SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-QSB

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

                  For the quarterly period ended March 31, 2000



                         COMMISSION FILE NUMBER 0-26168


                               CAREADVANTAGE, INC.
             (Exact name of registrant as specified in its charter)


DELAWARE                                                         52-1849794
(State or other jurisdiction of                            (I.R.S. Employer
Incorporation or organization)                       Identification Number)

485-C Route 1 South, Iselin, New Jersey                               08830
(Address of principal executive offices)                         (Zip Code)


       Registrant's telephone number, including area code: (732) 602-7000

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  twelve 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 ___

                                   82,849,050
         Number of shares of Common Stock outstanding as of May 12, 2000

                  Transitional Small Business Disclosure Format
                                  Yes ___ No _X_










<PAGE>





                      CareAdvantage, Inc. and Subsidiaries
                                   Form 10-QSB
                    For the three months ended March 31, 2000


                                    I N D E X


Part I - Financial Information

Item 1.           Financial Statements

  Condensed Consolidated Balance Sheets -
     March 31, 2000 (Unaudited) and December 31, 1999 (Audited).............   2

  Condensed  Consolidated  Statements of Operations -
     Three months ended March 31, 2000 (Unaudited) and
      April 30, 1999 (Unaudited)............................................   3

  Condensed Consolidated Statements of Cash Flows -
       Three months ended March 31, 2000 (Unaudited) and
        April 30, 1999 (Unaudited)..........................................   4

  Notes to Condensed Consolidated Financial Statements......................   5
  (Unaudited)

Item 2.       Management's Discussion and Analysis of
              Financial Condition and Results of Operations.................   8

Item 3.       Quantitative and Qualitative Disclosures about Market Risk....  11


Part II - Other Information

Item 1.       Legal Proceedings.............................................  11

Item 2.       Changes in Securities.........................................  11

Item 3.       Defaults Upon Senior Securities...............................  11

Item 4.       Submission of Matters to a Vote of Security Holders...........  11

Item 5.       Other Information ............................................  11

Item 6.       Exhibits and Reports on Form 8-K..............................  11

Signature...................................................................  12







<PAGE>





PART I - FINANCIAL INFORMATION
ITEM 1.  Financial Statements

<TABLE>
<CAPTION>
                                                  CAREADVANTAGE, INC
                                              CONSOLIDATED BALANCE SHEETS


                                                                 March 31,                         December 31,
                     ASSETS                                        2000                               1999
                                                                 Unaudited                            Audited
                                                                 ---------                            -------
<S>                                                                     <C>                               <C>
Current assets:
     Cash and cash equivalents                                   $1,471,000                        $1,615,000
     Accounts receivable for services:
         Stockholder                                              1,156,000                         1,135,000
         Other                                                      528,000                           173,000
     Other current assets                                           308,000                           220,000
                                                                    -------                           -------
                  Total current assets                            3,463,000                         3,143,000

Property and equipment, at cost less accumulated depreciation       716,000                           845,000
Intangible assets                                                 1,214,000                         1,283,000
Other assets                                                        102,000                           102,000
                                                                    -------                           -------

Total Assets                                                    $ 5,495,000                     $   5,373,000
                                                                ===========                         =========

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

     Accounts payable                                               225,000                           313,000
     Due to stockholder                                             692,000                           393,000
     Due to customer                                                839,000                           902,000
     Accrued salaries and employee benefits                         931,000                           841,000
     Accrued expenses and other current liabilities                 301,000                           332,000
     Deferred revenue, current                                       43,000                            98,000
                                                                     ------                        ----------

                  Total current liabilities                       3,031,000                         2,879,000


Due to stockholder, less current portion                                  0                           300,000



Total Liabilities                                                 3,031,000                         3,179,000
                                                                  ---------                         ---------

Stockholders' equity (capital deficiency):
     Preferred stock-par value $.10 per share;
          authorized 10,000,000 shares; none issued
     Common stock-par value $.001 per share;
         authorized 103,600,000 shares; issued
         and outstanding 82,849,050 and 82,189,883                   83,000                            82,000
     Additional capital                                          22,094,000                        22,062,000
     Accumulated deficit                                        (19,713,000)                      (19,950,000)
                                                               ------------                     -------------

Total Stockholders' Equity                                        2,464,000                         2,194,000
                                                                  ---------                       -----------
Total Liabilities and Stockholders' Equity                      $ 5,495,000                     $   5,373,000
                                                                ===========                     =============

</TABLE>

        The accompanying notes are an integral part of these statements.

