SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB



(Mark  One)

[X]     ANNUAL  REPORT  PURSUANT  TO  SECTION  13  or  15(d)  OF  THE SECURITIES
        EXCHANGE  ACT  OF  1934
        For the fiscal year ended:  December 31, 2000

[ ]     TRANSITION  REPORT  PURSUANT  TO  SECTION 13 or 15(d) OF THE SECURITIES
        EXCHANGE  ACT  OF  1934
        For the transition period from:

                           Commission File No. 1-12451

                           NEW YORK HEALTH CARE, INC.

                 (Name of small business issuer in its charter)

          New  York                                         11-2636089
(State of other jurisdiction of             (I.R.S. Employer Identification No.)
Incorporation or  organization)

       1850 McDonald Avenue, Brooklyn, New York               11223
     (Address  of  principal  executive  offices)           (Zip Code)

Issuer's telephone number, including area code:           (718) 375-6700

Securities issued pursuant to Section 12(b) of the Act:
                                                          Name of exchange on
     Title  of  each  class                                which  registered
     ----------------------                                -----------------

     Common  Stock  $.01  par  value                    Boston Stock Exchange


<PAGE>
Securities  registered  pursuant  to  Section  12(g)  of  the  Act:


Common  Stock  $.01  par  value

Check  whether  the issuer (1) filed all reports required to be filed by Section
13  or  15(d) of the Exchange Act during the past 12 months (or for such shorter
period  that the registrant was required to file such reports), and (2) has been
subject  to  such  filing  requirements  for  the  past  90  days.
Yes X   No
   ---    ---

Check  if there is no disclosure of delinquent filers in response to Item 405 of
Regulation  S-B  contained in this form, and no disclosure will be contained, to
the  best  of  registrant's  knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in  Part III of this Form 10-KSB or any
amendment  to  this  Form  10-KSB.  [ ]


State  issuer's  revenues  for  its  most  recent  fiscal  year.  $29,383,547


State  the  aggregate  market  value  of the voting stock held by non-affiliates
computed  by  reference to the price at which the stock was sold, or the average
bid and asked prices of such stock, as of a specified date within the past sixty
(60)  days.  $3,149,595  (as  of  2/26/01).


                   (APPLICABLE ONLY TO CORPORATE REGISTRANTS)

State  the  number of shares outstanding of each of the issuer's class of common
equity,  as  of  the  latest  practicable  date:  3,668,730


                       DOCUMENTS INCORPORATED BY REFERENCE

The  following  document is incorporated by reference in this Form 10-KSB; Proxy
Statement  on  Form  14A  dated  November  15,  2000.


                                        2
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                           FORWARD LOOKING STATEMENTS

     Information  provided  by  the  Company in this annual report contains, and
from  time  to  time  the  Company may disseminate materials and make statements
which may contain, "forward-looking" information, as that term is defined by the
Private Securities Litigation Reform Act of 1995 (the "Act"). In particular, the
information  contained  in  "Management's  Discussion  and Analysis of Financial
Condition  and  Results  of  Operation-Liquidity and Capital Resources" contains
information concerning the ability of the Company to service its obligations and
other  financial  commitments  as  they come due and "Company Strategy" contains
information  regarding  management's  belief concerning the growth opportunities
available to the Company. The aforementioned forward looking statements, as well
as  other forward looking statements made in this annual report are qualified in
their  entirety by these cautionary statements, which are being made pursuant to
the  provisions  of  the Act and with the intention of obtaining the benefits of
the  "safe  harbor"  provisions  of  the  Act.

     The  Company cautions investors that any forward-looking statements made by
the Company are not guarantees of future performance and that actual results may
differ  materially  from  those in the forward-looking statements as a result of
various  factors,  including,  but  not  limited  to,  the  following:

(a)     In recent years, an increasing number of legislative proposals have been
introduced  or  proposed  by Congress and in some state legislatures which would
effect  major  changes  in  the  healthcare  system. However, the Company cannot
predict  the  form  of  healthcare  reform legislation, which may be proposed or
adopted by Congress or by state legislatures. Accordingly, the Company is unable
to  assess  the  effect of any such legislation on its business. There can be no
assurance  that  any such legislation will not have a material adverse impact on
the  future  growth,  revenues  and  net  income  of  the  Company.

