTIONS:

SDL Consultants, a company owned by Sarason D. Liebler, who became a member
of our Board of Directors in August, 1994, rendered consulting services to us
during 2005, 2004 and 2003 for aggregate fees of approximately $83,000, $96,000,
and $83,000, respectively.

In accordance with our FertilityPartners agreement with Shady Grove,
Michael J. Levy, M.D., an employed shareholder physician of the P.C., became a
member of our Board of Directors in March 1998. In 2004, Dr. Levy became an
advisory director and was no longer a voting member of the Board of Directors.
The medical practice at Shady Grove paid us service fees of $3,603,000,
$3,214,000 and $2,909,000 in 2005, 2004 and 2003, respectively.

In accordance with our FertilityPartners agreement with FCI (the Illinois
practice), Aaron Lifchez, M.D., an employed shareholder physician of FCI, became
a member of our Board of Directors in August 1997. In 2004, Dr. Lifchez became
an advisory director and was no longer a voting member of the Board of
Directors. The medical practice FCI paid us service fees of $2,200,000,
$3,074,000 and $3,215,000 in 2005, 2004 and 2003, respectively.

NOTE 17 -- SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION AND
NON-CASH TRANSACTIONS:

During the year ended December 31, 2005, we incurred a non-cash charge of
approximately $41,000 related to the voluntary withholding of stock grants to
various officers in order to satisfy certain tax requirements.

Income tax payments of $165,000, $46,000, and $117,000 were paid in the
years ended December 31, 2005, 2004 and 2003, respectively.

Interest paid in cash during the years ended December 31, 2005, 2004 and
2003, amounted to $328,000, $295,000, and $109,000, respectively. Interest
income received during the years ended December 31, 2005, 2004 and 2003 amounted
to approximately $520,000, $259,000, and $125,000, respectively.

F-21

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS ON
FINANCIAL STATEMENT SCHEDULE

To the Board of Directors and Shareholders
of IntegraMed America, Inc.:

Our audits of the consolidated financial statements referred to in our
report dated February 16, 2005 appearing in the 2004 Annual Report to
Shareholders of IntegraMed America, Inc. (which report and consolidated
financial statements are incorporated by reference in this Annual Report on Form
10-K) also included an audit of the financial statement schedule listed in Item
8 and 15 (a) (1) of this Form 10-K. In our opinion, this financial statement
schedule presents fairly, in all material respects, the information set forth
therein when read in conjunction with the related consolidated financial
statements.

/s/PricewaterhouseCoopers LLP

Boston, Massachusetts
February 16, 2005

To the Board of Directors and Shareholders
of IntegraMed America, Inc.:

Our audit of the consolidated financial statements referred to in our
report dated February 13, 2006 appearing in the 2005 Annual Report to
Shareholders of IntegraMed America, Inc. (which report and consolidated
financial statements are incorporated by reference in this Annual Report on Form
10-K) also included an audit of the financial statement schedule listed in Item
8 and 15 (a) (1) of this Form 10-K. In our opinion, this financial statement
schedule presents fairly, in all material respects, the information set forth
therein when read in conjunction with the related consolidated financial
statements.

/s/Amper, Politziner & Mattia

Edison, New Jersey
March 23, 2006

S-1

SCHEDULE II

INTEGRAMED AMERICA, INC.

VALUATION AND QUALIFYING ACCOUNTS

For the Years Ended December 31, 2005, 2004, 2003

Additions-
Balance at Charged to Balance at
Beginning Costs and End of
of Period Expenses Deductions Period
--------- -------- ---------- ------

Year Ended December 31, 2005
Allowance for doubtful accounts receivable $ 159 $ 45 $ 88 $ 116
Shared Risk Pregnancy Loss Reserve ....... 171 137 15 293
Deferred Tax Valuation Allowance ......... 1,187 -- 419 768

Year Ended December 31, 2004
Allowance for doubtful accounts receivable $ 215 $ (44) $ 12 $ 159
Shared Risk Pregnancy Loss Reserve ....... 114 63 6 171
Deferred Tax Valuation Allowance ......... 1,594 -- 407 1,187

Year Ended December 31, 2003
Allowance for doubtful accounts receivable $ 136 $ 86 $ 7 $ 215
Shared Risk Pregnancy Loss Reserve ....... 72 114 72 114
Deferred Tax Valuation Allowance ......... 1,594 -- -- 1,594

S-2

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

INTEGRAMED AMERICA, INC.

