FORM 10-Q
                             -----------------------
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

         (Mark One)
         [X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                  SECURITIES EXCHANGE ACT OF 1934

                  FOR THE PERIOD ENDED SEPTEMBER 30, 2000

                                       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 Number: 0-22162

                         SIMIONE CENTRAL HOLDINGS, INC.
             (Exact name of registrant as specified in its charter)


        DELAWARE                                             22-3209241
        (State or other jurisdiction of                      (I.R.S. Employer
        incorporation or organization)                       Identification No.)

        6600 POWERS FERRY ROAD                               30339
        ATLANTA, GEORGIA                                     (zip code)
        (Address of principal
        executive offices)

     (Registrant's telephone number, including area code) (770) 644-6700

                                       N/A
                                      -----
     (Former name,  former address and former fiscal year, if changed since last
     report)

     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  the  number of  shares  outstanding  of each of the  registrant's
classes of common stock, as of the latest practicable date:

                                                        Outstanding at
                Class                                   10/31/2000
                -----                                   ---------------
                COMMON STOCK, $.001 PAR VALUE           3,849,816 SHARES



                                       1
<PAGE>


                         SIMIONE CENTRAL HOLDINGS, INC.

                          QUARTERLY REPORT ON FORM 10-Q

                                      INDEX


PART I.   FINANCIAL INFORMATION

Item 1.   Consolidated Financial Statements

          Consolidated  Balance  Sheets -  September  30, 2000  (unaudited)  and
          December 31, 1999 (audited).

          Consolidated  Statements  of Operations - Three Months and Nine Months
          Ended September 30, 2000 and 1999 (unaudited).

          Consolidated  Statements of  Shareholders'  Equity - Nine Months Ended
          September 30, 2000 (unaudited).

          Consolidated  Statements  of Cash Flows - Nine Months Ended  September
          30, 2000 and 1999 (unaudited).

          Notes to  Consolidated  Financial  Statements  -  September  30,  2000
          (unaudited).


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


PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings

Item 2.   Changes in Securities

Item 3.   Defaults Upon Senior Securities

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

Item 5.   Other Information

Item 6.   Exhibits and Reports on Form 8-K



                           SIGNATURES



                                       2
<PAGE>

<TABLE>
<CAPTION>
<S>                                                           <C>                    <C>
                                       SIMIONE CENTRAL HOLDINGS, INC.
                                         CONSOLIDATED BALANCE SHEETS

                                                                SEPTEMBER 30,          DECEMBER 31,
                                                                    2000                   1999
                                                              ------------------     -----------------
                                                                 (UNAUDITED)           (AUDITED)
                ASSETS
 Current assets:
     Cash and cash equivalents                                     $   1,661,000         $      47,000
     Accounts receivable, net of
        allowance for doubtful accounts
        of $542,000 and $166,000 respectively                          8,621,000             4,329,000
     Prepaid expenses and other current assets                           645,000               273,000
                                                              ------------------     -----------------
       Total current assets                                           10,927,000             4,649,000

Purchased software, furniture and equipment, net                       2,136,000               920,000
Intangible assets, net                                                24,634,000                     -
Other assets                                                             273,000             1,127,000
                                                              ------------------     -----------------
       Total assets                                                $  37,970,000         $   6,696,000
                                                              ==================     =================

                        LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
     Line of credit                                                $   4,598,000          $          -
     Notes Payable                                                       600,000                     -
     Accounts payable                                                  1,986,000             1,137,000
     Accrued compensation expense                                        511,000               393,000
     Accrued liabilities                                               6,986,000             1,334,000
     Customer deposits                                                 2,403,000               419,000
     Unearned revenues                                                 5,091,000             2,908,000
                                                              ------------------     -----------------
       Total current liabilities                                      22,175,000             6,191,000

Accrued liabilities, less current portion                                393,000                     -

Note payable long-term                                                   600,000                     -

Commitments and contingencies

Shareholders' equity:
     Preferred Stock ; 10,000,000 shares authorized
     Series B Preferred, $.001 par value;
     5,600,000  issued and outstanding                                     6,000                     -
     Series C Preferred, $.001 par value;
       850,000  issued and outstanding                                     1,000                     -
     Series D Preferred, $.001 par value;
       398,000  issued and outstanding                                         -                     -
     Common stock, $.001 par value; 20,000,000 shares authorized;
       3,850,000 shares issued and outstanding at September 30, 2000
       1,490,000 shares issued and outstanding at December 31, 1999        4,000                 1,000

     Additional paid-in capital                                       21,070,000             1,260,000
     Stock warrants                                                    1,000,000                    -
     Accumulated deficit                                              (7,279,000)             (756,000)
                                                              ------------------     -----------------
       Total shareholders' equity                                     14,802,000               505,000
                                                              ------------------     -----------------

       Total liabilities and shareholders' equity                  $  37,970,000         $   6,696,000
                                                              ==================     =================

</TABLE>


See notes to consolidated financial statements.
The above  financial  statements  reflect the fact that for accounting  purposes
MCS, Inc. is deemed to have acquired Simione Central Holdings,  Inc. on March 7,
2000,  the date of the merger,  as more fully  explained in Notes 1 and 2 to the
Consolidated Financial Statements.


                                       3
<PAGE>

<TABLE>
<CAPTION>
<S>                                              <C>                  <C>                <C>                  <C>
                                              SIMIONE CENTRAL HOLDINGS, INC.
                                          CONSOLIDATED STATEMENTS OF OPERATIONS
                                                       (UNAUDITED)

                                                   THREE MONTHS ENDED SEPTEMBER        NINE MONTHS ENDED SEPTEMBER 30,
                                                               30,
                                                 ---------------------------------   -------------------------------------
                                                      2000              1999               2000                 1999
                                                 ----------------  ---------------   ------------------   ----------------

Net revenues:                                        $ 8,547,000      $3,797,000          $18,805,000          $12,519,000

Costs and expenses:
    Cost of revenues                                   3,756,000       2,339,000           10,258,000            7,669,000
    Selling, general and administrative                3,262,000         986,000            7,522,000            3,152,000
    Research and development                           1,897,000         300,000            4,388,000              831,000
    Amortization and depreciation                      1,171,000          57,000            2,780,000              170,000
                                                ----------------  --------------     ------------------   ----------------
      Total costs and expenses                        10,086,000       3,682,000           24,948,000           11,822,000
                                                ----------------  --------------     ------------------   ----------------

    (Loss) income from operations                    (1,539,000)         115,000           (6,143,000)             697,000

Other (expense) income:
    Other (expense) income                                    -                -               (6,000)                  -
    Interest expense                                   (316,000)               -             (582,000)                  -
    Interest and other income                            17,000           13,000               57,000               28,000
                                                 ----------------  ---------------   ------------------   ----------------
                                                 ----------------  ---------------   ------------------   ----------------
Net (loss)income before taxes                        (1,838,000)         128,000           (6,674,000)             725,000
                                                 ----------------  ---------------   ------------------   ----------------
    Income tax benefit (expense)                         (7,000)         (52,000)             151,000            (284,000)
                                                 ----------------  ---------------   ------------------   ----------------
Net  (loss) income from continuing operations        (1,845,000)          76,000           (6,523,000)             441,000
                                                 ----------------  ---------------   ------------------   ----------------

Discontinued operation
    Income from operations of discontinued
         segment before taxes                                 -           54,000                    -              251,000

    Applicable tax expense                                    -           22,000                    -              100,000

Net income from operations of discontinued       ----------------  ---------------   -----------------    ----------------
     segment                                                  -           32,000                     -             151,000
                                                 ----------------  ---------------   -----------------    ----------------

Net  (loss) income                                 $ (1,845,000)      $  108,000         $ (6,523,000)         $   592,000
                                                 ================  ===============   =================    ================
Net (loss) income per share - basic and
diluted
    From continuing operations                     $      (0.48)      $     0.05          $     (1.99)         $      0.30
                                                 ================  ===============   =================     ===============
Weighted average common shares -
    basic and diluted                                  3,850,000       1,490,000             3,273,000           1,490,000
                                                 ================  ===============   =================    ================
Net (loss) income per share - basic and
diluted
    From discontinued operations                        $      -       $    0.02           $         -          $     0.10
                                                 ================  ===============   =================    ================
Weighted average common shares -
    basic and diluted                                  3,850,000       1,490,000             3,273,000           1,490,000
                                                 ================  ===============   =================    ================
Net (loss) income per share - basic and
diluted
    From discontinued operations                   $       (0.48)      $    0.07           $    (1.99)          $     0.40
                                                 ================  ===============   =================    ================
Weighted average common shares -
    basic and diluted
                                                       3,850,000       1,490,000             3,273,000           1,490,000
                                                 ================  ===============   =================    ================

</TABLE>


See notes to consolidated financial statements.
The above  financial  statements  reflect the fact that for accounting  purposes
MCS, Inc. is deemed to have acquired Simione Central Holdings,  Inc. on March 7,
2000,  the date of the merger,  as more fully  explained in Notes 1 and 2 to the
Consolidated Financial Statements.



