U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

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

                     For the quarter ended December 31, 1998
                                       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 No. 0-22947


                       HEALTHCORE MEDICAL SOLUTIONS, INC.
             (Exact name of registrant as specified in its charter)


             DELAWARE                                          43-1771999
(State or other jurisdiction of                             (I.R.S. Employer
 incorporation or organization)                           Identification Number)


 11904 BLUE RIDGE BOULEVARD, GRANDVIEW, MISSOURI                 64030
     (Address of principal executive offices)                  (Zip Code)


       Registrant's telephone number, including area code: (816) 763-4900



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 for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to the filing requirements for the past 90 days. YES [X] NO [__]

State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date:

As of February  12, 1999,  3,018,000  shares of Class A Common  Stock,  $.01 par
value,  and  216,000  shares of Class B Common  Stock,  $.01 par  value,  of the
registrant were issued and outstanding.


Transitional Small Business Disclosure Format (check one):
         YES [__]     NO [X]



<PAGE>

                       HEALTHCORE MEDICAL SOLUTIONS, INC.
                          Successor to MegaVision, L.C.

                                TABLE OF CONTENTS



ITEM                                                                       PAGE
----                                                                       ----

                                     PART I.
                              FINANCIAL INFORMATION

 Item 1.  Financial Statements (unaudited)

                  Balance Sheet as of December 31, 1998 .................     3
                  Statement of Operations for the quarter
                      ended December 31, 1998 and 1997 ..................     4
                  Statement of Cash Flows for the quarter
                      ended December 31, 1998 and 1997 ..................     5
                  Notes to the Financial Statements......................     6

Item 2.  Management's Discussion and Analysis ...........................     9



                                    PART II.
                                OTHER INFORMATION

Item 2. Changes in Securities and Use of Proceeds........................    12

Item 5. Other Information................................................    12

Item 6. Exhibits and Reports on Form 8-K ................................    13

SIGNATURES ..............................................................    14



                                                                          Page 2

<PAGE>



                       HEALTHCORE MEDICAL SOLUTIONS, INC.
                          Successor to MegaVision, L.C.

                                  BALANCE SHEET
                                   (unaudited)

ASSETS                                                             December 31,
                                                                       1998
                                                                   ------------
Current assets:
      Cash and cash equivalents                                      $3,487,171
      Prepaid expenses and other current assets                         170,215
                                                                   ------------
                     Total current assets                             3,657,386
                                                                   ------------

Property and equipment, net                                             200,463
Other assets                                                             15,570
                                                                   ------------
                                                                        216,033
                                                                   ------------

                     TOTAL                                           $3,873,418
                                                                   ============

LIABILITIES
Current liabilities:
      Accounts payable and accrued expenses                             $82,445
      Deferred income                                                    20,866
      Current portion-long term debt                                     63,987
                                                                   ------------
                     Total current liabilities                          167,298
                                                                   ------------

Obligations under capital lease                                           4,390
                                                                   ------------

                     Total liabilities                                  171,688
                                                                   ------------

Commitments and other matters

SHAREHOLDERS' EQUITY
Preferred Stock, $.01 par value;  
authorized 5,000,000 shares; 
Common Stock, $.01 par value:
      Class A, authorized, 19,784,000 shares
                     Issued and outstanding 3,018,000 shares             30,180
      Class B, authorized, 216,000 shares;
                     Issued and outstanding 216,000 shares                2,160
      Additional paid in capital                                     10,755,932
      Accumulated deficit                                            (7,086,542)
                                                                   ------------
                     Total shareholders equity                        3,701,730
                                                                   ------------

                     TOTAL                                           $3,873,418
                                                                   ============

See notes to financial statements
                                                                          Page 3


<PAGE>

                       HEALTHCORE MEDICAL SOLUTIONS, INC.
                          Successor to MegaVision, L.C.

                             STATEMENT OF OPERATIONS
                                   (unaudited)

<TABLE>
<CAPTION>
                                                            Three Months Ended
                                                        December 31,   December 31,
                                                           1998            1997*
                                                        -----------    -----------
<S>                                                       <C>            <C>      
Revenues:

        Membership revenues                                 $29,903         $8,351

Costs & expenses:

        Costs of memberships                                 23,510          7,068

        Selling and marketing                               218,139         83,166

        General and administrative                          359,172        277,986

        Interest expense                                      5,174         49,643
                                                        -----------    -----------
                Total
                                                            605,995        417,863
                                                        -----------    -----------

Loss before other income                                   (576,092)      (409,512)
                                                        -----------    -----------

Other income - interest                                      45,015         62,555
                                                        -----------    -----------
Net loss                                                   (531,077)      (346,957)

Net loss per share:                                          ($0.23)        ($0.18)
                                                        ===========    ===========

Weighted average number of commons shares outstanding     2,334,000      1,938,529
                                                        ===========    ===========
</TABLE>


* 1997 Quarter revised to reflect change in revenue recognition of annual
contracts. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations."


