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

                                  FORM 10-Q

         [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                       SECURITIES EXCHANGE ACT OF 1934
               FOR THE QUARTERLY PERIOD ENDED NOVEMBER 30, 1999
                                      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 0-19393


                             LIFEMARK CORPORATION
            (Exact name of registrant as specified in its charter)


            DELAWARE                                        36-3338328
 (State or other jurisdiction of incorporation or organization)(I.R.S. Employer
Identification No.)


                            7600 NORTH 16TH STREET
                                  SUITE 150
                            PHOENIX, ARIZONA 85020
                   (Address of principal executive offices)
                                  (Zip Code)

                                 602-331-5100
             (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 _______

There were 5,084,673 shares of common stock outstanding as of January 13, 2000.

<PAGE>

                              TABLE OF CONTENTS

                                                                            PAGE



Part I      Financial Information


     Item 1.Financial Statements


            Consolidated Balance Sheets.......................................3


            Consolidated Statements of Income.................................4


            Consolidated Statements of Cash Flows.............................5


            Notes to Unaudited Consolidated Financial Statements............6-9


     Item 2.Management's Discussion and Analysis of Financial Condition
            and Results of Operations.....................................10-13

     Item 3.Quantitative and Qualitative Disclosures About Market Risk.......13


Part II     OTHER INFORMATION


     Item 6.Exhibits and Reports on Form 8-K.................................14

                                       2
<PAGE>

      PART I - FINANCIAL INFORMATION

      ITEM 1.  FINANCIAL STATEMENTS

                                    LIFEMARK CORPORATION
                                 CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                              NOVEMBER 30,     MAY 31,
                                                                 1999           1999
                                                             -------------- -------------
<S>                                                          <C>            <C>
                                                             (UNAUDITED)
      ASSETS
      ------
      Current Assets:
       Cash and cash equivalents, including restricted
         cash of $9,355,000 and $9,713,000, respectively     $ 13,884,000   $ 13,792,000
       Short-term investments                                           -        501,000
       Accounts and notes receivable and unbilled services, net 5,362,000      5,886,000
       Deferred income taxes, net                               1,103,000      1,213,000
       Prepaid expenses and other current assets                1,214,000        882,000
                                                             ------------   ------------
         Total current assets                                  21,563,000     22,274,000

      Related party notes receivable                              387,000        568,000
      Property and equipment, net                               4,891,000      4,205,000
      Performance bonds                                         6,601,000      4,203,000
      Goodwill, net                                             2,279,000      2,462,000
      Other assets                                              1,014,000      1,108,000
                                                             ------------   ------------
         Total assets                                        $ 36,735,000   $ 34,820,000
                                                             ============   ============

      LIABILITIES AND STOCKHOLDERS' EQUITY
      ------------------------------------
      Current Liabilities:
       Accounts payable                                      $    468,000   $    659,000
       Accrued medical claims                                   9,250,000      8,662,000
       Risk pool payable                                          840,000        691,000
       Related party risk pool payable                            161,000        152,000
       Accrued compensation                                     2,273,000      2,464,000
       Other accrued expenses                                   2,455,000      1,750,000
       Current portion of related party interest payable           40,000        710,000
       Current portion of long-term debt                           84,000         23,000
                                                             ------------   ------------
         Total current liabilities                             15,571,000     15,111,000

      Long-term debt                                              717,000        211,000
      Related party long-term debt                              3,459,000      3,440,000
      Deferred income taxes, net                                  242,000        155,000
                                                             ------------ --------------
         Total liabilities                                     19,989,000     18,917,000
                                                             ------------   ------------

      Commitments and Contingencies                                     -              -

      Stockholders' Equity:
       Common stock, $0.01 par value
       Authorized - 10,000,000 shares
       Issued and outstanding 5,085,000 shares
         and 4,808,000 shares, respectively                        51,000         48,000
       Capital in excess of par value                          16,955,000     16,148,000
       Stockholder notes receivable                              (696,000)             -
       Retained earnings (accumulated deficit)                    436,000       (293,000)
                                                             ------------   ------------
         Total stockholders' equity                            16,746,000     15,903,000
                                                             ------------   ------------
                                                             $ 36,735,000   $ 34,820,000
                                                             ============   ============
</TABLE>
             THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.

                                           3
<PAGE>


                                        LIFEMARK CORPORATION
                                  CONSOLIDATED STATEMENTS OF INCOME
                                             (UNAUDITED)
<TABLE>
<CAPTION>
                                             THREE MONTHS ENDED               SIX MONTHS ENDED
                                         ---------------------------    --------------------------
                                          NOVEMBER        NOVEMBER       NOVEMBER       NOVEMBER
                                             30,             30,            30,            30,
                                            1999            1998           1999           1998
                                         ------------   ------------   ------------   ------------
<S>                                      <C>            <C>            <C>            <C>


Revenues                                 $ 24,574,000   $ 20,639,000   $ 48,183,000   $ 39,883,000
                                         ------------   ------------   ------------   ------------

Direct cost of operations                  18,764,000     15,822,000     36,614,000     30,122,000
Marketing, sales and administrative         5,073,000      4,217,000     10,608,000      8,604,000
                                         ------------   ------------   ------------   ------------