(b)     The  Company  derives  substantial  portions  of  its  revenues  from
third-party  payers  including,  both  directly  and  indirectly,  government
reimbursement  programs  such  as Medicare and Medicaid and some portions of its
revenues  from non-governmental sources, such as commercial insurance companies,
health  maintenance  organizations  and  other  charge-based  contracted payment
sources.  Both  government  and  non-government  payers  have  undertaken
cost-containment  measures  designed  to limit payments to healthcare providers.
There  can be no assurance that payments under governmental and non-governmental
payer  programs  will  be  sufficient  to  cover the costs allocable to eligible
patients.  The  Company  cannot  predict  whether  or  what  proposals  or
cost-containment  measures  will be adopted or, if adopted and implemented, what
effect,  if  any,  such  proposals  might have on the operations of the Company.

(c)     The Company is subject to extensive federal, state and local regulations
governing  licensure, conduct of operations at existing facilities, construction
of  new  facilities,  purchase  or lease of existing facilities, addition of new
services,  certain  capital expenditures, cost-containment and reimbursement for
services  rendered. The failure to obtain or renew required regulatory approvals
or  licenses,  the  delicensing  of  facilities owned, leased or operated by the
Company  or  the  disqualification  of the Company from participation in certain
federal  and  state  reimbursement programs could have a material adverse effect
upon  the  operations  of  the  Company.


                                        3
<PAGE>
(d)     There  can be no assurance that the Company will be able to continue its
substantial  historical  growth  or  be  able  to  fully  implement its business
strategies  or  that  management  will  be  able  to  successfully integrate the
operations  of  its  various  acquisitions.


                                     PART I


Item  1.     DESCRIPTION  OF  BUSINESS.

(a)  General  Development  of  Business.

     New  York  Health Care, Inc. (the "Company") is a licensed home health care
agency  engaged  primarily  in  supplying  the services of paraprofessionals who
provide  a  broad  range  of  health  care support services to patients in their
homes.  The  Company  was initially organized under the laws of the State of New
York,  in  February  1983.

     The Company operates 24 hours a day, seven days a week to receive referrals
and  coordinate  services  with  physicians,  case  managers, patients and their
families.

     The Company operates in all five boroughs of New York City and the counties
of Nassau, Westchester, Rockland, Orange, Dutchess, Ulster, Putnam and Sullivan,
in  the State of New York.  The Company, as a result of acquisitions as describe
elsewhere  in  this  annual  report,  also  operates  in  Jersey  City,  Edison,
Shrewsbury,  Toms  River,  East Orange and Hackensack, New Jersey under the name
Helping  Hands  Healthcare,  (the  business  name  of NYHC Newco Paxxon, Inc., a
wholly  owned  subsidiary  of the Company).  The Company's services are supplied
principally  pursuant  to  contracts  with health care institutions and agencies
such  as  various  county  Departments  of  Social Services, NYC HRA, New Jersey
Medicaid,  Beth  Abraham  Health  Services  in the Bronx and Westchester County,
Kingsbridge  Medical Center, Mt.  Sinai Medical Center, Aetna US Healthcare, and
Gentiva  Health  Services.

     The  Company's  primary  objective  is  to enhance its position in the home
health care market by increasing the promotion of its full service and specialty
health  care  capabilities  to  existing  and  new  referral sources; expand its
markets  and  enter  new  markets  by establishing additional branch offices and
acquiring  other related health care businesses; expand its provision of skilled
nursing  services,  principally  infusion  therapy  and the care of women during
pregnancy and their newborn children; and develop complimentary home health care
products  and  services, as well as maintaining its regular training and testing
programs,  and  recruitment  activities.

     The  Company  maintains  its  principal  offices  at  1850 McDonald Avenue,
Brooklyn,  NY  11223,  telephone  (718)  375-6700.


                                        4
<PAGE>
Industry  Background.