                                        2


<PAGE>





                               CAREADVANTAGE, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


                                                 Three Months Ended
                                        March 31,                  April 30,
                                          2000                       1999
                                          ----                       ----


Net revenues                                 $4,550,000         $3,955,000

Costs of services                             2,239,000          2,203,000
                                             ----------         ----------


Gross margin                                  2,311,000          1,752,000
                                              ---------          ---------

Operating expenses:

Selling, general and administration           1,909,000          2,334,000
Depreciation and amortization                   178,000            216,000
                                                -------            -------

Total operating expenses                      2,087,000          2,550,000
                                              ---------          ---------

Operating income/(loss)                         224,000           (798,000)

Net interest income/(expense)                    14,000              7,000
                                                 ------              -----


Net income/(loss)                               238,000           (791,000)
                                                =======           =========

Net  income/(loss)
per share of common stock-basic and diluted        $.00              ($.01)
                                                   ====             ======

Weighted average number
of common shares outstanding -

     Basic                                   82,755,000         82,190,000
                                             ==========         ==========

     Diluted                                 93,344,000         82,190,000
                                             ==========         ==========



                                        3


<PAGE>



<TABLE>
<CAPTION>


                      CAREADVANTAGE, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

                                                                         Three Months Ended
                                                                March 31,                 April 30,
                                                                   2000                     1999
                                                                   ----                     -----
<S>                                                               <C>                       <C>
Cash flows from operating activities:

Net profit/(loss)                                                 $ 238,000            $  (791,000)

Adjustments to reconcile net  profit/(loss)
to net cash (used  by)/provided from
operating activities:

Depreciation and amortization                                       222,000                 342,000
Compensation due to option issuance                                  13,000                  14,000

Change in assets and liabilities:

Due to/from customers/stockholders                                 (376,000)                228,000
Other assets                                                        (88,000)                 46,000
Accounts payable                                                    (89,000)                257,000
Accrued expenses and other liabilities                              (16,000)                371,000
Deferred revenue                                                    (43,000)                (43,000)
                                                                   ---------               --------

Net cash  (used by) /provided from
operating activities                                               (139,000)                424,000
                                                                   ---------                -------

Cash flows from investing activities:

Capital expenditures                                                (24,000)               (163,000)
                                                                    --------               ---------

Net cash  (used by) investing
activities                                                          (24,000)               (163,000)
                                                                    --------              ----------

Cash flows from financing activities:

Proceeds from Issuance of Common Stock                               19,000                      0
Principal payments to stockholder                                         0               (119,000)
Principal payments under long-term debt                                   0               (159,000)
                                                                          -               ---------

Net cash (used by) financing
Activities                                                          19,000                (278,000)
                                                                   -------                ---------

Net  (decrease)/increase in cash                                   (144,000)               (17,000)

Cash - beginning of fiscal year                                   1,615,000              2,924,000
                                                                  ---------              ---------

Cash - end of period                                             $1,471,000             $2,907,000
                                                                 ==========             ==========


</TABLE>

        The accompanying notes are an integral part of these statements.