                                       4
<PAGE>

<TABLE>
<CAPTION>
<S>                                 <C>         <C>          <C>      <C>       <C>          <C>         <C>          <C>

                         SIMIONE CENTRAL HOLDINGS, INC.
            CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT)
                  FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000

                                          Common                  Preferred       Additional                               Total
                                    -------------------       ----------------      Paid-In               Accumulated  Shareholders'
                                    Shares        Stock       Shares     Stock      Capital    Warrants      Deficit       Equity
                                    ------        -----       ------     -----      -------    --------   -----------  -------------
Balance at December 31, 1999          1,000     $   1,000         -    $    -   $ 1,260,000   $     -     $ (756,000)     $  505,000

MCS, Inc. shares eliminated
  in merger                         (1,000)       (1,000)                                                                    (1,000)


Simione Central Holdings, Inc.
Shares post merger,
$.001 par value                   3,850,000         4,000         -         -    19,810,000    1,000,000                  20,814,000

Issuance of $.001 par value
preferred stock in
connection with merger                    -             -  6,848,000   7,000                                      -          7,000
Series B, 5,600,000 shares
Series C,  850,000 shares
Series D,  398,000 shares                                                   -

Net loss                                  -             -          -        -            -     6,523,000)   (6,523,000)
                                  ----------    ---------  ---------   ------   -----------    ----------  ------------  -----------
Balance at September 30, 2000     3,850,000     $   4,000  6,848,000   $7,000   $21,070,000    $1,000,000  $(7,279,000)  $14,802,000
                                  ==========    =========  =========   ======   ===========    ==========  ============  ===========


See notes to consolidated financial statements.

The above financial statements reflect the fact that for accounting purposes MCS, Inc. is deemed to have acquired Simione Central
Holdings, Inc. on March 7, 2000, the date of the merger, as more fully explained in Notes 1 and to the Consolidated
Financial Statements.
</TABLE>


                                       5
<PAGE>


<TABLE>
<CAPTION>
    <S>                                                     <C>                  <C>

                         SIMIONE CENTRAL HOLDINGS, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOW


                                                             NINE MONTHS ENDED SEPTEMBER 30,
                                                            ----------------------------------
                                                                 2000              1999
                                                            ---------------  -----------------

    CASH FLOWS FROM OPERATING ACTIVITIES:
    Net loss                                                  $(6,523,000)        $ 592,000

    ADJUSTMENTS TO RECONCILE NET LOSS
    TO NET CASH USED IN OPERATING ACTIVITIES:
       Provision for doubtful accounts
                                                                   376,000                -
       Amortization and depreciation
                                                                 2,780,000          151,000

    CHANGES IN ASSETS AND LIABILITIES, NET OF ACQUISITIONS:
       Accounts receivable                                       (905,000)          210,000
       Prepaid expenses and other current assets                   215,000           42,000
       Other assets                                              (117,000)                -
       Accounts payable                                        (1,182,000)        (183,000)
       Accrued compensation expense                              (192,000)        (343,000)
       Accrued liabilities                                     (1,225,000)          613,000
       Customer deposits                                          856,000          202,000)
       Unearned revenues                                          817,000         (620,000)
                                                           ---------------   --------------
       Net cash (used) in provide by
       operating activities                                    (5,100,000)         260,000
                                                           ---------------   --------------

    CASH FLOWS FROM INVESTING ACTIVITIES:
    Acquisition of Simione (net of cash acquired)             (12,148,000)                -
    Net cash acquired in the reverse merger                      3,547,000                -
    Purchase of software, furniture and equipment                (408,000)        (206,000)
                                                           ---------------   --------------
       Net cash used in investing activities                   (9,009,000)        (206,000)
                                                           ---------------   --------------

    CASH FLOWS FROM FINANCING ACTIVITIES:
    Equity issued in Simione/MCS merger                         12,148,000                -
    Capital contribution from former parent                              -           80,000
    Proceeds from (payment on) notes payable                         7,000                -
    Proceeds from issuance of preferred stock                    1,000,000                -
    Increase in notes payable                                    2,568,000                -
    Dividends paid                                                       -        (161,000)
                                                           ---------------   --------------
       Net cash provided by (used in)financian activities       15,723,000         (81,000)
                                                           ---------------   --------------
       Net change in cash and cash equivalents                   1,614,000         (27,000)

    Cash and cash equivalents, beginning of periodb                 47,000           60,000
                                                           ---------------   --------------

    Cash and cash equivalents, end of period                   $ 1,661,000        $  33,000
                                                           ===============   ==============

See notes to consolidated financial statements
The above financial statements reflect the fact that for accounting purposes MCS, Inc. is deemed to have acquired Simione Central
Holdings, Inc. on March 7, 2000, the date of the merger, as more fully explained in Notes 1 and 2 to the Consolidated
Financial Statements.

                                       6
<PAGE>

</TABLE>




<PAGE>


                         SIMIONE CENTRAL HOLDINGS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000
                                   (UNAUDITED)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

MCS AS DEEMED ACQUIRER OF SIMONE CENTRAL HOLDINGS, INC.

     On March 7, 2000, Simione Central Holdings,  Inc. ("Simione") and MCS, Inc.
("MCS")  merged in a  transaction  accounted  for as a reverse  acquisition  for
financial reporting purposes. In connection with the acquisition, Simione issued
1,489,853 shares of its common stock in exchange for all the outstanding  common
stock of MCS, and thereby,  the former  shareholders of MCS acquired  control of
Simione.  As a result,  MCS is considered  the  acquiring  company;  hence,  the
historical   financial   statements  of  MCS  became  the  historical  financial
statements of Simione and include the results of operations of Simione only from
the effective acquisition date.

     The  weighted  average  common  shares  for the  nine  month  period  ended
September  30, 2000 are recast in the  accompanying  Consolidated  Statements of
Operations to give effect to the 1,489,853  shares of Simione  common stock that
were issued to the MCS shareholders in connection with the Simione/MCS merger on
March 7, 2000 as though such shares had been  outstanding for the entire period.
For the period from January 1, 2000 through March 6, 2000, therefore,  1,489,853
shares of issued and outstanding  Simione common stock are deemed to be owned by
the MCS  shareholders.  For the period from March 7, 2000 through  September 30,
2000, there were 3,849,816 total shares of issued and outstanding Company common
stock (after  giving effect to the  Simione/MCS  merger).  The weighted  average
shares for the nine month  period  ended  September  30, 1999 are also recast to
give effect to the 1,489,853  shares of Simione common stock that were issued to
the MCS  shareholders  pursuant to the Simione/MCS  merger as though such shares
had been outstanding for the entire period.


BASIS OF PRESENTATION

     The  consolidated  financial  statements  have been prepared by the Company
(which as used herein refers to Simione,  after giving effect to the merger with
MCS and, as the context requires, MCS, prior to the Simione/MCS merger), include
the  results  of  operations  of  the  parent   company  and  its  wholly  owned
subsidiaries,  and are  unaudited  (except for the  December  31,  1999  balance
sheet). In the opinion of management,  all adjustments  (which consist of normal
recurring  adjustments)  considered  necessary for a fair presentation have been
included.  All  intercompany  balances and  transactions  have been  eliminated.
Interim  results  are not  necessarily  indicative  of the  results  that may be
expected for the year ending December 31, 2000.

     Certain financial information and footnote disclosures normally included in
financial  statements  prepared in accordance with generally accepted accounting
principles have been condensed or omitted.  These financial statements should be
read in conjunction with the consolidated financial statements and notes thereto
as of December 31, 1999 appearing in the Company's  Report on Form 10-K filed on
May 22, 2000.

     Certain prior period amounts have been  reclassified to conform to the 2000
financial statement presentation.


DESCRIPTION OF BUSINESS

     The  Company is a leading  provider  of  integrated  systems  and  services
designed to enable home health care providers to more effectively  operate their
businesses and compete in the prospective  payment system (PPS) and managed care
environments.  The Company offers several  comprehensive  and flexible  software
solutions,  each of which provide a core platform of software  applications  and
which incorporate  selected  specialized modules based on customer demand. These
software  solutions  are  designed to enable  customers  to generate and utilize
comprehensive  financial,  operational and clinical information.  In addition to
its software solutions and related software support services, the Company's home
health care consulting services assist providers in addressing the challenges of
reducing costs, maintaining quality,  streamlining operations and re-engineering
organizational  structures,  as well as assisting with regulatory compliance and
merger and acquisition due diligence.



                                       7
<PAGE>


MANAGEMENT ESTIMATES

     The  preparation  of financial  statements  in conformity  with  accounting
principles  generally accepted in the United States requires  management to make
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  as well as the  reported  amounts  of  revenues  and
expenses  during the reporting  period.  Actual  results could differ from those
estimates.


