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<CONFORMED-NAME>HEALTHSTREAM INC
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<STATE-OF-INCORPORATION>TN
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<BUSINESS-ADDRESS>
<STREET1>209 10TH AVE SOUTH STE 450
<CITY>NASHVILLE
<STATE>TN
<ZIP>37203
<PHONE>6153013100
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<DESCRIPTION>HEALTHSTREAM, INC. - FORM 8-K
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<TITLE>HEALTHSTREAM, INC. - FORM 8-K</TITLE>
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">



<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 1pt solid black; font-size: 1pt">&nbsp;</DIV>




<P align="center" style="font-size: 14pt"><B>SECURITIES AND EXCHANGE COMMISSION</B>

<DIV align="center" style="font-size: 12pt"><B>WASHINGTON, D.C. 20549</B>
</DIV>

<P align="center" style="font-size: 18pt"><B>FORM 8-K</B>


<P align="center" style="font-size: 12pt"><B>CURRENT REPORT<BR>
Pursuant to Section&nbsp;13 or 15(d) of the Securities Exchange Act of 1934</B>


<P align="center" style="font-size: 10pt"><B>Date of Report (Date of earliest event reported): February&nbsp;22, 2005 (February&nbsp;22, 2005)</B>


<P align="center" style="font-size: 24pt"><B>HealthStream, Inc.</B>


<DIV align="center" style="font-size: 10pt"><HR size="1" noshade width="100%" align="center" color="#000000">
(Exact name of registrant as specified in its charter)</DIV>


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<TR valign="bottom">
    <TD align="center" valign="top"><B>Tennessee</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>001-8833</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>62-1443555</B></TD>
</TR>
<TR style="font-size: 1px">
    <TD align="center" valign="top" style="border-top: 1px solid #000000">&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top" style="border-top: 1px solid #000000">&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">(State or other jurisdiction of incorporation)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(Commission File<BR>
Number)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(I.R.S. Employer<BR>
Identification No.)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
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    <TD width="47%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="47%">&nbsp;</TD>
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<TR valign="bottom">
    <TD align="center" valign="top">209 10<SUP style="font-size: 85%; vertical-align: text-top">th</SUP> Avenue South, Suite&nbsp;450</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">Nashville, Tennessee
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">37203</TD>
</TR>
<TR style="font-size: 1px">
    <TD align="center" valign="top" style="border-top: 1px solid #000000">&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">(Address of principal executive offices)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(Zip Code)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt"><B>Registrant&#146;s telephone number, including area code: (615)&nbsp;301- 3100</B>



<P align="center" style="font-size: 10pt"><B>Not Applicable</B>


<DIV align="center" style="font-size: 10pt"><HR size="1" noshade width="100%" align="center" color="#000000">
(Former name or former address, if changed since last report)</DIV>


<P align="left" style="font-size: 10pt">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions:



<P>
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    <TD nowrap><FONT face="Wingdings">&#111;</FONT>&nbsp;</TD>
    <TD>Written communications pursuant to Rule&nbsp;425 under Securities Act (17 CFR 230.425)</TD>
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    <TD nowrap><FONT face="Wingdings">&#111;</FONT>&nbsp;</TD>
    <TD>Soliciting material pursuant to Rule&nbsp;14a-12 under Exchange Act (17 CFR 240.14a-12)</TD>
</TR>
</TABLE>


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    <TD nowrap><FONT face="Wingdings">&#111;</FONT>&nbsp;</TD>
    <TD>Pre-commencement communications pursuant to Rule&nbsp;14d-2(b) under Exchange Act (17 CFR 240.14d-2(b))</TD>
</TR>
</TABLE>


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    <TD nowrap><FONT face="Wingdings">&#111;</FONT>&nbsp;</TD>
    <TD>Pre-commencement communications pursuant to Rule&nbsp;13e-4(c) under Exchange Act (17 CFR 240.13e-4(c))</TD>
</TR>
</TABLE>


<DIV style="width: 100%; border-bottom: 1pt solid black; margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>





<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">








<!-- TOC -->
<A name="toc"><DIV align="CENTER" style="page-break-before:always"><U><B>TABLE OF CONTENTS</B></U></DIV></A>