  Total costs and expenses                 23,837,000     20,039,000     47,222,000     38,726,000
                                         ------------   ------------   ------------   ------------

Operating income                              737,000        600,000        961,000      1,157,000
                                         ------------   ------------   ------------   ------------

Interest income                               266,000        233,000        521,000        486,000
Interest expense                              (93,000)       (90,000)      (193,000)      (180,000)
                                         ------------   ------------   ------------   ------------

  Net interest income                         173,000        143,000        328,000        306,000
                                         ------------   ------------   ------------   ------------

Income before income taxes                    910,000        743,000      1,289,000      1,463,000

Provision for income taxes                    395,000        251,000        560,000        549,000
                                         ------------   ------------   ------------   ------------

Net income                               $    515,000   $    492,000   $    729,000   $    914,000
                                         ============   ============   ============   ============

Net income per share--basic              $       0.11   $       0.10   $       0.15   $       0.19
                                         ============   ============   ============   ============

Weighted average common
  shares outstanding--basic                 4,808,000      4,720,000      4,808,000      4,707,000
                                         ============   ============   ============   ============

Net income per share--assuming dilution  $       0.10   $       0.09   $       0.14   $       0.17
                                         ============   ============   ============   ============
Weighted average common shares
outstanding--assuming dilution              5,683,000      5,780,000      5,700,000      5,891,000
                                         ============   ============   ============   ============



                     THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
</TABLE>
                                                       4
<PAGE>


                             LIFEMARK CORPORATION
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (UNAUDITED)

<TABLE>
<CAPTION>
                                                                SIX MONTHS ENDED
                                                        ------------------------------
                                                         NOVEMBER 30,     NOVEMBER 30,
                                                              1999            1998
                                                        -------------    -------------
<S>                                                     <C>              <C>

Cash flows from operating activities:
  Net income                                            $     729,000    $     914,000
  Adjustments to reconcile net income to net
   cash provided by operating activities:
   Bad debt expense                                             8,000                -
   Depreciation and amortization                            1,075,000        1,135,000
   Loss on sale of property and equipment                       5,000            2,000
   Deferred income taxes                                      197,000           49,000
   Interest on long-term debt                                 125,000          114,000
   Changes in assets and liabilities:
     Accounts receivable and unbilled services                516,000       (1,401,000)
     Prepaid expenses and other current assets               (332,000)           6,000
     Accounts payable                                        (191,000)         (64,000)
     Accrued medical claims                                   588,000          538,000
     Risk pool payable                                        149,000         (193,000)
     Related party risk pool payable                            9,000          (20,000)
     Accrued compensation                                    (191,000)         285,000
     Accrued expenses                                         705,000         (428,000)
     Other assets                                              94,000         (195,000)
                                                        -------------    -------------
Net cash provided by operating activities                   3,486,000          742,000
                                                        -------------    -------------

Cash flows from investing activities:
  Purchase of property and equipment                       (1,855,000)        (625,000)
  Proceeds from sale of property and equipment                285,000           56,000
  Purchase of short-term investments                                -       (1,645,000)
  Proceeds from maturity/sale of short-term investments       501,000                -
  Proceeds from related party notes receivable                181,000          117,000
  Proceeds from maturity of assets securing performance
    bond                                                    1,233,000        1,241,000
  Purchases of assets securing performance bond            (3,631,000)               -
                                                        -------------    -------------
Net cash used in investing activities                      (3,286,000)        (856,000)
                                                        -------------    -------------

Cash flows from financing activities:
  Proceeds from (payments on) long-term debt                  562,000         (184,000)
  Interest paid on long-term debt                            (784,000)               -
  Proceeds from common stock issuance                         114,000          197,000
                                                        -------------    -------------
Net cash provided (used) by financing activities             (108,000)          13,000
                                                        -------------    -------------
Net increase (decrease) in cash and cash equivalents           92,000         (101,000)
Cash and cash equivalents, beginning of period             13,792,000       12,764,000
                                                        -------------    -------------
Cash and cash equivalents, end of period                $  13,884,000    $  12,663,000
                                                        =============    =============
</TABLE>


        THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.


                                               5
<PAGE>

                              LIFEMARK CORPORATION
             NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - FINANCIAL STATEMENTS

In management's  opinion,  the  accompanying  unaudited  consolidated  financial
statements  contain  all  adjustments   (consisting  of  only  normal  recurring
adjustments)  considered  necessary for a fair  statement of the results for the
interim  periods  presented.  The  results of  operations  for the period  ended
November 30, 1999 are not  necessarily  indicative of the results to be expected
for the full year. The interim consolidated  financial statements should be read
in  conjunction  with  the  Lifemark   Corporation   ("Lifemark"  or  "Company")
consolidated  financial  statements and notes thereto  included in the Company's
Form 10-K for the year ended May 31, 1999.

NOTE 2 - NET INCOME PER SHARE

Basic net income per share is computed by  dividing  net income by the  weighted
average number of common shares  outstanding  during each period. Net income per
share  assuming  dilution is computed  by  dividing  net income by the  weighted
average  number of common  shares  outstanding  during the period  after  giving
effect to dilutive  stock options and warrants and adjusted for dilutive  common
shares assumed to be issued on conversion of the Company's convertible loans.