     The  home health care industry has grown substantially over the past decade
according  to  published  industry information. In 1997, HCFA estimated that 3.4
million  enrollees  received  fee-for-service  home  health  services  in  1997,
representing  a  greater than 40% rise from the number of home health recipients
in  1990.  For the period 1990-1997, Medicare home health expenditures increased
from  $5.1 billion to an estimated $17.2 billion and is projected to increase to
$20.1  billion in the year 2001 and $33.6 billion in the year 2008.  Most of the
rise in spending occurred as a result of the increase in visits, from 70 million
in  1990  to  an  estimated  258  million in 1997. Medicaid home health benefits
between  1994  and  1997  have  increased  from approximately $7 billion and $12
billion.  In  1998,  New  York State Medicaid expenditures for personal care and
home  health  aide  services totaled $2.3 billion. The Company believes that the
primary  reasons for the growth in the home health care market include the aging
of  the  U.S.  population;  the  realization of substantial cost savings through
treatment  at  home  as  an  alternative to hospitalization; advances in medical
technology  which  have enabled a growing number of treatments to be provided in
the  home  rather  than  requiring  hospitalization;  the  general preference of
patients  to  receive  treatment  in  a  familiar environment; reductions in the
length  of  hospital stays as a result of increasing cost containment efforts in
the  health  care  industry; growing acceptance within the medical profession of
home  health care and the increase in the incidence of AIDS-related diseases and
cancer.


Aging  Population.

     The  number of individuals over age 65 in the United States is estimated to
have  grown  from approximately 34.1 million in 1996, or 12.9% of the population
to  38.5  million or 14.2% in 1998, and is projected to increase to more than 53
million  in  the year 2020, or 16%. The elderly have traditionally accounted for
two  to three times the average per capita share of health care expenditures. As
the  number  of  Americans  over age 65 increases, the need for home health care
services  is  also  expected  to  increase.


Cost  Effectiveness  of  Home  Health  Care  Services.

     National  health  care  expenditures  increased  from  $993 billion in 1995
(13.7%  of  the  United  States  gross national product) to approximately $1,149
trillion  in  1998  (13.5%  of  the  United  States gross national product).  In
response  to  rapidly rising costs, governmental and private payers have adopted
cost  containment  measures  that encourage reduced hospital admissions, reduced
lengths  of  stay  in hospitals and delayed nursing, home admissions. Changes in
hospital  reimbursement  methods  under  Medicare  from a cost-based method to a
fixed  reimbursement  method  based  on  the patient's diagnosis have created an
incentive  for earlier discharge of patients from hospitals. These measures have
in  turn  fostered  an  increase  in  home  health care which, when appropriate,
provides  medically  necessary  care  at significantly less expense than similar
care  provided  in  an  institutional  setting.


Advances  in  Technology.

     Advances  in  technology  in  the  past  decade  now  enable  patients  who
previously  required  hospitalization  to  be  treated at home. For example, the
development  of  a compact and portable phototherapy blanket performing the same
functions  as  bilirubin  lighting  systems  in  hospitals  for the treatment of
newborn  children with jaundice, a common condition, permits these infants to be
treated  at  home.  Prior  to the development of this device, these infants were
kept  in  the  neonatal unit of a hospital even after the mother was discharged.
This  practice  delayed mother-infant bonding, made breast-feeding difficult and
otherwise  caused  substantial  inconvenience  and concern to families at a time
when the mother was in a weakened state. Similar advances have been made in home
infusion therapy (which is provided by the Company) and rehabilitation equipment
permitting  treatments  at  home,  which  used  to require hospital settings for
pediatric  and  adult  populations.


                                        5
<PAGE>
Patient  Preference  and  Physician  Acceptance.

     The  Company  believes  that, if possible in any given case, a patient will
prefer  to  be treated at home rather than in an institutional setting. Further,
in  the last decade, the medical profession has shown greater acceptance of home
health  care in the clinical management of patients. As evidence of this greater
acceptance,  the American Medical Association Councils on Scientific Affairs and
Medical  Education  has recommended that training in the principles and practice
of  home  health  care  be  incorporated  into  the  undergraduate, graduate and
continuing  education  of  physicians.