Dated: March 30, 2006

By/s/JOHN W. HLYWAK, JR.
----------------------
John W. Hlywak, Jr.
Executive Vice President
and Chief Financial Officer
(Principal Financial and Accounting Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

Signature Title Date
--------- ----- ----

/s/ JAY HIGHAM
Jay Higham President and Chief Executive Officer
and Director
(Principal Executive Officer) March 30, 2006

/s/ JOHN W. HLYWAK, JR
--------------------------------
John W. Hlywak, Jr. Executive Vice President
and Chief Financial Officer
(Principal Financial and
Accounting Officer) March 30, 2006

/s/ GERARDO CANET
--------------------------------
Gerardo Canet Director March 30, 2006

/s/ SARASON D. LIEBLER
--------------------------------
Sarason D. Liebler Director March 30, 2006

/s/ WAYNE R. MOON
--------------------------------
Wayne R. Moon Director March 30, 2006

/s/ LAWRENCE J. STUESSER
--------------------------------
Lawrence J. Stuesser Director March 30, 2006

/s/ ELIZABETH E. TALLETT
--------------------------------
Elizabeth E. Tallett Director March 30, 2006

/s/ YVONNE S. THORNTON, M.D.
Yvonne S. Thornton, M.D. Director March 30, 2006

INDEX TO EXHIBITS

Item 14(c)

Exhibit
Number Exhibit
------ -------

3.1 (f) -- Restated Certificate of Incorporation of IntegraMed America,
Inc. filed as exhibit with identical exhibit number to
Registrant's Report on Form 10-Q for the period ended June 30,
2004.

3.2 (d) -- Copy of By-laws of Registrant (as Amended on January 24, 2006)
filed as exhibit with identical exhibit number to Registrant's
Annual Report on Form 10-K for the year ended December 31, 2005.

4.14 -- Registration Rights Agreement dated July 20, 2002 filed as
Exhibit with identical number to Registrant's Quarterly Report
on Form 10-Q for the period ended June 30, 2002

4.14 (a) -- Form of Warrant issued on July 30, 2002 filed as Exhibit with
identical number to Registrant's Quarterly Report on Form 10-Q
for the period ended June 30, 2002

10.2 -- Copy of Registrant's 1992 Stock Option Plan, including form of
option filed as Exhibit with identical exhibit number to
Registrant's Statement on Form S-1 (Registration No. 33-47046)
and incorporated herein by reference thereto.

10.2 (a) -- Copy of Amendment to Registrant's 1992 Stock Option Plan filed
as Exhibit with identical number to Registrant's Quarterly
Report on Form 10-Q for the period ended March 31, 1998.

10.5 -- Severance arrangement between Registrant and Donald S. Wood
filed as Exhibit with identical exhibit number to Registrant's
Statement on Form S-1 (Registration No. 33-47046) and
incorporated herein by reference thereto.

10.6 -- Copy of Executive Retention Agreement between Registrant and
Donald S. Wood, Ph.D. filed as Exhibit with identical exhibit
number to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1994.

10.7 -- Copy of lease for Registrant's executive offices relocated to
Purchase, New York filed as Exhibit with identical exhibit
number to Registrant's Annual Report on Form 10-K for the year
ended December 31, 1994.

10.9 (a) -- Letter amendment effective June 9, 2005 to Gerardo Canet
Employment Agreement filed as exhibit with identical exhibit
number to Registrant's Report on Form 8-K dated June 9, 2005.

10.12 (a) -- Employment Agreement between IntegraMed America, Inc. and Jay
Higham filed as Exhibit with identical number to Registrant's
Quarterly Report on Form 10-Q for the period ended September 30,
2005.

10.14 -- Management Agreement dated January 7, 1997 by and between the
Registrant and Bay Area Fertility and Gynecology Medical Group,
Inc. filed as Exhibit with identical exhibit number to
Registrant's Report on Form 8-K dated January 20, 1997.