                                        4


<PAGE>


                               CAREADVANTAGE, INC.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS


Note A--Basis of preparation:

Fiscal Year Change:
-------------------

On June 8, 1999, CareAdvantage, Inc. ("CAI" or the "Company") changed its fiscal
year from one ending  October  31 to a calendar  year  ending  December  31. The
Company has not recast data for the comparative periods as such recasting is not
practicable.  Additionally,  the Company does not experience  seasonality in its
results  of  operations  and  cash  flows  and  such a  restatement  is not cost
justified.  The Company has prepared its financial  statements  for the calendar
quarter  ended March 31, 2000  compared  to the fiscal  quarter  ended April 30,
1999. The Company  believes such a comparison to the period ended April 30, 1999
provides a reliable basis for comparing changes in its results of operations and
cash flows for the period  ended  March 31,  2000.  The  consolidated  financial
statements  have been  prepared by the Company and have not been  audited by the
Company's  independent auditors.  The accompanying  financial statements include
all adjustments  (which include only normal recurring  adjustments) which in the
opinion of management  are necessary to present  fairly the financial  position,
results  of  operations  and cash  flows at March 31,  2000 and for all  periods
presented.  Certain information and note disclosures  required to be included in
the  financial   statements  prepared  in  accordance  with  generally  accepted
accounting principles have been omitted. These consolidated financial statements
should be read in conjunction  with the  consolidated  financial  statements and
notes thereto  included  with the  Company's  December 31, 1999 Annual Report on
Form 10-KSB.  The results of operations  for the period ended March 31, 2000 are
not  necessarily  indicative  of  operating  results to be expected for the full
year.

Note B--Per share data:  Net income per share has been computed  based on
the weighted  average number of shares  outstanding  during the periods.  Common
stock equivalents have not been included in 1999 as they are not dilutive.

Note C--Contingencies: Potential uninsured exposure to litigation:

(a)  Robert  T. Caruso  v. John J. Petillo,  Vincent  M. Achillare,  Lawrence A.
     Whipple,  and Horizon  Blue Cross Blue  Shield of New Jersey,  Inc. et al.,
     which was filed in Superior Court of New Jersey on August 12, 1998. Messrs.
     Petillo,  Achillare  and Whipple were  officers of the Company and may have
     claims for  indemnification for expenses and for any judgments against them
     in this case.  Mr.  Caruso was a consultant  to the Company.  The complaint
     alleges  breach of contract,  fraud,  conspiracy,  promissory  estoppel and
     negligent  misrepresentation  in connection with,  among other things,  the
     termination of Mr. Caruso's  consulting  arrangement with the Company.  The
     Plaintiff  seeks treble  damages for  unspecified  amount and claims actual
     damages in the approximate amount of $1.8-2.0 million. The Company received
     notice from two of its insurance  carriers denying coverage on this matter,
     but the Company plans to vigorously contest these coverage  decisions.  The
     Company  received  a written  claim  for  indemnification  from  defendants
     Petillo and Achillare and, subject to their having acted in good faith, the
     Company has agreed to indemnify them and defendant Whipple and to pay their
     reasonable  defense  costs.  The parties to this  litigation  are currently
     taking  discovery.  Until  discovery  has been  completed,  the Company has
     insufficient information regarding its potential exposure in this matter.


                                        5


<PAGE>


                               CAREADVANTAGE, INC.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS





(b)  In December 1999 the Company was impleaded as a third-party  defendant in a
     lawsuit  entitled  Horizon  Healthcare  of  New  Jersey,  Inc.  vs.  Allied
     Specialty Care Services,  Inc., pending in the United States District Court
     for the District of New Jersey.  This lawsuit seeks damages  arising out of
     an agreement between Horizon Healthcare of New Jersey, Inc. ("Horizon") and
     Allied Specialty Care Services, Inc. ("Allied").  One of the claims made by
     Horizon is that it is entitled to damages on account of Allied's  agreement
     to repay certain  monies  ("Risk  Amounts") to Horizon in the event certain
     charges for medical claims exceeded certain  capitation  amounts.  Allied's
     third-party  complaint  against the Company  seeks to enforce an  agreement
     among  Horizon,  Allied and the  Company  wherein  it is  claimed  that the
     Company  agreed to pay Allied  one-half  of any Risk  Amounts  that  Allied
     "owed" to Horizon,  but no more than certain funds  received by the Company
     on account  of such  agreement.  (A copy of the  agreement  among  Horizon,
     Allied and the Company has been filed as Exhibit 10(e) to Form 10-QSB dated
     April 30,  1997.) The Company has  previously  established  a reserve  that
     management  believes is sufficient to satisfy any liability the Company may
     have on account of Allied's claim.  The parties have  informally  agreed to
     settle their respective claims at a cost to the Company consistent with the
     reserve. However, until such agreement has  been executed  there can  be no
     assurance that such claims have been settled.