The following is the  computation  of the  reconciliation  of the numerators and
denominators  of net income  per common  share - basic and net income per common
share - assuming  dilution in accordance with Statement of Financial  Accounting
Standards No. 128, "Earnings Per Share".

<TABLE>
<CAPTION>

                                                                       THREE MONTHS ENDED
                                           ---------------------------------------------------------------------------
                                                     NOVEMBER 30, 1999                      NOVEMBER 30, 1998
                                           -----------------------------------    ------------------------------------
                                             Income        Shares      Per Share    Income       Shares     Per Share
                                           (Numerator)  (Denominator)    Amount   (Numerator) (Denominator)   Amount
                                           -----------  -------------  ---------  -----------  ------------- ---------
<S>                                        <C>          <C>            <C>        <C>          <C>           <C>


Net income per common share:
  Income available to common stockholders  $   515,000      4,932,000             $   492,000     4,720,000
  Reduction in shares outstanding in
    connection with stockholder notes
    receivable                                  (3,000)      (124,000)                      -             -
                                           -----------      ---------             -----------  ------------
  Adjusted income available to common
    stockholders                               512,000      4,808,000  $   0.11       492,000     4,720,000  $   0.10

Effect of dilutive securities:
  Stock options and warrants                         -         18,000                       -       203,000
  Convertible notes                             40,000        857,000                  40,000       857,000
                                           -----------  -------------             -----------  ------------

Net income per common share,
  assuming dilution:
  Income available to common
    stockholders  and assumed conversions  $   552,000      5,683,000  $   0.10   $   532,000     5,780,000  $   0.09
                                           ===========  =============  ========   ===========  ============  ========


                                                                6
<PAGE>

                                                                         SIX MONTHS ENDED
                                           -----------------------------------------------------------------------
                                                     NOVEMBER 30, 1999                   NOVEMBER 30, 1998
                                           -------------------------------------- -----------------------------------
                                             Income        Shares      Per Share    Income        Shares      Per Share
                                           (Numerator)  (Denominator)    Amount    (Numerator)  (Denominator)   Amount
                                           -----------  -------------  ----------  -----------  -------------  ---------
<S>                                        <C>          <C>            <C>         <C>          <C>            <C>

Net income per common share:
  Income available to common stockholders  $   729,000      4,870,000              $   914,000      4,707,000
  Reduction in shares outstanding in
    connection with stockholder notes
    receivable                                  (3,000)       (62,000)                      -              -
                                           -----------  -------------              -----------  -------------
  Adjusted income available to common
    shareholders                               726,000      4,808,000  $     0.15      914,000      4,707,000  $   0.19

Effect of dilutive securities:
  Stock options and warrants                         -         35,000                        -        327,000
  Convertible notes                             79,000        857,000                   79,000        857,000
                                           -----------  -------------              -----------  -------------
Net income per common share,
  assuming dilution:
  Income available to common
    stockholders and assumed conversions   $   805,000      5,700,000  $     0.14  $   993,000      5,891,000  $   0.17
                                           ===========  =============  ==========  ===========  =============  ========
</TABLE>


NOTE 3 - RESTRICTIONS ON FUND TRANSFERS

Certain of the Company's operating subsidiaries are subject to state regulations
which  require   compliance   with  certain  net  worth,   reserve  and  deposit
requirements.  To the extent the operating  subsidiaries  must comply with these
regulations,  they may not have the financial  flexibility  to transfer funds to
the  parent   organization,   Lifemark.   Net  assets  of  subsidiaries   (after
inter-company  eliminations) which, at November 30, 1999, may not be transferred
to Lifemark by  subsidiaries  in the form of loans,  advances or cash  dividends
without the consent of a third party are referred to as "Restricted Net Assets".
Total Restricted Net Assets of these operating  subsidiaries were $10,208,000 at
November 30, 1999,  with deposit and reserve  requirements  (performance  bonds)
representing $6,601,000 of the Restricted Net Assets and net worth requirements,
in excess of  deposit  and  reserve  requirements,  representing  the  remaining
$3,607,000.

NOTE 4 - BUSINESS SEGMENTS

The Company's business segments consist of management  services,  long-term care
health services and acute care health services.  The management services segment
is engaged in the business of  administering  risk-based  managed care plans and
programs in seven states. Long-term care health services is comprised of Ventana
Health Systems, Inc. ("Ventana"), which is a long-term care Medicaid health plan
operating  in seven  counties in Arizona,  and  Lifemark  At Home,  Inc.,  which
provides in-home personal,  respite,  companionship  and homemaking  services to
recipients in Arizona.  Acute care health  services  consists of Arizona  Health
Concepts,  Inc. ("AHC"),  an acute care Medicaid health plan currently operating
in two counties in Arizona.