REVENUE RECOGNITION

     In 1998,  the Company  adopted the American  Institute of Certified  Public
Accountants  ("AICPA")  Statement of Position  ("SOP") 97-2,  "Software  Revenue
Recognition,"  which  supersedes  SOP 91-1  and is  effective  for  transactions
entered  into for fiscal years  beginning  after  December 31, 1997.  While some
principles  remain the same,  there are several key differences  between the two
pronouncements,  including accounting for multiple element  arrangements.  Under
SOP 97-2, the Company  recognizes  software  license  revenue when the following
criteria are met: (1) a signed and executed  contract is obtained;  (2) shipment
has occurred;  (3) the license fee is fixed and determinable;  (4) collection is
probable;  and  (5)  remaining  obligations  under  the  license  agreement  are
immaterial.  The Company sells and invoices  software  licenses and  maintenance
fees  as  separate  contract  elements,   except  with  respect  to  first  year
maintenance  for the  Mestamed  product  which is sold in the form of a  bundled
turnkey system. Prices net of discounts are separately identified at the time of
sale for each element.  The Company has established  vendor  specific  objective
evidence related to the value of maintenance fees. The Company uses the residual
value method to allocate  Mestamed  software  revenue between licenses and first
year maintenance. The adoption of SOP 97-2 did not have a material impact on the
Company's financial statements.

     Revenues are derived from the licensing and sub-licensing of software,  the
sale of computer hardware, accessories and supplies,  professional and technical
consulting  services,  implementation and training products and services,  forms
and case plans, software maintenance and support services, outsourcing services,
as well as home health care management consulting services.

     To the extent that  software and  services  revenues  result from  software
support,  implementation,  training  and  technical  consulting  services,  such
revenues  are  recognized  monthly as the related  services are rendered or, for
software support revenues, over the term of the related agreement. To the extent
that  software and services  revenues  result from software  licenses,  computer
hardware and third-party  software  revenues,  such revenues are recognized when
the related products are delivered and  collectibility  of fees is determined to
be probable, provided that no significant obligation remains under the contract.
Limited amounts of revenues derived from the sale of software licenses requiring
significant modification or customization are recorded based upon the percentage
of completion method using labor hours or contract milestones.  Software support
or  maintenance  allows  customers  to  receive  unspecified   enhancements  and
regulatory data updates in addition to telephone  support.  Consulting  services
revenues are recognized monthly as the related services are performed.

     Revenues for post-contract customer support are recognized ratably over the
term of the support period,  which is typically one year. Post contract customer
support  fees  typically  cover  incremental  product  enhancements,  regulatory
updates  and  correction  of  software  errors.  Separate  fees are  charged for
significant product  enhancements,  new software modules,  additional users, and
migrations to different operating system platforms.

     Subsequent to system shipment, the Company frequently delivers a variety of
add-on  software  and  hardware  components.   Revenues  from  these  sales  are
recognized upon shipment.

     In addition to software  licenses,  software  maintenance and support,  and
related hardware, the Company also provides computer-based training, CD-ROMs and
a number of ancillary  services  including on site  implementation and training,
classroom training,  consulting and "premium" and after-hours support.  Revenues
from such  products  and services are  recognized  monthly as such  products are
delivered and such services are performed.



                                       8
<PAGE>


     Unbilled  receivables  typically represent revenues from ancillary services
performed  and earned in the  current  period but not  billed  until  subsequent
periods,  usually within one month.  Unearned revenues  represent amounts billed
and included in accounts  receivable for which revenue  recognition  has not yet
occurred.


PROPERTY AND EQUIPMENT

     Property and equipment are carried at cost.  Depreciation  and amortization
are computed using the  straight-line  method over the estimated useful lives of
the  assets.  When  assets are retired or  otherwise  disposed  of, the cost and
related accumulated depreciation are removed from the accounts and any resulting
gain or loss is reflected in income for the period.


SOFTWARE DEVELOPMENT EXPENSES

     SFAS No. 86 requires that software development costs incurred subsequent to
the  establishment of technological  feasibility for the product be capitalized.
The Company has no capitalized development costs as of September 30, 2000 except
those  developed  technologies  capitalized in connection  with the  Simione/MCS
merger on March 7, 2000 as more fully described in Note 5.


CONCENTRATIONS AND MAJOR CUSTOMERS

     The  Company  sells its systems and  services to various  companies  in the
health care industry.  The Company  performs  ongoing credit  evaluations of its
customers'  financial condition and, generally,  requires no collateral from its
customers.  Current  operations  are  charged  with an  allowance  for  doubtful
accounts based upon  experience and any unusual  circumstances  which affect the
collectibility of receivables.  Amounts deemed uncollectible are charged against
this allowance.


CASH EQUIVALENTS

     All highly liquid investments  purchased with an original maturity of three
months or less are considered to be cash equivalents.


PURCHASED SOFTWARE, LEASEHOLD IMPROVEMENTS

     Purchased   Software  and  Leasehold   Improvements  are  stated  at  cost.
Amortization   is  calculated  for  financial   reporting   purposes  using  the
straight-line  method over the estimated  useful lives  (ranging from one to ten
years) of the assets or lease term, whichever is shorter.


INTANGIBLE ASSETS AND LONG-LIVED ASSETS

     Statement of Financial  Accounting  Standards ("SFAS") No. 121, "Accounting
for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of"  requires  impairment  losses to be  recorded on  long-lived  assets used in
operations when indicators of impairment are present and the  undiscounted  cash
flows  estimated  to be  generated  by those  assets  are less than the  asset's
carrying  amount.  SFAS No. 121 also  addresses the  accounting  for  long-lived
assets that are expected to be disposed of.



                                       9
<PAGE>




     The intangible assets,  arising from the Simione/MCS  merger, are amortized
using the  straight-line  method over the estimated  useful lives of the related
assets as more fully disclosed in Note 5. The Company reviews its long-lived and
intangible  assets for impairment  whenever  events or changes in  circumstances
indicate that the carrying  amount may not be  recoverable.  The  measurement of
possible  impairment is based upon determining  whether  projected  undiscounted
future cash flow from the use of the asset is less than the  carrying  amount of
the asset.


INCOME TAXES

     The Company  accounts  for income  taxes using the  asset/liability  method
which  requires  recognition  of  deferred  tax  liabilities  and assets for the
expected future tax consequences of temporary  differences between the financial
statement carrying amount and the tax bases of assets and liabilities.


NET LOSS PER SHARE

     The Company has adopted  SFAS No. 128,  "Earnings  Per Share." SFAS No. 128
which replaced the  calculation of primary and fully diluted  earnings per share
with basic and diluted  earnings per share.  Unlike primary  earnings per share,
basic earnings per share excludes any dilutive effects of options,  warrants and
convertible  securities.  Diluted  earnings  per share are very  similar  to the
previously  reported fully diluted earnings per share. Per share amounts for all
periods have been presented in conformity with SFAS No. 128 requirements.


STOCK BASED COMPENSATION

     Stock options are accounted for under  Accounting  Principles Board Opinion
No. 25, "Accounting for Stock Issued to Employees," and related interpretations.


FAIR VALUE OF FINANCIAL INSTRUMENTS

     The  following  methods  and  assumptions  were  used  by  the  Company  in
estimating its fair value disclosures for financial instruments:

     Cash and cash  equivalents:  The carrying  amounts  reported in the balance
sheet for cash and cash equivalents approximate their fair value.

     Notes  payable:  The  carrying  amounts  of  the  Company's  notes  payable
approximates their fair value.


RECENTLY ADOPTED ACCOUNTING STANDARDS

     In 1998,  the  Financial  Accounting  Standards  Board  issued SFAS No. 133
"Accounting for Derivative  Instruments and Hedging Activities." SFAS No. 133 is
effective for the Company's first quarter of the fiscal year ending December 31,
2001.  The Company's  management  does not believe that the adoption of SFAS No.
133 will have a material impact on the Company's  financial  position or results
of operations.

     On  December 3, 1999,  the SEC  released  Staff  Accounting  Bulletin  101,
(SAB 101)   "Revenue   Recognition  in  Financial   Statements".  This  bulletin
established  more clearly defined revenue  recognition  criteria than previously
existing accounting pronouncements. On June 26, 2000, the SEC released SAB 101B,
which  delayed the  required  implementation  of SAB 101 until no later than the
fourth quarter of fiscal years ending  December 31, 2000.  The Company  believes
that  the  effects  of this  bulletin  will  not be  material  to its  financial
position, results of operations or cash flow.



                                       10
<PAGE>


DISCONTINUED OPERATIONS

     The discontinued operations reported in the Company's results of operations
for the nine months ended September 30, 1999 relate to MCS's Profitworks segment
which was  distributed  to MCS's parent  company,  Mestek Inc.,  its then parent
company, on September 1, 1999.