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<TR><TD></TD><TD colspan="8"><A HREF="#000"><U>Item&nbsp;2.02. Results of Operations and Financial Condition</U></A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#001"><U>Item&nbsp;7.01. Regulation&nbsp;FD Disclosure</U></A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#002"><U>Item&nbsp;9.01. Financial Statements and Exhibits</U></A></TD></TR>
<TR><TD colspan="9"><A HREF="#003">SIGNATURE</A></TD></TR>
<TR><TD colspan="9"><A HREF="#004">INDEX TO EXHIBIT</A></TD></TR>
<TR><TD colspan="9"><A HREF="g93421exv99w1.txt">EX-99.1 PRESS RELEASE 02/22/05</A></TD></TR>
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>




<!-- link2 "<U>Item&nbsp;2.02. Results of Operations and Financial Condition</U>" -->
<DIV align="left"><A NAME="000"></A></DIV>
<P align="left" style="font-size: 10pt"><U>Item&nbsp;2.02. Results of Operations and Financial Condition</U><BR>
On February&nbsp;22, 2005, HealthStream, Inc. issued a press release announcing results of operations
for its fourth quarter and full year 2004, the text of which is set forth in Exhibit&nbsp;99.1.


<!-- link2 "<U>Item&nbsp;7.01. Regulation&nbsp;FD Disclosure</U>" -->
<DIV align="left"><A NAME="001"></A></DIV>

<P align="left" style="font-size: 10pt"><U>Item&nbsp;7.01. Regulation&nbsp;FD Disclosure</U>


<P align="left" style="font-size: 10pt">On February&nbsp;22, 2005, HealthStream, Inc. issued a press release announcing results of operations
for its fourth quarter and full year 2004, the text of which is set forth in Exhibit&nbsp;99.1.


<!-- link2 "<U>Item&nbsp;9.01. Financial Statements and Exhibits</U>" -->
<DIV align="left"><A NAME="002"></A></DIV>

<P align="left" style="font-size: 10pt"><U>Item&nbsp;9.01. Financial Statements and Exhibits</U>



<P align="left" style="font-size: 10pt">(c)&nbsp;Exhibits



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;99.1 Press Release dated February&nbsp;22, 2005.


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

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<DIV align="left"><A NAME="003"></A></DIV>

<P align="center" style="font-size: 10pt"><B>SIGNATURE</B>


<P align="left" style="font-size: 10pt">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 hereunto duly authorized.



<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
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    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">HEALTHSTREAM, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Arthur E. Newman
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Arthur E. Newman&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD align="left"></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Chief Financial Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD align="left"></TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">February 22, 2005&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">


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<P align="center" style="font-size: 10pt"><B>INDEX TO EXHIBIT</B>


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    <TD nowrap align="left"><B>Exhibit<br></B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="left" style="border-bottom: 1px solid #000000"><B>Number</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Description</B></TD>
</TR>

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<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">99.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Press Release dated February&nbsp;22, 2005</TD>
</TR>
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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>g93421exv99w1.txt
<DESCRIPTION>EX-99.1 PRESS RELEASE 02/22/05
<TEXT>
<PAGE>
                                                                    EXHIBIT 99.1
For Immediate Release:

                             Contact:     Arthur Newman
                                          Chief Financial Officer
                                          (615) 301-3300
                                          ir@healthstream.com

                                          Media
                                          Mollie Elizabeth Condra
                                          Communications & Investor Relations
                                          (615) 301-3237
                                          mollie.condra@healthstream.com


HEALTHSTREAM ANNOUNCES FOURTH QUARTER & FULL YEAR 2004 RESULTS

HIGHLIGHTS:

     FOURTH QUARTER
     o    Fourth quarter revenues of $5.4 million, up 14% from fourth quarter
          2003
     o    Net income of $77,000 in the fourth quarter, compared to a net loss of
          $418,000 in fourth quarter 2003
     o    EBITDA of $572,000 in the fourth quarter, an improvement of $554,000
          over fourth quarter 2003

