COMPUMED, INC. WINS CONTRACT RENEWAL WITH NEW YORK STATE TO PROVIDE REMOTE ECG SCREENING
Department of Correctional Services to Purchase CardioGram ECG Terminals and Service

LOS ANGELES, July 15, 2004 -- CompuMed, Inc. (CMPD.OB) -- a medical informatics company serving the healthcare community with diagnostic software solutions -- today announced that it has been awarded a five year renewal of its contract to provide electrocardiogram (ECG) interpretation systems and services for the New York State Department of Correctional Services (NYDOCS).

Under the contract, NYDOCS will purchase a minimum of 87 new CardioGram systems along with ongoing ECG remote interpretation services. The new Internet-optimized CardioGram system is based on an advanced server platform created by Schiller AG (Baar, Switzerland) and customized to meet CompuMed's specifications.

"We are pleased that New York State renewed our contract for an additional five year term," said Jerry McLaughlin, CompuMed's CEO. "The purchase of these new ECG terminals will enable the State's correctional facilities to keep inmate medical costs under control via timely remote diagnosis of potentially serious health problems."

As one of the largest correctional systems in the nation, the New York Department of Correctional Services is responsible for the confinement and rehabilitation of about 65,000 inmates held at 70 state correctional facilities.

CompuMed's traditional core business is providing remote ECG interpretation services to medical facilities that may not have access to trained physicians qualified to interpret ECG results. Customers for the Company's CardioGram system are typically correctional facilities, ambulatory surgery centers, occupational health clinics and physicians' offices. One of the CardioGram's many advantages is an optional feature that automatically sends ECG results to a trained cardiologist for an over-read when the results are abnormal.

About CompuMed:

Founded in 1973, CompuMed, Inc. (OTC Bulletin Board: CMPD) is a leading provider of computer-aided telemedicine and diagnostics technology. The company's core products are the OsteoGramŽ and CardioGram systems. The OsteoGram, which is cleared by the FDA for commercial use, is an accurate and precise technology for low-cost osteoporosis testing. The CardioGram system remotely interprets electrocardiograms and is used by private practice, government and corporate healthcare providers nationwide. The CardioGram also has the capability to automatically provide an over-read (i.e., follow-up review) by a cardiologist. CompuMed is headquartered in Los Angeles. Visit CompuMed at www.compumed.net.

This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, ability to raise capital, the availability of appropriate acquisition candidates and/or business partnerships, economic conditions, the impact of competition and pricing, capacity and supply constraints or difficulties, government regulation and other risks defined in this document. All such forward-looking statements whether written or oral, and whether made by or on behalf of the Company are expressly qualified by these cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.

CONTACT: Erik Deutsch - Tellem Worldwide, +1 (310) 479-6111 x.15, edeutsch@tellem.com