UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

                                   (Mark One)

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

                  For the quarterly period ended June 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 0-12050

                       SAFEGUARD HEALTH ENTERPRISES, INC.
             (Exact name of registrant as specified in its charter)


              DELAWARE                                  52-1528581
     (State or other jurisdiction           (I.R.S. Employer Identification No.)
        of  incorporation)


                                  95 ENTERPRISE
                          ALISO VIEJO, CALIFORNIA 92656
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (949) 425-4300
              (Registrant's telephone number, including area code)



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

                                 Yes  X    No
                                     ---      ---

The  number  of  shares  of registrant's common stock, par value $.01 per share,
outstanding  at  July  31,  2000,  was 4,747,498 shares (not including 3,274,788
shares  of  common  stock  held  in  treasury).


<PAGE>
                       SAFEGUARD HEALTH ENTERPRISES, INC.
                                AND SUBSIDIARIES

                                    FORM 10-Q

                       FOR THE QUARTER ENDED JUNE 30, 2000

                         INFORMATION INCLUDED IN REPORT


                                                                            Page
                                                                            ----

Part  I.       Financial  Information  (unaudited)

     Item 1.   Consolidated  Financial  Statements                             1

               Consolidated  Balance  Sheets                                   1

               Consolidated  Statements  of  Operations                        2

               Consolidated  Statements  of  Cash  Flows                       3

               Notes  to  Consolidated  Financial  Statements                  5

     Item 2.   Management's Discussion and Analysis of Financial
                Condition and Results  of  Operations                         10

     Item 3.   Quantitative and Qualitative Disclosures about Market Risk     14

Part  II.      Other  Information                                             14

     Item 1.   Legal  Proceedings                                             14

     Item 2.   Recent  Sales  of  Unregistered  Securities                    14

     Item 3.   Defaults  upon  Senior  Securities                             14

     Item 5.   Other  Information                                             14

     Item 6.   Exhibits  and  Reports  on  Form  8-K                          15

SIGNATURES                                                                    16


                                      i
<PAGE>
<TABLE>
<CAPTION>
                          SAFEGUARD  HEALTH  ENTERPRISES,  INC.  AND  SUBSIDIARIES
                                        CONSOLIDATED BALANCE SHEETS
                                               (IN THOUSANDS)


                                                                                 JUNE 30,     DECEMBER 31,
                                                                                   2000           1999
                                                                               ------------  --------------
                                     ASSETS                                    (unaudited)
<S>                                                                            <C>           <C>
Current assets:
  Cash and cash equivalents                                                    $       929   $       1,639
  Investments available-for-sale, at estimated fair value                            9,113           3,361
  Accounts receivable, net of allowances                                             2,225           2,978
  Income taxes receivable                                                               --             480
  Prepaid expenses and other current assets                                            734             641
                                                                               ------------  --------------
    Total current assets                                                            13,001           9,099

Property and equipment, net of accumulated depreciation                              3,523           4,816
Restricted cash and investments available-for-sale, at estimated fair value          3,441           3,454
Investments available-for-sale, at estimated fair value                              3,618             515
Notes receivable, net of allowances                                                  2,650           3,505
Assets of discontinued operations transferred under contractual arrangements         2,500           2,500
Intangible assets, net of accumulated amortization                                   4,502           4,437
Other assets                                                                           250             251
                                                                               ------------  --------------

    Total assets                                                               $    33,485   $      28,577
                                                                               ============  ==============

                LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
  Accounts payable                                                             $     5,415   $       5,771
  Accrued interest, subject to conversion to equity (Note 5)                         3,068           1,207
  Other accrued expenses                                                             3,834           2,484
  Short-term debt, subject to conversion to equity (Note 5)                         47,545              --
  Other short-term debt                                                                105             255
  Claims payable and claims incurred but not reported                                5,700           6,437
  Deferred revenue                                                                   2,190           1,975
                                                                               ------------  --------------
    Total current liabilities, including $50,613 of liabilities in 2000
      that are subject to conversion to equity (Note 5)                             67,857          18,129

Long-term debt                                                                          --          39,545
Other long-term liabilities                                                          1,177           2,517

Stockholders' equity (deficit):
  Preferred stock                                                                       --              --
  Common stock                                                                      21,829          21,829
  Retained earnings (accumulated deficit)                                          (39,261)        (35,302)
  Accumulated other comprehensive income (loss)                                          6             (18)
  Treasury stock, at cost                                                          (18,123)        (18,123)
                                                                               ------------  --------------
    Total stockholders' equity (deficit)                                           (35,549)        (31,614)
                                                                               ------------  --------------

    Total liabilities and stockholders' equity (deficit)                       $    33,485   $      28,577
                                                                               ============  ==============
</TABLE>

See  accompanying  Notes  to  Consolidated  Financial  Statements.


                                      -1-
<PAGE>
<TABLE>
<CAPTION>
                        SAFEGUARD HEALTH ENTERPRISES, INC. AND SUBSIDIARIES
                               CONSOLIDATED STATEMENTS OF OPERATIONS
                             THREE MONTHS ENDED JUNE 30, 2000 AND 1999
                               (IN THOUSANDS, EXCEPT PER SHARE DATA)
                                            (UNAUDITED)


                                                                               2000         1999
                                                                           -------------  --------
                                                                                       (As restated)
                                                                                        (see Note 7)
<S>                                                                        <C>            <C>
Premium revenue                                                            $     24,173   $23,989

Health care services expense                                                     17,464    16,718
Selling, general and administrative expense                                       7,365     9,332
                                                                           -------------  --------

Operating loss                                                                     (656)   (2,061)

Investment and other income                                                         378       437
Interest expense on debt that is subject to conversion to equity (Note 5)        (1,202)   (1,058)
Other interest expense                                                              (18)      (44)
                                                                           -------------  --------

Loss before income taxes and discontinued operations                             (1,498)   (2,726)
Income tax benefit                                                                   --      (940)
                                                                           -------------  --------

Loss before discontinued operations                                              (1,498)   (1,786)
Discontinued operations:
  Loss from operations to be disposed of                                             --    (3,264)
                                                                           -------------  --------

     Net loss                                                              $     (1,498)  $(5,050)
                                                                           =============  ========

Basic and diluted loss per share:
  Loss from continuing operations                                          $      (0.32)  $ (0.38)
  Loss from discontinued operations                                                  --     (0.69)
                                                                           -------------  --------

     Net loss                                                              $      (0.32)  $ (1.07)
                                                                           =============  ========

Weighted average basic and diluted shares outstanding                             4,747     4,747
</TABLE>

          See accompanying Notes to Consolidated Financial Statements.