NOTE 2 - MERGER

     On March 7, 2000, MCS completed the merger with Simione  Central  Holdings,
Inc.  (Simione).  Simione  issued  1,489,853  shares  of  common  stock  to  MCS
stockholders in exchange for all of the outstanding  shares of MCS common stock.
This number of shares has been adjusted to reflect a one-for-five  reverse stock
split  that  was  completed  by  Simione  immediately  prior to the  merger.  In
connection  with the  closing of the merger,  Mestek  invested  $6.0  million in
Simione in  exchange  for 5.6  million  shares of Series B  preferred  stock and
warrants  to  purchase  400,000  shares (on a split  adjusted  basis) of Simione
common  stock.  Additional  information  on the merger is included in  Simione's
Registration Statement on Form S-4 (Registration No. 333-96529).

     Pro-forma unaudited results assuming the merger took place as of January 1,
1999,  and further  assuming that the  acquisition  of CareCentric by Simione on
August 12, 1999 took place on January 1, 1999, are as follows:


                                          FOR NINE MONTHS ENDED SEPTEMBER 30,
                                        ----------------------------------------
                                        -------------------  -------------------
                                              2000                     1999
                                        -------------------  -------------------

    Net revenues                            $  22,815,000         $  34,228,000
    Net (loss)                              $  (7,918,000)        $  (8,173,000)
    Net (loss) per share - basic            $       (2.06)        $       (2.12)
    Net (loss) per share - diluted          $       (2.06)        $       (2.11)


NOTE 3 - INVENTORIES

     Inventories  consist  principally of computer equipment held for resale and
related  operating system licenses.  Inventories are valued at the lower of cost
or market.


NOTE 4 - FURNITURE AND EQUIPMENT

Property and equipment consisted of the following:
<TABLE>
<CAPTION>
   <S>                                            <C>                     <C>                       <C>

                                                                                                       DEPRECIATION
                                                     SEPTEMBER 30,             DECEMBER 31,              ESTIMATED
                                                          2000                     1999                USEFUL LIVES
                                                  ---------------------    ---------------------    --------------------

    Furniture and Fixtures                              $    1,533,000            $     315,000          10 years
    Computer equipment                                       5,996,000                1,483,000           5 years
                                                  ---------------------    ---------------------     -------------------
                                                             7,529,000                1,798,000
    Accumulated depreciation                               (5,393,000)                (878,000)
                                                  ---------------------    ---------------------
                                                        $    2,136,000            $     920,000
                                                  =====================    =====================
</TABLE>


                                       11
<PAGE>



NOTE 5 - INTANGIBLE ASSETS

Intangible assets at September 30, 2000 consisted of the following:
<TABLE>
<CAPTION>
    <S>                               <C>                  <C>                    <C>                <C>
                                                               ACCUMULATED            NET BOOK            AMORTIZATION
                                             COST             AMORTIZATION              VALUE                PERIOD
                                       -----------------   --------------------   ------------------  ---------------------

    Developed technology                    $10,650,000         $    (776,000)         $  9,874,000         8 years
    Assembled workforce                       2,300,000              (268,000)            2,032,000         5 years
    Customer base                             1,700,000              (110,000)            1,590,000         9 years
    Goodwill                                 12,151,000            (1,013,000)           11,138,000         7 years
                                       -----------------   --------------------   ------------------
                                            $26,801,000         $  (2,167,000)         $ 24,634,000
                                       =================   ====================   ==================
</TABLE>

     Amortization of the above  intangible  assets will reduce  operating income
(or increase operating losses) by approximately $3.1 million in the year 2000.

NOTE 6 - INCOME TAXES

     At December 31, 1999,  Simione  Central  Holdings,  Inc. had  approximately
$15.3  million of net  operating  losses for income tax  purposes  available  to
offset future taxable  income.  Such losses expire  beginning in 2010 and may be
subject  to  certain  limitations  arising  from  the  change  in  ownership  in
connection with the Simione/MCS  merger on March 7, 2000. A valuation  allowance
reducing  the net  deferred  tax  assets  to zero  has  been  recorded  based on
management's assessment that it is "more likely than not" that this net asset is
not realizable as of September 30, 2000.

     The  Company's  actual  income tax expense  (benefit)  for the three months
ended  September  30, 2000  differs  from the  "expected"  amount  (computed  by
applying the U.S.  Federal  corporate  income tax rate of 35% to the loss before
income  taxes) due to the fact that the portion of the loss arising  after March
7, 2000, the date of the Simione/MCS  merger,  cannot be assured of generating a
federal income tax benefit in the future.


NOTE 7 - NOTES PAYABLE AND CAPITAL LEASE OBLIGATIONS

                                        SEPTEMBER 30, 2000     DECEMBER 31, 1999
                                        ------------------     -----------------

SHORT TERM:
Line of Credit                          $   4,598,000
Note Payable - Mestek                         600,000           $      -
                                        ===============         ================

LONG TERM:
Convertible Note Payable -
 Barrett C. O'Donnell                   $     600,000           $      -
                                        ===============         ================



                                       12
<PAGE>


Line of Credit:

     On July 12, 2000, the Company entered into a $6.0 million Loan and Security
Agreement  facility (the  Wainwright  Facility) with  Wainwright  Bank and Trust
Company,  a commercial  bank,  under which the Company  granted a first priority
position on substantially all of its assets as security. The Wainwright Facility
was used to pay off the Line of Credit with Silicon  Valley Bank,  certain short
term loans from  Mestek,  Inc.,  and a loan from David O.  Ellis,  as more fully
described  below in Note 7.  Borrowings  under the  Wainwright  Facility  accrue
interest,  at the bank's  prime  rate per annum,  require  monthly  payments  of
interest  and  mature on July 12,  2001.  The  Company's  obligations  under the
Wainwright Facility are guaranteed by Mestek, Inc. in consideration of which the
Company has issued a warrant to Mestek,  Inc. to purchase  104,712 shares of the
Company's  common stock as more fully  explained  in Note 10 to these  Financial
Statements.

Convertible Note Payable - Barrett C. O'Donnell:

     On November 11, 1999,  Simione borrowed  $500,000 from Barrett C. O'Donnell
and  $250,000  from David O. Ellis,  both on an  unsecured  basis,  and executed
promissory  notes in  connection  therewith.  Dr.  Ellis and Mr.  O'Donnell  are
directors of the Company.  When the Simione/MCS merger was completed on March 7,
2000, the Company  succeeded to both of these  obligations.  The note payable to
Dr. Ellis,  which accrued interest at 9% per annum, was paid in full on July 12,
2000 in  advance  of its  August  15,  2000  maturity.  The note  payable to Mr.
O'Donnell  included interest at 9% per annum, was scheduled to mature on May 11,
2002, and required quarterly payment of accrued interest. On August 8, 2000, the
$500,000  note  payable to Mr.  O'Donnell,  together  with  $100,000 of deferred
salary, was cancelled in exchange for a $600,000 subordinated note,  convertible
into Common Stock at a strike price of $2.51 per share,  with interest at 9% per
annum and a five-year maturity.

Note Payable - Mestek:

     The Company is obligated under a one year unsecured  promissory note in the
principal  amount of  $600,000  payable to Mestek Inc.  which bears  interest at
prime with  interest  payable  semiannually  and which matures on July 30, 2001.
This note  covers  funds  advanced  by Mestek to  Simione to cover  payroll  and
accounts  payable  obligations  incurred by the Company during the period of its
transition of senior  lenders from Silicon  Valley Bank to  Wainwright  Bank and
Trust Company.

J.E. Reed facility:

     On June 22, 2000, the Company entered into a new financing facility (the J.
E. Reed Facility)  provided by John E. Reed, a Simione director and the Chairman
and Chief Executive Officer of Mestek,  Inc. The J. E. Reed Facility consists of
a $6.0 million  subordinated  revolving line of credit,  convertible into Common
Stock of the Company at a strike price of $2.51 per share,  with  interest at 9%
per annum and a five-year maturity. The J. E. Reed Facility can be drawn down by
the Company as needed in $500,000 increments and is secured by a second position
on  substantially  all of the Company's  assets.  No borrowings were outstanding
under the J. E. Reed Facility as of September 30, 2000.

     The  Company  is  obligated  under a number of  capital  lease  obligations
originally  entered into by Simione related to computer  equipment formerly used
in Simione's business.


NOTE 8 - COMMITMENTS AND CONTINGENCIES

     The Company is engaged in various legal and regulatory  proceedings arising
in the normal  course of  business  which  management  believes  will not have a
material adverse effect on its financial position or results of operations.

     The Company  reached a settlement on June 30, 2000 with IBM relative to the
early  cancellation  of the Company's  service  agreement  with IBM for services
provided to a former customer of a subsidiary of Simione Central Holdings, Inc.,
and  related  fees for  services.  The  settlement  was  fully  reserved  for in
connection with the accounting for the Simione/MCS  merger on March 7, 2000 and,
accordingly, did not have a material adverse impact upon the Company's financial
condition or results of operations.