                                                        7
<PAGE>

Information concerning operations by business segment follows:
<TABLE>
<CAPTION>

                                               For the Three Months Ended November 30, 1999
                                          -----------------------------------------------------

                                           Management     Long-Term Care     Acute Care
                                            Services      Health Services  Health Services      Totals
                                            --------      ---------------  ---------------      ------
<S>                                        <C>            <C>              <C>                  <C>
Total revenues from reportable segments    $ 12,936,000   $    8,547,000   $   4,894,000    $  26,377,000
Intersegment revenues                        (1,443,000)        (360,000)              -       (1,803,000)
                                           ------------   --------------   -------------    -------------
   Total consolidated revenues             $ 11,493,000   $    8,187,000   $   4,894,000    $  24,574,000
                                           ============   ==============   =============    =============

Interest income                            $     64,000   $      134,000   $      69,000    $     267,000
Intersegment interest income                          -           (1,000)              -           (1,000)
Interest expense                                (94,000)               -               -          (94,000)
Intersegment interest expense                     1,000                -               -            1,000
                                           ------------   --------------   -------------    -------------
   Net interest income (expense)           $    (29,000)  $      133,000   $      69,000    $     173,000
                                           ============   ==============   =============    =============

Depreciation and amortization              $    538,000   $            -   $           -    $     538,000
                                           ============   ==============   =============    =============

Segment income (loss) before taxes         $  1,036,000   $      258,000   $    (384,000)   $     910,000

Income tax expense (benefit)                    443,000           98,000        (146,000)         395,000
                                           ------------   --------------   -------------    -------------
   Net income (loss)                       $    593,000   $      160,000   $    (238,000)   $     515,000
                                           ============   ==============   =============    =============

Expenditures for capital assets            $  1,088,000   $            -   $           -    $   1,088,000
                                           ============   ==============   =============    =============
</TABLE>




<TABLE>
<CAPTION>

                                             For the Three Months Ended November 30, 1998
                                             ---------------------------------------------

                                           Management      Long-Term Care     Acute Care
                                            Services       Health Services  Health Services      Totals
                                           ----------     ---------------- ----------------     --------
<S>                                        <C>            <C>              <C>                  <C>

Total revenues from reportable segments    $ 10,634,000   $    7,435,000   $   4,057,000    $  22,126,000
Intersegment revenues                        (1,223,000)        (264,000)              -       (1,487,000)
                                           ------------   --------------   -------------    -------------
   Total consolidated revenues             $  9,411,000   $    7,171,000   $   4,057,000    $  20,639,000
                                           ============   ==============   =============    =============

Interest income                            $     37,000   $      118,000   $      86,000    $     241,000
Intersegment interest income                          -           (8,000)              -           (8,000)
Interest expense                                (98,000)               -               -          (98,000)
Intersegment interest expense                     8,000                -               -            8,000
                                           ------------   --------------   -------------    -------------
   Net interest income(expense)            $    (53,000)  $      110,000   $      86,000    $     143,000
                                           ============   ==============   =============    =============

Depreciation and amortization              $    575,000   $            -   $           -    $     575,000
                                           ============   ==============   =============    =============

Segment income (loss) before taxes         $    507,000   $      336,000   $    (100,000)   $     743,000
Income tax expense (benefit)                    198,000          123,000         (70,000)         251,000
                                           ------------   --------------   -------------    -------------
   Net income (loss)                       $    309,000   $      213,000   $     (30,000)   $     492,000
                                           ============   ==============   =============    =============

Expenditures for capital assets            $    360,000   $            -   $           -    $     360,000
                                           ============   ==============   =============    =============
</TABLE>

                                                    8

<PAGE>

<TABLE>
<CAPTION>


                                                     For the Six Months Ended November 30, 1999
                                           --------------------------------------------------------------
                                           Management      Long-Term Care     Acute Care
                                            Services       Health Services  Health Services      Totals
                                           --------       ---------------  ---------------      ------
<S>                                        <C>            <C>              <C>                  <C>

Total revenues from reportable segments    $ 25,447,000   $   16,632,000   $   9,658,000    $  51,737,000
Intersegment revenues                        (2,842,000)        (712,000)              -       (3,554,000)
                                           ------------   --------------   -------------    -------------
   Total consolidated revenues             $ 22,605,000   $   15,920,000   $   9,658,000    $  48,183,000
                                           ============   ==============   =============    =============

Interest income                            $    128,000   $      264,000   $     133,000    $     525,000
Intersegment interest income                          -           (4,000)              -           (4,000)
Interest expense                               (197,000)               -               -         (197,000)
Intersegment interest expense                     4,000                -               -            4,000
                                           ------------   --------------   -------------    -------------
   Net interest income (expense)           $    (65,000)  $      260,000   $     133,000    $     328,000
                                           ============   ==============   =============    =============

Depreciation and amortization              $  1,074,000   $            -   $           -    $   1,074,000
                                           ============   ==============   =============    =============

Segment income (loss) before taxes         $  1,235,000   $      620,000   $    (566,000)   $   1,289,000
Income tax expense (benefit)                    539,000          236,000        (215,000)         560,000
                                           ------------   --------------   -------------    -------------
   Net income                              $    696,000   $      384,000   $    (351,000)   $     729,000
                                           ============   ==============   =============    =============

Expenditures for capital assets            $  1,855,000   $            -   $           -    $   1,855,000
                                           ============   ==============   =============    =============

Segment total assets                       $ 25,856,000   $   13,447,000   $   6,879,000    $  46,182,000
Intersegment assets                          (8,487,000)        (400,000)       (560,000)      (9,447,000)
                                           ------------   --------------   -------------    -------------
   Total assets                            $ 17,369,000   $   13,047,000   $   6,319,000    $  36,735,000
                                           ============   ==============   =============    =============
</TABLE>