                                      -2-
<PAGE>
<TABLE>
<CAPTION>
                        SAFEGUARD HEALTH ENTERPRISES, INC. AND SUBSIDIARIES
                               CONSOLIDATED STATEMENTS OF OPERATIONS
                              SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                               (IN THOUSANDS, EXCEPT PER SHARE DATA)
                                            (UNAUDITED)


                                                                               2000         1999
                                                                           -------------  --------
                                                                                        (As restated)
                                                                                         (see Note 7)
<S>                                                                        <C>            <C>
Premium revenue                                                            $     48,636   $47,852

Health care services expense                                                     34,969    33,236
Selling, general and administrative expense                                      16,011    18,443
                                                                           -------------  --------

Operating loss                                                                   (2,344)   (3,827)

Investment and other income                                                         637     1,940
Interest expense on debt that is subject to conversion to equity (Note 5)        (2,217)   (1,923)
Other interest expense                                                              (35)     (126)
                                                                           -------------  --------

Loss before income taxes and discontinued operations                             (3,959)   (3,936)
Income tax benefit                                                                   --    (1,290)
                                                                           -------------  --------

Loss before discontinued operations                                              (3,959)   (2,646)
Discontinued operations:
  Loss from operations to be disposed of                                             --    (3,264)
                                                                           -------------  --------

     Net loss                                                              $     (3,959)  $(5,910)
                                                                           =============  ========

Basic and diluted loss per share:
  Loss from continuing operations                                          $      (0.83)  $ (0.56)
  Loss from discontinued operations                                                  --     (0.69)
                                                                           -------------  --------

     Net loss                                                              $      (0.83)  $ (1.25)
                                                                           =============  ========

Weighted average basic and diluted shares outstanding                             4,747     4,747
</TABLE>

          See accompanying Notes to Consolidated Financial Statements.


                                      -3-
<PAGE>
<TABLE>
<CAPTION>
                   SAFEGUARD HEALTH ENTERPRISES, INC. AND SUBSIDIARIES
                          CONSOLIDATED STATEMENTS OF CASH FLOWS
                         SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                      (IN THOUSANDS)
                                       (UNAUDITED)


                                                                       2000       1999
                                                                     ---------  ---------
                                                                              (As restated)
                                                                               (see Note 7)
<S>                                                                  <C>        <C>
Cash flows from operating activities:
  Net loss                                                           $ (3,959)  $ (5,910)
  Adjustments to reconcile net loss to net
    cash provided by (used in) operating activities:
    Loss from discontinued operations                                      --      3,264
    Depreciation and amortization                                       1,516      2,138
    Gain on sale of property and equipment                                (67)        --
    Deferred income taxes                                                  --      2,282
  Changes in operating assets and liabilities:
    Accounts receivable                                                   754       (253)
    Income taxes receivable                                               480     (2,901)
    Prepaid expenses and other current assets                             (92)       (49)
    Accounts payable                                                     (356)     1,397
    Accrued expenses                                                    1,104        699
    Claims payable and claims incurred but not reported                  (737)     1,157
    Deferred revenue                                                      215        658
    Non-current assets                                                   (297)       (44)
    Non-current liabilities                                               767        134
                                                                     ---------  ---------
    Net cash provided by (used in) operating activities                  (672)     2,572

Cash flows from investing activities:
  Purchase of investments available-for-sale                          (22,919)   (13,267)
  Proceeds from sales/maturities of investments available-for-sale     14,100     11,989
  Proceeds from the sale of property and equipment                        200      3,000
  Additions to intangible assets                                           --       (969)
  Purchases of property and equipment                                    (124)      (505)
  Payments received on notes receivable                                   855          6
                                                                     ---------  ---------
    Net cash provided by (used in) investing activities                (7,888)       254

Cash flows from financing activities:
  Borrowings on long-term debt                                          8,000         --
  Payments on notes payable and long-term debt                           (150)    (2,296)
                                                                     ---------  ---------
    Net cash provided by (used in) financing activities                 7,850     (2,296)
                                                                     ---------  ---------
Net increase (decrease) in cash                                          (710)       530
Cash balance at beginning of period                                     1,639      2,978
                                                                     ---------  ---------
Cash balance at end of period                                        $    929   $  3,508
                                                                     =========  =========
</TABLE>

          See accompanying Notes to Consolidated Financial Statements.


                                      -4-
<PAGE>
               SAFEGUARD HEALTH ENTERPRISES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE  1.  GENERAL
-----------------

The accompanying unaudited consolidated financial statements of SafeGuard Health
Enterprises,  Inc. and subsidiaries (the "Company") for the three months and six
months  ended  June  30,  2000  and  1999, have been prepared in accordance with
accounting  principles  generally  accepted  in  the  United  States of America,
applicable to interim periods. The accompanying financial statements reflect all
adjustments  that,  in  the  opinion  of  management,  are  necessary for a fair
presentation  of  the Company's financial position and results of operations for
the  interim periods.  The financial statements have been prepared in accordance
with the regulations of the Securities and Exchange Commission, and omit certain
footnote  disclosures  and  other information necessary to present the Company's
financial  position  and  results  of  operations  in accordance with accounting
principles  generally accepted in the United States of America.  These financial
statements  should  be  read  in  conjunction  with  the  Consolidated Financial
Statements  and  Notes  thereto contained in the Company's Annual Report on Form
10-K  for the year ended December 31, 1999.  Management believes the disclosures
herein  are  adequate  to  make  the  accompanying  financial  statements  not
misleading.

NOTE  2.  GOING  CONCERN  BASIS
-------------------------------

The  accompanying  financial  statements  have  been prepared on a going concern
basis,  which  contemplates  the  realization  of assets and the satisfaction of
liabilities  in  the  normal course of business. The financial statements do not
include  any  adjustments  related  to  the  recoverability or classification of
assets,  or  to  the  amounts  or  classification  of  liabilities that might be
necessary  in  the  event  the Company is unable to continue as a going concern.
During the six months ended June 30, 2000, and the years ended December 31, 1999
and  1998,  the  Company  incurred net losses of $4.0 million, $52.0 million and
$9.9  million,  respectively, and net cash used by operating activities was $0.7
million,  $0.6  million and $2.0 million, respectively. As of June 30, 2000, the
Company  was not in compliance with certain financial covenants contained in the
credit  agreements  related  to  its  revolving credit facility and senior notes
payable.  However,  both lenders have agreed not to demand or accept any payment
under  these  credit  agreements, and not to take any enforcement actions of any
kind  under  those  agreements  until  April  30,  2001  (see  Note  5).