Note D - Supplemental Cash Flow Information:

Below  is supplemental  cash flow information  related to the three months ended
March 31, 2000 and April 30, 1999:

                                              March 31,           April 30,
                                               2000                  1999
                                               ----                  ----

Income taxes paid                             31,000               104,000

Interest paid                                      0                22,000

Note E - Stock Option Grant and 1996 Stock Option Plan Amendment

On January 8, 1999,  the Board of  Directors  of the Company  ("Board")  granted
stock  options  for  3,600,000  shares of Common  Stock of the  Company to David
Noone, its Chief Executive  Officer,  in connection with Mr. Noone's  employment
agreement. The options have an exercise price of $.03 per share and a term of 10
years. Options for 1,800,000 shares shall become exercisable as follows: (a) 1/3
on December 31, 1999;  and (b) the  remaining  2/3 shall become  exercisable  in
equal  monthly  amounts over the period  January 1, 2000,  to December 31, 2001.
Options for the remaining 1,800,000 shares originally were to become exercisable
over a period  of 3 years  commencing  January  8, 2000 if  certain  performance
criteria  were met. On February  24,  1999,  the Board  approved an amendment to
these  options.  Under the terms of this amendment the options for the remaining
1,800,000 shares shall become exercisable in three equal annual  installments on
the  fourth,  fifth  and  sixth  anniversary  of the  date of grant  subject  to
acceleration  upon  achievement  of certain  performance  targets.  The  Company
realized compensation costs related to this amendment of approximately  $252,000
and is amortizing this cost over the six-year vesting period of the options.  In
connection  with this grant,  the Board amended the Company's  1996 Stock Option
Plan (the "Stock  Option  Plan") to provide  the Board (or a Committee  thereof)
with  increased  discretion in the terms and  conditions of stock options it may
award.

On January 26, 1999, the Board granted stock options,  constituting an aggregate
of 10,556,000  shares of Common Stock of the Company,  to various  employees,  a
director  and a former  employee of the  Company.  The options  have an exercise
price of $.08 per share and a term of 10 years  subject to  earlier  termination
upon  certain  events.  A  portion  of the  options  vests  immediately  and the
remainder vests over 3 years. In connection with these grants, the Board amended
the Stock Option Plan to increase the number of shares  authorized  for issuance
from 10% to 18% of the Company's  authorized  Common  Stock,  and it amended the
Company's 1996 Directors Stock Option Plan (the  "Directors  Stock Option Plan")
to provide the Board with  increased  discretion in the terms and  conditions of
stock options it may award.

                                       6

<PAGE>


                               CAREADVANTAGE, INC.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



In addition, on January 26, 1999, the Board amended the Company's Certificate of
Incorporation  to increase  the number of shares of the  Company's  Common Stock
authorized for issuance from 90,000,000 shares to 103,600,000 shares.

On July 7, 1999, the Company's stockholders approved the foregoing amendments to
the Company's Stock Option Plan, the amendments to the Company's Directors Stock
Option Plan and the amendment to the Company's Certificate of Incorporation.

Note F - Issuance of Common Stock

During the quarter ended March 31, 2000,  certain  employees  exercised  options
that resulted in the issuance of 659,167 shares of common stock.


