SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

------------------

FORM 10-Q

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the quarterly period ended September 30, 1996

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the transition period from _____________________ to ________________________

Commission file number: 0-26348

HPR INC.
(Exact name of registrant as specified in its charter)

Delaware 04-2985551
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No)

245 First Street
Cambridge, MA 02142
(Address of principal executive offices)

(617) 679-8000
(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

Yes X No ___

As of October 25, 1996, there were 15,153,757 shares of the Registrant's Common
Stock, $0.01 par value per share, outstanding.

HPR INC.
Form 10-Q for the Three Months Ended September 30, 1996

Table of Contents

Page No.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited):

Consolidated Balance Sheets as of
September 30, 1996 and June 30, 1996. . . . . . . . . . . . . . . . . 3

Consolidated Statements of Operations for the Three
Months Ended September 30, 1996 and 1995. . . . . . . . . . . . . . . 4

Consolidated Statements of Cash Flows for the Three
Months Ended September 30, 1996 and 1995 . . . . . . . . . . . . . . 5

Notes to Interim Consolidated Financial Statements. . . . . . . . . . 6

Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operation . . . . . . . . . . . . 7

PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . 13

Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

PART I. FINANCIAL INFORMATION
Item 1. Financial Statements

HPR Inc.
CONSOLIDATED BALANCE SHEETS
(unaudited)

September 30,
1996 June 30, 1996
------------ -----------

ASSETS:
Current Assets:
Cash and cash equivalents.......................... $7,696,756 $8,479,122
Investments in marketable securities............... 11,100,180 9,016,146
Accounts receivable, net of allowances for doubtful
accounts of $610,000, and $603,000 for September 30,
1996 and June 30, 1996, respectively............... 3,847,219 4,491,065
Contract receivables............................... 4,314,086 3,142,680
Prepaid and deferred income tax expense............ 1,989,720 415,149
Prepaid expenses and other current assets.......... 725,248 727,044
------------ ------------
Total current assets........................ 29,673,209 26,271,206
Investments in marketable securities 3,003,616 5,394,340
Property and equipment, net.......................... 1,936,174 1,964,164
Software development costs, net...................... 865,859 873,427
Other assets......................................... 104,309 100,332
------------ ------------
Total assets................................ $35,583,167 $34,603,469
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current Liabilities:
Accounts payable................................... $650,885 $607,259
Accrued expenses................................... 1,699,147 1,038,045
Accrued support costs.............................. 1,469,184 1,425,191
Accrued employee compensation and benefits......... 598,614 1,323,973
Deferred revenue................................... 229,868 698,029
Income taxes payable............................... -- 438,758
Sales taxes payable................................ 123,083 275,022
------------ ------------
Total current liabilities................... 4,770,781 5,806,277
Deferred income taxes................................ 882,173 882,173
------------ ------------
Total liabilities........................... 5,652,954 6,688,450
------------ ------------
Stockholders' Equity:
Convertible preferred stock, par value
$0.10, 3,000,000 shares authorized;
zero shares outstanding at September 30,
1996 and June 30, 1996...........................
Common stock, par value $0.01, 35,000,000
shares authorized; 18,018,547 and 17,918,625
shares issued and 15,112,297 and 15,012,375
shares outstanding at September 30, 1996
and June 30, 1996, respectively ................. 180,185 179,185
Additional paid-in capital......................... 17,056,327 15,972,680
Less treasury stock, at cost: 2,913,750 and 2,906,250
shares at September 30, 1996 and June 30, 1996,
respectively...................................... (2,848,775) (2,843,900)
Retained earnings.................................. 15,542,476 14,607,054
------------ ------------
Total stockholders' equity.................. 29,930,213 27,915,019
------------ ------------
Total liabilities and stockholders' equity.. $35,583,167 $34,603,469
=========== ===========

The accompanying notes are an integral part of the consolidated financial
statements.