As  of  June  30, 2000, and December 31, 1999, the Company's current liabilities
exceeded  its  current  assets by $54.9 million (including $50.6 million of debt
and accrued interest that is expected to be converted into equity securities, as
discussed  in  Note 5) and $9.0 million, respectively. The Company believes this
negative  working  capital  position will be mitigated by its plans to return to
profitability,  as  described  below.  The  Company also intends to sell certain
long-term  assets  during  the  next  several  months,  although there can be no
assurance  it  will  be  successful  in  doing  so.

In  March  2000  the  Company  entered into a Recapitalization Agreement with an
investor  group  and its primary lenders, under which the investor group and the
primary lenders agreed to convert substantially all of the Company's outstanding
debt  to  convertible preferred stock (see Note 5). This conversion is currently
pending  regulatory  approval of the change in control of the Company that would
result  from  the conversion. In connection with the Recapitalization Agreement,
the  Company  obtained  a new president and chief executive officer, and certain
new  directors.

To  return the Company to profitability, management is taking action to increase
premium  rates,  reduce  certain types of non-standard provider payments, reduce
the number of its employees by consolidating certain administrative functions in
one  location,  reduce the amount of office space used, and reduce various other
general  and  administrative expenses.  Management's plans also include enhanced
programs  for  customer  retention,  increasing  the  efficiency of its provider
network,  and streamlining operations with a focus toward strengthening customer
service.  Management  believes  the results of its plans will enable the Company
to  meets  its  ongoing  obligations  on a timely basis and return to profitable
operations,  although  there  can be no assurance it will be successful in doing
so.  The  Company  also believes it will be able to obtain additional financing,
if  necessary,  to  support  its  operations.


                                      -5-
<PAGE>
NOTE  3.  RECENT  ACCOUNTING  PRONOUNCEMENTS
--------------------------------------------

In  June  1998,  the  Financial  Accounting  Standards Board issued Statement of
Financial  Accounting Standards No. 133 ("SFAS 133"), "Accounting for Derivative
Instruments  and Hedging Activities," which establishes accounting and reporting
standards  for  derivative instruments, including certain derivative instruments
embedded  in  other  contracts, and for hedging activities. SFAS 133 requires an
entity  to  recognize  all  derivatives  as  either assets or liabilities in the
statement  of financial position and measure those instruments at fair value. If
a  derivative  is  not  a  hedge,  changes  in its fair value must be recognized
currently  in  earnings.  If a derivative is a hedge, depending on the nature of
the  hedge,  changes  in its fair value will either be offset against changes in
the  fair  value  of  the  hedged  assets,  liabilities,  or firm commitments in
earnings,  or  will be recognized in other comprehensive income until the hedged
item  is  recognized  in earnings. Changes in a derivative's fair value that are
related  to  the  ineffective  portion  of  a  hedge,  if any, must generally be
recognized  currently in earnings. SFAS 133 is effective for all fiscal quarters
of  all  fiscal  years  beginning  after  June  15,  2000.  The Company believes
implementation  of  SFAS  133  will  have no significant effect on its financial
statements,  as the Company has no derivative instruments or hedging activities.
`
In  December  1999,  the United States Securities and Exchange Commission issued
Staff Accounting Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial
Statements." SAB 101 provides guidance on applying generally accepted accounting
principles  to  revenue  recognition issues in financial statements. The Company
will  be  required to adopt SAB 101 no later than the fourth quarter of the year
ending  December  31,  2001.  The Company believes implementation of SAB 101will
have  no  significant  effect  on  its  financial  statements.

NOTE  4.  ASSETS  OF  DISCONTINUED  OPERATIONS  TRANSFERRED  UNDER  CONTRACTUAL
-------------------------------------------------------------------------------
ARRANGEMENTS
------------

During  the  three  months  ended  September  30, 1997, the Company sold several
general dental practices to a single purchaser (the "Purchaser") in exchange for
$8.0  million of long-term promissory notes. In April 1998 the Company also sold
several  orthodontic practices to the Purchaser in exchange for $15.0 million of
long-term  promissory notes. During 1997 and 1998, other entities that purchased
four other general dental practices from the Company conveyed those practices to
the  Purchaser  in  exchange  for the assumption of the related promissory notes
payable to the Company. At the time of the conveyances of these practices to the
Purchaser,  the  related promissory notes had an aggregate outstanding principal
balance  of  $1.9  million.  During 1997 and 1998, the Company loaned a total of
$1.6  million  to  the Purchaser, which was used for working capital purposes by
the  Purchaser.

Due  to uncertainty about the Purchaser's ability to meet its commitments to the
Company  under  the  promissory  notes,  the  Company  did  not  treat  the sale
transactions  with  the Purchaser as sales for accounting purposes. Accordingly,
the  related promissory notes and the working capital loans are not reflected in
the  accompanying  financial statements. Instead, the historical cost of the net
assets  of  the  related  general  dental  and  orthodontic  practices, less the
interest  payments  received  from  the Purchaser, is reflected on the Company's
balance  sheet  under the caption "Assets of discontinued operations transferred
under  contractual  arrangements."  The  Company's  financial  statements do not
reflect  any  gains  on these sale transactions, and do not reflect any interest
income  on  the related promissory notes. In addition, the carrying value of the
promissory  notes  related  to  the  four practices that were transferred to the
Purchaser  was  reduced  to the historical cost of the net assets of the related
dental practices. These assets are also reflected on the Company's balance sheet
under  the  caption  "Assets  of  discontinued  operations  transferred  under
contractual arrangements." The working capital loans were treated as expenses at
the  time  the  loans  were  made. In the opinion of management, this accounting
treatment  appropriately reflects the economic substance of the transactions, as
distinct  from  the  legal  form  of  the  transactions.