                                        7


<PAGE>


                               CAREADVANTAGE, INC.
           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS



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

Cautionary Statements:

Statements  in this Form  10-QSB  may  constitute  "forward-looking  statements"
within  the  meaning of the  Private  Securities  Litigation  Reform Act of 1995
("PSLRA"),  including statements concerning  management's plans,  intentions and
expectations  with respect to future  financial  performance  and future events,
particularly   relating  to  revenues   from   performance-based   services  and
re-negotiations  of existing and new  contracts  with  customers.  Many of these
statements  involve known and unknown risks,  uncertainties  and  contingencies,
many of which are beyond our  control,  which  could  cause  actual  results and
outcomes to differ  materially from those expressed in this 10-QSB.  Although we
believe  that  our  plans,   intentions  and  expectations  reflected  in  these
forward-looking  statements  are  reasonable,  we can give no assurance that our
plans,  intentions  or  expectations  will  be  achieved.  For a  more  complete
discussion of these risk factors,  please see "Cautionary  Statements" in Item 6
of the  Company's  Form  10-KSB for the fiscal  year ended  December  31,  1999.

GENERAL  OVERVIEW:

The Company is a holding company which, through its subsidiaries,  CareAdvantage
Health Systems,  Inc.  ("CAHS") and  Contemporary  HealthCare  Management,  Inc.
("CHCM"),  is in the business of providing health care cost containment services
designed to enable health care insurers and other health  service  organizations
to reduce the costs of  medical  services  provided  to their  subscribers.  The
services provided include  utilization  review in  medical/surgical  cases where
pre-authorization is required for hospitalization and for certain in-patient and
outpatient  procedures,  case management and disease  management.  The Company's
services have been  principally  provided to several of Blue  Cross/Blue  Shield
("BCBS") health services organizations in the Northeastern United States.

RESULTS OF OPERATIONS:

The following  discussion  compares the Company's  results of operations for the
three months  ended March 31, 2000,  with those for the three months ended April
30, 1999.  The Company's  consolidated  financial  statements  and notes thereto
included  elsewhere in this report contain  detailed  information that should be
referred to in conjunction with the following discussion.

Three Months Ended March 31, 2000, Compared to Three Months Ended April 30, 1999

Revenues:

The Company's total operating  revenues for the three-month  periods ended March
31,  2000 and  April 30,  1999 were  approximately  $4,550,000  and  $3,955,000,
respectively.  This  represents  an increase of  approximately  $595,000 for the
three-month  period  ended March 31, 2000 from the  corresponding  period of the
prior  fiscal  year.  The  increase for the three months ended March 31, 2000 is
largely due to increased revenue of approximately  $255,000 from the realization
of performance  revenues and increased revenue of approximately  $340,000 due to
increased   membership  on  a  major   account.   Contracts   that  provide  for
performance-based revenues require claims data that is supplied by the Company's
customers  to  calculate  the  achievement  of goals  for each  period.  Because
compilation of claims data typically  lags the Company's  actual  performance by
several  months,  it is difficult to ensure  complete  accuracy  when  recording
performance-based revenues.  Management has worked closely with its customers to
secure more timely and accurate  data to improve the  accuracy of reporting  its
revenues,  including,  in some cases,  the  re-negotiation  of the contract to a
fixed fee basis.  Management believes its estimated  performance-based  revenues
contained  in reported  revenues  for the three  months ended March 31, 2000 are
accurate  based upon the data  available  to  management.  However,  information
received by the Company  after the filing of this Form 10-QSB could result in an
adjustment  of its  estimates  of  performance-based  revenues  (which  would be
reflected in subsequent quarters, if necessary).

Revenues from at-risk  performance-based  service  contracts  generally  tend to
follow a pattern whereby  significant  revenues are generated during the initial
term of the contract, as savings opportunities are the greatest and then decline
thereafter as the opportunity for additional  savings  diminishes.  As a result,
the Company's ability to

                                       8

<PAGE>


                               CAREADVANTAGE, INC.
           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS


increase  revenues and gross margins is dependent upon its ability to enter into
additional  contracts with new customers and/or expand the services  provided to
existing customers

Cost of services:

The Company's  total direct cost of services for the  three-month  periods ended
March 31, 2000 and April 30, 1999 was  approximately  $2,239,000 and $2,203,000,
respectively.  This  represents  an  increase of  approximately  $36,000 for the
three-month  period  ended March 31, 2000 over the  corresponding  period of the
prior fiscal  year.  This  increase in the cost of services for the  three-month
period ended March 31, 2000 was primarily due to increases in personnel costs of
approximately  $152,000  offset by a decrease in depreciation  and  amortization
expense of approximately $120,000.