     FULL YEAR
     o    Revenues for the year of $20.1 million, up 10% over 2003
     o    Net loss improved 69% to a net loss of $1.0 million in 2004, compared
          to a net loss of $3.4 million in 2003
     o    Year ended with 1,040,000 fully implemented healthcare professional
          subscribers on our Internet-based learning network, up from 770,000 at
          the start of 2004, a 35% increase
     o    EBITDA improved to earnings of $818,000 for 2004 from a loss of
          $755,000 for 2003, ending the year with cash and investments of $16.5
          million


NASHVILLE, TENN. (FEBRUARY 22, 2005)--HealthStream, Inc. (NASDAQ/NM: HSTM), a
leading provider of learning solutions for the healthcare industry, announced
today results for the fourth quarter and full year ended December 31, 2004.

FINANCIAL RESULTS:
FOURTH QUARTER 2004 COMPARED TO FOURTH QUARTER 2003
Revenues for the fourth quarter of 2004 were $5.4 million, up 14 percent from
$4.8 million for the fourth quarter of 2003. This year-over-year increase is the
result of an increase of $610,000, or 28 percent, in revenues from our growing
subscriber base of our HealthStream Learning Center(TM). These revenue increases
were partially offset by lower content development revenues of $230,000. The
portion of revenues derived from our Internet-based subscription products
increased to 67 percent of total revenues for the fourth quarter of 2004 from 60
percent during the same quarter in 2003.

Gross margins (which we define as revenues less cost of revenues divided by
revenues) improved to 66 percent for the fourth quarter of 2004 from
approximately 63 percent in the

<PAGE>




fourth quarter of 2003. The improvement is a result of the increased revenues
from the HealthStream Learning Center(TM), but was partially offset by increased
personnel costs and higher royalties paid by us associated with content
subscription revenues. Net income for the fourth quarter of 2004 was $77,000, or
$0.00 per share, compared to a net loss of $418,000, or ($0.02) per share, for
the fourth quarter of 2003. The achievement of net income in the fourth quarter
of 2004 resulted primarily from increased revenues and related gross margin
improvement. Sales and marketing expense increases resulted from additional
account management and sales force personnel, which were partially offset by
lower personnel expenses associated with product development and general and
administrative functions.

EBITDA (which we define as earnings or loss before interest, taxes,
depreciation, and amortization) improved to $572,000 for the fourth quarter of
2004, compared to $18,000 for the fourth quarter of 2003. This improvement is
consistent with the factors mentioned above.

FULL YEAR 2004
Revenues for the year ended December 31, 2004 were $20.1 million, up 10 percent
from $18.2 million for 2003. Revenues for 2004 consisted of $14.0 million for
HCO (hospital-based customer channel) and $6.1 million for PMD (pharmaceutical
and medical device company customer channel). In 2003, revenues consisted of
$12.0 million for HCO and $6.2 million for PMD. The growth in HCO revenues
related primarily to increases in subscription revenues from our Internet-based
HealthStream Learning Center(TM) of $2.1 million, $340,000 from content
maintenance services, and $150,000 from the Competency Compass product. These
HCO revenue increases were partially offset by a decline of approximately
$550,000 associated with declines in maintenance fees related to our installed
learning management products, while content subscription revenues declined
slightly. The decline in PMD revenues was primarily associated with a reduction
in live event services of $290,000, which was partially offset by an increase of
$130,000 from content development revenues.

Gross margins declined to 64 percent for 2004 from 66 percent for 2003.This
decline resulted from increases in personnel, higher incremental costs
associated with increased content maintenance and content development revenues,
and increased royalties paid by us associated with content subscriptions and
Competency Compass revenues. The increase in personnel expenses associated with
our Competency Compass and HospitalDirect solutions were accounted for in
product development expenses in 2003. Now that both products have been launched,
these personnel costs were included in cost of revenues during 2004.

Net loss for 2004 improved 69 percent to a net loss of $1.0 million, or ($0.05)
per share, compared to a net loss for 2003 of $3.4 million, or ($0.17) per
share. The reduction in net loss over the prior year resulted from increased
revenues, an overall decline in personnel expenses, lower amortization,
reductions in marketing expenses, as well as reductions in other operating
expenses. These expense improvements were partially offset by an increase in
commission expense. We experienced lower personnel expenses for product
development and general and administrative areas, while sales and marketing
personnel expenses increased as a result of additional sales and account
management personnel.