During  1999,  the  Company  reached  an  oral  agreement with the Purchaser and
another  third party (the "New Purchaser"), under which the long-term promissory
notes  described  above (the "Notes") would be liquidated. Under this agreement,
the  Purchaser  would  convey the dental and orthodontic practices that comprise
the collateral for the Notes to the New Purchaser, in exchange for proceeds that
would  be  paid  to  the  Company  in  satisfaction  of the Notes. Based on this
agreement, the Company recorded a $3.3 million charge to earnings (net of income
tax  benefit  of  $2.1  million) during the three months ended June 30, 1999, to
reduce  the  carrying  value  of  "Assets of discontinued operations transferred
under contractual arrangements" to their estimated realizable value. This charge
is  reflected  on  the Company's statement of operations under the caption "Loss
from  operations  to  be  disposed of." In March 2000 the Company entered into a
definitive  agreement  with  respect  to  this transaction, which was subject to
regulatory  approval.  The  Company  is  currently  negotiating  a  restructured
agreement  with  the  New  Purchaser.


                                      -6-
<PAGE>
NOTE  5.  SHORT-TERM  AND  LONG-TERM  DEBT
------------------------------------------

Short-term  and  long-term  debt  consisted  of  the  following  (in thousands):

<TABLE>
<CAPTION>
                              JUNE 30,    DECEMBER 31,
                                2000          1999
                             ----------  --------------
<S>                          <C>         <C>
  Investor senior loan       $   8,000   $          --
  Revolving credit facility      7,045           7,045
  Senior notes payable          32,500          32,500
  Other notes payable              105             255
                             ----------  --------------
    Total debt                  47,650          39,800
  Less - current portion       (47,650)           (255)
                             ----------  --------------

      Long-term debt         $      --   $      39,545
                             ==========  ==============
</TABLE>

On  March 1, 2000, the Company entered into a Recapitalization Agreement with an
investor  group  (the  "Investors"), the holder of the senior notes payable (the
"Senior  Note  Holder"),  and the revolving credit facility lender (the "Bank").
Under  the  Recapitalization Agreement, the Investors loaned $8.0 million to the
Company in the form of an investor senior loan, which is due April 30, 2001, and
bears  interest  at 10% annually. The Investors, the Senior Note Holder, and the
Bank  agreed to convert the $8.0 million investor senior loan, the $32.5 million
of  senior  notes payable, and the outstanding balance of $7.0 million under the
revolving  credit facility to convertible preferred stock, subject to regulatory
and  stockholder  approval,  as  described  below.

The  convertible  preferred  stock  would  not accrue dividends of any kind, and
would  be  convertible  into  common  stock  at  the  option  of the holder. The
convertible  preferred stock would entitle the holder to one vote for each share
of  common  stock into which the preferred stock is convertible, with respect to
all  matters  voted on by the common stockholders of the Company. The conversion
of  the  Company's  outstanding debt to convertible preferred stock is currently
pending  regulatory  approval of the change in control of the Company that would
result  from  this  conversion.

After  regulatory  approval  of  the  change  in  control  is  obtained, and the
conversion  of  the Company's outstanding debt to convertible preferred stock is
completed,  the existing stockholders of the Company would own approximately 14%
of  the  common  stock  interests  of  the  Company.  Under the Recapitalization
Agreement,  the Company agreed to place new directors on its board of directors,
who  represent  the  Investors,  the  Senior  Note Holder and the Bank, and who,
collectively,  will  constitute  a  majority  of  the  board  of  directors.

Under  the  Recapitalization Agreement, both the Senior Note Holder and the Bank
agreed  not to demand or accept any payment of principal or interest under their
respective  credit  agreements,  and  not to take any enforcement actions of any
kind  under  those  agreements  until  April 30, 2001. The Company is subject to
various  financial  covenant  requirements  under the credit agreements with the
Senior  Note  Holder  and the Bank. The Company was not in compliance with those
requirements  as of June 30, 2000. Therefore, in the event the conversion of the
Company's outstanding debt to convertible preferred stock is not completed prior
to  April  30, 2001, the outstanding balances under the senior notes payable and
the  revolving  credit  facility  will  be  due  and  payable on April 30, 2001.
Accordingly,  these outstanding balances are reflected as short-term debt on the
Company's  balance  sheet  as  of  June  30,  2000.

In  1999,  the  Company issued warrants to purchase 382,000 shares of its common
stock  for  $4.51  per share to the Senior Note Holder. However, the Senior Note
Holder  has  agreed  to  cancel  the  warrants  upon conversion of the Company's
outstanding  debt  into  convertible  preferred  stock,  as  set  forth  in  the
Recapitalization  Agreement  described  above.


                                      -7-
<PAGE>
The  expected  effect  of  the conversion of the Company's outstanding debt into
convertible  preferred  stock on the Company's capital structure is shown in the
recapitalization  table below, as though the conversion had occurred on June 30,
2000  (in  thousands).

<TABLE>
<CAPTION>
                                                             ACTUAL AS OF      EFFECT OF          AFTER
                                                             JUNE 30, 2000    TRANSACTION    RECAPITALIZATION
                                                            ---------------  -------------  ------------------
<S>                                                         <C>              <C>            <C>
  Short-term debt, subject to conversion to equity          $       47,545   $    (47,545)  $              --
  Accrued interest, subject to conversion to equity                  3,068         (3,068)                 --
  Other current liabilities                                         17,244             --              17,244
  Long-term liabilities                                              1,177             --               1,177
                                                            ---------------  -------------  ------------------
      Total liabilities                                             69,034        (50,613)             18,421

  Preferred stock                                                       --         19,200              19,200
  Common stock                                                      21,829             --              21,829
  Accumulated deficit                                              (39,261)        31,413              (7,848)
  Accumulated other comprehensive income (loss)                          6             --                   6
  Treasury stock                                                   (18,123)            --             (18,123)
                                                            ---------------  -------------  ------------------
      Total stockholders' equity (deficit)                         (35,549)        50,613              15,064
                                                            ---------------  -------------  ------------------

      Total liabilities and stockholders' equity (deficit)  $       33,485   $         --   $          33,485
                                                            ===============  =============  ==================
</TABLE>

Pursuant  to the Recapitalization Agreement described above, it is expected that
substantially  all  of  the Company's short-term debt ($47.5 million at June 30,
2000)  and  the  accrued  interest on the senior notes payable and the revolving
credit  facility  ($3.1  million  at  June  30,  2000)  will  be  converted into
convertible  preferred  stock.  In exchange for the outstanding debt and accrued
interest,  it  is  expected  that  the  Company  will  issue  300,000  shares of
convertible  preferred stock. The convertible preferred stock has been valued at
$64  per  share  for  purposes  of the above information, which is the Company's
estimate  of  its  market  value  as of June 30, 2000. Each share of convertible
preferred  stock  would  be convertible into 100 shares of common stock, and the
closing  price  of  the  Company's  common  stock on June 29, 2000 was $0.64 per
share.