See notes to financial statements

                                                                          Page 4
<PAGE>

                       HEALTHCORE MEDICAL SOLUTIONS, INC.
                          Successor to MegaVision, L.C.

                            Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                           Three Months Ended
                                                                       December 31,   December 31,
                                                                          1998           1997*
                                                                       -----------    -----------
<S>                                                                     <C>            <C>       
Cash flows used for operating activities:
         Net loss                                                        ($531,077)     ($346,957)
         Adjustments to reconcile net loss to net
         Cash used in operating activities:
              Depreciation and amortization                                 13,683         13,514
              Amortization of discount on notes payable-bridge units                       31,764

         Changes in:
              Prepaid expenses and other assets                             (6,762)       (47,580)
              Accounts payable and accrued expenses                        (32,442)      (445,842)
              Other liabilities                                             20,866          2,419
                                                                       -----------    -----------

              Net cash used in operating activities                       (535,732)      (792,682)
                                                                       -----------    -----------

Cash flows from investing activities:
         Acquisition of property and equipment                              (3,304)       (43,201)
                                                                       -----------    -----------

Cash flows from financing activities:

         Decrease in restricted cash                                                       85,000
         Principal payments on notes payable-bridge units                              (2,300,000)
         Net change in notes payable-banks                                               (103,600)
         Principal payments on obligation under capital lease              (14,242)       (14,244)
         Net proceeds from initial public offering                                      8,747,714

              Net cash used in financing activities                        (14,242)     6,414,870
                                                                       -----------    -----------

Net increase in cash and cash equivalents                                 (553,278)     5,578,987

Cash and cash equivalents - beginning of period                          4,040,449        147,350
                                                                       -----------    -----------

Cash and cash equivalents - end of period                               $3,487,171     $5,726,337
                                                                       ===========    ===========

Supplemental disclosure of cash flow information: Cash paid for:
              Interest                                                      $5,174       $177,700
</TABLE>


* 1997 Quarter revised to reflect change in revenue recognition of annual
contracts. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations."


See notes to fonancial statements

                                                                          Page 5
<PAGE>

                       HEALTHCORE MEDICAL SOLUTIONS, INC.
                          Successor to MegaVision, L.C.

                          Notes to Financial Statements
                                December 31, 1998
                                   (unaudited)

NOTE A - THE COMPANY AND BASIS OF PRESENTATION

General

These financial  statements have been prepared by HealthCore  Medical Solutions,
Inc.  ("HealthCore"  or the  "Company") in accordance  with  generally  accepted
accounting  principles for interim  financial  reporting and in accordance  with
Rule  10-01 of  Regulation  S-X.  Accordingly,  they do not  include  all of the
information and notes required by generally accepted  accounting  principles for
complete  financial  statements.  In the opinion of  management,  the  unaudited
financial  statements  include  all  adjustments   (consisting  only  of  normal
recurring  adjustments)  necessary to present fairly the financial position, the
results of operations and the statement of cash flows for the periods presented.

The unaudited  financial  statements  presented  herein were prepared  using the
underlying  accounting  principles  utilized in the Company's September 30, 1998
audited  financial  statements  filed on Form  10-KSB  with the  Securities  and
Exchange Commission on December 29, 1998. Operating results for the three months
ended December 31, 1998 are not  necessarily  indicative of the results that may
be expected for the year ending September 30, 1999.

HealthCore  was  organized  as a  Delaware  corporation  in  February  1997 as a
business successor to MegaVision,  L.C. ("MegaVision").  The Company markets and
administers  Consumer  and  health  care  benefit  services  programs  which are
designed to enable participants  ("Members") to obtain discounts on purchases of
consumer,  medical and  ancillary  health care  products  and  services  through
certain  networks  ("Networks")  of providers  ("Providers").  The Networks with
which the  Company  currently  maintains  contracts  comprise  an  aggregate  of
approximately  450,000  participating  Providers of medical services,  eye care,
dental,  hearing,  pharmacy,  physical and  occupational  therapy,  chiropractic
benefits and consumer purchases throughout the United States. Members can access
the Networks through the use of a discount membership card ("Cards").  The Cards
are  currently  being  marketed,   directly  and  through  independent  brokers,
insurance  agents and consumer  marketing  organizations,  to individuals and to
employers,   health   maintenance   organizations   and   businesses  and  other
associations  who may  either  purchase  the Cards  for,  or offer it to,  their
employees or members.