Incidences  of  AIDS  and  Cancer.

     Increases in the incidence of AIDS/HIV infections and cancer have also been
responsible  for a significant portion of the growth in the home care market. As
of  December 31, 1999, 733,374 cases of AIDS had been reported to the Center for
Disease  Control  (not  including  those  with less advanced HIV who could still
benefit  from  treatment). During their treatment, AIDS/HIV patients may receive
several  courses  of  infusion  and  other  therapies  typically administered by
infusion  therapy  companies,  including  AZT,  aerosolized  Pentamidine  (TM),
antibiotics  and  nutritional  support. The Company presently provides a limited
amount  of infusion therapy with pharmaceuticals provided by licensed suppliers.
The  Company  plans  to  expand  its infusion therapy operations during the next
year.  See  "Home  Health  Care  Services."

     The National Cancer Institute estimates that 8.4 million of Americans alive
today  have  a  history  of cancer.  The American Cancer Society, estimated that
about  1.3 million new cancer cases were diagnosed in 1999 and approximately 1.2
million  new  cases  were expected to be diagnosed in 2000.  Cancer treatment is
one  of  the  fastest  growing  segments  of  outpatient infusion therapy due to
increasing numbers of patients and new technologies that allow for the therapy's
safe  and  effective administration in the home and at alternate site locations.
Over  the  course  of  their  treatment,  cancer patients may require a range of
infusion  therapies,  including  chemotherapy,  pain  management and nutritional
support.

(b)  Financial  Information  About  Industry  Segments

     Not  Applicable

(c)  Narrative  Description  of  Business

     The  Company  currently offers a broad range of support services, including
assistance  with personal hygiene, dressing and feeding, meal preparation, light
housekeeping  and  shopping,  and,  to  a  limited  extent, physical therapy and
standard skilled nursing services such as the changing of dressings, injections,
catheterizations and administration of medications. The Company's personnel also
train  patients  in  their  own  care, monitor patient compliance with treatment
plans,  make  reports  to  the  physicians  and  process reimbursement claims to
third-party  payers.  Among  the  paraprofessionals  and  nurses supplied by the
Company  are  those  fluent in Spanish, Mandarin and  Cantonese Chinese, Yiddish
and Russian as well as personnel knowledgeable in the requirements and practices
of  Kosher  homes.


                                        6
<PAGE>
Home  Health  Care  Services

     The  Company's  home  health  care services are provided principally by its
professional  and  paraprofessional staff, who provide personal care to patients
and,  to  a  lesser  extent,  by  its skilled nursing staff, who provide various
therapies  employing  medical  supplies  and  equipment  and  infusion  therapy.
Personal  care  and  nursing services for a particular patient can extend from a
few  visits to years of service and can involve intermittent or continuous care.
Approximately  95% of the Company's total net revenues in 2000 were attributable
to  services  by  its  paraprofessional  staff.

Certified  Paraprofessionals

     The  Company's  certified  paraprofessional staff provides a combination of
unskilled  nursing and personal care services to patients, as well as assistance
with daily living, tasks such as hygiene and feeding. Consistent with applicable
regulations,  all  of  the  Company's  aides  are  certified  and work under the
supervision  of a licensed professional nurse. Certain aides have been specially
trained  by the Company to work with patients with particular needs, such as new
mothers  and  their  newborn  infants, patients with particular diseases such as
cancer,  AIDS  or Alzheimer's Disease and particular classes of patients such as
the  developmentally  disabled  and  terminal.

     The Company is approved by the New York State Department of Health to train
"Home  Health  Aides" and by the New York Department of Social Services to train
"Personal  Care  Aides." The Company is also approved by the Board of Nursing in
New  Jersey  to  train  "Certified  Home  Health  Aides".  Medicaid  provides
reimbursement for services performed by both Home Health Aides and Personal Care
Aides,  while  Medicare provides reimbursement only for the services provided by
Home  Health  Aides.  In  order  to  provide a qualified and reliable staff, the
Company  continuously  recruits,  trains,  provides continuing education for and
offers  benefits  and  other  programs  to  encourage  retention  of  its staff.
Recruiting  is  conducted  primarily  through  advertising,  direct contact with
community  groups  and  employment  programs,  and  the use of benefits programs
designed  to  encourage  new  employee  referrals  by  existing  employees.