The  transaction  illustrated  in the above table is contingent upon stockholder
approval  of an increase in the number of authorized shares of common stock, and
regulatory  approval  of  the change in control of the Company that would result
from  this  transaction.  The  purpose of the above recapitalization table is to
show  what  the  significant  effects  of the above-described transaction on the
Company's  capital  structure  might be if the transaction had been completed on
June  30,  2000.  The  above  information  is  not necessarily indicative of the
results  of  the  transaction  or  related  effects  on  the Company's financial
position  that would result if the above-described transaction is completed on a
different  date,  with a different valuation of the convertible preferred stock.

NOTE  6.  INCOME  TAXES
-----------------------

The  Company's  deferred tax assets have been fully reserved since September 30,
1999,  due  to  uncertainty  about  whether they will be realized in the future,
primarily  due  to operating losses incurred by the Company in 1998 and 1999 and
the existence of significant net operating loss carry-forwards. Accordingly, the
Company  recorded  no  income tax expense or benefit during the three months and
six  months  ended  June  30,  2000.


                                      -8-
<PAGE>
NOTE  7.  RESTATEMENT
---------------------

Subsequent  to  the issuance of the Company's financial statements for the three
months  and six months ended June 30, 1999, the Company determined that it would
be  necessary to restate its revenue and earnings for those periods. The Company
also determined that various other amounts in its balance sheet and statement of
operations  related  to  those  periods, including accounts receivable, deferred
income  taxes  and deferred revenue, required modification. This information was
disclosed  in  the  Company's  1999  Annual  Report  on Form 10-K. The Company's
statements  of  operations  for  the  three months and six months ended June 30,
1999,  have  been  restated from the amounts previously reported, as shown below
(in  thousands):

<TABLE>
<CAPTION>
                                                  THREE  MONTHS  ENDED       SIX  MONTHS  ENDED
                                                    JUNE  30,  1999           JUNE  30,  1999
                                               ------------------------  ------------------------
                                                    AS                        AS
                                                PREVIOUSLY       AS       PREVIOUSLY       AS
                                                 REPORTED     RESTATED     REPORTED     RESTATED
                                               ------------  ----------  ------------  ----------
<S>                                            <C>           <C>         <C>           <C>
  Premium revenue                              $    25,050   $  23,989   $    49,805   $  47,852

  Health care services expense                      16,509      16,718        32,951      33,236
  Selling, general and administrative expense        9,339       9,332        17,051      18,443
                                               ------------  ----------  ------------  ----------

    Operating loss                                    (798)     (2,061)         (197)     (3,827)

  Investment and other income                          789         437         2,341       1,940
  Interest expense                                  (1,102)     (1,102)       (2,049)     (2,049)
  Loss on impairment of assets                     (10,355)         --       (10,355)         --
                                               ------------  ----------  ------------  ----------
  Loss before income taxes and
    discontinued operations                        (11,466)     (2,726)      (10,259)     (3,936)
  Income tax benefit                                (4,420)       (940)       (3,998)     (1,290)
                                               ------------  ----------  ------------  ----------

  Loss before discontinued operations               (7,046)     (1,786)       (6,261)     (2,646)
  Loss from operations to be disposed of                --      (3,264)           --      (3,264)
                                               ------------  ----------  ------------  ----------

  Net loss                                     $    (7,046)  $  (5,050)  $    (6,261)  $  (5,910)
                                               ============  ==========  ============  ==========

  Basic and diluted loss per share:
    Loss from continuing operations            $     (1.48)  $   (0.38)  $     (1.32)  $   (0.56)
    Loss from discontinued operations                   --       (0.69)           --       (0.69)
                                               ------------  ----------  ------------  ----------

      Net loss                                 $     (1.48)  $   (1.07)  $     (1.32)  $   (1.25)
                                               ============  ==========  ============  ==========

  Weighted average basic and diluted
    shares outstanding                               4,747       4,747         4,747       4,747
</TABLE>

NOTE  8.  LITIGATION
--------------------

In  December  1999,  a  stockholder lawsuit against the Company was filed, which
alleges that the Company and certain of its officers violated certain securities
laws  by  issuing a series of alleged false and misleading statements concerning
the  Company's  publicly reported revenues and earnings during a specified class
period.  The  Company has directors and officers liability insurance and intends
to  vigorously  defend  this  litigation.  In  the  opinion  of  the  Company's
management, the ultimate outcome of this matter will not have a material adverse
effect  on  the  Company's  financial  position  or  results  of  operations.


                                      -9-
<PAGE>
ITEM  1.     MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF FINANCIAL CONDITION AND
RESULTS  OF  OPERATIONS