<TABLE>
<CAPTION>

                              For the Six Months Ended November 30, 1998
                             ---------------------------------------------

                                          Management      Long-Term Care     Acute Care
                                           Services       Health Services  Health Services      Totals
                                           ---------      ---------------- ----------------     ------
<S>                                        <C>            <C>              <C>                  <C>

Total revenues from reportable segments    $  20,489,000  $   14,315,000   $   7,988,000    $  42,792,000
Intersegment revenues                         (2,376,000)       (533,000)              -       (2,909,000)
                                           -------------  --------------   -------------    -------------
   Total consolidated revenues             $  18,113,000  $   13,782,000   $   7,988,000    $  39,883,000
                                           =============  ==============   =============    =============

Interest income                            $      86,000  $      239,000   $     179,000    $     504,000
Intersegment interest income                           -         (18,000)              -          (18,000)
Interest expense                                (198,000)              -               -         (198,000)
Intersegment interest expense                     18,000               -               -           18,000
                                           -------------  --------------   -------------    -------------
   Net interest income (expense)           $     (94,000) $      221,000   $     179,000    $     306,000
                                           =============  ==============   =============    =============

Depreciation and amortization              $   1,135,000  $            -   $           -    $   1,135,000
                                           =============  ==============   =============    =============

Segment income (loss) before taxes         $     606,000  $      887,000   $     (30,000)   $   1,463,000
Income tax expense (benefit)                     255,000         337,000         (43,000)         549,000
                                           -------------  --------------   -------------    -------------
   Net income (loss)                       $     351,000  $      550,000   $      13,000    $     914,000
                                           =============  ==============   =============    =============

Expenditures for capital assets            $     625,000  $            -   $           -    $     625,000
                                           =============  ==============   =============    =============

Segment total assets                       $  22,761,000  $   10,963,000   $   7,500,000    $  41,224,000
Intersegment assets                           (7,725,000)       (511,000)        (54,000)      (8,290,000)
                                           -------------  --------------   -------------    -------------
   Total assets                            $  15,036,000  $   10,452,000   $   7,446,000    $  32,934,000
                                           =============  ==============   =============    =============

</TABLE>
                                                    9

<PAGE>

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

Lifemark  Corporation  ("Lifemark"  or the  "Company"),  formerly  Managed  Care
Solutions, Inc., is involved in a variety of health care programs, many of which
serve  indigent  and  Medicaid  populations.  Two  subsidiaries  of the Company,
Ventana Health  Systems,  Inc.  ("Ventana")  and Arizona Health  Concepts,  Inc.
("AHC"),  derive  substantially all of their revenues through contracts with the
Arizona  Health  Care Cost  Containment  System  Administration  ("AHCCCSA")  to
provide  specified  long-term and acute care health services,  respectively,  to
qualified  members.   The  contract  periods  expire  September  30,  2001   and
September 30, 2002 for Ventana and AHC,  respectively.  Each  contract  provides
for  fixed  monthly  premiums,  based  on  negotiated per capita enrollee rates.
Ventana and AHC subcontract  with  nursing  homes,  hospitals,  physicians,  and
other medical providers within Arizona to care for members.

The  Company  also  provides  contract  management  services to county and state
governmental units and other health care organizations.  The Company's contracts
typically have multi-year terms, with its existing contracts expiring at various
dates through the year 2002.

RESULTS OF OPERATIONS

Consolidated    revenues   for   the   three   and   six-month   periods   ended
November 30, 1999 increased  19%  and 21%,  respectively,  over  the  comparable
periods of the previous fiscal year.  For the three and six-month  periods ended
November  30,  1999,  direct   costs   of  operations  increased  19%  and  22%,
respectively, over the same periods of the previous  fiscal  year.  The increase
in both  revenues and expenses is a result of growth in enrollment under certain
management contracts, coupled  with an increase in  membership,  and  capitation
rate  received  from AHCCCSA, for both Ventana and AHC.

MANAGEMENT  SERVICES.  For the  three-month  period  ended  November  30,  1999,
revenues   generated  from  fees  for  management   services  increased  22%  to
$11,493,000 from $9,411,000 for the equivalent  period of the prior fiscal year.
For the six-month period ended November 30, 1999,  revenues  generated from fees
for management  services  increased 25% to $22,605,000  from $18,113,000 for the
corresponding  period of the prior fiscal year.  The increases are primarily due
to growth in  enrollment  in the  Community  Choice  Michigan and Rio Grande HMO
plans,  the  acquisition  of AdviNet,  Inc.  in March 1999 and the  renegotiated
administrative service agreement with AlohaCare.

                                     10
<PAGE>

Direct  costs  of  operations  for  the  three   and   six-month  periods  ended
November 30, 1999 included  $6,870,000  and  $13,678,000, respectively,  related
to fees generated from  management  services  of health plans and programs.  The
direct cost of operations for management  services  as  a  percentage of related
revenues for the three and six-month periods ended  November 30, 1999  decreased
3% and 1%, respectively, from the comparable periods of the previous year to 60%
and 61%, due in part to increased profitability from  the Company's renegotiated
agreement  with  AlohaCare, which  was  effective  August  1,  1999  and expires
July 31, 2000.