                                       13
<PAGE>


NOTE 9 - SEGMENT RESULTS

     The Company has two reportable  segments:  product  related and consulting.
The Company's product related segment sells  comprehensive and flexible software
solutions and services to enable home health care providers to more  effectively
operate their  businesses and compete in  prospective  payment (PPS) and managed
care environments.  The consulting segment assists home health care providers in
addressing the challenges of reducing costs,  maintaining quality,  streamlining
operations and re-engineering  organizational  structures,  as well as assisting
with  regulatory  compliance  and  assisting  with  merger and  acquisition  due
diligence.

     The Company evaluates  performance and allocates  resources based on profit
or loss  from  operations,  not  including  gains and  losses  on the  Company's
investment portfolio. The accounting policies of the reportable segments are the
same as those used for the  consolidated  financial  statements.  The  revenues,
operating  losses and assets of the Company  include the  operations  of Simione
from March 7, 2000 to September  30, 2000,  the  operations  of MCS for the full
nine months ended  September  30, 2000,  and the  operations of MCS only for the
three  month and nine  month  periods  ended  September  30,  1999 as more fully
explained in Note 1. Accordingly, because Simione's 1999 results from operations
are not  included,  comparability  between  1999 and 2000  figures is  adversely
affected.  See Management's  Discussion and Analysis of Financial  Condition and
Results of Operations for a discussion of revenue and results of operations on a
"comparable" basis. The revenues,  operating losses and assets of the Company by
business segment are as follows:

<TABLE>
<CAPTION>
<S>                                 <C>                     <C>                  <C>                     <C>

                                  THREE MONTHS ENDED SEPTEMBER 30,                NINE MONTHS ENDED SEPTEMBER 30,
                             --------------------------------------------   --------------------------------------------
                                    2000                    1999                   2000                    1999
                             --------------------   ---------------------   --------------------   ---------------------
Revenues
     Product related                 $ 7,334,000             $ 3,797,000           $ 16,102,000            $ 12,519,000
     Consulting                        1,213,000                                      2,703,000
                                                                       -                                              -
                             --------------------   ---------------------   --------------------   ---------------------
              Total                  $ 8,547,000             $ 3,797,000           $ 18,805,000            $ 12,519,000
                             ====================   =====================   ====================   =====================

Cost of sales
     Product related                 $ 2,620,000             $ 2,339,000            $ 7,670,000             $ 7,669,000
     Consulting                        1,136,000                                      2,588,000
                                                                       -                                              -
                             --------------------   ---------------------   --------------------   ---------------------
              Total                  $ 3,756,000             $ 2,339,000           $ 10,258,000             $ 7,669,000
                             ====================   =====================   ====================   =====================

Research and development
     Product Related                 $ 1,897,000              $  300,000            $ 4,388,000              $  831,000
                             ====================   =====================   ====================   =====================

Depreciation and amortization
     Product related                 $ 1,028,000               $  57,000            $ 2,457,000              $  170,000
     Consulting                          143,000                       -                323,000
                             --------------------   ---------------------   --------------------   ---------------------
              Total                  $ 1,171,000               $  57,000            $ 2,780,000              $  170,000
                             ====================   =====================   ====================   =====================

Net income (loss)  before
taxes from continuing operations
     Product related               $ (1,868,000)              $  128,000           $(6,401,000)              $  725,000
     Consulting                          30,000                        -              (273,000)                       -
                             --------------------   ---------------------   --------------------   ---------------------
              Total                $ (1,838,000)              $  128,000           $(6,674,000)              $  725,000
                             ====================   =====================   ====================   =====================


                                                       September 30,           December 31,
                                                            2000                   1999
                                                    ---------------------   --------------------
Assets
     Product related                                        $ 33,355,000            $ 6,696,000
     Consulting                                                4,615,000                      -
                                                    ---------------------   --------------------
              Total                                         $ 37,970,000            $ 6,696,000
                                                    =====================   ====================

</TABLE>

The Net  Income  (loss)  from  continuing  operations  reported  above  has been
affected by non-cash depreciation and amortization charges as reported above.


                                       14
<PAGE>


NOTE 10 - SHAREHOLDERS' EQUITY

     Subsequent  to the  Simione/MCS  Merger  on March 7,  2000,  the  Company's
Shareholders'  Equity  (all on a  split  adjusted  basis)  is  comprised  of the
following:

     Common Shares - 20,000,000 shares  authorized,  $.001 par value,  3,849,816
shares issued and outstanding.  1,489,853 of such shares were issued on March 7,
2000 to the former MCS common  shareholders.  606,904 of such shares were issued
on March 7, 2000 to the former holders of Simione Central Holdings,  Inc. Series
A Preferred  Stock,  which shares were  converted  into Simione common shares in
connection with the merger.  If the value of the Company's common stock does not
equal $15.00 per share on or prior to December 31, 2000, the Company is required
to issue up to an  additional  606,904  shares  of  common  stock to the  former
holders of the Series A Preferred Stock or, alternatively,  at the discretion of
the  Company,  to pay cash or a  combination  of cash and  common  stock to such
former holders of the Series A Preferred  Stock under a formula set forth in the
CareCentric/Simione merger agreement.

     Preferred Stock-10,000,000 shares authorized

     Series B Preferred  Stock -$.001 par value,  5,600,000  shares issued.  The
shares of Series B Preferred  Stock are held by Mestek,  Inc.  (Mestek) and were
issued in consideration of $6,000,000 paid to Simione Central Holdings,  Inc. on
March 7, 2000, in the form of cash and debt forgiveness.  The Series B Preferred
shares, as originally  issued,  carried 2,240,000 common share votes (on a split
adjusted  basis) and were  entitled  to a 9%  cumulative  dividend,  among other
rights  which are  described  in greater  detail in  Appendix  B to the  Simione
Central  Holdings,  Inc.-MCS,  Inc. Joint Proxy Statement issued pursuant to the
merger.  In connection with the Company's  application for listing on the NASDAQ
SmallCap  Market,  the Company reached an agreement with Mestek on June 12, 2000
under which  Mestek  agreed to allow the  aforementioned  number of common share
votes to be  reduced to  1,120,000  in  consideration  for the  issuance  by the
Company to Mestek of a warrant to acquire up to 490,396 shares of Simione common
stock, as more fully described below.

     Series C Preferred  Stock - $.001 par value,  850,000  shares  issued.  The
shares of Series C Preferred Stock are held by Mestek,  Inc. and result from the
conversion of a pre-existing  $850,000  convertible note payable to Mestek, Inc.
The Series C  Preferred  shares  carry  170,000  common  share votes (on a split
adjusted  basis) and are  entitled to an 11%  cumulative  dividend,  among other
rights  which are  described  in greater  detail in  Appendix  F to the  Simione
Central Holdings,  Inc.-Mestek,  Inc. Joint Proxy Statement issued in connection
with the merger.

     Series D Preferred  Stock - $.001 par value,  398,406  shares  issued.  The
shares of Series D  Preferred  Stock are held by John E. Reed and were issued on
June 12, 2000 in  consideration of $1.0 million paid to the Company in cash. The
Series D Preferred  shares are entitled to other  rights which are  described in
greater detail in the Certificate of Designations, Preferences and Rights of the
Series D Preferred Stock of Simione included in Simione's  Restated  Certificate
of  Incorporation,  which was filed as an exhibit to Simione's Form 10-Q for the
period ended June 30, 2000.

     Common  Stock  Warrants - In  connection  with the issuance of the Series B
Preferred Stock described above,  Mestek,  Inc. received a warrant to acquire up
to 400,000  shares of the Company's  common stock at a per share  exercise price
equal to  $10.875.  In  connection  with the waiver by Mestek,  Inc.  of certain
voting rights previously granted to it, Mestek, Inc. received on June 12, 2000 a
warrant to acquire up to 490,396 shares of the Company's common stock for a term
of 3 years at a per share  exercise  price equal to $3.21.  In  connection  with
Mestek's  guarantee of the Company's  obligations  under the line of credit from
Wainwright  Bank and Trust Company,  as more fully  explained in Note 7 to these
Financial  statements,  Mestek,  Inc.  received  on July 12,  2000 a warrant  to
acquire up to 104,712 shares of the Company's common stock for a term of 3 years
at a per share exercise price equal to $2.51. The aforementioned  shares and per
share prices are all on a split adjusted basis.

     Stock  Options - The Company has  established  several  stock option plans,
under which the Company has granted  options to purchase an aggregate of 350,136
shares  (on a split  adjusted  basis) of common  stock as of October  26,  2000.


                                       15
<PAGE>


Options  granted under Simione's 1997 Omnibus  Equity-based  Incentive Plan must
have an exercise price not less than the fair market value at the date of grant.
Of the options  granted,  56,885 were  exercised  prior to December 31, 1999 and
5,228 have been  cancelled  as of October 26,  2000.  Of the  remaining  288,023
options,  288,010 are vested as of October 26, 2000 and 226,257 are  exercisable
as of that date. The exercise prices range from $7.50 to $55.75 per share,  both
on a split adjusted basis.

