This document presents a new algorithm for progressive medical image coding using binary wavelet transforms (BWT). It divides grayscale medical images into binary bit-planes and applies a three-level BWT to each bit-plane. It then encodes each BWT bit-plane using quadtree-based partitioning to exploit the energy concentration in high-frequency subbands. Experiments on ultrasound, MRI and CT images show it provides significant improvements in bitrate for required quality compared to existing progressive image coding methods.