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

The  Private  Securities  Litigation Reform Act of 1995 provides a "safe harbor"
for  forward-looking  statements,  as long as those statements are identified as
forward-looking  and  are  accompanied  by  meaningful  cautionary  statements
identifying  important  factors  that  could  cause  actual  results  to  differ
materially  from  those discussed in the statements. The Company desires to take
advantage  of  these  safe  harbor  provisions. The statements contained in this
Management's  Discussion  and  Analysis  of  Financial  Condition and Results of
Operations  concerning  expected  growth,  the  outcome  of business strategies,
future  operating results and financial position, economic and market events and
trends,  future  premium  revenue,  future  health  care expenses, the Company's
ability  to  control  health care, selling, general and administrative expenses,
items  discussed under the heading "Year 2000" and all other statements that are
not  historical  facts,  are  forward-looking statements. Words such as expects,
projects,  anticipates,  intends,  plans,  believes,  seeks  or  estimates,  or
variations  of  such words and similar expressions are also intended to identify
forward-looking  statements.  These  forward-looking  statements  are subject to
significant  uncertainties  and  contingencies,  many  of  which  are beyond the
control  of  the  Company.  Actual  results  may  differ  materially  from those
projected  in the forward-looking statements, which statements involve risks and
uncertainties.  The  Company's  ability  to  expand  its business is affected by
competition from a large number of other entities that offer dental plans in the
markets  in  which the Company operates. Certain large employer groups and other
purchasers  of  dental  health  care services continue to demand minimal premium
rate  increases,  while  limiting the number of choices offered to employees. In
addition,  securing  cost-effective  contracts  with  dentists  may  become more
difficult due to increased competition among dental plans for dentist contracts.
There  is  a  risk  that  the  Company  will  be unable to obtain waivers and/or
extensions  from  its  lenders,  in  the  event  the  expected conversion of its
outstanding  debt  to  preferred  stock  does  not  occur.  There are also risks
associated with changes in the Company's operating and expansion strategies, and
the  possible  inability to complete the proposed resale of dental office assets
and/or  promissory  notes.  The Company's profitability depends, in part, on its
ability  to  maintain  effective  control  over  its  health  care  costs, while
providing members with quality dental care. Factors such as utilization rates of
dental  health  care services, possible increases in reserves, new technologies,
the  cost  of  services  delivered by referral specialists, claims expenses, and
numerous  other  external influences may affect the Company's operating results.
The  Company's  expectations for the future are based on current information and
its  evaluation  of  external  influences.  Changes  in  any  one  factor  could
materially  impact the Company's expectations related to premium rates, benefits
plans  offered,  membership  enrollment,  the  amount  of  health  care expenses
incurred,  and  profitability,  and  therefore,  affect  the  forward-looking
statements  which  may  be  included in this report. In addition, past financial
performance  is  not  necessarily a reliable indicator of future performance. An
investor  should  not  use  historical  performance  alone  to anticipate future
results  or  future  period  trends.


                                      -10-
<PAGE>
Summary  of  Results  of  Operations

The following table shows the Company's results of operations as a percentage of
revenue,  and  is  used  in  the  period-to-period  comparisons discussed below.

<TABLE>
<CAPTION>
                                                      THREE MONTHS ENDED  SIX MONTHS ENDED
                                                          JUNE  30,          JUNE  30,
                                                       ----------------  ----------------
                                                        2000   1999 (1)   2000   1999 (1)
                                                       ------  --------  ------  --------
<S>                                                    <C>     <C>       <C>     <C>
Premium revenue                                        100.0%    100.0%  100.0%    100.0%

Health care services expense                            72.2      69.7    71.9      69.5
Selling, general and administrative expense             30.5      38.9    32.9      38.5
                                                       ------  --------  ------  --------
Operating loss                                          (2.7)     (8.6)   (4.8)     (8.0)

Investment and other income                              1.6       1.8     1.3       4.1
Interest expense on debt that is subject
  to conversion to equity (2)                           (5.0)     (4.4)   (4.5)     (4.0)
Other interest expense                                  (0.1)     (0.2)   (0.1)     (0.3)
                                                       ------  --------  ------  --------

Loss before income taxes and discontinued operations    (6.2)    (11.4)   (8.1)     (8.2)

Income tax benefit                                        --      (3.9)     --      (2.7)
                                                       ------  --------  ------  --------
Loss before discontinued operations                     (6.2)     (7.5)   (8.1)     (5.5)

Loss from operations to be disposed of                    --     (13.6)     --      (6.8)
                                                       ------  --------  ------  --------

  Net loss                                             (6.2)%   (21.1)%   (8.1)   (12.3)%
                                                       ======  ========  ======  ========
<FN>

(1)     As  restated.  See  Note  7  to  the  accompanying  financial  statements.
(2)     See  Note  5  to  the  accompanying  financial  statements  for a discussion of a
        transaction  that  is expected to convert substantially all of the Company's debt
        and the related  accrued  interest  into  preferred  stock.
</TABLE>

Three  Months  Ended  June 30, 2000 Compared to Three Months Ended June 30, 1999

Premium  revenue  increased  by $184,000, or 0.8%, from $24.0 million in 1999 to
$24.2  million  in  2000.  The average membership for which the Company provided
dental coverage decreased by approximately 50,000 members, or 5.7%, from 878,000
members  during  1999 to 828,000 during 2000. The decrease in the average number
of  members  is  primarily due to the loss of several customers during the first
six  months  of  2000.  Premium  revenue  increased  by 0.8% even though average
membership  decreased  by 5.7%. This was primarily due to a shift in the product
mix toward preferred provider ("PPO")/indemnity plans, which have higher premium
rates  than  managed  care plans, increases in premium rates, and a shift in the
product  mix  toward  managed  care  plans with higher benefit levels and higher
premium  rates.

Health  care services expense increased by $746,000, or 4.5%, from $16.7 million
in  1999  to $17.5 million in 2000. Health care services expense as a percentage
of  premium  revenue (the "loss ratio") increased from 69.7% in 1999 to 72.2% in
2000.  This  increase  is  primarily  due  to an increase in the loss ratio from
PPO/indemnity  plans,  and  a shift in the product mix toward more PPO/indemnity
business.  The  Company's PPO/indemnity business has a significantly higher loss
ratio  than its managed care business. However, the PPO/indemnity business has a
higher  amount  of  gross  margin  (premium  revenue  less  health care services
expense)  per  insured individual, and the Company believes it has significantly
lower  selling,  general  and administrative expenses than the Company's managed
care  business,  as  a  percentage  of  premium  revenue.


                                      -11-
<PAGE>
Selling, general and administrative ("SG&A") expenses decreased by $1.9 million,
or  21.1%, from $9.3 million in 1999 to $7.4 million in 2000. SG&A expenses as a
percentage  of  premium  revenue  decreased from 38.9% in 1999 to 30.5% in 2000.
This  decrease is primarily due to a reduction in the number of employees during
the  first  quarter  of 2000 in connection with a consolidation of the Company's
administrative services into a single location. The decrease in SG&A expenses is
also  partially  due to a decrease in amortization expense related to intangible
assets.  During  the third quarter of 1999, the Company recorded a $24.9 million
impairment  loss to reduce the carrying values of its intangible assets to their
estimated  realizable values, which caused a decrease in amortization expense in
2000.  In addition, the decrease in SG&A expenses is partially due to a decrease
in  computer  programming  expenses,  as  the  Company  has  completed  several
enhancements  to  its  proprietary  management  information  system that were in
process  during  1999.

Investment  and  other  income  decreased by $59,000, or 13.5%, from $437,000 in
1999  to  $378,000  in 2000. This decrease is primarily due to realized gains on
the  sale  of  investments  in  1999.