Operating expenses:

Selling, general, and administrative:

The  Company's  total  selling,   general,  and  administrative  costs  for  the
three-month  periods ended March 31, 2000 and April 30, 1999 were  approximately
$1,909,000  and  $2,334,000,   respectively.   This  represents  a  decrease  of
approximately  $425,000 for the three-month period ended March 31, 2000 over the
corresponding period of the prior fiscal year. This decrease for the three-month
period ended March 31, 2000 is largely due to  decreases  in personnel  costs of
approximately $146,000,  professional fees and consulting costs of approximately
$201,000,  and other general and administrative costs of approximately  $78,000.
The higher personnel costs in the prior period ending April 30, 1999 were due to
certain non-recurring charges incurred. Management has taken and intends to take
additional  steps  to  reduce  general  and  administrative  costs.  There is no
assurance,  however, that the Company will be successful in reducing general and
administrative costs by any significant amount.

Depreciation and amortization:

The Company's  total  depreciation  and  amortization  costs for the three-month
periods ended March 31, 2000 and April 30, 1999 were approximately  $222,000 and
$342,000, respectively. Approximately $44,000 and $126,000 were included in cost
of services for such periods.

Interest expense:

The Company's total net interest income for the three-month  periods ended March
31, 2000 and April 30, 1999 was approximately $14,000 and $7,000,  respectively.
This represents an increase of  approximately  $7,000 in net interest income for
the three-month period ended March 31, 2000 from the corresponding period of the
prior  fiscal  year.  The  increase  in net  interest  income is largely  due to
decreased  interest  costs  of  approximately  $6,000  under  the  Master  Lease
Agreement with IBM Credit  Corporation  ("IBM") and decreased  interest costs of
approximately  $7,000  related  to an  8%  Exchangeable  Note  in  the  original
principal  amount of  $3,600,000,  maturing on June 30, 1998 assigned to Horizon
Blue Cross Blue Shield of New Jersey,  Inc.  (the  "Horizon  BCBSNJ  Note").  In
addition, the Company realized decreased interest income of approximately $6,000
from the Company's short-term investments.


LIQUIDITY, FINANCIAL CONDITION AND CAPITAL RESOURCES:

General overview:

At March 31, 2000, the Company had a working  capital  surplus of  approximately
$432,000,  stockholders  equity of  approximately  $2,464,000 and an accumulated
deficit  since its  inception of  approximately  $19,713,000.  By  continuing to
provide  high quality care cost  containment  services to its existing  customer
base of five BCBS  plans,  management  believes  it can  continue  to market its
products to other BCBS plans.  This strategy is particularly  significant  given
the current health care environment where large  third-party  payers are merging
in an effort to protect  their  respective  franchises  and expand  their market
reach. The various BCBS plans throughout the country

                                       9
<PAGE>


                               CAREADVANTAGE, INC.
           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS



are no exception to this phenomenon and the Company believes it can leverage its
core competencies to participate in this consolidating environment.

Management is of the opinion that it must continue to refine its current service
lines in order to  continue to add value to existing  and  potential  customers.
Additionally,  the Company  intends to broaden its services  offered with unique
and  complementary  cost-containment  strategies.  Management will evaluate each
service with regard to anticipated changes in the health care industry, the cost
to enter any such  line of  service  as well as the  availability  of  competent
resources. To further expand its line of services, the Company intends to pursue
alternatives  to its  internal  products  and  service  development  efforts  by
entering  into  strategic  alliances  and  joint  ventures  as well  as  through
acquisitions.

Financial  condition:

At March 31,  2000,  the  Company  had cash of  approximately  $1,471,000  and a
working capital  surplus of  approximately  $432,000.  At December 31, 1999, the
Company had cash of  approximately  $1,615,000 and a working  capital surplus of
approximately $264,000.