     In  connection  with the  Simione/MCS  merger on March 7, 2000,  Mestek was
granted a series of options to purchase a total of approximately  378,295 shares
of the Company's  common stock (on a split  adjusted  basis).  These options are
exercisable  only to the extent that outstanding  Simione  options,  warrants or
other  conversion  rights are exercised.  These options were designed to prevent
dilution of Mestek,  Inc.'s ownership  interest in the Company after the merger.
As options,  warrants and other common  rights are  cancelled,  Mestek's  option
rights are correspondingly reduced.


NOTE 11 - RELATED PARTY TRANSACTIONS

     A  shareholder  and  executive  officer  of the  Company is a partner in an
entity that leases an office  facility to the Company  under an operating  lease
that  expires in December  2002.  Annual  rental  payments  under this lease are
approximately $136,000 per year through 2002.

     The Company has subleased  certain space to  Healthfield,  Inc. which has a
significant shareholder who was a former member of the board of directors of the
Company.

     Certain  relatives  of William  Simione,  Jr. and Robert  Simione  manage a
certified public accounting  business which performs services for the Company in
conjunction with services performed for customers of Simione.

     R. Bruce Dewey remains a Senior Vice  President of Mestek while  performing
his duties as Chief Executive Officer, President and director of the Company.

     Stephen M. Shea remains Senior Vice President and Chief  Financial  Officer
of Mestek,  Inc. while  performing his duties as Chief Financial  Officer of the
Company.

     As of September 30, 2000, the Company had one promissory  note  outstanding
to a director. The note is described in Note 7 to these Financial Statements.

     John  E.  Reed  is a  director  and a  significant,  but  not  controlling,
shareholder  of the  Wainwright  Bank and Trust  Company  which has provided the
Company with a $6.0 million line of credit, as more fully explained in Note 7 to
the Financial Statements.

     John E. Reed,  Chairman  of the Company and  Chairman  and Chief  Executive
Officer of Mestek,  Inc.,  has  provided the Company with a $6.0 million line of
credit  (unrelated to the Wainwright  Bank and Trust $6.0 million line of credit
described  above) as more fully described in Note 7 to the Financial  Statements
and has also purchased $1.0 million of the Company's Series D Preferred Stock on
June 12, 2000, as more fully described in Note 10 to these Financial Statements.
An  independent  committee of the Company's  Board of  Directors,  consisting of
Barrett C. O'Donnell and David O. Ellis, negotiated the terms of Mr. Reed's debt
and equity investments in the Company.  The issuance of 398,406 shares of Series
D Preferred  Stock to Mr. Reed for his $1.0 million equity  investment was based
on a per share  price of $2.51,  which was the 5-day  average  closing  price of
Simione common stock as of the date of the final negotiation of the terms of Mr.
Reed's  purchase.  The conversion  price for Mr. Reed's $6.0 million loan, which
converts  into  Simione  common  stock as  described in more detail in Note 7 to
these Financial Statements, is also $2.51 per share.

     Warrants  were granted in June 2000 and July 2000 by the Company to Mestek,
Inc. in connection with its waiver of certain voting rights  previously  granted
to it and in connection  with its guarantee of the loan from Wainwright Bank and
Trust  Company to the Company.  The terms of the warrants (as  described in more
detail in Note 10 to these Financial  Statements)  were based on negotiations by
independent committees of the Boards of Directors of the Company and Mestek.




                                       16
<PAGE>


NOTE 12 - LICENSE AGREEMENTS

     The Company  licenses  certain  software  products  from third  parties for
incorporation  in, or other use  with,  its  products  and is  obligated  to pay
license fees in connection  with such  products.  The Company  sublicenses  such
products  to  its  customers   and  collects   fees  in  connection   with  such
sublicensees.




                                       17
<PAGE>



ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS.

Certain  statements  set  forth  in  Management's  Discussion  and  Analysis  of
Financial  Condition  and  Results  of  Operations  constitute  "forward-looking
statements"  within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and
are  subject  to the safe  harbor  created by such  sections.  When used in this
report, the words "believe",  "anticipate",  "estimate",  "expect",  and similar
expressions are intended to identify forward-looking  statements.  The Company's
future  financial  performance  could differ  significantly  from that set forth
herein,  and from the expectations of management.  Important  factors that could
cause the Company's financial performance to differ materially from past results
and from those  expressed in any forward  looking  statements  include,  without
limitation, the inability to obtain additional capital resources, variability in
quarterly operating results,  customer concentration,  product acceptance,  long
sales cycles,  long and varying  delivery  cycles,  the Company's  dependence on
business  partners,   emerging  technological  standards,   changing  regulatory
standards,  inability to retain or hire experienced and knowledgeable employees,
risks  associated  with  acquisitions,  and the  risk  factors  detailed  in the
Company's  Registration  Statement on Form S-4 (File No.  333-96529)  and in the
Company's  periodic  reports filed with the Securities and Exchange  Commission.
Readers  are  cautioned  not to place undue  reliance  on these  forward-looking
statements, which speak only as of their dates. This Management's Discussion and
Analysis of  Financial  Condition  and Results of  Operations  should be read in
conjunction with the Company's  consolidated  financial statements and the notes
thereto.


LIQUIDITY AND CAPITAL RESOURCES

     The  Company  has  recently  secured  $13.0  million in new debt and equity
capital as follows:

<TABLE>
<CAPTION>
    <S>                                   <C>                        <C>                           <C>
                  SOURCE                          FUNDING                       FORM                    DATE CLOSED
    ------------------------------------  -------------------------  ----------------------------  ----------------------

    John E. Reed                                  $      1,000,000   Series D Preferred Stock              June 22, 2000

    John E. Reed                                         6,000,000   Line of Credit                        June 22, 2000

    Wainwright Bank and Trust Company                    6,000,000   Line of Credit                        July 12, 2000
                                          -------------------------
                                                  $     13,000,000
                                          =========================
</TABLE>

Detail on these three  transactions  are described in greater  detail in Notes 7
and 10 to the accompanying Financial Statements.

     The  Wainwright  Bank and Trust  Company Line of Credit was used to pay off
the  Silicon  Valley Bank Line of Credit,  certain  short term loans from Mestek
Inc., and the note payable to David O. Ellis. As of October 20, 2000, the unused
capacity under the John E. Reed and  Wainwright  Bank and Trust Company lines of
credit are $6,000,000 and $1,402,000, respectively.

     The Company believes that the above funding sources will provide sufficient
capital  to meet its  working  capital  needs  in the year  2000 as well as fund
planned product development initiatives during this period.

     The Company's  operating  earnings for the three months ended September 30,
2000, after adding back non cash charges  (amortization  and  depreciation)  and
discretionary spending on research and development, was $1,529,000,  computed as
follows:

       (Loss) Income from operations                 $     (1,539,000)
       Amortization and depreciation
                                                             1,171,000
       Research and development
                                                             1,897,000

                                                    --------------------------
                                                      $      1,529,000
                                                    ==========================




                                       18
<PAGE>


BACKGROUND

     The  Company is a leading  provider  of  integrated  systems  and  services
designed to enable home health care providers to more effectively  operate their
businesses  and  compete  in the  prospective  payment  (PPS) and  managed  care
environments.  The Company offers several  comprehensive  and flexible  software
solutions,  each of which provide a core platform of software  applications  and
which incorporate  selected  specialized modules based on customer demand. These
software  solutions  are  designed to enable  customers  to generate and utilize
comprehensive  financial,  operational and clinical information.  In addition to
its software solutions and related software support services, the Company's home
health care consulting services assist providers in addressing the challenges of
reducing costs, maintaining quality,  streamlining operations and re-engineering
organizational structures.

     The Company sells its software pursuant to non-exclusive license agreements
which provide for the payment of a one-time  license fee. In accordance with SOP
97-2,   these  revenues  are  recognized  when  products  are  shipped  and  the
collectibility  of fees is probable,  provided that no  significant  obligations
remain under the contract that affect the  acceptance of the products.  Revenues
derived from the sale of software products requiring significant modification or
customization  are  recognized  based upon the  percentage of completion  method
using labor hours or contract  milestones.  The price of the Company's  software
varies  depending on the number of software  modules  licensed and the number of
users  accessing  the system and can range from under ten thousand  dollars to a
few million dollars.  The Company  generally  requires payment of a deposit upon
the  signing  of a  customer  order  as well  as,  for  certain  products,  some
additional payments prior to delivery.  As a result, the Company's balance sheet
reflects significant customer deposits.

     Third party software and computer hardware revenues are recognized when the
related  products  are  shipped.   Software  support  agreements  are  generally
renewable  for one year  periods,  and revenue  derived from such  agreements is
recognized  ratably  over  the  period  of  the  agreements.   The  Company  has
historically  maintained high renewal rates with respect to its software support
agreements.  The  Company  charges for  software  implementation,  training  and
technical  consulting  services as well as management  consulting services on an
hourly or daily basis.  The price of such services varies depending on the level
and expertise of the related professionals. These revenues are recognized as the
related services are performed.