In February 1997, MegaVision,  L.C., a Missouri limited liability company in the
development stage, merged into HealthCore. In conjunction with the merger, 1,100
member units of MegaVision  were  exchanged for 708,000 shares of Class A common
stock of  HealthCore  and 600 member  units of  MegaVision  were  exchanged  for
360,000  shares  of Class B common  stock of  HealthCore.  The  business  of the
Company was conducted by MegaVision  from June 1, 1995 to February 19, 1997. The
merger  described  above has been accounted for in a manner similar to a pooling
of interests and, except as otherwise  indicated or where the context  otherwise
requires,  the  information  set forth in these  financial  statements  has been
adjusted to give retroactive effect to the reorganization.

HealthCore  and  MegaVision  have been  principally  devoted  to  organizational
activities, raising capital, marketing, building a sales network and negotiating
provider agreements.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

[1]  Cash and cash equivalents:

Cash and cash equivalents  include cash on hand,  demand deposits and all highly
liquid  investments  with a  maturity  of  three  months  or less at the time of
purchase.

[2]  Management estimates:

The preparation of financial  statements in conformity  with generally  accepted
accounting principles 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,  and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.

                                                                          Page 6

<PAGE>

                       HEALTHCORE MEDICAL SOLUTIONS, INC.
                          Successor to MegaVision, L.C.

                          Notes to Financial Statements
                                December 31, 1998
                                   (unaudited)

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

[3]  Revenue and costs recognition:

The Company  currently offers a full money-back  guarantee to Members who, after
the first 90 days of enrollment, are not satisfied with the Card.


All monthly and single annual  payment sales and their  corresponding  expenses,
including  sales  commissions,  provider fees and a provision for  cancellations
from potential  guarantee-related refunds incurred by the Company at the time of
sale, are recognized in the monthly period after the expiration of the guarantee
period. Annual card sales are recognized ratably over the term of the membership
following the expiration of the guarantee period.

[4]  Property and equipment:

Property and equipment are recorded at cost.  Depreciation  and amortization are
being provided on the  straight-line  method over the estimated  useful lives of
the assets.  Equipment is  depreciated  over periods  ranging from five to seven
years.  Leasehold  improvements are amortized over the shorter of the lease term
or their estimated useful life.

Equipment under capital leases is recorded at the lesser of the present value of
the lease payments or fair value of the  equipment.  Such equipment is amortized
on a  straight-line  basis over the  shorter of the lease term or its  estimated
useful life.

[5]  Net loss per share:

Net loss per share was computed based upon the weighted average number of shares
of common stock  outstanding  during each year presented,  excluding the 900,000
shares placed in escrow. Upon the Company exceeding certain income levels or the
common  stock  exceeding  certain  market  prices per share,  some or all of the
shares of common stock held in escrow are to be released (see Note E).


NOTE C - CAPITAL STOCK

[1]  Stock option plan:

The Company adopted a stock option plan,as  amended,  under which 500,000 shares
of Class A common  stock are  reserved  for  issuance  upon  exercise  of either
incentive or non-incentive  stock options which may be granted from time to time
by the board of directors to the Company's  officers,  directors,  employees and
others.  The Company has granted  options to purchase  172,500 shares of Class A
common stock at prices  ranging from $.875 per share to $5.00 per share.  Of the
options  granted,  15,000 have been forfeited by resignation of the grantees and
are  available for future  grants.  The remaining  157,500  options  granted and
outstanding will fully vest during the period from August 1997 through June 2001
and will expire ten years from the date of grant.

[2]  Shares reserved for issuance:

The  Company  has  reserved  3,849,000  shares of its  Class A common  stock for
issuance  upon  exercise of the  outstanding  warrants  and  options,  including
warrants issued in connection with the IPO.

[3]  Common and preferred stock:

The  shares  authorized  aggregate  19,784,000  shares of Class A common  stock,
216,000 shares of Class B common stock and 5,000,000  shares of preferred stock,
all with $.01 par  value.  The  Class A and  Class B shares of common  stock are
substantially  identical  except that the Class A common  stockholders  have the
right to cast one vote per  share  and the  Class B common  stockholder  has the
right to cast five  votes per  share.  Class B shares  automatically  convert to
Class A shares on a one-for-one basis upon (i) the sale, gift or transfer,  (ii)
death of the original  stockholder  thereof,  (iii) termination of employment of
the  stockholder  by the  Company  for any reason or (iv) if, for the year ended
September  30,  1999,  the  minimum  pretax  income,  as  defined,  is less than
$1,000,000  or if, for any  subsequent  year through  September  30,  2002,  the
Company's  minimum  pretax  income  does not equal or  exceed  110% of the prior
year's minimum pretax income.


                                                                          Page 7

<PAGE>

                       HEALTHCORE MEDICAL SOLUTIONS, INC.
                          Successor to MegaVision, L.C.