LONG-TERM CARE HEALTH  SERVICES.  Long-term  care health and personal  services,
which  consist of operations  of Ventana and Lifemark at Home,  Inc.,  generated
revenues of $8,187,000 and $15,920,000 for the three and six-month periods ended
November 30, 1999,  respectively,  as compared to $7,171,000 and $13,782,000 for
the corresponding  periods of the prior fiscal year. The revenues from long-term
care health services  experienced 14% and 16% growth for the three and six-month
periods ended November 30, 1999,  respectively,  over the comparable  periods of
the previous  fiscal year.  The  increases  are  primarily  due to the growth in
average monthly  membership in Ventana of approximately 8% and 11% for the three
and  six-month  periods  ended  November 30,  1999,  coupled with an increase of
approximately 4% in the capitation rate received from AHCCCSA by Ventana.

Direct costs of  operations  related to long-term  care health  services for the
three  and  six-month  periods  ended  November  30,  1999 were  $7,042,000  and
$13,581,000,  respectively,  versus  $6,066,000  and  $11,455,000  for the  same
periods of last fiscal year. As a percentage of related revenues, direct cost of
operations  related to long-term care health  services  increased to 86% and 85%
for the three and  six-month  periods  ended  November 30,  1999,  respectively,
versus 85% and 83% for the same periods of the previous  year. The increases are
primarily due to higher  pharmacy costs for Ventana  resulting from a terminated
capitation  contract with a pharmaceutical  company, an increase in hospital and
adult  care  home  expenses  resulting  from the  change in  patient  mix and an
increase of  approximately  2% in contracted  nursing home rates. The Company is
unable to determine if future patient mixes would significantly  differ from the
current patient mix to yield lower or higher operating costs.

Ventana was awarded  contracts  covering two additional rural Arizona  counties,
effective December 1, 1999. These additional counties will add approximately 550
members  to  Ventana's  current  enrollment  and  approximately  $15,000,000  in
additional revenues.

ACUTE CARE HEALTH SERVICES.  Acute care health  services,  which consists of the
operations of AHC, generated revenues of $4,894,000 and $9,658,000 for the three
and six-month periods ended November 30, 1999, respectively,  representing a 21%
increase over the comparable  periods of the  prior fiscal year.  The change was
caused by an increase in average monthly membership of 13% and 12% for the three
and  six-month  periods  ended  November 30, 1999,  respectively,  along with an
average increase of approximately 6% in the capitation rate received by AHC from
AHCCCSA.

Direct costs of operations  related to acute care health  services for the three
and six-month  periods ended November 30, 1999 were  $4,852,000 and  $9,355,000,
respectively,  versus  $3,815,000  and  $7,398,000  for the same  periods of the
previous  fiscal  year.  The  reason for the  increase  is the growth in average
monthly membership for AHC from 8,400 to 9,400 for the six months ended November
30, 1998 and 1999,  respectively.  Direct costs of operations as a percentage of
related  revenues  increased to 99% and 97% for the three and six-month  periods
ended  November  30, 1999 versus 94% and 93% for the  comparable  periods of the
prior  fiscal  year.  The  principal  reason for the rise is higher  utilization
of  AHC's  services  by  its  members coupled  with an increase in rates paid to
providers.  The  Company  is  unable  to  determine  if  future  utilization  of
healthcare  services  would differ from  the current utilization levels to yield
lower or higher operating costs.

MARKETING,  SALES  AND  ADMINISTRATIVE.   Marketing,  sales  and  administrative
expenses as a percentage of consolidated revenue were 21% and 22%, respectively,
for the three and six-month  periods ended November 30, 1999 versus 20% and 22%,
respectively,  for the  corresponding  periods of the previous year.  Marketing,
sales and  administrative  expenses for the three and  six-month  periods  ended
November 30, 1999 include the obligation to make severance  payments pursuant to
the terms of an employment  agreement with Michael D.  Hernandez,  the Company's
former Chief Executive Officer. In addition, marketing, sales and administrative
expenses  include  consulting  fees  related to  management  reorganization  and
process redesign intended to improve the Company's service delivery system.  The
Company  does  not  anticipate  significant  consulting  fees  related  to  this
initiative in the future.

INTEREST  INCOME.  Interest  income for the three and  six-month  periods  ended
November 30, 1999 was $266,000 and $521,000 versus $233,000 and $486,000 for the
same periods of the prior fiscal year. The additional income is due to growth of
interest bearing cash and cash equivalents.

                                       11
<PAGE>

INTEREST  EXPENSE.  Interest  expense was $93,000 and $193,000 for the three and
the six-month  periods  ended  November 30, 1999,  respectively,  as compared to
$90,000 and  $180,000  for the same  periods of the last fiscal  year.  Interest
expense is primarily  attributable to outstanding secured convertible term loans
in an aggregate  principal amount of $3,300,000 issued by the Company in October
1996,  along with an interim funding  agreement  obtained from a bank during the
fourth quarter of fiscal year 1999. The Company has borrowed $796,000 under this
funding agreement as of November 30, 1999.