     The Company believes that continued  enhancement of its software systems is
critical to its future success,  and anticipates that investment in existing and
new  products  will  continue  as  needed  to  support  the  Company's   product
strategies.  Costs  incurred  to  establish  the  technological  feasibility  of
computer software products are expensed as incurred.  The Company's policy is to
capitalize  costs  incurred  between  the  point of  establishing  technological
feasibility and general release only when such costs are material.  For the nine
months ended  September 30, 2000 and 1999,  the Company did not  capitalize  any
computer software development costs.


BACKLOG

     The Company had backlog  associated with its software of approximately $4.2
million  and  $1.8  million  on  September  30,  2000  and  December  31,  1999,
respectively,  including  in both cases the  products  of MCS and  Simione.  The
backlog at September 30, 2000 includes  approximately $2.4 million in new orders
for software  systems booked in the three month period ended September 30, 2000.
Backlog consists of the unrecognized portion of contractually committed software
license fees, hardware,  estimated  installation fees and professional services.
The  length of time  required  to  complete  an  implementation  depends on many
factors  outside  the  control  of  the  Company,  including  the  state  of the
customer's existing information systems and the customer's ability to commit the
personnel and other resources necessary to complete the implementation  process,
although system orders are typically  installed within 16 weeks of the date that
the  initial  deposit is  received.  As a result,  the  Company may be unable to
predict  accurately  the amount of revenue it will  recognize  in any period and
therefore can make no assurances  that the amounts in backlog will be recognized
in the next twelve months.




                                       19
<PAGE>




RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999

Net Revenues.  Total net revenues for the three months ended  September 30, 2000
were  $8,547,000,  an increase  of 125.1%  relative  to the three  months  ended
September 30, 1999. The financial  statements  for September 30, 1999,  however,
include only the  operations  of MCS. If the  historical  operations of Simione,
CareCentric Solutions, Inc., (which Simione acquired on August 12, 1999) and MCS
were  arithmetically  combined for the three month period  ended  September  30,
1999,   revenues   (exclusive  of  Simione's   outsourcing   segment  which  was
discontinued  prior to the end of 1999) for the three months ended September 30,
1999 would have been $8,954,000.  Comparable revenues for the three months ended
September 30, 2000, therefore, were reduced $407,000 or 4.5%, principally due to
a  decline  in home  health  consulting  revenues.  The home  health  consulting
segment's revenue in 1999 included several large engagements which have not been
replaced with  comparable  engagements  in 2000.  The Company  believes that the
market for home health consulting services and home health business software has
been adversely effected by cutbacks in Medicare  reimbursement  rates originally
enacted  via  amendments  to  the  Balanced  Budget  Act  of  1997  and  related
regulations.

     The Company believes it has made significant  progress in strengthening its
franchise by  re-affirming  its  commitment  to the  continued  development  and
support of its core products,  strengthening  its customer  support  staff,  and
securing  substantial new capital  commitments  which are described in detail in
Notes 7 and 10 to the accompanying Financial Statements.

     The Company's  operating loss from  continuing  operations,  reflecting the
same  assumptions  as  above  for  purposes  of  comparability,  decreased  from
($4,368,000)  in the third quarter of 1999 to  ($1,845,000) in the third quarter
of  2000.   Management   believes  this  reduced  operating  loss  is  traceable
principally  to the  effect of the cost  saving  initiatives  which the  Company
undertook  after the  consummation of the merger on March 7, 2000. The Company's
Dezine and Mestamed  product  support groups have been largely  consolidated  in
Pittsburgh. The Company's executive,  general and administrative,  financial and
human resources functions have been consolidated in Atlanta, Georgia. Offices in
San Diego,  Dallas,  Jacksonville  and  Huntington  Beach have been closed,  and
offices in Houston and New Jersey have been significantly down-sized. Two of the
three floors at the Company headquarters in Atlanta and one of two floors at the
facility in Pompano Beach have been sublet.

     Research and  development  expenses,  however,  increased,  on a comparable
basis, from $1,230,000 to $1,898,000.

Other Income  (Expense).  Interest  expense for the three months ended September
30, 2000 relates  primarily to  borrowings  under the  Company's  line of credit
agreement  and  capital  lease  obligations.  The  Company  was a  wholly  owned
subsidiary  of Mestek,  Inc.  during the quarter  ended  September  30, 1999 and
accordingly reported no interest expense during this period. The Company expects
its interest  expense to increase  during the remainder of 2000 due to increased
borrowings. The impact of recent increases in the prime lending rate will likely
be offset by the reduced cost of funds under the Wainwright  Bank and Trust Line
of Credit,  which will be  approximately  200 basis points (2 percent) below the
rate formerly incurred under the prior credit line.



                                       20
<PAGE>



Income Taxes. At December 31, 1999,  Simione Central Holdings Inc. (Simione) had
net  operating  loss  ("NOL")  carryforwards  for federal  and state  income tax
purposes of $15.3 million, which will expire at various dates beginning in 2010,
if not  utilized.  Simione  also has research and  development  and  alternative
minimum tax credits of approximately  $90,000  available to reduce future income
tax  liabilities.  The Tax Reform Act of 1986, as amended,  contains  provisions
that  limit the NOL and tax  credit  carryforwards  available  to be used in any
given year when  certain  events  occur,  including  additional  sales of equity
securities and other changes in ownership.  As a result,  certain of the NOL and
tax credit  carryforwards may be limited as to their  utilization  subsequent to
the  Simione/MCS  merger on March 7, 2000.  The Company has concluded that it is
more  likely than not that these NOLs and tax credit  carryforwards  will not be
realized based on a weighing of evidence at September 30, 2000, and as a result,
a 100% deferred tax valuation allowance has been recorded against these assets.


RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999

Net  Revenues.  Total net revenues for the nine months ended  September 30, 2000
were  $18,805,000,  an  increase  of 50.2%  relative  to the nine  months  ended
September 30, 1999.  Results of operations  for the nine months ended  September
30, 2000 include the  operations  of Simione from March 7, 2000 to September 30,
2000,  and the  operations  of MCS for  the  full  nine  months.  The  financial
statements  for the nine  months  ended  September  30,  1999  include  only the
operations  of  MCS.  If  the  historical  operations  of  Simione,  CareCentric
Solutions,  Inc.  (which  Simione  acquired  on  August  12,  1999) and MCS were
arithmetically  combined for the nine month periods ended September 30, 2000 and
1999,   revenues   (exclusive  of  Simione's   outsourcing   segment  which  was
discontinued  prior to the end of 1999) would have been $22,173,000 for the nine
months  ended  September  30, 2000 and  $30,516,000  for the nine  months  ended
September 30, 1999. The reduced revenues are attributable principally to reduced
bookings of software and  equipment  sales in the final  quarter of 1999 and the
first half of year  2000.  The  Company  believes  this  resulted  from  adverse
economic conditions in the healthcare marketplace,  uncertainties related to the
Simione/MCS  merger,  and customer concerns related to year 2000  functionality.
The reduction in comparable  sales revenue is traceable more  specifically  to a
drop in  Mestamed  (MCS)  revenue of  approximately  $4,145,000,  a drop in STAT
(Simione)  revenue  of  approximately  $1,672,000,  a drop in  Dezine  (Simione)
revenue of approximately  $962,000 and a drop in home health consulting  revenue
of  approximately  $1,222,000.  The  Company  believes  that the market for home
health consulting  services and home health business software has been adversely
effected  by cutbacks in Medicare  reimbursement  rates  originally  enacted via
amendments to the Balanced Budget Act of 1997 and related regulations.

The Company's  operating loss from  continuing  operations,  reflecting the same
assumptions as above for purposes of comparability, decreased from ($10,631,000)
for the nine months ended September 30, 1999 to ($6,999,000) for the nine months
ended  September  30, 2000.  Management  believes this reduced  operating  loss,
despite  significant  reduced revenue on a comparable  basis,  is  attributable,
principally  to  the  cost  savings   initiatives  the  Company  has  undertaken
subsequent to the Simione/MCS merger on March 7, 2000.

Other Income (Expense). Interest expense for the nine months ended September 30,
2000  relates  primarily  to  borrowings  under  the  Company's  line of  credit
agreement  and  capital  lease  obligations.  The  Company  was a  wholly  owned
subsidiary of Mestek,  Inc.  during the nine months ended September 30, 1999 and
accordingly reported no interest expense during this period. The Company expects
its interest  expense to increase  during the remainder of 2000 due to increased
borrowings. The impact of recent increases in the prime lending rate will likely
be offset by the reduced cost of funds under the Wainwright  Bank and Trust Line
of Credit,  which will be  approximately  200 basis points (2 percent) below the
rate formerly incurred under the prior credit line.