                          Notes to Financial Statements
                                December 31, 1998
                                   (unaudited)

NOTE D - INCOME TAXES

The Company's  deferred tax asset as of September 30, 1998 represented a benefit
from net operating loss carryforwards of $1,504,500. This deferred tax asset has
been reduced by a valuation allowance of $1,504,500 since the future realization
of such tax benefit is not presently determinable. As of September 30, 1998, the
Company  had a net  operating  loss  carryforward  of  approximately  $3,946,000
expiring  in 2012 and  2018.  As a result  of the  IPO,  usage of  approximately
$2,000,000 of this net operating loss  carryforward is limited to  approximately
$789,000 per year.

NOTE E - INITIAL PUBLIC OFFERING

On October 17 1997,  the Company,  in its IPO, sold 1,760,000  units.  Each unit
consists  of one share of Class A common  stock and one  redeemable  warrant  to
purchase a share of Class A common stock at $6.50,  expiring  October  2002.  On
November 10, 1997,  the  underwriter  executed its option to sell an  additional
264,000  shares of the  Company's  common  stock.  Proceeds from the IPO, net of
expenses of $1,745,000, approximated $8,355,000. In connection with the IPO, the
underwriter  was granted an option to purchase up to 176,000  units at $6.00 per
unit and a director was granted a warrant to purchase 15,000 shares at $5.00 per
share.

Upon consummation of the Company's initial public offering, certain stockholders
deposited  900,000  shares of common stock (the "Escrow  Shares") into an escrow
account. Some or all of these shares are to be released upon the Company meeting
certain performance goals or the stock price exceeding certain targets. If these
goals are not met the shares will be canceled. However, should the goals be met,
the  release  of  the  shares  owned  by  officers,  directors  and  consultants
aggregating  346,500  shares of the 900,000  shares in escrow will result in the
Company  recognizing  an  additional  expense  equal to the market  value of the
shares released. A total of 400,000 shares of common stock held in escrow are to
be released  if either (a) the  Company's  minimum  pretax  income,  as defined,
equals or exceeds $3,800,000 for the year ending September 30, 1998,  $5,500,000
for the year  ending  September  30,  1999 or  $7,500,000  for the  year  ending
September  30, 2000 or (b) the average  closing price of the common stock equals
or exceeds  $12.50 per share for a 30 trading day period in the 18-month  period
beginning  with the  consummation  of the IPO or $16.50 per share for 30 trading
days in the period  beginning after 18 months after the  consummation of the IPO
and ending 36 months  after the IPO.  All shares of common  stock held in escrow
are to be  released  if either  (a) the  Company's  minimum  pretax  income,  as
defined,  equals or exceeds  $4,600,000 for the year ending  September 30, 1998,
$6,600,000  for the year ending  September 30, 1999 or  $9,000,000  for the year
ending  September 30, 2000 or (b) the average  closing price of the common stock
equals or exceeds  $15.00 per share for a 30 trading day period in the  18-month
period  beginning  with the  consummation  of the IPO or $18.00 per share for 30
trading days in the period  beginning after 18 months after the  consummation of
the IPO and ending 36 months after the IPO.

As of September  30,  1998,  the Company did not attain the income level nor did
the stock price meet or exceed the per share value  necessary for the release of
the escrow shares.

                                                                          Page 8

<PAGE>


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


Statements in this  Form  10-QSB  that are not  descriptions of historical facts
are  forward-looking  statements  that are  subject to risks and  uncertainties.
Actual results could differ materially from those currently anticipated due to a
number of  factors,  including  those  set forth  under  "Risk  Factors"  in the
Company's Form 10-KSB for the year ended  September 30, 1998, and including,  in
particular,  history of operating  losses;  anticipated  future losses;  limited
operating history;  unproven commercial acceptance;  need for market acceptance.
Limited marketing capabilities;  competition;  government regulation; dependence
on third parties; and other risks.

General

The  Company  develops,  markets  and  administers  a benefit  services  program
designed to enable  members to obtain  discounts  on  purchases  of consumer and
medical  products and  services  through  networks of  providers  with which the
Company has executed  provider  agreements.  The Company  currently offers three
products:  The  HealthCare  Solutions  Card,  offering  discounts  for ancillary
medical services;  the Medical Solutions Card, providing discounts on physicians
and hospital medical expenses: and the Saving Solutions Card, offering discounts
on ancillary medical and consumer purchases.


                                                                          Page 9

<PAGE>


The  Company's  revenues  are  derived  from the  receipt  of annual or  monthly
enrollment  fees  paid by or on  behalf  of  Members  for the  right  to  obtain
discounts  from  Providers in the Networks.  The Company  receives a significant
portion of its revenue in the form of monthly  bank  drafts and monthly  payroll
deductions made by employers on behalf of their employees. The Company currently
offers a money-back guarantee. All monthly payment sales and their corresponding
expenses,  including sales  commissions and provider fees, are recognized in the
monthly  periods  after which the guarantee  expires.  Since the initial cost of
delivery the cards to the customers is incurred and expensed in the first month,
the gross profit associated with each new individual card issued is lower in the
month of  issuance  than in the  remaining  eleven  months  prior to the  card's
expiration  date.  In addition,  since all renewal cards are subject to the same
costs of issuance, this twelve month pattern of lower gross profits in the first
month continues for renewal periods.