HPR Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)

Three Months Ended September 30,

1996 1995
------------- -----------

Revenues......................... $7,070,994 $5,319,515
Expenses:
Cost of revenues............... 1,640,030 1,385,756
Marketing and sales............ 1,586,588 1,319,759
Research and development....... 1,530,969 897,976
General and administrative..... 1,015,812 790,605
--------- ---------
Total expenses................... 5,773,399 4,394,096
--------- ---------
Operating income................. 1,297,595 925,419
--------- ---------
Interest income, net............. 301,418 145,219
Income before provision for
income taxes..................... 1,599,013 1,070,638
Provision for income taxes....... 663,591 452,183
Net income(1).................... $935,422 $618,455
-------- --------
Net income per share............. $0.06 $0.04
Weighted average common shares
and equivalents (1).............. 16,098,000 15,238,000

(1) All share and earnings per share amounts have been restated to reflect the
stock split effected in the form of a 100% stock dividend paid on May 6,
1996 to all shareholders of record as of April 26, 1996.

The accompanying notes are an integral part of the consolidated financial
statements.

HPR Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)

Three Months Ended September 30,
1996 1995
----------- -----------

Cash flows from (for) operating activities:
Net income........................ $ 935,422 $ 618,455
Adjustments to reconcile net income to
cash provided by (used in) operating
activities:
Depreciation and amortization.. 351,849 310,091
Provision for doubtful accounts 125,000 85,000
Loss on disposal of equipment.. 2,565 --
Amortization of discount on
investments.................. (27,630) (18,016)
Change in operating assets and
liabilities:
Accounts and contract receivables (652,560) (314,618)
Prepaid expenses and other current
assets ...................... (577,375) 334,329
Other assets................... (3,977) (61,866)
Accounts payable and other accrued
liabilities.................. 23,362 (220,726)
Sales taxes payable............ (151,939) (61,393)
Deferred revenue............... (468,161) 17,125
Income taxes payable........... (438,758) 67,577
----------- -----------
Net cash provided by (used in)
operating activities........ (882,202) 705,872
----------- -----------
Cash flows from (for) investing activities:
Capitalized software development
costs.......................... (131,847) (149,878)
Proceeds from disposal of fixed assets 15,903 --
Capital expenditures.............. (202,912) (871,949)
Sale of marketable securities 2,500,000 --
Purchases of marketable securities (2,165,680) (3,891,903)
----------- -----------
Net cash provided by (used in)
investing activities........ 15,464 (4,913,730)
----------- -----------
Cash flows from (for)financing activities:
Proceeds from initial public
offering....................... -- 8,013,348
Expenses related to initial public
offering....................... -- (858,896)
Proceeds from exercise of stock
options........................ 89,247 89
Payments to acquire treasury stock (4,875) --
------------ -----------
Net cash provided by financing
activities................ 84,372 7,154,541
------------ -----------
Net increase (decrease) in cash and cash
equivalents....................... (782,366) 2,946,683
------------ -----------
Cash and cash equivalents, beginning of
period............................ 8,479,122 8,486,062
------------ -----------
Cash and cash equivalents provided by the
acquisition of The Integrity Group, Inc. -- 28,193
Adjusted cash and cash equivalents,
beginning of period............... 8,479,122 8,514,255
------------- -----------
Cash and cash equivalents, end of
period............................ $ 7,696,756 $11,460,938
=========== ===========

The accompanying notes are an integral part of the consolidated financial
statements.

HPR Inc.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

(1) Description of Business

HPR Inc. (the "Company") was formed in 1987. The Company develops and
markets software and proprietary database products incorporating
clinical knowledge that enable payors and providers to better manage
the financial risk associated with the delivery of healthcare and the
quality of care. The Company's products are used to contain the costs
of healthcare by clinically evaluating claims for payment; measuring
efficiency, quality and outcomes; determining appropriate utilization;
influencing physician referral patterns and profiling providers. The
Company's products are developed and maintained in consultation with
board certified physicians serving on Company-organized panels.

(2) Summary of Significant Accounting Policies

Accounting

The accompanying consolidated financial statements are unaudited and
have been prepared in accordance with generally accepted accounting
principles. These statements include the accounts of HPR and its
subsidiaries. Certain information and footnote disclosures normally
included in the Company's annual consolidated financial statements have
been condensed or omitted. The interim consolidated financial
statements, in the opinion of management, reflect all adjustments
(consisting only of normal recurring accruals) necessary for a fair
statement of the results for the interim periods ended September 30,
1996 and 1995, respectively.

