UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C.  20549

                                   FORM 10-QSB

(Mark  One)

  X     QUARTERLY  REPORT  UNDER  SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
 ---    ACT  OF  1934

               For  the  quarterly  period  ended  June 30,  1999
                                                  -----------------

       TRANSITION  REPORT  UNDER  SECTION  13  OR  15(d)  OF THE EXCHANGE ACT
 ---
               For  the  transition  period  from  ________  to  ________

               COMMISSIONS  FILE  NUMBER:  000-24807

                            CORECARE  SYSTEMS,  INC.
                            ------------------------
     (Name  of  small  business  issuer  as  specified  in  its  charter)

                Delaware                               23-2840367
           -------------------                        -------------
        (State of jurisdiction of                   (I.R.S. Employer
      incorporation or organization)               Identification  No.)

         c/o Kirkbride Center, 111 North 49th St., Phila., PA 19139
         ----------------------------------------------------------
                (Address  of  principal  executive  offices)

                               (215)  471-2600
                            ---------------------
                          (Issuer's Telephone Number)

Check  whether  the issuer (1) filed all reports required to be filed by Section
13  or  15(d)  of  the  Exchange  Act during the past 12 months (or 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
                                                                            ---

           As of July 1, 1999 the issuer had issued and outstanding
               15,765,232 shares, $.001 par value, of Common Stock

<PAGE>
                               CORECARE SYSTEMS, INC.
                                   FORM 10-QSB

                                TABLE OF CONTENTS
                                -----------------


PART  I  -  FINANCIAL  INFORMATION
                                                                            PAGE

Item  1:     Financial  Statements                                             2
Item  2:     Management's  Discussion
             and  Analysis  of  Financial  Condition
             and  Results  of  Operations                                    2-4

Item  3:     Quantitative  and  Qualitative
             Disclosures  About  Market  Risk                                  4



PART  II  -  OTHER  INFORMATION
                                                                            PAGE

Item  1:     Legal  Proceedings                                                5
Item  2:     Changes  in  Securities  and  Use  of  Proceeds                   5
Item  3:     Default  and  Senior  Securities                                  5
Item  4:     Submission of Matters to a Vote of Security Holders               5
Item  5:     Other  Information                                                5
Item  6:     Exhibits  and  Reports  on  Form  8-K                             5


                          INDEX TO FINANCIAL STATEMENTS
                          -----------------------------

     Consolidated  Balance  Sheet
     Three  months  ended
     June 30,  1999  and
     Fiscal  Year  Ended
     December  31,  1998                                                    9-10

     Consolidated Statement of Operations
     Three  months and Six Months ended
     June 30, 1999 and 1998                                                   11

                                      1
<PAGE>
ITEM  1.     FINANCIAL  STATEMENTS


     The  financial  statements can be found at the end of this report beginning
on  pages  7  through  11.


ITEM  2.     Management's  Discussion  and  Analysis
ITEM  1.     FINANCIAL  STATEMENTS

     CoreCare  Systems,  Inc.  (the  "Company")OTC-Bulletin  Board:  CRCS)  is a
regional  behavioral  health  carenetwork  operating  in  Eastern  Pennsylvania,
which performs behavioral therapy services  and  associated clinical research in
central nervous system drugs. The Company's  headquarters  are  located  at  c/o
Kirkbride  Center, 111 North 49th Street, Philadelphia, PA  19139. Its telephone
number  at  its is  (215) 471-2600. The executive office suite can be reached at
(215)  471-2358.


     Management's  discussion  and  analysis  is  based  upon  the  unaudited
consolidated  financial  statements  of  the Company for the three month periods
ended  March  31, 1999 and 1998, and include the accounts of the Company and its
subsidiaries  after  elimination of any inter-company balances and transactions.


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

RESULTS  OF  OPERATIONS:

          Revenue - Revenues for the three-months and six months ending June 30,
1999,  were  $6,818,623 and $13,082,641, respectively, representing increases of
approximately 37% and 41% over total revenue for the comparable periods in 1998.
The material increases in total revenue compared with the prior year period, are
attributable  to  a  number  of  factors,  including  the  following:

          Net  Patient  Revenue  -Net  patient  revenues  of  $5,525,032  and
$11,617,398  for  the three month and six month periods, respectively, increased
35%  and  54%  versus the same periods in 1998. These increases  were  primarily
due  to  the  following  developments:

          (a)  Drug and alcohol unit (licensed for 63 beds) was opened for six
months  of  operation  at  Kirkbride  Center during 1999 and was not operational
during  the  first  quarter  1998;

          (b)  Substantial increases in patient  days  at  the  Kirkbride Center
and Westmeade at Warwick in  1999  versus  1998;

          (c)  New  programs  at  the  Kirkbride  Center including the geriatric
partial  hospitalization;

                                      2
<PAGE>
          (d)  Dual  diagnosis  program  at the Kirkbride Center expanded during
1998.

         Management  Services  Revenue  -Management  services  revenue  declined
in  both  the  three months and six months periods in 1999 compared to 1998  due
to  the  expiration  of  a  hospital  management  contract  on  June  30,  1998.