In those instances when a sale of the Company's discount cards is collected as a
single annual fee, the Company recognizes all of its single payment sales in the
period in which the card is delivered,  since all of the expenses resulting from
the  purchase  of an  annual  card,  including  the  costs  of  issuance,  sales
commission,  provider  fees, and an provision for  cancellations  from potential
guarantee-related  refunds, are incurred by the Company at the time of sale. The
Company  incurs  only  nominal  additional  direct  costs  associated  with each
cardholder in the following  eleven months due to the fact that under all of its
provider  network  contracts,  each provider is obligated to continue to provide
discounts to all cardholders until the annual card expires, even if the provider
network  contract  has been  terminated.  The Company  also offers a  money-back
guarantee  to Members  who,  within  ninety  days,  are not  satisfied  with the
discount card and the Company has established reserves therefor. The Company has
some existing cards with a 12-month guarantee and respective  reserves have been
established.

While most marketing activity has focused primarily on the HealthCare  Solutions
Card, the Company has only recently  begun to market the Medical  Solutions Card
and the Savings  Solutions Card. There can be no assurance that the Company will
successfully maintain or expand the Networks and/or market its discount cards.

The following  discussion and analysis  should be read in  conjunction  with the
financial statements and notes thereto appearing elsewhere in this report.

Results of Operations

Quarters Ended December 31, 1998 and December 31, 1997. Operating revenues for
the quarter ended December 31, 1998 (the "1998 Quarter") increased by
approximately 375% from $8,000 (adjusted) for the quarter ended December 31,
1997 (the "1997 Quarter") to approximately $30,000. Operating revenue for the
1998 Quarter does not include approximately $21,000 in annual membership fees
received that were deferred until after the expiration of the 90 day money back
guarantee period. The deferred revenue is being deferred as a result of a recent
Securities and Exchange Commission ("SEC") position that income cannot be
recognized until after the expiration of the guarantee period and income from
annual contracts must be recognized ratably over the life of the membership. For
comparative purposes, the 1997 Quarter revenues have been adjusted to reflect
deferred revenue recognition of $5,565 in annual membership fees. The overall
increase in revenue is a result of increased sales and marketing efforts to
promote the Company's products.

Selling, general and administrative expenses increased by approximately 60% from
approximately $361,000 in the 1997 Quarter to approximately $577,000 in the 1998
Quarter. The increase is due primarily to management level staffing increases in
the sales,  marketing and customer  service  departments  and increased  program
development costs.

Interest expense decreased by approximately 95% from  approximately  $50,000 for
the  1997  Quarter  to  approximately  $5,000  for the 1998  Quarter  due to the
completion  of  the  bridge  financing  in the  1997  Quarter.  Interest  income
decreased  approximately 27% from approximately  $62,000 for the 1997 Quarter to
approximately $45,000 for the 1998 Quarter due to decreased investments effected
by corporate needs.

Net Loss  increased  53% from  approximately  $347,000  (adjusted)  for the 1997
Quarter  to  approximately  $531,000  for the 1998  Quarter  as a result  of the
foregoing factors.

Liquidity and Capital Resources

The Company utilizes capital resources  primarily for general corporate purposes
and to support  anticipated  growth.  As of December 31, 1998, the Company had a
working capital of approximately  $3,490,000 including cash and cash equivalents
of approximately $3,487,000.


                                                                         Page 10

<PAGE>

 
Net cash used in operating  activities was  approximately  $536,000 for the 1998
Quarter compared to approximately  $793,000 for the 1997 Quarter.  Net cash used
in  operating  activities  consisted  primarily of  approximately  $531,000 as a
result of net loss from operations.

The  Company  intends to use its cash to  implement  its  business  plan,  which
includes the refinement,  sales and marketing of its Savings Cards. In addition,
from time to time, the Company evaluates possible acquisitions or investments in
businesses and products that are  complementary  to those of the Company and the
Company may use a portion of the  remaining  proceeds  of the IPO in  connection
with  any  such  potential  acquisition  or  investment.  However,  the  Company
currently has no present  commitments or agreements with respect to any material
acquisition  or  investment.  From  time  to time  the  Company  also  evaluates
potential  opportunities  outside of its current business operations and intends
to continue to evaluate such opportunities in the future.

The Company expects to continue to incur  substantial  costs in the near term in
connection with its sales and marketing activities, all of which are expected to
be financed from a substantial portion of the remaining proceeds of the IPO. The
Company also expects that general and administrative  costs necessary to support
the establishment of a sales and marketing organization and other infrastructure
will increase in the future.  Unless the Company is able to generate significant
commercial  sales of the its Savings  Cards,  the Company will continue to incur
operating  losses.  There can be no assurance that the Company will ever achieve
profitable operations.