10.14 (a) -- Amendment No. 1 to Management Agreement between IntegraMed
America, Inc. and Bay Area Fertility and Gynecology Medical
Group, Inc. filed as Exhibit with identical number to
Registrant's Quarterly Report on Form 10-Q for the period ended
March 31, 1998.

10.14 (b) -- Amendment No. 2 to Management Agreement between IntegraMed
America, Inc. and Bay Area Fertility and Gynecology Medical
Group, Inc. filed as Exhibit with identical number to
Registrant's Quarterly Report on Form 10-Q for the period ended
March 31, 1999.

Exhibit
Number Exhibit
------ -------

10.14 (c) -- Amendment No. 3 to Management Agreement between IntegraMed
America, Inc. and Bay Area Fertility and Gynecology Medical
Group, Inc. dated April 1, 2000 filed as Exhibit with identical
exhibit number to Registrant's Quarterly Report on Form 10-Q for
the period ended June 30, 2000.

10.14 (d) -- Amendment No. 4 to Management Agreement between IntegraMed
America, Inc. and Bay Area Fertility and Gynecology Medical
Group, P.C. filed as Exhibit with identical exhibit number to
Registrant's Quarterly Report on Form 10-Q for the period ended
September 30, 2001.

10.14 (e) -- Amendment No. 5 to Management Agreement between IntegraMed
America, Inc. and Bay Area Fertility and Gynecology Medical
Group, P. C. filed as Exhibit with identical exhibit number to
Registrant's Quarterly Report on Form 10-Q for the period ended
September 30, 2001.

10.14 (f) -- Amendment No. 6 to Service Agreement between IntegraMed America,
Inc. and Reproductive Science Center of the San Francisco Bay
Area, a medical corporation.

10.15 -- Asset Purchase Agreement dated January 7, 1997 by and between
the Registrant and Bay Area Fertility and Gynecology Medical
Group, a California Partnership filed as Exhibit with identical
exhibit number to Registrant's Report on Form 8-K dated January
20, 1997.

10.16 -- Management Agreement between Registrant and Fertility Centers of
Illinois, S.C. dated February 28, 1997 incorporated by Reference
to the Exhibit with the identical exhibit number to Registrant's
Registration Statement on Form S-1 (registration No. 333-26551)
filed with the Securities and Exchange Commission on May 6,
1997.

10.17 -- Amendment to Management Agreement between Registrant and
Fertility Centers of Illinois, S.C. dated May 2, 1997
incorporated by reference to the Exhibit with the identical
exhibit number to Registrant's Registration Statement on Form
S-1 (Registration No. 333-26551) filed with the Securities and
Exchange Commission on June 20, 1997.

10.18 -- Amendment No. 2 to Management Agreement between Registrant and
Fertility Centers of Illinois, S.C. dated June 18, 1997
incorporated by reference to the Exhibit with the identical
exhibit number to Registrant's Registration Statement on Form
S-1 (Registration No. 333-26551) filed with the Securities and
Exchange Commission on June 20, 1997.

10.19 -- Amendment No. 3 to Management Agreement between Registrant and
Fertility Centers of Illinois, S.C. dated August 19, 1997 filed
as Exhibit with identical exhibit number to Registrant's
Quarterly Report on Form 10-Q for the period ended September 30,
1997 and incorporated herein by reference thereto.

10.20 -- Amendment No. 4 to Management Agreement between Registrant and
Fertility Centers of Illinois, S.C. dated January 9, 1998 filed
as Exhibit with identical exhibit number to Schedule 13D dated
February 11, 1998.

10.21 -- Amendment No. 5 to Management Agreement between Registrant and
Fertility Centers of Illinois, S.C. dated March 5, 1998 filed as
Exhibit with identical exhibit number to Registrant's Annual
Report on Form 10-K for the year ended December 31, 1997.

10.21 (a) -- Amendment No. 6 to Management Agreement between IntegraMed
America, Inc. and Fertility Centers of Illinois, S.C. dated July
1, 1999 incorporated by reference to the Registrant's Definitive
Proxy Statement filed on May 5, 1997.

Exhibit
Number Exhibit
------ -------

10.21 (b) -- Amendment No. 7 to Management Agreement between IntegraMed
America, Inc. and Fertility Centers of Illinois, P.C. dated
April 1, 2000. filed as Exhibit with identical exhibit number to
Registrant's Quarterly Report on Form 10-Q for the period ended
June 30, 2000.