        Other  revenues  of  $431,690  for  the quarter and $851,560 for the six
months  included  revenue from the Company's subsidiary Quantum Clinical Service
Group  in  1999  from  clinical  research  drug  trials  on  behalf  of
pharmaceutical  companies which did not occur in the comparable periods in 1998.
Additionally,  rental  income  from tenant  revenue  rose  in 1999  versus 1998.

        Operating  Expenses  -  Operating expenses of $6,402,435 for the quarter
and  $13,090,450  six  months ended June 30, 1999 increased 11% and 21% over the
comparable  periods  in  1998.  Operating  expenses increased  at  a  rate  much
lower  than  the  37% and 41% increases in revenue for the quarter and six month
periods.  Operating  expenses as  a percentage of revenue declined to 93.9% from
115.1%  for  the same quarter  a  year ago.  The company was able to achieve the
benefits  of  operating  leverage  and  improved  operating  efficiency.

        Salaries  and  Employees  Benefits-  Salaries  and  Employee  Benefits
increased  approximately  $890,000  or  26%  during  the  second quarter 1999 as
compared  to  the  second  quarter  1998.  This  increase is attributable to the
increase  in  services  being  offered at the Kirkbride Center.  During 1999 the
number  of  acute  patients was greater than 1998, the drug and alcohol unit was
operational,  and  the  outpatient  programs  have  increased.  These additional
services  required  an  increase  in  staffing  costs  along with start-up costs
associated with the clinical drug  research  and  restructuring costs associated
with  the  company's  re-engineering  activities.

                                      3
<PAGE>
          Bad  Debt  Expense  -  Bad  debt  expense  of  $377,664  declined as a
percentage  of  revenue  to 5.5% for the quarter as compared with 10.6% in 1998.

     Income  from  Operations  of  $416,186 in the second quarter represented an
increase  of  $1,171,000 compared to the loss of ($755,643). Year to date Income
from  Operations  was  approximately  breakeven as losses from the first quarter
offset  the  income from the second quarter, yet Income from Operations was $1.5
million  greater  compared  to  the  first  half  of  1998.

          Interest  Expense  -  Interest  expense  increased  due  to  higher
outstanding  debt  at  June  30,  1999  versus  1998.

          Depreciation  and Amortization expense - Depreciation and amortization
expense  declined  by  53% for the quarter and 42% year to date compared to 1998
due  to  reduction  in  the  amortization  expense  associated with the mortgage
costs.

          Net  Loss  for the quarter declined to $(767,803) from $(2,247,619) in
1998.  Year  to  date  Net  Loss of $(2,2428,054) declined 47% compared to 1998.

                                      4
<PAGE>
ITEM  3.     QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  AND  MARKET  RISK

     Not  Applicable

<PAGE>
                           PART II - OTHER INFORMATION


ITEM  1.     LEGAL  PROCEEDINGS

          None


ITEM  2.     CHANGES  IN  SECURITIES  AND  USE  OF  PROCEEDS

          None


ITEM  3.     DEFAULTS  ON  SENIOR  SECURITIES

          None


ITEM  4.     SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS

          None


ITEM  5.     OTHER  INFORMATION

          None


ITEM  6.     EXHIBITS  AND  REPORTS

            (a)     Exhibits.
                    --------

                    SEC
Exhibit             Reference
  No.               No.
-------             ---------
  27                Financial Data Schedule

            (b)     Reports  on  Form  8-K.
                    ----------------------
                    No  new reports on Form 8-K were filed in the quarter ended
June 30,  1999.

                                      6
<PAGE>
                                   SIGNATURES


          In  accordance  with the requirements of the Exchange Act of 1934, the
registrant  caused  this  report  to be signed on its behalf by the undersigned,
thereunto  duly  authorized.


Date:  October  12,  1999
     ----------------


                              CORECARE  SYSTEMS,  INC.


     BY: _______________________________
         ROSE  S.  DIOTTAVIO,  PRESIDENT

                                      7
<PAGE>
Notes  to  Financial  Statements

1.     Basis  of  presentation:
The accompanying unaudited financial statements have been prepared in accordance
with  generally accepted accounting principles for interim financial information
and  with  the  instructions  for  Form  10-Q  and Article 10 of Regulation S-X.
Accordingly,  they  do not include all of the information and footnotes required
by  generally  accepted accounting principles for complete financial statements.
In  the  opinion  of management, all adjustments (consisting of normal recurring
accruals)  considered  necessary  for  a  fair  presentation have been included.
Operating  results for the three months ended June 30, 1999 are not necessarily
indicative  of the results that may be expected for the year ending December 31,
1999.  The unaudited financial statements should be read in conjunction with the
financial  statements  and  footnote thereto included in the Company's report on
Form  10K-SB  for  the  year  ended  December  31,  1998.

2.     The  Business:
Corecare  Systems,  Inc.  through  its  eight  operating  subsidiaries, provides
management  services to behavioral health service providers; provides, owns, and
operates  outpatient and inpatient behavioral health services; provides clinical
trial services to the pharmaceutical industry; and develops billing software for
the  health  industry.