EBITDA improved to earnings of $818,000 for 2004 from an EBITDA loss of $755,000
for 2003. This improvement is a result of the factors mentioned above.


<PAGE>





OTHER FINANCIAL INDICATORS
At December 31, 2004, the Company had cash, investments, and related interest
receivable of $16.5 million, comparable with September 30, 2004 balances, and
down from $18.0 million at December 31, 2003. The decline during the year
resulted from capital expenditures and content purchases of $2.5 million and an
increase in accounts receivable, which was partially offset by increases in
accrued liabilities and deferred revenue.

Our Days Sales Outstanding (DSO) increased from approximately 48 days for the
fourth quarter of 2003, to approximately 67 days for the fourth quarter of 2004.
This change resulted from increased accounts receivable associated with the
timing of billings during the fourth quarter of 2004. The Company calculates DSO
by dividing the accounts receivable balance (excluding unbilled and other
receivables) by average daily revenues for the quarter.

HOSPITAL-BASED CUSTOMER CHANNEL UPDATE
Our learning solutions are helping healthcare organizations improve their
required regulatory training, while also offering an opportunity to train their
employees in multiple clinical areas. In addition, our products are designed to
improve knowledge of medical devices, thereby reducing organizational risks and
improving patient safety.

At December 31, 2004, approximately 1,040,000 healthcare professionals were
fully implemented to use our Internet-based HealthStream Learning Center(TM) for
training and education. Revenue recognition commences when a contract is fully
implemented. This number was up from approximately 770,000 at December 31, 2003.
The total number of contracted subscribers at December 31, 2004 was
approximately 1,168,000, up from approximately 839,000 at December 31, 2003.
"Contracted subscribers" include both those already implemented (1,040,000) and
those in the process of implementation (128,000).

Concurrent with a larger number of subscribers is significantly greater usage of
the HealthStream Learning Center(TM) during 2004. Approximately 2,061,000 course
completion certificates were awarded to healthcare professionals in the fourth
quarter of 2004, a 57 percent increase over the fourth quarter of 2003.
Cumulatively, approximately 16 million courses were completed by healthcare
professionals on HealthStream's learning platform by year-end 2004. These
metrics reflect the sustained momentum of HealthStream's customers to actively
use the HealthStream Learning Center as their ongoing learning solution.

To introduce the most cost-efficient entry point to our products, HealthStream
launched HealthStream Express(TM), a streamlined, economy-scaled version of our
platform at the beginning of 2004. HealthStream Express is designed to meet a
basic set of regulatory requirements and is primarily targeted to healthcare
organizations with fewer than 500 employees. In its first year, HealthStream
Express was selected by 147 healthcare organizations, representing,
collectively, over 26,000 contracted subscribers.

Since the end of 2003, we have increased the penetration of our Competency
Compass product. The contract activity for this online competency assessment and
performance management solution for healthcare organizations has increased from
5,000 contracted users in 2003 to 17,000 contracted users at the end of 2004,
resulting in cumulative contact

<PAGE>




value, including implementation fees and product subscriptions, of approximately
$1.1 million at the end of 2004. We continue to develop tools and enhancements
for this product to improve penetration rates and grow our subscriber base.

During 2004, a number of our HealthStream Learning Center(TM) customers'
contracts came up for renewal. We measure our renewal rates by both the number
of customer accounts that are renewed and by the annual contract value renewed.
For the fourth quarter of 2004, the account renewal rate was 88 percent (14 out
of 16) and the renewal rate based on the annual value for the contracts renewed
was 94 percent. Cumulatively, for the year ended December 31, 2004, the account
renewal rate was 81 percent (87 out of 108) and the annual value for the
contracts renewed was 85 percent. The number of contracts coming up for renewal
and the annual value associated with those contracts will significantly increase
in 2005.


PHARMACEUTICAL AND MEDICAL DEVICE CUSTOMER CHANNEL UPDATE
HealthStream works with its pharmaceutical and medical device company customers
to develop education initiatives that reach hospital-based healthcare
professionals. Our innovative learning solutions are also used by these
customers in their product launch plans and in support of their sales training
efforts.