The results of operations for the interim periods are not necessarily
indicative of the results of operations to be expected for the entire
year. It is suggested that these interim consolidated financial
statements be read in conjunction with the audited consolidated
financial statements for the year ended June 30, 1996, which are
contained in the Company's Annual Report on Form 10-K filed with the
Securities and Exchange Commission on September 23, 1996.

(3) Investment in Marketable Securities

In accordance with FAS 115, management determines the appropriate
classification of its investments in debt and equity securities at the
time of purchase and reevaluates such determination at each balance
sheet date. Debt securities for which the Company has the intent or
ability to hold to maturity are classified as held to maturity. The
Company holds no investments in equity securities at September 30, 1996
and June 30, 1996. Securities held to maturity are carried at amortized
cost which approximates fair market value. At September 30, 1996 and
June 30, 1996 the Company had no investments that qualified as trading
or available for sale.

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

See Safe Harbor Statement for Forward-Looking Statements at the end of this
item.

Overview

HPR Inc. licenses its products primarily pursuant to multi-year
agreements that, in general, provide payment of equal annual license fees over
their terms. Revenues from software license agreements are recognized upon
execution of a contract and shipment of the software provided that no
significant vendor obligations remain outstanding and collection of the related
receivable is deemed probable by management. For annual recurring license fees,
revenues are recognized on the contract anniversary date.

The Company has experienced a seasonal pattern in its operating results
with the second and fourth fiscal quarters typically having the highest revenues
and net income, while the first and third fiscal quarters typically have lower
revenue and net income. The Company believes the seasonality of its revenue and
net income will continue for the foreseeable future. In order to account for the
effect of seasonal revenues, comments with respect to prospective expenses as a
percentages of revenues reflect annualized estimates and are not necessarily
representative of expected interim results.

Revenues

Total revenues increased 32.9% to $7,071,000 from $5,320,000 for the
three months ended September 30, 1996 versus the same period in 1995. The
Company attributed the significant growth in revenues to continued license
activity associated with the Company's existing products, CodeReview, Patterns
Review, and Episode Profiler, as well as the Quality Profiler and Referral
Profiler products which were introduced to the market in fiscal 1996 and early
fiscal 1997, respectively.

Cost of Revenues

Cost of revenues for the three months ended September 30, 1996
increased to $1,640,000 or 23.2% of revenues from $1,386,000 or 26.1% during the
same three month period a year ago. The increase in expense was due mainly to
certain royalty payments made to third parties for software products licensed by
the Company which are incorporated into the Company's products, most notably
Episode Profiler and Referral Profiler. The Company expects cost of revenues to
remain relatively constant as a percentage of revenues.

Marketing and Sales

Marketing and sales expenses increased 20.2% to $1,587,000 from
$1,320,000 for the three months ended September 30, 1996 versus the same period
one year earlier. As a percentage of revenues, marketing and sales expenses
decreased to 22.4% from 24.8% for the three months ended September 30, 1996 and
1995, respectively.

The Company has continued its expansion of the sales force in
response to increased demand for its products. The increase in the size of the
sales force, along with the addition of new product lines in fiscal 1996 and
early fiscal 1997 were strong contributing factors to the increase in the
Company's overall revenues. The Company expects to continue its investment
in marketing and salesin line with demand for its products and as a result
the Company expects marketing and sales expenses to remain constant or
increase slightly as a percentage of sales.

Research and Development

Research and development expenses increased to $1,531,000 or 21.7% of
revenues for the three months ended September 30, 1996 from $898,000 or 16.9% of
revenues for the same period in the prior year. During the three month period
ending September 30, 1996, the Company capitalized software development
expenditures in an amount equal to 8% of total research and development costs
which compares with a capitalization rate of 14% for the three month period
ended September 30, 1995. The increase in research and development expenditures
is a result of work being performed on the Company's next suite of products, the
Clinical Care Management Software (CCMS), currently under development. The
Company expects that as work continues on the CCMS product line and as new
products are undertaken, research and development expenses as a percentage of
revenues will remain substantially the same or increase slightly for the
foreseeable future.