INCOME  TAXES.   Income   tax  expense   was  $395,000  and   $560,000  for  the
three-month  and six-month  periods ended November 30, 1999,  respectively.  The
effective  tax rate for both  periods was 43%.  These rates were higher than the
statutory rates for the respective  periods primarily due to the amortization of
non-deductible  goodwill expenses.  During the three-month and six-month periods
ended November 30, 1998, the effective tax rates were 34% and 38%, respectively.
These  rates  were a result  of the  reduction  in the  deferred  tax  valuation
allowance  based on the Company's  assessment of the reliability of deferred tax
assets  partially  offset by  amortization of  non-deductible  goodwill expense.

NET  INCOME.    Net   income   for   the   three  and  six-month  periods  ended
November 30, 1999  was  $515,000  and  $729,000  as  compared  to  $492,000  and
$914,000 for the comparable periods of the previous fiscal year.  The reason for
the decrease in profitability  for the six-month period ended  November 30, 1999
is primarily due to the  increase in direct expenses as a percentage  of related
revenue   of  the  long-term  care  and  acute  care  health  service  segments.
This  decrease  is partially offset by enhanced profitability  in the management
services segment with the growth in enrollment in the Community Choice  Michigan
and Rio Grande HMO  plans  and  additional  profitability   resulting  from  the
renegotiated administrative service agreement with AlohaCare.


LIQUIDITY AND CAPITAL RESOURCES

The   Company's   cash   and   cash  equivalents  increased  to  $13,884,000  at
November  30,  1999  from  $13,792,000  at  May  31, 1999.  Operating activities
generated  $3,486,000  for  the  six-month period ended November 30, 1999 versus
$742,000 during the same period of the previous fiscal year. The primary reasons
for  the  change  in  cash  are  earnings  before non-cash charges, a refundable
deposit  of  $650,000  obtained  from  AlohaCare  pursuant  to  the terms of the
renegotiated  administrative   services   agreement,  a  decrease  in   accounts
receivable   related   to   Ventana   and   AHC  resulting  from  collection  of
reinsurance receivables of approximately $1,263,000 and an  increase  in accrued
medical  claims.  The  increase in accrued  medical claims is primarily  due  to
annual  increases in  fee-for-service  rates  paid  to  providers  along with an
increase in enrollment in both Ventana and AHC.

Investing  activities   used   $3,286,000   for  the  six-month   period   ended
November 30, 1999 as compared to $856,000 during the corresponding period of the
prior fiscal year.  Cash of $1,855,000 was used to purchase fixed  assets during
the   six-month   period   ended  November  30,  1999.    Additional   cash   of
$3,631,000 was used to increase the amount of performance bonds held by  Ventana
partially  offset by the maturity of a  previously  held performance bond in the
amount of $1,233,000.  The  increase  in  performance  bonds  was  necessary  to
satisfy  requirements established by AHCCCSA.  The required level of performance
bonds has increased due to the expansion of Ventana into two additional counties
in Arizona along with an increase  in  enrollment  in existing  counties.  Other
sources of cash for the six-month  period  ended  November  30,  1999  were  the
maturity  of  a  short-term  investment  held  by  Ventana of $501,000 and funds
received from the sale of fixed assets to  AlohaCare  for  $285,000  pursuant to
the terms of the  renegotiated administrative  services  agreement.   During the
six-month period ended November 30, 1998, cash was used to purchase  $625,000 of
fixed  assets   and  $1,645,000  was  used  to  purchase  additional  short-term
investments.

Financing  activities  used  $108,000 and  generated  $13,000 for the  six-month
periods ended November 30, 1999 and 1998, respectively.  The primary use of cash
for  the  current  period  was an  interest  payment  of  $784,000  relating  to
outstanding  convertible debt offset by $567,000 received pursuant to an interim
funding  agreement  and  $114,000  received  for common  stock  pursuant  to the
Company's  employee  stock  purchase  plan.  Issuance  of common stock  provided
$197,000 for the six-month  period ended  November 30, 1998, partially offset by
principal payments on long-term debt.

Certain of the Company's operating subsidiaries are subject to state regulations
which require compliance with net worth,  reserve and deposit  requirements.  To
the extent the operating  subsidiaries must comply with these regulations,  they
may not have the financial flexibility to transfer funds to Lifemark. Net assets
of subsidiaries (after inter-company  eliminations) which, at November 30, 1999,
may not be  transferred  to  Lifemark  by  subsidiaries  in the  form of  loans,
advances or cash dividends  without the consent of a third party are referred to
as  "Restricted  Net Assets".  Total  Restricted  Net Assets of these  operating
subsidiaries  was  $10,208,000  at November 30,  1999,  with deposit and reserve
requirements  (performance bonds) representing  $6,601,000 of the Restricted Net
Assets  and  net  worth   requirements,   in  excess  of  deposit   and  reserve
requirements,  representing  the  remaining  $3,607,000.  There  were  no  funds
provided by Ventana to Lifemark under loan agreements at November 30, 1999.

                                       12
<PAGE>

The Company believes that its existing capital resources and cash flow generated
from  future  operations  will  enable  it to  maintain  its  current  level  of
operations and its planned operations, including capital expenditures, in fiscal
year 2000.