The live event business experienced lower sales activity in 2004 compared to
2003 due to our pharmaceutical and medical device customers taking a cautious
position with respect to additional regulations associated with commercial
support of educational activities. Live events comprise the planning,
development, implementation, and administration of educational activities for
healthcare professionals at either conference venues or within the hospital
environment, for which pharmaceutical and medical device companies provide the
commercial support. In the fourth quarter of 2004, we experienced approximately
30 percent growth compared to the third quarter of 2004 and modest improvement
when compared to the fourth quarter of 2003.

At December 31, 2004, medical device companies have contracted to train
hospital-based healthcare professionals on 28 devices. HospitalDirect is our
innovative software tool set that provides medical device companies a unique
gateway into the nation's single largest network of hospitals on a common,
online learning platform. During 2004, HealthStream launched over 100 online
courses for new device training and device-related education through
HospitalDirect.

During the fourth quarter of 2004, HospitalDirect experienced modest adoption
growth from new customers, while existing medical device companies increased the
number of medical devices they provide to our network of hospitals. We also
experienced modest growth in course completions in the current quarter compared
to the third quarter, ending the full year activity with 32,000 course
completions. At year-end, HospitalDirect has a cumulative contract value of
approximately $460,000.



<PAGE>




In addition, HealthStream helps medical device companies reach hospital-based
healthcare professionals through clinical education programs. Clinical education
programs are instructor-led continuing education activities directed by
HealthStream that typically take place in acute-care hospitals. In the fourth
quarter, approximately 9,800 hospital-based healthcare professionals utilized
this learning solution, up from approximately 7,000 in the prior quarter. For
the full year, approximately 30,400 healthcare professionals utilized this
learning solution.

FINANCIAL OUTLOOK 2005
Revenues for the first quarter of 2005 are expected to increase modestly over
the fourth quarter of 2004 and increase by an estimated $500,000 to $700,000
over the same prior year quarter. Gross margins are expected to improve over the
first quarter of 2004, but to decline slightly from the fourth quarter of 2004,
primarily due to changes in revenue mix.

For the full year 2005, revenues are expected to grow between 15-20 percent over
2004 with each quarter showing improvement over the same quarter from the prior
year. Gross margins are expected to improve over 2004 as a higher portion of
revenues are expected from our Internet-based subscription products. We expect
that product development, sales, account management, and marketing expenses will
increase during 2005, primarily due to additional personnel or commissions. We
also anticipate that general and administrative expenses will increase due to
increased costs associated with implementation of Sarbanes-Oxley regulations.

We anticipate approximating break-even net income in the first quarter of 2005
while incurring a net loss during the second quarter, primarily due to timing
associated with our annual eLearning Summit. During the third quarter of 2005,
we will adopt a new accounting rule which will require us to expense the fair
value of stock options. We have not yet completed our analysis of the impact on
our operational results for 2005. Excluding the impact of this charge, we expect
to achieve net income for the second half of 2005.

Capital expenditures and content purchases are expected to approximate $3
million in 2005. Approximately half of the anticipated spending is expected to
relate to hardware and software associated with delivery of our products and
services, while the remainder relates to development of new products, services,
and feature enhancements.

Commenting on 2004 results, Robert A. Frist, Jr., chief executive officer, said,
"Our record fourth quarter results represent a great way to end an outstanding
year for HealthStream. During 2004, top-line revenues increased 10 percent to
$20.1 million, EBITDA improved to $818,000, and the number of fully-implemented
subscribers on the HealthStream Learning Center grew 35 percent to approximately
1,040,000. Our year-end results reinforce our expectation to continue to achieve
net income for the full year 2005."

"With over one million healthcare professionals training on the HealthStream
Learning Center who collectively average approximately 30,000 online courses
completed per weekday, we believe we are improving our leadership position. We
believe our comprehensive learning solutions and our strategic value
propositions are increasingly attracting healthcare organizations to
HealthStream. During 2004, many of our new customers opted to transition

<PAGE>




from their existing vendor and upgrade to the HealthStream Learning Center,
including, for example, Tenet Healthcare, Bon Secours Health System, Henry Ford
Health System, and Mobile Infirmary Medical Center," explained Robert A. Frist,
Jr.