Total  interest  expense  increased  by $118,000, or 10.7%, from $1.1 million in
1999 to $1.2 million in 2000. This increase is primarily due to interest expense
on  the  $8.0  million  borrowing  on  March  1,  2000,  which  was completed in
connection  with  the  transaction  described  in  Note  5  to  the accompanying
financial  statements.  This  increase was partially offset by a decrease in the
interest  expense  on  the  revolving  credit  facility,  due  to a nonrecurring
increase  in  the  interest  rate  during  the  second  quarter  of  1999.

The  loss  before  income  taxes  and  discontinued operations decreased by $1.2
million,  from  $2.7  million  in  1999 to $1.5 million in 2000. The loss before
income  taxes  and  discontinued  operations  as a percentage of premium revenue
decreased  from  11.4%  in  1999  to  6.2% in 2000. The decrease in the loss was
primarily  due  to a $1.9 million decrease in SG&A expenses, as discussed above,
which  was  partially  offset  by  a  $746,000  increase in health care services
expense,  as  discussed  above.

The  income  tax  benefit  decreased  from $940,000 in 1999 to zero in 2000. The
Company  recorded  no income tax expense or benefit in 2000 due to the valuation
reserve  against  its  deferred  tax  assets  (see  Note  6  to the accompanying
financial  statements).

Six  Months  Ended  June  30,  2000  Compared  to Six Months Ended June 30, 1999

Premium  revenue  increased  by $784,000, or 1.6%, from $47.9 million in 1999 to
$48.6  million  in  2000.  The average membership for which the Company provided
dental coverage decreased by approximately 31,000 members, or 3.5%, from 875,000
members  during  1999 to 844,000 during 2000. The decrease in the average number
of  members  is  primarily due to the loss of several customers during the first
six  months  of  2000.  Premium  revenue  increased  by 1.6% even though average
membership  decreased  by 3.5%. This was primarily due to a shift in the product
mix  toward  PPO/indemnity  plans,  which have higher premium rates than managed
care  plans,  increases  in premium rates, and a shift in the product mix toward
managed  care  plans  with  higher  benefit  levels  and  higher  premium rates.

Health  care  services  expense  increased  by $1.8 million, or 5.2%, from $33.2
million  in  1999  to  $35.0  million in 2000. Health care services expense as a
percentage of premium revenue (the "loss ratio") increased from 69.5% in 1999 to
71.9%  in  2000. This increase is primarily due to an increase in the loss ratio
from  PPO/indemnity  plans,  and  a  shift  in  the  product  mix  toward  more
PPO/indemnity business. The Company's PPO/indemnity business has a significantly
higher  loss  ratio  than  its managed care business. However, the PPO/indemnity
business  has  a higher amount of gross margin (premium revenue less health care
services  expense)  per  insured  individual,  and  the  Company believes it has
significantly  lower  selling,  general  and  administrative  expenses  than the
Company's  managed  care  business,  as  a  percentage  of  premium  revenue.

Selling, general and administrative ("SG&A") expenses decreased by $2.4 million,
or  13.2%, from $18.4 million in 1999 to $16.0 million in 2000. SG&A expenses as
a  percentage  of premium revenue decreased from 38.5% in 1999 to 32.9% in 2000.
This  decrease is primarily due to a reduction in the number of employees during
the  first  quarter  of 2000 in connection with a consolidation of the Company's
administrative services into a single location. The decrease in SG&A expenses is
also  partially  due to a decrease in amortization expense related to intangible
assets.  During  the third quarter of 1999, the Company recorded a $24.9 million
impairment  loss to reduce the carrying values of its intangible assets to their


                                      -12-
<PAGE>
estimated  realizable values, which caused a decrease in amortization expense in
2000.  In addition, the decrease in SG&A expenses is partially due to a decrease
in  computer  programming  expenses,  as  the  Company  has  completed  several
enhancements  to  its  proprietary  management  information  system that were in
process  during  1999.

Investment  and  other  income  decreased  by  $1.3 million, or 67.2%, from $1.9
million  in  1999  to  $637,000  in 2000. This decrease is primarily due to $1.2
million  of  realized gains on the sale of investments in 1999, compared to none
in  2000.

Total interest expense increased by $203,000, or 9.9%, from $2.0 million in 1999
to  $2.2  million in 2000. This increase is primarily due to interest expense on
the  $8.0  million borrowing on March 1, 2000, which was completed in connection
with  the  transaction  described  in  Note  5  to  the  accompanying  financial
statements.  This  increase  was  partially offset by a decrease in the interest
expense  on the revolving credit facility, due to a nonrecurring increase in the
interest  rate  during  the  second  quarter  of  1999.

The loss before income taxes and discontinued operations increased slightly from
$3.9  million  in 1999 to $4.0 million in 2000. The loss before income taxes and
discontinued  operations  as  a percentage of premium revenue decreased slightly
from  8.2%  in  1999  to  8.1%  in  2000. The operating loss decreased from $3.8
million  in 1999 to $2.3 million in 2000, which was largely offset by a decrease
in  investment  and  other  income,  as  discussed  above.

The  income tax benefit decreased from $1.3 million in 1999 to zero in 2000. The
Company  recorded  no income tax expense or benefit in 2000 due to the valuation
reserve  against  its  deferred  tax  assets  (see  Note  6  to the accompanying
financial  statements).

Liquidity  and  Capital  Resources

Net  cash  used by operating activities was $672,000 during the six months ended
June  30,  2000,  compared  to net cash provided by operating activities of $2.6
million  during  the  same  period  in  1999.  This  change  of $3.2 million was
primarily  due  to  $1.1  million  of  reductions in accounts payable and claims
payable  in  2000, compared to $2.5 million of increases in those liabilities in
1999.  The decreases in these liability accounts in 2000 were due to a reduction
in  the processing time for both accounts payable and dental claim payments. Net
cash  used  by  investing  activities  was $7.9 million during 2000, compared to
$254,000 of net cash provided by investing activities in 1999. The net cash used
by investing activities in 2000 was primarily due to the purchase of investments
with  the  $8.0  million  proceeds  of  the  investor  senior  loan  obtained in
connection  with  the  transaction completed on March 1, 2000 (see Note 5 to the
accompanying  financial  statements).  Net cash provided by financing activities
was  $7.9 million during 2000, compared to net cash used by financing activities
of  $2.3  million during 1999. This change of $10.2 million was primarily due to
$8.0  million  of  proceeds  from  the investor senior loan obtained on March 1,
2000,  and  $2.3  million  of  debt  payments  in  1999.