General and Administrative

General and administrative expenses for the three months ended
September 30, 1996 increased to $1,016,000 or 14.4% of revenue from $791,000 or
14.9% for the same period in the prior year. The increased expenditures are a
factor of the increased growth of the Company. Although general and
administrative expenditures will increase as the Company grows, it is believed
that as revenues continue to increase general and administrative expenses will
decrease slightly as a percentage of revenues for the foreseeable future.

Net Interest

Interest income increased to $301,000 from $145,000 for the three
months ended September 30, 1996 compared with the prior year. The increase was
primarily due to the interest earned on the cash balances the Company
generated from operations and from the proceeds of the Company's initial public
offering of Common Stock completed in August 1995 and the second public offering
completed in February 1996.

Liquidity and Capital Resources

The Company had working capital as of September 30, 1996 of $24,902,000
compared with $20,465,000 in working capital as of June 30, 1996. The change was
mainly due to cash provided by operations and investment income earned during
the three month period.

The Company believes that the net proceeds from the common stock
sold by the Company in its initial and second public offerings, together with
available funds, cash generated from operations and an available unused line of
credit of $5,000,000 will be sufficient to meet the Company's operating and
capital requirements, assuming no change in the operations of the Company's
business, for the foreseeable future.

Safe Harbor Statement for Forward-Looking Statements

Statements in this report concerning the future results of operations,
financial condition and business of the Company are "forward-looking" statements
as defined in the Securities Act of 1933 and the Securities Exchange Act of
1934. Investors are cautioned that information contained in these
forward-looking statements is inherently uncertain, and that actual performance
and results may differ materially due to numerous risk factors, including but
not limited to the following:

Seasonality and Variable Operating Results.

The Company has experienced a seasonal pattern in its operating results,
with the fourth and second fiscal quarters typically having the highest revenues
and net income and the first and third fiscal quarters typically having lower
revenues and net income. The timing of revenues is influenced by a number of
factors, including the timing of individual orders and shipments, seasonal
customer buying patterns and changes in product development and sales and
marketing expenditures. The Company believes the seasonality of its revenues and
net income for the fourth fiscal quarter can be attributed to due dates for
payment obligations under multi-year license agreements, renewals of existing
agreements and the Company's sales compensation program, which is based
significantly on fiscal year sales levels. The Company believes the seasonality
of its revenues and net income in the second fiscal quarter can be attributed to
the seasonal purchasing patterns of its customers. The Company most recently
reported a net loss in the first and third quarters of fiscal 1994 and there can
be no assurance that the Company will be profitable during future quarters. In
addition, although the Company has no present agreements or commitments to enter
into any major contracts, the signing of a major contract could generate a large
increase in revenues and net income for any given quarter or fiscal year, which
increase may prove anomalous when compared to changes in revenues and net income
in other periods. Furthermore, the Company typically experiences long sales
cycles for new customers, which may extend over several quarters before a sale
is consummated. As a result, the Company believes that quarterly results of
operations will continue to be subject to significant fluctuations and that its
results of operations for any particular quarter or fiscal year may not be
indicative of results of operations for future periods.

Dependence Upon New Product Development, Acceptance and Enhancement.

The market for the Company's products is characterized by rapid
technological progress and changing customer needs. The Company believes that as
the markets for CodeReview and Pattern Review mature, the continued growth of
the Company will require the successful introduction of new products.
Accordingly, the Company's future success will depend on its ability to
successfully develop and introduce new products, including CCMS, and to enhance
its existing products. There can be no assurance that the Company will be
successful in developing, introducing on a timely basis, and marketing such
products or enhancements or that they will be accepted by the market.
Significant research and development expenditures will be required in the
future. There can be no assurance that the Company's expected new product
releases and product enhancements will adequately address customer requirements
for performance and functionality or that its software will not contain "bugs"
that would delay product introduction or shipment.

Dependence on Third Party for Component of Episode Profiler.