The Company  believes  that its existing  resources  will provide the  necessary
liquidity and capital resources to sustain its planned  operations until January
2000. In the event that the Company's internal estimates relating to its planned
expenditures  prove  materially  inaccurate,  the  Company  may be  required  to
reallocate  funds  among its planned  activities  and  curtail  certain  planned
expenditures.  In any event, the Company anticipates that it will likely require
substantial  additional  financing after such time,  which financing could be in
the form of  equity or debt  financing  or money  received  in  connection  with
collaborative arrangements,  that may be entered into in the future. The Company
has no commitments for any future  financing and there can be no assurance as to
the  availability  or terms of any required  additional  financing,  when and if
needed.  In the event that the Company fails to raise the funds it requires,  it
may be necessary  for the Company to  significantly  curtail its  activities  or
cease operations.

YEAR 2000 COMPLIANCE.  Certain aspects of the Company's business,  including its
customer service capabilities, the Company's ability to timely pay brokers their
commissions and pay network providers their fees, are dependent upon the ability
to store, retrieve, process and manage data and to maintain and upgrade the data
processing system the Company currently relies on. Although the Company believes
that it has established  appropriate safeguard mechanisms,  interruption of data
processing  capabilities  for any extended  period of time, loss of stored data,
programming  errors or other computer problems may affect its ability to attract
and  retain  brokers  and  networks,  which in turn may  negatively  affect  its
business. The Company cannot predict whether it will experience problems, delays
or unanticipated costs in the use of its current system.

The Company  continues  to review its  computer  systems to identify the systems
that could be affected by the "Year 2000" issue and is currently  developing  an
implementation  plan to resolve the issue.  The Year 2000 issue is the result of
computer  programs being written using two digits rather than four to define the
applicable year. Any of the Company's programs that have time-sensitive software
may recognize a date using "00" as the year 1900 rather than the year 2000.  The
Year 2000 issue can arise at any point in the Company's processing, distribution
and   financial   chains  and  could  result  in  a  major  system   failure  or
miscalculations,  affect its ability to pay  commissions and fees to its brokers
and  networks,  as well as its ability to review  network  providers in a timely
manner and on the whole disrupt its business operations.

The Company is utilizing internal personnel, contract programmers and vendors to
review its information and  operational  systems,  including the Data Management
and  Systems  Design  (DMSD)  System,  for  purposes  of  identifying  Year 2000
non-compliance  problems. The Company has identified two specific areas of risks
relating to the Year 2000 problem:  internal  business  systems and software and
external  noncompliance  by third parties  including  suppliers of participating
providers data, suppliers requiring information about our eligibility, financial
vendors and the Company's members.

Internal Business Systems and Software -- The Company's  systems,  including the
DMSD System,  were developed  utilizing  program  source code and  off-the-shelf
software that was Year 2000 compliant. The total estimated cost of the hardware,
software and  installation  cost of the  Company's  system,  including  the DMSD
System,  was  approximately  $600,000,  a portion of which was allocated to year
2000  compliance.  All  available  upgrades for  off-the-shelf  products  (which
include  Year 2000  compliance)  have been  loaded  and are in active  use.  The
Company's telephone system vendors have indicated Year 2000 compliance including
services relating to long distance, local, 1-800, telephone switch and audix.



                                                                         Page 11

<PAGE>


External Non-Compliance by Third Parties -- Suppliers of Participating Providers
Data -- A survey  of all  suppliers  of  participating  providers  data has been
conducted  and is  approximately  90%  completed.  Of  the  suppliers  who  have
responded to our survey,  all have indicated that they are Year 2000  Compliant,
although the Company  cannot  guarantee  that there  suppliers and the remaining
suppliers are and will be Year 2000 compliant.

External  Non-Compliance  by Third  Parties -- Suppliers  Requiring  Information
About  Eligibility.  A survey of all suppliers  requiring  information about the
Company's  eligibility has been conducted with a 100% response rate to date. Two
pharmacy benefits management  suppliers with whom the Company has contracts have
indicated that they are Year 2000 compliant. 

To the extent that the Company  determines that any of its suppliers'  responses
to the Year 2000 issue are unsatisfactory, it will consider alternate sources of
suppliers. The Company can not assure that it will be successful in finding such
alternative suppliers.

External  Non-Compliance  by Third  Parties --  Financial  Vendors --  Financial
vendors such as the Company's  merchant bank and credit card  processor have not
yet been  surveyed.  The Company  expects that such surveys will be conducted no
later than the first quarter of 1999. To the extent that the Company's financial
vendors are not Year 2000 compliant, the Company will consider alternate sources
of financial  vendors who are Year 2000  compliance.  The Company cannot assure
that it will be successful in finding such alternative financial vendors.