3.     Summary  of  significant  accounting  policies:

Principles  of  consolidation:
The  June 30,  1999  and December 31, 1998 financial statements of the Company
include accounts  of  Corecare Systems, Inc. and its wholly owned subsidiaries.

                                      8
<PAGE>
<TABLE>
<CAPTION>
CORECARE  SYSTEMS,  INC.
CONSOLIDATED  BALANCE  SHEET

                                 JUNE 30,      DECEMBER 31,
                                   1999           1998
                               ------------  -------------

Current assets:
<S>                            <C>           <C>
   Cash & cash equivalents         419,209         115,242
   Accounts receivable           4,379,955       4,411,418
   Prepaid expenses                354,685         175,659
                               ------------  -------------
 Total current assets            5,153,849       4,702,319

 Contract rights                 1,288,919       1,288,919
   Less acc. amortization        1,117,645       1,023,619
                               ------------  -------------
                                   171,274         265,300

 Property & equipment,net       13,998,441      14,151,787

 Goodwill, net                   1,681,950       1,705,231

 Deferred finance costs,net        142,659         443,172

 Long-term investments:
 Real estate held for sale       1,073,847       1,100,000


 Other Assets:
 Deposits                           26,999          10,467
 Other                             404,521         816,651
                               ------------  -------------
 Total Other Assets                431,520       2,975,927

 Total Assets                   22,653,550      23,194,927
                               ============  =============
</TABLE>

                                      9
<PAGE>
<TABLE>
<CAPTION>
CORECARE  SYSTEMS,  INC.
CONSOLIDATED  BALANCE  SHEET


                                  JUNE 30,    DECEMBER 31,
                                    1999         1998
                               -------------  ------------

Current liabilities:
<S>                            <C>         <C>
   Accounts payable               4,048,327     3,748,882
   Payrolls & related taxes       3,099,456     3,048,183
   Accrued expenses               2,894,926     1,851,026
   Due to Medicare                2,441,461     1,692,389
   HCFP Funding                   3,900,630     4,308,703
   Notes Pay. incl.
        current portion LTD      16,014,714    16,191,983
   Current portion on capital
        lease obligations            73,478        38,565
   Advances, officers             1,332,692     1,332,692
                               -------------  ------------
 Total current liabilities       34,178,084    32,212,423

 Long-term liabilities:
 Long-term debt,
     net of current portion       2,185,635     2,192,374
                               -------------  ------------
2,185,635     2,192,374

 Total liabilities               36,363,719    34,404,797

 Shareholders' equity
   Preferred Stock,                      17            17
 Common Stock,                       15,949        15,949
 Additional paid in capital      11,014,095    11,086,340
 Retained earnings              (24,740,230)  (22,312,176)
                               -------------  ------------
 Total stockholders' equity     (13,710,169)  (11,209,870)
                               -------------  ------------

 Total liabilities and
     stockholders' equity        22,653,550    23,194,927
                                 ===========  ============
</TABLE>

                                      10
<PAGE>
<TABLE>
<CAPTION>
 CORECARE  SYSTEMS,  INC.
 CONSOLIDATED  STATEMENT  OF  OPERATIONS
 PERIODS  ENDING  JUNE 30, 1999 AND JUNE 30, 1998

          Three Months Ended     Six Months Ended
   ----------------------       --------------------
                                   6/30/99      6/30/98    6/30/99 6/30/98
                            -----------  ---------   ---------      -------
Revenue:
<S>                            <C>          <C>          <C>          <C>
   Net patient service          5,525,032    4,047,883   $11,617,398     7,566,026
   Management service             307,126      577,801       613,683     1,040,669
   Other                          431,860      334,861       851,560       694,192
                               -----------  -----------  ------------  ------------
                                6,818,623    4,992,315    13,082,641     9,300,889


 Operating Expenses:
 Salaries and benefits          4,277,990    3,125,658     8,504,916     6,208,950
 Purchased services               774,362            -     1,589,811             -
 Administrative expenses          972,419    2,092,319     1,948,638     3,609,792
 Bad debt expense                 377,664      529,981     1,047,085       964,593
                               -----------  -----------  ------------  ------------
 Total operating expenses       6,402,435    5,747,958    13,090,450    10,783,335

 Income from operations           416,188     (755,643)       (7,809)   (1,482,446)

 Other expenses:
 Interest expense                 786,683      731,473     1,634,071     1,360,252
 Impaired asset write down              -            -       369,380             -
 Depreciation & Amortiz.          397,308      760,503       786,174     1,285,660
                               -----------  -----------  ------------  ------------
 Total other expenses           1,183,991    1,491,976     2,420,245     3,015,292
                               -----------  -----------  ------------  ------------
 Net income(loss)                (767,803)  (2,247,619)   (2,428,054)   (4,497,738)
                               ===========  ===========  ============  ============

average shares outstanding     15,753,792   15,186,404    15,733,845    14,675,861
 loss per share-basic               (0.05)       (0.15)        (0.15)        (0.31)
 loss per share-fully diluted       (0.05)       (0.15)        (0.15)        (0.31)
</TABLE>

                                      11
<PAGE>