A principal component of Episode Profiler, the "Episode Treatment Groups"
product, is licensed from a third-party vendor, Symmetry Health Data Systems,
Inc. ("Symmetry"), under the terms of a 63-month license which commenced
November 17, 1994 and has a 24-month renewal option which is contingent on the
Company meeting minimum royalty requirements. Symmetry has agreed, subject to
certain conditions, that it will not license Episode Treatment Groups to certain
other companies which might be considered competitors of the Company. While the
Company believes that the terms of such license are adequate to protect the
Company's investment in Episode Profiler, any factor adversely affecting the
Company's ability to retain the benefits of such license or to obtain the
updated Episode Treatment Groups would have a material adverse effect on the
Company's results of operations, financial condition and business.

Risk of Inability to Grow Through Acquisitions.

The Company has grown, and intends to continue to grow, in part through
acquisitions of products, technologies and businesses. The Company's ability to
expand successfully through acquisitions depends on many factors, including the
successful identification and acquisition of products, technologies and
businesses and management's ability to effectively integrate and operate the new
products, technologies or businesses. There is significant competition for
acquisition opportunities in the industry, which may intensify due to
consolidation in the industry, increasing the costs of capitalizing on such
opportunities. The Company competes for acquisition opportunities with other
companies that have significantly greater financial and management resources.

Management of Growth.

The Company is currently experiencing a period of rapid growth and expansion
which could place a significant strain on the Company's personnel and resources.
The Company's growth has resulted in an increase in the level of responsibility
for both existing and new management personnel. The Company has sought to manage
its current and anticipated growth through the recruitment of additional
management and technical personnel and the implementation of internal systems
and controls. However, the failure to manage growth effectively could adversely
affect the Company's results of operations, financial condition or business.

Inability to Retain or Attract Customers Due to Competition.

The market in which HPR's products are licensed is highly competitive. Most
of the Company's competitors have significantly greater financial, technical,
product development and marketing resources than the Company. The Company's
potential competitors for customers include healthcare information companies and
large data processing and information companies. Many of these competitors have
substantial installed customer bases in the healthcare industry and the ability
to fund significant product development and acquisition efforts. The Company
believes that the principal competitive factors in its market are clinical
credibility and integrity and product innovation. These factors address both
customer needs for cost containment tools and increasing industry concerns about
quality control. Other important competitive factors include product reputation
and reliability, system features, client service, price, and the effectiveness
of marketing and sales efforts. There can be no assurance that future
competition will not have a material adverse effect on the Company's results of
operations, financial condition or business.

Dependence on Proprietary Software and Clinical Knowledge-Bases.

The Company's success is dependent to a significant extent on its ability to
maintain the proprietary and confidential software and clinical knowledge-bases
incorporated in CodeReview, Patterns Review, Episode Profiler, Quality Profiler,
Referral Profiler, Credentialer and other products as they are released. The
Company relies on a combination of patent, trade secret, copyright and
contractual protections to establish and protect its proprietary rights. There
can, however, be no assurance that the legal protections and the precautions
taken by the Company will be adequate to prevent misappropriation of the
Company's technology. Any infringement or misappropriation of the Company's
proprietary software and clinical knowledge-bases would disadvantage the Company
in its efforts to retain and attract new customers in a highly competitive
market, and could cause the Company to lose revenues or incur substantial
litigation expense. In addition, these protections and precautions do not
prevent independent third-party development of competitive technology or
products. Further, the Company depends on third-party suppliers to license to
HPR necessary technology that is incorporated into certain of the Company's
products, including Episode Profiler. The inability of the Company for any
reason to continue using or otherwise acquire such technology could prevent
distribution of such products, having a material adverse effect on the Company's
results of operations, financial condition or business.

Dependence on Certain Key Personnel.

The Company depends to a significant extent on key management, technical and
marketing personnel. The Company's growth and future success will depend in
large part on its ability to attract, motivate and retain highly qualified
personnel. The Company does not have employment agreements with any of its
officers or key employees providing for their employment for any specific term.
The Company does not have "key person" life insurance on any of its personnel
other than Marcia J. Radosevich, the Company's Chairman of the Board, Chief
Executive Officer, and President. The loss of key personnel, particularly the
loss of more than one member of the Company's executive management team, or the
inability to hire or retain qualified personnel could have a material adverse
effect on the Company's results of operations, financial condition or business.

Uncertainty in the Healthcare Industry.