External  Noncompliance  by Third  Parties --  Sponsors.  The  Company  does not
currently have any formal  information  about the status of its Sponsors and the
Year 2000 issue. The Company has, however, received indications that most of the
Company's Sponsors are in the process of becoming Year 2000 compliant. Year 2000
non-compliance  by any of the Company's  subscribers  may negatively  affect the
Company's business.

Through December 31, 1998, the Company incurred costs of approximately  $600,000
to update the Company's  systems,  a portion of which was allocated to year 2000
compliance. In addition, the Company has incurred additional costs in connection
with the Company's review of internal and external systems  compliance,  none of
which is  material.  The  Company  does not  anticipate  that it will  incur any
additional material costs associated with addressing Year 2000 issues.

The impact of the Year 2000  problem on the  Company's  business as presented is
based on the  management's  best estimates at the present time. The Company does
not expect these estimates to change substantially.

Such estimates are based on the results of the Company's  internal review of its
information  and  operational  systems and formal  surveys  received  from third
parties to date.  The Company can not assure that these  estimates are accurate.
The  estimates  were made  using  assumptions  of future  events  including  the
continued  availability  of certain  resources,  Year 2000  modification  plans,
implementation success by key third-parties, and other factors. New developments
may occur that could  affect the  Company's  estimates of the amount of time and
costs needed to modify and test its information and operational systems for Year
2000 compliance.  These  developments  include,  but are not limited to: (i) the
availability  and cost of  personnel  trained in this area;  (ii) the ability to
locate and correct all  relevant  date-sensitive  codes in its  information  and
operational  systems;  (iii)  unanticipated  failures  in  its  information  and
operational systems; and (iv) the planning and Year 2000 compliance success that
third-parties  attain.  The  Company  has  not  yet  determined  the  extent  of
contingency planning that may be required.

The Company cannot  determine the impact of these potential  developments on the
current  estimate of probable  costs of making its systems Year 2000  compliant.
Accordingly,  the  Company is not able to estimate  its  possible  future  costs
beyond the current  estimates of costs. As new  developments  occur,  these cost
estimates may be revised to reflect the impact of these developments
 on the costs to the Company of making its  systems  Year 2000  compliant.  Such
revisions in costs could have a material adverse impact on the Company's results
of operations in the quarterly  period in which they are recorded.  Although the
Company considers it unlikely, such revisions could also have a material adverse
effect on the  business,  financial  condition or results of  operations  of the
Company.


                                                                         Page 12

<PAGE>


Release of Escrow Shares.  In connection with the IPO, the pre-IPO  stockholders
of the  Company  placed,  on a pro rata  basis,  a portion of their  shares into
escrow pending the Company's  attainment of certain  earnings  thresholds or per
share stock price thresholds. The Commission has taken the position with respect
to the release of securities from escrow that in the event the Escrow Shares are
released from escrow to directors,  officers,  employees or  consultants  of the
Company,  the release will be treated,  for  financial  reporting  purposes,  as
compensation expense to the Company. Accordingly, in the event of the release of
the Escrow  Shares,  the Company will  recognize  during the period in which the
earnings  or market  price  targets  are met or become  probable of being met, a
substantial  non-cash  charge which would  substantially  increase the Company's
loss or reduce or  eliminate  earnings,  if any,  at such  time.  The  amount of
compensation  expense  recognized  by the Company will not affect the  Company's
total  stockholders'  equity.  There can be no  assurance  that the Company will
attain the targets  which  would  enable the Escrow  Shares to be released  from
escrow.  In  addition,  a portion of the  warrants  issued to Neal J. Polan will
become  exercisable  only upon the attainment by the Company of certain earnings
or market price thresholds.  In the event that such warrants become exercisable,
the Company will  recognize  during the period in which the earnings  thresholds
are probable of being met or such stock levels achieved,  an additional non-cash
charge to earnings equal to the fair market value of the portion of the warrants
subject to such earnings or market price thresholds, which could have the effect
of  significantly  increasing  the  Company's  loss or reducing  or  eliminating
earnings, if any, at such time.

The  recognition of the potential  charges to income  described above may have a
depressive effect on the market price of the Company's securities









                                                                         Page 13

<PAGE>

                                     PART II


Item 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

During the quarter ended December 31, 1998, the Company  granted an aggregate of
10,000 options to employees of the Company at exercise  prices ranging from .875
to 1.00 per share (the market  value of the Class A Common  Stock on the date of
grant) under the  Company's  1997 Stock Option Plan,  which options will vest at
various times over a three year period.

The 2,024,000 units of the Company and the underlying  securities  consisting of
one share of Class A Common Stock and one warrant to purchase one share of Class
A Common Stock per unit issued in the IPO were  registered  under a registration
statement on Form SB-2 (File No. 333-28233) which was declared  effective by the
Securities and Exchange Commission on October 14, 1997.