10.21 (c) -- Amendment No. 8 to Management Agreement between IntegraMed
America, Inc. and Fertility Centers of Illinois, S.C. filed as
Exhibit with identical exhibit number to Registrant's Quarterly
Report on Form 10-Q for the period ended September 30, 2001.

10.21 (d) --

Amendment No. 9 to Service Agreement between IntegraMed America,
Inc. and Fertility Centers of Illinois, S.C.

10.21 (e) -- Amendment No. 10 to Service Agreement between IntegraMed
America, Inc. and Fertility Centers of Illinois, S.C. dated
January 1, 2005 filed as Exhibit with identical exhibit number
to Registrant's Annual Report on Form 10-K for the year ended
December 31, 2005.

10.22 (a) -- Service Agreement between IntegraMed America, Inc. and MPD
Medical Associates (MA) P.C. dated May 25, 2001 filed as Exhibit
with identical exhibit number to Registrant's Quarterly Report
on Form 10-Q for the period ended June 30, 2001.

10.22 (b) -- Amendment No. 1 to Service Agreement between IntegraMed America,
Inc. and MPD Medical Associates (MA), P.C. dated March 5, 2002
filed as exhibit with identical exhibit number to Registrant's
Report on Form 10-K for the year ended December 31, 2001.

10.23 -- Management Agreement between Shady Grove Fertility Centers, P.C.
and Levy, Sagoskin and Stillman, M.D., P.C. dated March 11, 1998
filed as Exhibit with identical exhibit number to Registrant's
Annual Report on Form 10-K for the year ended December 31, 1997.

10.23 (a) -- Amendment No. 1 to Management Agreement between Shady Grove
Fertility Centers, Inc. and Levy Sagoskin and Stillman, M.D.,
P.C filed as Exhibit with identical number to Registrant's
Quarterly Report on Form 10-Q for the period ended March 31,
1998.

10.23 (b) -- Amendment No. 2 to Management Agreement between Shady Grove
Fertility Centers, Inc. and Levy Sagoskin and Stillman, M.D.,
P.C. dated May 6, 1998 filed as Exhibit with identical number to
Registrant's Annual Report on Form 10-K for the year ended
December 31, 1998.

10.23 (c) -- Amendment No. 3 to the Management Agreement between IntegraMed
America, Inc. and Shady Grove Reproductive Science Center, P.C.
dated September 1, 1999, filed as Exhibit with identical number
to Registrant's Quarterly Report on Form 10-Q for the period
ended September 30, 1999.

10.23 (d) -- Amendment No. 4 to Management Agreement between IntegraMed
America, Inc. and Shady Grove Reproductive Science Center, P.C.
dated April 1, 2000 filed as Exhibit with identical exhibit
number to Registrant's Quarterly Report on Form 10-Q for the
period ended June 30, 2000.

10.23 (e) -- Amendment No. 5 to Management Agreement between IntegraMed
America, Inc. and Shady Grove Reproductive Science Center, P.C.
filed as Exhibit with identical exhibit number to Registrant's
Quarterly Report on Form 10-Q for the period ended September 30,
2001.

10.23 (f) -- Amendment No. 6 to Management Agreement between IntegraMed
America, Inc. and Shady Grove Reproductive Science Center, P.C.
filed as Exhibit with identical exhibit number to Registrant's
Quarterly Report on Form 10-Q for the period ended September 30,
2001.

10.23 (g) -- Amendment No. 7 to Service Agreement between IntegraMed America,
Inc. and Shady Grove Reproductive Science Center, P.C.

Exhibit
Number Exhibit
------ -------

10.23 (h) -- Amendment No. 8 to Service Agreement between IntegraMed America,
Inc. and Shady Grove Reproductive Science Center, P.C. dated
February 16, 2006 filed as Exhibit with identical number to
Registrant's Annual Report on Form 10-K for the year ended
December 31, 2005.

10.24 -- Commitment letter with Fleet Bank, National Association filed as
Exhibit with identical number to Registrant's Quarterly Report
on form 10-Q for the period ended June 30, 1998.