The  Company's  total short-term and long-term debt increased from $39.8 million
at  December 31, 1999, to $47.7 million at June 30, 2000, due to an $8.0 million
borrowing  on  March  1, 2000, in connection with the Recapitalization Agreement
described  in  Note  5  to  the  accompanying  financial  statements.

Year  2000  Compliance

The  Year  2000  issue results from computer programs that use two digits rather
than  four to define the applicable year. The Company believes it has adequately
modified  its  information  systems  so that dates in the year 2000 are properly
recognized  by  all  of  its significant applications.  As of June 30, 2000, the
Company  has  experienced  no  significant impact on its business related to the
Year  2000  issue,  from  either  its  own information systems or those of third
parties  with  which  it  does  business.

Impact  of  Inflation

The Company's operations are potentially impacted by inflation, which can affect
premium  rates,  health  care  services  expense,  and  selling,  general  and
administrative expense. The Company expects that its earnings will be positively
impacted by inflation in premium rates, because premium rates for dental benefit
plans  in  general  have  been  increasing due to inflation in recent years. The


                                      -13-
<PAGE>
impact  of  inflation on the Company's health care expenses is mitigated to some
extent  by  the  fact  that  45-50%  of  total  health  care services expense is
comprised  of  capitation  or  fixed payments to providers. However, the Company
expects  that  its  earnings  will be negatively impacted by inflation in health
care  costs  to some extent, because fees charged by other dental providers have
been  increasing  due  to  inflation  in  recent years. In addition, most of the
Company's  selling,  general and administrative expenses are impacted by general
inflation  in  the  economy.

ITEM  2.    QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT MARKET RISK

The  Company  is  not subject to a material amount of risk related to changes in
interest  rates  or  foreign  currency  exchange  rates.

PART  II.   OTHER  INFORMATION

ITEM  1.    LEGAL  PROCEEDINGS

The  Company  is  subject  to  various  claims and legal actions in the ordinary
course  of  business.  The  Company  believes that all pending claims either are
adequately covered by insurance maintained by its contracted dental providers or
by  the  Company,  or  will  not have a material adverse effect on the Company's
results  of  operations  or  financial position. In December 1999, a stockholder
lawsuit  against  the  Company  was  filed,  which  alleges that the Company and
certain  of its officers violated certain securities laws by issuing a series of
alleged  false  and  misleading  statements  concerning  the  Company's publicly
reported  revenues and earnings during a specified class period. The Company has
directors and officers liability insurance and intends to vigorously defend this
litigation.  In the opinion of the Company's management, the ultimate outcome of
this  matter  will not have a material adverse effect on the Company's financial
position  or  results  of  operations.

ITEM  3.    DEFAULTS  UPON  SENIOR  SECURITIES

See  Note  5  to  the  accompanying  consolidated  financial  statements herein.

ITEM  5.    OTHER  INFORMATION

The  Company  has  tentatively scheduled a Special Meeting of Stockholders to be
held  on  October 25, 2000 at 4:00 p.m., Pacific Daylight Time, at the principal
executive  offices  of  the  Company  located  at  95  Enterprise,  Aliso Viejo,
California  92656-2601.  Among  other items, one of the matters to be considered
at  the  Special Meeting of Stockholders will be the election of directors.  The
nominees  of  the  Board  of  Directors for election as directors at the Special
Meeting  will  be: Jack R. Anderson, Steven J. Baileys, DDS, Ronald I. Brendzel,
James  E.  Buncher, Leslie B. Daniels, and Dennis L. Gates.  The Company will be
mailing  to  stockholders  a  proxy statement regarding the Special Meeting that
will  contain  information  regarding the nominees of the Board of Directors for
election  as  directors.

Pursuant  to  Section 2.13B of the Company's Bylaws, if a stockholder desires to
nominate  a  person  or  persons  for election as a director, the stockholder is
required to provide notice to the Company at its principal executive offices not
later  than  the  tenth day following the date on which a public announcement is
first  made  of the date of the Special Meeting, and of the nominees proposed by
the  Board  of  Directors  to be elected at such meeting.  Such notice shall set
forth  (a)  all information relating to any proposed nominee that is required to
be  disclosed  in  the  solicitation  of  proxies  for  election of directors in
election  contests,  or otherwise required, pursuant to Regulation 14A under the
Securities  Exchange  Act  of 1934, (b) the name and address of the stockholder,
and  (c)  the  number  of  shares  of  the  Company  beneficially  owned by such
stockholder.

Accordingly,  if  a  stockholder  desires  to  nominate  a person or persons for
election  as  a director, the stockholder must submit the required notice to the
Company  at its principal executive office within ten (10) days from the date of
this  Report.


                                      -14-
<PAGE>
If a stockholder desires to request that a proposal be included in the Company's
proxy  statement  for the Special Meeting of Stockholders pursuant to Rule 14A-8
under  the  Securities  Exchange  Act,  the  proposal  must  be  received at the
Company's  principal  executive  offices  a  reasonable  time before the Company
begins  to  print  and  mail  the  proxy statement for the Special Meeting.  The
Company  currently  anticipates  that  it will begin to print and mail its proxy
statement  for  the  Special  Meeting  on  approximately  September  15,  2000.
Stockholders  may not present proposals for consideration at the Special Meeting
that are not included in the notice of the meeting and proxy materials mailed by
the  Company  to  the  stockholders.
 .
ITEM  6.    EXHIBITS  AND  REPORTS  ON  FORM  8-K

(A)     EXHIBITS

        EXHIBIT                     DESCRIPTION
        -------               -------------------------

         27.1                 Financial  Data  Schedule

(B)     REPORTS  ON  FORM  8-K.

None.


                                      -15-
<PAGE>
                                   SIGNATURES

Pursuant  to  the requirements of Section 13 or 15(d) 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, in the City of Aliso
Viejo,  State  of  California,  on  the  11th  day  of  August  2000.

                           SAFEGUARD  HEALTH  ENTERPRISES,  INC.


                           By: /s/  James  E.  Buncher
                               -----------------------
                               James  E.  Buncher
                               President and Chief Executive Officer
                               (Principal Executive  Officer)


                           By: /s/  Dennis  L.  Gates
                               -----------------------
                               Dennis  L.  Gates
                               Senior Vice President and Chief Financial Officer
                               (Chief  Accounting  Officer)


                                      -16-
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