Income Taxes. At December 31, 1999,  Simione Central Holdings Inc. (Simione) had
net  operating  loss  ("NOL")  carryforwards  for federal  and state  income tax
purposes of $15.3 million, which will expire at various dates beginning in 2010,
if not  utilized.  Simione  also has research and  development  and  alternative
minimum tax credits ("tax credits") of approximately $90,000 available to reduce
future income tax liabilities.  The Tax Reform Act of 1986, as amended, contains
provisions that limit the NOL and tax credit carryforwards  available to be used
in any given year when  certain  events  occur,  including  additional  sales of
equity  securities and other changes in ownership.  As a result,  certain of the
NOL  and  tax  credit  carryforwards  may be  limited  as to  their  utilization
subsequent to the Simione/MCS merger on March 7, 2000. The Company has concluded


                                       21
<PAGE>


that it is more  likely  than not that these  NOLs and tax credit  carryforwards
will not be realized  based on a weighing of evidence at September 30, 2000, and
as a result,  a 100% deferred tax valuation  allowance has been recorded against
these assets.

IMPACT OF NEW ACCOUNTING STANDARDS

     In 1998, the Financial and Accounting  Standards  Board issued SFAS No. 133
("SFAS  No.  133"),   "Accounting   for  Derivative   Instruments   and  Hedging
Activities."  SFAS No. 133 is  effective  for the  Company's  fiscal year ending
December 31, 2001. The Company's  management  does not believe that the adoption
of SFAS No. 133 will have a material impact on the Company's position or results
of operations.

     On  December 3, 1999,  the SEC  released  Staff  Accounting  Bulletin  101,
(SAB 101)   "Revenue   Recognition  in  Financial   Statements".  This  bulletin
established  more clearly defined revenue  recognition  criteria than previously
existing accounting pronouncements. On June 26, 2000, the SEC released SAB 101B,
which  delayed the  required  implementation  of SAB 101 until no later than the
fourth quarter of fiscal years ending  December 31, 2000.  The Company  believes
that  the  effects  of this  bulletin  will  not be  material  to its  financial
position, results of operations or cash flow.




                                       22
<PAGE>



PART II - OTHER INFORMATION

     Item 1. Legal Proceedings.

     Neither the Company nor any of its subsidiaries is currently a party to any
legal proceedings which would be material to the business or financial condition
of the Company on a consolidated basis.

Simione was one of several defendants named in a "whistleblower" lawsuit related
to alleged  Medicare  fraud  filed  under the False  Claims Act in the  Northern
District of Georgia (U.S. ex rel. McLendon v. Columbia/HCA  Healthcare Corp., et
al.,  No.  97-VC-0890  (N.D.  Ga.)).  The lawsuit  involves  claims that Simione
allegedly participated in a conspiracy with Columbia/HCA and other third parties
to bill inflated and fraudulent claims to Medicare. The Company has learned that
the Justice  Department has elected not to join in the claims  asserted  against
Simione by Donald  McLendon,  who is a former  employee of an unrelated  service
provider to Columbia/HCA.  Although the Justice  Department joined the suit with
regard to other defendants, it specifically declined to intervene with regard to
Simione.  In late 1999, the Company  received an indication from Mr.  McLendon's
attorney that  notwithstanding  the declination by the Justice  Department,  Mr.
McLendon  might  elect to pursue  "whistleblower"  claims  against  the  Company
directly.  There has been no further contact from Mr. McLendon's attorneys since
that time,  however.  In the  meantime,  in May 2000,  Columbia/HCA  announced a
tentative  settlement  with the Justice  Department with respect to the McLendon
claim,  among others. It is not clear what effect, if any, this settlement might
have with regard to any potential claim by Mr. McLendon against the Company.  In
any event,  the Company does not believe that any of these  claims,  if asserted
against the Company,  will have any  material  effect on the  Company's  overall
business or financial  condition.  Should  these  claims be asserted,  moreover,
Simione intends to vigorously defend against them.

     The Company  reached a settlement on June 30, 2000 with IBM relative to the
early  cancellation  of the Company's  service  agreement  with IBM for services
provided to a former  customer of Simione  Central  Holdings,  Inc., and related
fees for services.  The settlement was fully reserved for in connection with the
accounting for the Simione/MCS merger on March 7, 2000 and, accordingly, did not
have a material adverse impact upon the Company's financial condition or results
of operations.

     Item 2. Change in Securities.

     In June 2000, in connection with John E. Reed's  investment in the Company,
the Company issued  398,406  shares of Simione  Series D Preferred  Stock to Mr.
Reed for an aggregate  purchase  price of $1.0  million.  The Series D Preferred
Stock is convertible  into common stock at an initial  conversion price of $2.51
per share, subject to antidilution  adjustments for stock splits, stock dividend
or reclassifications. In connection with Mestek, Inc.'s waiver of certain voting
rights with respect to the ownership of Simione  Series B Preferred  Stock,  the
Company  issued a warrant to Mestek in June 2000 to purchase  490,396  shares of
the  Company's  common  stock at an exercise  price of $3.21 per share.  In July
2000, the Company  issued to Mestek a warrant to purchase  104,712 shares of the
Company's  common stock in connection  with Mestek's  guarantee of the loan from
Wainwright  Bank and Trust Company to the Company at an exercise  price of $2.51
per share. In issuing the warrants and shares without registration,  the Company
relied on the  exemption  from  registration  provided  in  Section  4(2) of the
Securities  Act of 1933,  as amended,  and Rule 506 of  Regulation D promulgated
thereunder.

     Item 3. Defaults Upon Senior Securities.

     None

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

     On August 8, 2000 the Annual  Meeting of  Stockholders  of Simione  Central
Holdings, Inc. was held. Stockholders present in person or by proxy representing
4,852,298  shares of common stock and Preferred  stock were  represented  at the
meeting.



                                       23
<PAGE>




     Seven  Directors  of the Company were duly elected to hold office until the
next Annual Meeting of Stockholders or until  successors have been duly elected.
The elected Directors and the affirmative votes were as follows:

                                                                 VOTES AGAINST
        NAME                          AFFIRMATIVE VOTES          OR WITHHELD
        ----                          -----------------          -----------
        R. Bruce Dewey                     4,839,689                  907
        Barrett C. O'Donnell               4,835,284                5,312
        Winston R. Hindle, Jr.             4,839,704                  892
        Dr. David O. Ellis                 4,839,731                  865
        John E. Reed                       4,839,686                  910
        Jesse I. Treu                      4,839,842                  754
        Edward K. Wissing                  4,839,704                  892


     - approval to appoint  Grant  Thornton  LLP as the  Company's  auditors for
       December 31, 2000

     The affirmative votes for this matter was as follows:

                                     AFFIRMATIVE         VOTES          VOTES
                                        VOTES           AGAINST       ABSTAINED
                                        -----           -------       ---------

      Appoint Grant Thornton LLP       4,843,287         4,000           5,010

      Item 5.  Other Information.

      None.

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

     (a)  Exhibits:

          The following  Exhibits are filed as part of this Quarterly  Report on
          Form 10-Q:

          Exhibit No.   Description
          -----------   -----------

          10.1*Loan and Security  Agreement by and between the Company,  Simione
               Central  National,  LLC,  Simione  Central  Consulting,  Inc. and
               Wainwright Bank and Trust Company, dated July 10, 2000.

          10.7** Warrant  dated July 12,  2000 by and  between  the  Company and
               Mestek, Inc.

          10.8**  Restated  Certificate  of  Incorporation  of  Simione  Central
               Holdings  Inc.  filed with the  Secretary of State of Delaware on
               August 11, 2000

          27.1* Financial Data Schedule (for SEC use only).

          -----------------------------
          *    Filed  herewith.
          **   Incorporated  by  reference  to the exhibit of the same number
               filed with the Company's Form 10-Q for the quarter ended
               June 30, 2000 (File No. 000-22162)

         (b)   Reports on Form 8-K:




                                       24
<PAGE>


     The Company  filed a Report on Form 8-K on July 12, 2000  reporting  on the
     closing of the debt financing  provided for the Company by Wainwright  Bank
     and Trust Company.

                                       25
<PAGE>


                                   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.


                                        SIMIONE CENTRAL HOLDINGS, INC.


     Dated: November 13, 2000        By: /s/ Steve Shea
                                           ------------------------------------
                                           STEVE SHEA
                                           Senior Vice President - Finance and
                                           Chief Financial Officer
                                           (Principal Financial Officer)



                                       26
<PAGE>



                                  EXHIBIT INDEX

Exhibit No.       Description
-----------       -----------

10.1*Loan and Security  Agreement by and between the Company,  Simione  Central,
     LLC,  Simione  Central  Consulting,  Inc.  and  Wainwright  Bank and  Trust
     Company, dated July 10, 2000.

10.7** Warrant dated July 12, 2000 by and between the Company and Mestek, Inc.

10.8** Restated  Certificate of  Incorporation  of Simione Central Holdings Inc.
     filed with the Secretary of State of
                  Delaware on August 11, 2000

27.1* Financial Data Schedule (for SEC use only).

-----------------------------
*Filed herewith.

**Incorporated  by  reference  to the exhibit of the same number  filed with the
Company's Form 10-Q for the quarter ended June 30, 2000 (File No. 000-22162)



                                       27