10.24 (a) -- Loan Agreement dated September 11, 1998 between IntegraMed
America, Inc. and Fleet Bank, National Association filed as
Exhibit with identical number to Registrant's Quarterly Report
on Form 10-Q for the period ended September 30, 1998.

10.24 (b) -- Master Lease Agreement between Fleet Capital Corporation and
IntegraMed America, Inc. filed as Exhibit with identical number
to Registrant's Quarterly Report on Form 10-Q for the period
ended September 30, 1999.

10.24 (c) -- Amendment Number One to Loan Agreement dated September 11, 1998
between IntegraMed America, Inc. and Fleet Bank, National
Association filed as Exhibit with identical number to
Registrant's Annual Report on Form 10-K for the year ended
December 31, 1999.

10.24 (d) -- Amendment Number Two to Loan Agreement dated September 11, 1998
between IntegraMed America, Inc. and Fleet Bank, National
Association filed as Exhibit with identical number to
Registrant's Annual Report on Form 10-K for the year ended
December 31, 1999.

10.24 (e) -- Amendment Number Three to Loan Agreement dated September 11,
1998 between IntegraMed America, Inc. and Fleet Bank, National
Association filed as Exhibit with identical exhibit number to
Registrant's Annual Report on Form 10-K for the year ended
December 31, 2000.

10.24 (f) -- Amendment Number Four to Loan Agreement dated September 11, 1998
between IntegraMed America, Inc. and Fleet Bank, National
Association. filed as Exhibit with identical exhibit number to
Registrant's Annual Report on Form 10-K for the year ended
December 31, 2000.

10.24 (g) -- Amended and Restated Loan Agreement dated as of September 28,
2001 between IntegraMed America, Inc. and Fleet National Bank
filed as Exhibit with identical exhibit number to Registrant's
Quarterly Report on Form 10-Q for the period ended September 30,
2001.

10.24 (h) -- Amendment to Amended and Restated Loan Agreement between
IntegraMed America, Inc. and Fleet National Bank dated September
20, 2002 filed as Exhibit with identical number to Registrant's
Quarterly Report on form 10Q for the period ended September 30,
2002.

10.24 (i) -- Second Amendment to Amended and Restated Loan Agreement dated
July 31, 2003 filed as exhibit with identical exhibit number to
Registrant's Report on Form 10-K for the year ended December 31,
2001.

10.24 (j) -- Third Amendment to Amended and Restated Loan Agreement dated
November 14, 2003

10.24 (k) -- Fourth Amendment and Waiver to Amended and Restated Loan
Agreement between IntegraMed America, Inc. and Fleet National
Bank, a Bank of America Company dated as of March 21, 2005 filed
as Exhibit with identical exhibit number to Registrant's
Quarterly Report on Form 10-Q for the period ended March 31,
2005.

Exhibit
Number Exhibit
------ -------

10.24 (l) -- Fifth Amendment to Amended and Restated Loan Agreement between
IntegraMed America, Inc. and Bank of America, N.A., successor by
merger to Fleet National Bank dated December 23, 2005 and filed
as Exhibit with identical exhibit number to Registrant's Annual
Report on Form 10-K for the year ended December 31, 2005.

10.25 (a) -- Termination and Settlement Agreement by and among IntegraMed
America, Inc., ivpcare, inc. and IntegraMed Pharmaceutical
Services, Inc. filed as Exhibit with identical number to
Registrant's Form 8-K dated October 31, 2005.

10.25 (b) -- Agreement between ivpcare, inc. and IntegraMed America, Inc.
filed as Exhibit with identical number to Registrant's Form 8-K
dated October 31, 2005.

10.26 -- Form of Retention Agreement between Registrant and Kathi
Baginski, Peter Cucchiara, Dan Desmarais, Anders Engen, Jay
Higham, John Hlywak, Jr., Mark Segal, Claude E. White, and
Donald S. Wood, Ph.D. filed as Exhibit with identical number to
Registrant's Quarterly Report on Form 10-Q for the period ended
June 30, 1999.