YEAR 2000 ISSUES

Many  existing  computer  systems  did  not  recognize  or  process  dates after
December 31, 1999. Certain hardware and software, including that utilized by the
Company, had to be modified and/or reprogrammed to properly function in the year
2000 and beyond.  The Company's  year  2000 committee  assessed all internal-use
hardware, software,  non-information systems equipment, procedures and  business
processes.  An inventory of the  Company's  hardware and software was  obtained.
There were several computer systems  that  did  not  properly recognize the year
2000.  Therefore,  the  Company  replaced  several  older  critical  systems and
modified remaining systems prior to December 31, 1999.

The Company has spent  approximately  $137,000 to date  preparing  and analyzing
year 2000 issues.  The Company  systems were  unaffected  by the change from the
year 1999 to the year 2000 with some minor exceptions which have been addressed.
The Company does not anticipate significant problems or material expenditures in
the future related to the year 2000 issue.

The Company realizes that there are outside influences relative to its year 2000
efforts,  over which it has  little or no  control.  The  Company  continues  to
communicate  with state  agencies to assess their year 2000 issues.   As of  the
date of this report the Company has not been affected by any year  2000 problems
of other parties, but such problems could arise in the future.  The Company will
attempt to minimize the impact of other  parties'  failure to  resolve year 2000
problems.

FORWARD-LOOKING INFORMATION

This  report   contains  both   historical  and   forward-looking   information.
Forward-looking  statements  include,  but are not limited to, discussion of the
Company's strategic goals, new contracts,  possible expansion of existing plans,
expected increase in certain expenses,  and cash flow. These statements speak of
the  Company's  plans,  goals  or  expectations  and  refer  to  estimates.  The
forward-looking   statements  may  be   significantly   impacted  by  risks  and
uncertainties,  and are made  pursuant  to the  safe  harbor  provisions  of the
Private  Securities  Litigation Reform Act of 1995 (the "Reform Act"). There can
be no assurance that anticipated  future results will be achieved because actual
results  may differ  materially  from  those  projected  in the  forward-looking
statements.  Readers are cautioned that a number of factors, which are described
herein and in the  Company's  Form 10-K for the year ended May 31,  1999,  could
adversely  affect the Company's  ability to obtain these results.  These include
the effects of either federal or state health care reform or other  legislation;
changes in reimbursement system trends, the ability of care providers (including
physician practice management groups) to comply with current contract terms; and
renewal of the Company's  contracts  with various  state and other  governmental
entities.  Such  factors  also  include  the effects of other  general  business
conditions, including but not limited to, government regulation, competition and
general  economic  conditions.  The cautionary  statements  made pursuant to the
Reform  Act herein and  elsewhere  by the  Company  should not be  construed  as
exhaustive or as any admission regarding the adequacy of disclosures made by the
Company prior to the effective date of the Reform Act. The Company cannot always
predict what factors would cause actual results to differ  materially from those
indicated by the forward-looking  statements. In addition,  readers are urged to
consider  statements  that include the terms  "believes",  "belief",  "expects",
"plans", "objectives",  "anticipates", "intends" or the like to be uncertain and
forward-looking.


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is subject to the risk of fluctuating interest rates in the ordinary
course of business on certain  assets and  liabilities  including  cash and cash
equivalents,  short-term  investments  and long-term  debt. The Company does not
expect changes in interest  rates to have a significant  effect on the Company's
operations, cash flow or financial position.

                                       13
<PAGE>


PART II - OTHER INFORMATION


ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a)   Exhibits

               3.1  Conformed Bylaws
              10.1  Administrative Services  Agreement between  AlohaCare,  Inc.
                     and the registrant*
              10.2  Pledge  Agreement and Promissory Note between  Rhonda  Brede
                     and the registrant.
              10.3  Pledge  Agreement  and  Promissory   Note   between  Michael
                     Kennedy and the registrant.
              10.4  Pledge Agreement and  Promissory  Note  between Rick Jelinek
                     and the registrant.
              10.5  Pledge Agreement and Promissory Note between Dave Decker and
                     the registrant.
              10.6  Employment and Severance  Agreement between Rhonda Brede and
                     the registrant.
              10.7  Employment  Agreement   between   Rick   Jelinek   and   the
                     registrant.
              10.8  Employment Agreement between Dave Decker and the registrant.
              10.9  Employment  Agreement   between   Michael  Kennedy  and  the
                     registrant.
              10.10 Severance Agreement between Rick Jelinek and the registrant.
              10.11 Severance Agreement between Dave Decker and  the registrant.
              10.12 Severance   Agreement   between  Michael   Kennedy  and  the
                     registrant.
              27    Financial data schedule.

(b)   Reports on Form 8-K

              None


          *Confidential Treatment Requested

                                       14
<PAGE>


SIGNATURES

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

                        LIFEMARK CORPORATION

                        By:   /S/ RHONDA E. BREDE
                              ----------------------------------------------
                              Rhonda E. Brede, President and Chief Executive
                              Officer (Principal Executive Officer)

                        By:   /S/ MICHAEL J. KENNEDY
                              ----------------------------------------------
                              Michael J. Kennedy, Vice President and Chief
                              Financial Officer (Principal Financial and
                              Accounting Officer)

                        Dated:January 13, 2000

                                       15