During the quarter  ended  December 31, 1998, a portion of the net proceeds from
the IPO were used (i) to make  principal and interest  payments in the amount of
approximately  $19,000 on a capital  lease  entered into in April 1997;  (ii) to
purchase  equipment in the amount of approximately  $3,000 and (iii) for working
capital purposes in the amount of approximately  $535,000. The remaining portion
of the net  proceeds  from the IPO and  other  available  cash in the  amount of
approximately  $3,487,000  has been  invested in  short-term,  interest-bearing,
investment grade securities.

Item 5. OTHER INFORMATION

Neal J. Polan, the Chairman and Chief Executive Officer of the Company,  devotes
approximately  50% of his  business  time to  other  interests  and  investments
outside of the Company,  some of which are or may be in the health care services
field.  In the  course  of his  activities,  Mr.  Polan may from time to time be
presented  with  various  business  opportunities  in the health  care  services
industry.  Mr. Polan may present certain of these  opportunities to the Company,
although Mr. Polan has no agreement to do so and there can be no assurance  that
any such  opportunities  will be presented to the Company.  The Company  entered
into a one-year  consulting  agreement with Practice  Management,  Inc. ("PMI"),
whereby PMI is marketing  the Company's  business to labor groups,  managed care
entities, preferred provider organizations and third party administrators for an
annual fee of $50,000. Mr. Polan has entered into a separate agreement with PMI,
whereby is marketing,  in exchange for a one-time payment of $50,000, to present
to Mr. Polan, in preference to others, certain business opportunities; provided,
that  the  agreement  between  PMI and Mr.  Polan  provides  that  PMI  shall be
obligated to first  present to the  Company,  prior to Mr.  Polan,  any business
opportunities that may be appropriate for the Company. The Company is evaluating
its  relationship  with PMI and has notified PMI of its desire to terminate this
relationship.  These  arrangements  and  agreements  may  give  rise to  certain
conflicts of interest.

SIGA  Pharmaceuticals,  Inc.  (SIGA) filed a Schedule 13D dated October 15, 1998
stating that it  beneficially  owned  151,000  shares of the  Company's  Class A
Common Stock or  approximately  5.0% of the outstanding  shares of the Company's
Class A Common  Stock,  and 149,800  Class A Warrants to purchase  shares of the
Company's  Class A Common Stock.  SIGA stated that the securities  were acquired
for  investment  purposes  and that it  intended  to request a meeting  with the
Company  for the  purpose of  discussing  methods  of  maximizing  or  enhancing
stockholder  value.  SIGA  also  stated  that  it had no  present  intention  of
acquiring additional securities.  On January 11, 1999, SIGA amended its Schedule
13D to state that it had met with the  Company's  Chairman  of the Board and had
sent a letter  dated  January  6, 1999 to the  Chairman  suggesting  a  possible
combination  of the  Company  and SIGA and  outlining  the  proposed  terms of a
possible transaction. The Schedule 13G also stated that no formal offer was made
by SIGA to  acquire  the  Company  and that  SIGA had no  present  intention  of
acquiring additional securities.

On January 15, 1999, the Company's  Board of Directors met to discuss the letter
from SIGA. On January 19, 1999,  the  Company's  Chairman sent a letter to SIGA.
The letter  stated that in order for the Board of Directors to fully  evaluate a
possible transaction,  the Board of Directors required a better understanding of
SIGA's business.  The letter also stated that the Board of Directors intended to
fully  evaluate a possible  transaction  with SIGA and retained a consultant  to
assist  in such  evaluation.  Based on the  Board of  Director's  analysis  of a
proposed  transaction  with SIGA,  including the review of a report delivered by
the  consultant  engaged by the Company,  the  Company's  Board of Directors has
determined,  and has advised  SIGA,  that the Company will not proceed,  at this
time, with a transaction with SIGA.

                                                                         Page 14


<PAGE>




Item 6. EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits

         27  Financial Data Schedule

(b)      Reports on Form 8-K

                  None.















                                                                         Page 15

<PAGE>

                                   SIGNATURES




     Pursuant to the  requirements  of the  Securities and Exchange Act of 1934,
the  Registrant  has duly  caused  this report to be signed on its behalf by the
undersigned, thereunto duly authorized.




                                         HEALTHCORE MEDICAL SOLUTIONS, INC.



                                         By: /s/ Neal J. Polan
                                         --------------------------------
                                         Neal J. Polan
                                         Chairman and Chief Executive Officer


                                         By: /s/ David L. Mullikin
                                         --------------------------------
                                         David L. Mullikin
                                         President, Chief Operating Officer and
                                         Acting Chief Financial Officer


Date: February 12, 1999



                                                                         Page 16