10.27 -- Form of Indemnification Agreement dated June 1, 2000 between
IntegraMed America, Inc. and M. Fazle Husain, Michale Levy,
M.D., Aaron Lifchez, M.D., Sarason Liebler, Larry Stuesser,
Elizabeth E. Tallett, Gerardo Caned, Peter Cucchiara, Jay
Higham, John Hlywak, Jr., Claude E. White, and Donald S. Wood,
Ph.D. filed as Exhibit with identical exhibit number to
Registrant's Quarterly Report on Form 10-Q for the period ended
June 30, 2000.

10.28 -- Service Agreement between IntegraMed America, Inc. and Northwest
Center for Infertility and Reproductive Endocrinology dated
April 26, 2002 filed as Exhibit with identical number to
Registrant's Quarterly Report on Form 10-Q for the period ended
March 31, 2002.

10.28 (a) -- Amendment No. 1 to Service Agreement between IntegraMed America,
Inc. and Northwest Center for Infertility and Reproductive
Endocrinology dated June 14, 2002 filed as Exhibit with
identical number to Registrant's Quarterly Report on form 10Q
for the period ended September 30, 2002.

10.28 (b) -- Amendment No. 2 to Service Agreement between IntegraMed
America, Inc. and Northwest Center for Infertility and
Reproductive Endocrinology dated November 1, 2002 filed as
exhibit with identical exhibit number to Registrant's Report on
Form 10-K for the year ended December 31, 2002.

10.28 (c) -- Amendment No. 3 to Service Agreement between IntegraMed America,
Inc. and Northwest Center for Infertility and Reproductive
Endocrinology.

10.29 -- Copy of Registrant's 2000 Long-Term Compensation Plan filed as
Exhibit with identical number to Registrant's Quarterly Report
on Form 10-Q for the period ended June 30, 2002.

10.29 (a) -- IntegraMed America, Inc. Incentive Stock Option Agreement filed
as Exhibit with identical number to Registrant's Quarterly
Report on Form 10-Q for the period ended June 30, 2005.

10.29 (b) -- IntegraMed America, Inc. Non-Qualified Stock Option Agreement
filed as Exhibit with identical number to Registrant's Quarterly
Report on Form 10-Q for the period ended June 30, 2005.

10.30 -- Service Agreement between IntegraMed America, Inc and
Reproductive Endocrine Associates of Charlotte, P.C. filed as
Exhibit with identical number to Registrant's Quarterly Report
on Form 10-Q for the period ended September 31, 2003.

Exhibit
Number Exhibit
------ -------

10.31 -- Service Agreement between IntegraMed America, Inc. and Seattle
Reproductive Medicine, Inc., P.S. filed as exhibit with
identical exhibit number to Registrant's Report on Form 10-Q for
the period ended March 31, 2004.

10.32 -- Submanagement Agreement dated January 1, 2005 between
Reproductive Partners Inc. and IntegraMed America, Inc. filed as
Exhibit with identical number to registrant's Quarterly Report
on Form 10-Q for the period ended March 31, 2005.

10.32 (a) -- Submanagement Agreement dated January 1, 2005 between
Reproductive Partners Inc. and IntegraMed America, Inc. filed as
Exhibit with identical number to registrant's Quarterly Report
on Form 10-Q for the period ended March 31, 2005.

14.1 -- Code of Ethics filed as Exhibit with identical exhibit number to
Registrant's Statement on Form 10-K for the year ended December
31, 2003.

21 -- List of Subsidiaries

23.1 -- Consent of PricewaterhouseCoopers LLP

23.2 -- Consent of Amper, Politziner & Mattia, P.C.

31.1 -- CEO Certification Pursuant to 18 U.S.C. ss. 1350 as Adopted
Pursuant to Section 302 of the Sarbanes Oxley Act of 2002 dated
March 30, 2006.

31.2 -- CFO Certification Pursuant to 18 U.S.C. ss. 1350 as Adopted
Pursuant to Section 302 of the Sarbanes Oxley Act of 2002 dated
March 30, 2006.

32.1 -- CEO Certification Pursuant to 18 U.S.C. ss. 1350 as Adopted
Pursuant to Section 906 of the Sarbanes Oxley Act of 2002 dated
March 30, 2006.

32.2 -- CFO Certification Pursuant to 18 U.S.C. ss. 1350 as Adopted
Pursuant to Section 906 of the Sarbanes Oxley Act of 2002 dated
March 30, 2006.