A conference call with Robert A. Frist, Jr., chief executive officer, Arthur
Newman, senior vice president and chief financial officer, Susan Brownie, senior
vice president of finance and human resources, and Mollie Condra, director of
communications and investor relations will be held on Wednesday, February 23 at
9:00 a.m. (EST). To listen to the conference, please dial 800-946-0741 (passcode
#2745261) if you are calling within the domestic U.S. If you are an
international caller, please dial 719-457-2649 (passcode #2745261). The
conference may also be accessed by going to
http://www.healthstream.com/Investors/index.htm for the simultaneous Webcast of
the call, which will subsequently be available for replay.


ABOUT HEALTHSTREAM
HealthStream (NASDAQ: HSTM) is a leading provider of learning solutions for the
healthcare industry. Approximately 1,168,000 contracted healthcare professionals
have selected the Internet-based HealthStream Learning Center(TM),
HealthStream's learning platform. The Company's learning products and services
are used by healthcare organizations to meet the full range of their training
needs, while, concurrently, supporting business objectives. Once subscribed to
the Healthcare Learning Center(TM), customers benefit from increased compliance,
reduced risks, and improved learning effectiveness. In addition, HealthStream
has pioneered a new collaboration with pharmaceutical and medical device
companies to assist them in product launch and market education initiatives
within the Company's nationwide network of hospital customers. Nine of the top
ten medical device companies and eight of the top ten pharmaceutical companies
are among the organizations in HealthStream's growing customer base.
(www.healthstream.com)


<PAGE>






                               HEALTHSTREAM, INC.
                             SUMMARY FINANCIAL DATA
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)


<TABLE>
<CAPTION>

                                                         THREE MONTHS ENDED                  YEAR ENDED
                                                            DECEMBER 31,                     DECEMBER 31,
                                               --------------------------------- -----------------------------------
                                                       2004             2003              2004              2003
                                                       ----             ----              ----              ----
<S>                                            <C>               <C>               <C>               <C>
Revenues                                        $       5,426    $       4,766     $      20,057     $      18,195

Operating expenses:
   Cost of revenues                                     1,860            1,766             7,277             6,268
   Product development                                    591              711             2,531             3,247
   Sales and marketing                                  1,336            1,142             4,799             4,445
   Depreciation and amortization                          578              507             2,107             3,048
   Other general and administrative                     1,067            1,131             4,634             4,986
                                                  -----------      -----------     -------------     -------------
      Total operating expenses                          5,432            5,257            21,348            21,994

Operating loss                                             (6)            (491)           (1,291)           (3,799)
   Other income, net                                       83               73               243               387
                                                -------------    -------------     -------------      ------------
Net income (loss)                               $          77    $        (418)     $     (1,048)     $     (3,412)
                                                =============    =============     =============     =============

Net Income (loss) per share:
Net income (loss) per share, basic              $        0.00    $      (0.02)     $      (0.05)     $      (0.17)
                                                =============    =============     =============     =============
Net income (loss) per share, diluted            $        0.00    $      (0.02)     $      (0.05)     $      (0.17)
                                                =============    =============     =============     =============

Weighted average shares outstanding:
Basic                                                  20,660           20,444            20,586            20,383
                                                =============    =============     =============     =============
Diluted                                                21,124           20,444            20,586            20,383
                                                =============    =============     =============     =============

</TABLE>









<PAGE>





                       SUMMARY FINANCIAL DATA - CONTINUED
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)


INCOME (LOSS) BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION OR EBITDA
(1):

<TABLE>
<CAPTION>

                                                                      THREE MONTHS ENDED                    YEAR ENDED
                                                                         DECEMBER 31,                       DECEMBER 31,
                                                             -------------------------------- -----------------------------------
                                                                    2004             2003              2004              2003
                                                                    ----             ----              ----              ----
<S>                                                          <C>              <C>               <C>               <C>
Net income (loss)                                            $         77     $       (418)     $     (1,048)     $     (3,412)
Interest income                                                       (86)             (75)             (258)             (413)
Interest expense                                                        3                4                13                22
Income taxes                                                           --               --                 4                --
Depreciation and amortization                                         578              507             2,107             3,048
                                                             ------------     ------------      ------------      ------------