The healthcare industry is subject to changing political, economic and
regulatory influences that may affect the procurement practices and operation of
healthcare organizations. The Company's products are designed to function within
the structure of the current national healthcare financing and reimbursement
system currently being used in the United States. The Company believes that the
commercial value and appeal of its products may be adversely affected if that
system were to be materially changed. During the past several years, the United
States healthcare industry has been subject to an increase in governmental
regulation of, among other things, reimbursement rates. Certain proposals to
reform the United States healthcare system are currently under consideration by
Congress. These programs may contain proposals to increase government
involvement in healthcare and otherwise change the operating environment for the
Company's customers. Healthcare organizations may react to these proposals and
the uncertainty surrounding such proposals by curtailing or deferring
investments in cost containment tools and related technology such as the
Company's products. The Company cannot predict what impact, if any, such factors
might have on its results of operations, financial condition or business. In
addition, many healthcare providers are consolidating to create integrated
healthcare delivery systems with greater regional market power. As a result,
these emerging systems could have greater bargaining power, which may lead to
price erosion of the Company's products. The failure of the Company to maintain
adequate price levels would have a material adverse effect on the Company's
results of operations, financial condition or business. Other legislative or
market-driven reforms could have unpredictable effects on the Company's results
of operations, financial condition or business.

Risk of Product Liability Claims.

The Company's products provide information that relates to payment of
healthcare claims and to the appropriateness of medical treatment in particular
cases and in general. Any failure by the Company's products to process such
claims or to review such treatments accurately could result in claims against
the Company by its customers. Further, successful use of the Company's products
could influence the treatments rendered by providers and give rise to claims
against the Company by patients or providers. The Company maintains insurance to
protect against certain claims associated with the use of its products, but
there can be no assurance that its insurance coverage would adequately cover any
claim asserted against the Company. A successful claim brought against the
Company in excess of, or excluded from, its insurance coverage could have a
material adverse effect on the Company's results of operations, financial
condition or business. Even unsuccessful claims could result in the Company's
expenditure of funds in litigation and management time and resources. While to
date the Company has not experienced any product liability claims against it,
the Company is aware of claims made against payors by patients for coverage
decisions which adversely influenced medical treatment. There can be no
assurance that the Company will not be subject to product liability claims, that
such claims will not result in liability in excess of its insurance coverage,
that the Company's insurance will cover such claims or that appropriate
insurance will continue to be available to the Company in the future at
commercially reasonable rates. In addition, if liability of the Company were to
be established, substantial revisions to its products could be required that may
cause the Company to incur additional unanticipated research and development
expenses.

Possible Volatility of Stock Price.

Prior to August 10, 1995, there was no public market for the Common Stock,
and there can be no assurance that an active trading market will be sustained or
that the market price of the Common Stock will not decline below its current
price. The stock market historically has experienced volatility which has
affected the market price of securities of many companies and which has
sometimes been unrelated to the operating performance of such companies. The
trading price of the Common Stock could also be subject to significant
fluctuations in response to variations in quarterly results of operations,
announcements of new products or acquisitions by the Company or its competitors,
governmental regulatory action, other developments or disputes with respect to
proprietary rights, general trends in the industry and overall market
conditions, and other factors. The market price of the Common Stock may be
significantly affected by factors such as announcements of new products by the
Company's competitors, as well as variations in the market conditions in the
medical cost containment or software industries in general. The market price may
also be affected by movements in prices of equity securities in general.

PART II. OTHER INFORMATION

Item 6 Exhibits and Reports on Form 8-K
(a) Exhibits

11.1 Statement re Computation of Earnings Per Share

(b) Reports on Form 8-K

There were no reports on Form 8-K filed during the
three months ended September 30, 1996.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

HPR INC.
(Registrant)

Dated: October 30, 1996 /s/ Marcia J. Radosevich
------------------------
Marcia J. Radosevich
Chairman of the Board, Chief
Executive Officer, and President
(Principal Executive Officer)

Dated: October 30, 1996 /s/ Brian D. Cahill
-------------------
Brian D. Cahill
Vice President, Corporate Finance
and Planning,and Chief Financial
Officer

(Principal Financial and
Accounting Officer)