Net cash (used by)/provided from operating  activities amounted to approximately
($139,000)  and $424,000 for the  three-month  periods  ended March 31, 2000 and
April 30, 1999,  respectively.  The cash used by 2000  operating  activities  is
largely due to a an increase in customer  receivable of approximately  $376,000,
offset by non-cash charges of approximately $235,000.

Net cash used in  investing  activities  amounted to  approximately  $24,000 and
$163,000 for the  three-month  periods  ended March 31, 2000 and April 30, 1999,
respectively.  The  decrease  in cash used of  approximately  $139,000 is due to
decreased  capital outlays for  computer-related  equipment  incurred during the
three-month period ended March 31, 2000.

Net cash  provided/(used) in  financing  activities  amounted to  approximately
$19,000 and  ($278,000)  for the  three-month  periods  ended March 31, 2000 and
April  30,  1999,  respectively.  The  decrease  in cash  used of  approximately
$297,000   is   largely   due   to   decreased    principal    payments   to   a
stockholder/customer  of approximately $159,000 and decreased principal payments
related to the Master Lease Agreement with IBM of approximately $119,000, offset
by proceeds from issuance of common stock of approximately $19,000.

While there can be no  assurances,  management  believes  that its cash on hand,
projected future cash flows from operations and the Company's borrowing capacity
under its credit facility with Summit Bank (see  discussion  below under Capital
Resources)  will provide  adequate  capital  resources to support the  Company's
anticipated cash needs for the next twelve months.

Capital resources:

Pursuant to the Horizon BCBSNJ Note, the Company owes $692,000 to Horizon BCBSNJ
as of March  31,2000.  The Company has an oral  agreement with Horizon BCBSNJ to
suspend  payments on the note due to Horizon  BCBSNJ  through  August 2000.  The
Company is to resume  making  payments  on  September  1, 2000 in equal  monthly
installments  to  repay  the debt by  March  31,  2001.  While  there  can be no
assurances  that  future  operating  results  will be  sufficient  to fund  this
obligation of the Company,  management expects such amounts to be funded through
operations.

The Company has a credit  facility  with a bank that  provides  for a $1,500,000
working capital revolver to be used for general working capital needs, which has
been extended  through June 30, 2000.  In September of 1998,  the bank issued an
irrevocable  letter of credit in the amount of $250,000,  for the account of the
Company in favor of a vendor as security for the  Company's  obligation  under a
non-cancelable  operating  lease.  This  letter of  credit  is issued  under the
Company's  credit  facility  and the  availability  is thus  reduced by the face
amount of the  letter  of  credit.  The  remainder  of the  credit  facility  is
available to the Company.  As of March 31, 2000 the $250,000  irrevocable letter
of credit is still outstanding under the credit facility.



                                       10


<PAGE>


                               CAREADVANTAGE, INC.


ITEM 3.  Quantitative and Qualitative Disclosures about Market Risk

As of March 31, 2000, the Company's  investments are not significantly  impacted
by change in market interest rates. The Company does not believe that changes in
interest  rates will have a  material  impact on future  earnings  or cash flows
during the next twelve months.

PART II--OTHER INFORMATION

Item 1.  Legal Proceedings

For a description of legal proceedings,  see Note C to the Financial Statements.
With the exception of the legal proceedings described in Note C to the Financial
Statements,  there are no material pending legal proceedings other than ordinary
routine litigation incidental to the business of the Company.

Item 2.  Changes in Securities

None.

Item 3.  Defaults Upon Senior Securities

None.

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

No matters were submitted to a vote of the Company's security holders during the
last quarter of calendar year ended March 31, 2000.

Item 5.  Other Information

None.

Item 6. Exhibits and reports on Form 8-K

    (a) Exhibits

          (27) Financial Data Schedule

                                       11
<PAGE>


                               CAREADVANTAGE, INC.

                                   SIGNATURES

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

                                     CareAdvantage, Inc

May 12, 2000                         /s/ David G. Noone
                                     --------------------------------------
                                         David G. Noone
                                         Chief Executive Officer

May 12, 2000                         /s/ R. Christopher Minor
                                     ---------------------------------------
                                         R. Christopher Minor
                                         Chief Financial Officer





                                       12