Income (loss) before interest, taxes,
     depreciation and amortization                           $        572     $         18      $        818      $       (755)
                                                             ============     ============      ============      =============
</TABLE>

(1)      In order to better assess the Company's financial results, management
         believes that income (loss) before interest, taxes, depreciation and
         amortization ("EBITDA") is an appropriate measure for evaluating the
         operating performance of the Company at this stage in its life cycle
         because EBITDA reflects net income (loss) adjusted for non-cash and
         non-operating items. EBITDA is also used by many investors to assess
         the Company's results from current operations. EBITDA is a non-GAAP
         financial measure and should not be considered as a measure of
         financial performance under generally accepted accounting principles.
         Because EBITDA is not a measurement determined in accordance with
         generally accepted accounting principles, it is susceptible to varying
         calculations. Accordingly, EBITDA, as presented, may not be comparable
         to other similarly titled measures of other companies.






<PAGE>




                               HEALTHSTREAM, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>


                                                                                         DECEMBER 31,           DECEMBER 31,
                                                                                             2004                 2003 (1)
                                                                                             ----                 --------
<S>                                                                                    <C>                    <C>
ASSETS
Current assets:
     Cash, short term investments and related interest receivable                      $      16,492          $      18,021
     Accounts and unbilled receivables, net(2)                                                 4,588                  3,090
     Prepaid and other current assets                                                          1,393                  1,045
                                                                                       -------------          -------------
          Total current assets                                                                22,473                 22,156

Property and equipment, net                                                                    2,319                  2,003
Goodwill and intangible assets, net                                                            3,473                  3,817
Other assets                                                                                     292                    423
                                                                                       -------------          -------------
          Total assets                                                                 $      28,557          $      28,399
                                                                                       =============          =============

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
     Accounts payable, accrued and other liabilities                                   $       2,786          $       2,742
     Deferred revenue                                                                          3,988                  3,059
     Current portion of long-term liabilities                                                     24                     39
                                                                                       -------------          -------------
          Total current liabilities                                                            6,798                  5,840

Long-term liabilities, net of current portion                                                     30                      1
                                                                                       -------------          -------------
          Total liabilities                                                                   6,828                  5,841

Shareholders' equity:
     Common stock                                                                             91,642                 91,417
     Accumulated deficit and other comprehensive income                                      (69,913)               (68,859)
                                                                                       -------------          -------------
          Total shareholders' equity                                                          21,729                 22,558

          Total liabilities and shareholders' equity                                   $      28,557          $      28,399
                                                                                       =============          =============
</TABLE>



(1)  Derived from audited financial statements contained in the Company's filing
     on Form 10-K for the year ended December 31, 2003.

(2)  Includes unbilled receivables of $597 and $593 and other receivables of
     $20 and $14 at December 31, 2004 and 2003, respectively.












<PAGE>




This press release includes certain forward-looking statements (statements other
than solely with respect to historical fact), including statements regarding
expectations for the financial performance for 2005 that involve risks and
uncertainties regarding HealthStream. These statements are based upon
management's beliefs, as well as assumptions made by and data currently
available to management. This information has been, or in the future may be,
included in reliance on the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. Investors are cautioned that such results or
events predicted in these statements may differ materially from actual future
events or results. The Company's preliminary financial results, while presented
with numerical specificity, are forward-looking statements which are subject to
potential contingencies associated with the Company's year-end financial and
accounting procedures. The forward-looking statements contained herein are
subject to significant risks and uncertainties, including those referenced from
time to time in the Company's filings with the Securities and Exchange
Commission. Consequently, such forward-looking information should not be
regarded as a representation or warranty by the Company that such projections
will be realized. Many of the factors that will determine the Company's future
results are beyond the ability of the Company to control or predict. Readers
should not place undue reliance on forward-looking statements, which reflect
management's views only as of the date hereof. The Company undertakes no
obligation to update or revise any such forward-looking statements.

</TEXT>
</DOCUMENT>
</SUBMISSION>