     All  paraprofessional  personnel  must  pass  a  written  exam and a skills
competency test prior to employment, with all certificates having been validated
by  the  issuing  agency.  The Director of Nursing or Director of Maternal/Child
Health  in  each  of  the  Company's  branch  offices validates the professional
competency  of  all  new  hires.  Newly  hired  employees are re-evaluated as to
competency  within  six  months  of  their  employment  and  all  employees  are
re-evaluated  on  an  on-going, basis at least semi-annually.  In addition, they
undergo  an  orientation program which includes material regarding HIV patients,
Hepatitis  B,  universal  precautions  which  must  be  taken with all patients,
patient's  rights  issues,  and  the  Company's  policies  and  procedures.  An
orientation  manual  is  also  provided  to  each  employee.

     Competition  for  qualified  staff  has  been intense in recent years.  The
Company  competes  to  attract and retain personnel on the basis of compensation
and  working  conditions.  Among  the benefits which the Company provides to its
staff  are  competitive  salaries,  a  401(k)  Plan  and  employee-funded health
insurance.  The  Company  has generally not experienced difficulties in the past
in  attracting  and retaining personnel.  It believes it will be able to compete
effectively  in  this  area  and  satisfy  its  overall  staffing  requirements.
However,  there  can be no assurance that shortages of health care professionals
in  the  future  will  not  occur and such shortages could materially effect the
Company's  ability  to  maintain  or  increase  its  current  commitments.


                                        7
<PAGE>
Licensed  Professional  Nurses

     The  Company  employs  licensed professional nurses (both registered nurses
and  licensed  practical  nurses)  who  provide special and general professional
nursing  services  (these  nurses are employed on a per diem basis). The Company
also  employs registered nurses who are responsible for training and supervising
the  Company's  paraprofessional staff, as well as providing backup in the field
for  the  nursing  staff which is providing care (these nurses are employed on a
salaried  basis).  General  nursing  care is provided by registered and licensed
practical  nurses  and  includes  periodic assessments of the appropriateness of
home  care,  the  performance  of  therapy  procedures,  and  patient and family
instruction.  Patients  receiving  such  care  include  stabilized postoperative
patients  recovering at home, patients who, although acutely ill, do not need to
be  cared  for  in  an  acute  care facility and patients who are chronically or
terminally  ill.

     Specialty  nurses are registered nurses with experience or certification in
particular  specialties,  such  as  emergency service, intensive care, oncology,
intravenous  therapy  or  infant  and  pediatric  nursing.  The  Company employs
specialty  nurses  to provide a variety of therapies and special care regimes to
patients in their homes. These specialty nurses also instruct patients and their
families  in  the  self-administration  of  certain  therapies  and in infection
control,  emergency procedures and the proper handling and usage of medications,
medical  supplies  and  equipment.

     The  Company's  licensed  professional  nurses  also provide a very limited
amount of in-home administration to patients of nutrients, antibiotics and other
medications  intravenously  (into  a  vein),  subcutaneously (under the skin) or
through  feeding tubes, utilizing supplies provided by licensed suppliers.  Such
intravenous  therapy  is  used for antibiotic treatment, parental nutrition (the
administration of nutrients), enteral nutrition (the administration of nutrients
directly into the digestive tract), growth hormone therapy, pain management, and
chemotherapy.  The  duration,  progression and complexity of infusion therapy is
governed  by  the  patient's disease and condition and can range anywhere from a
few  weeks  to  many  years.

     All  nurses  hired  by  the Company must have at least one year of current,
verifiable  experience,  including  references  and  license  verification.  All
nurses  working  in  specialty areas must have at least two years of experience.

     While the provision of licensed professional nursing services accounted for
less  than  5%  of the Company's net revenues in 2000, the Company  has expanded
its  nursing  operations  in  its  existing  markets  as  well as new geographic
locations.  See  "Company  Strategy."


Company  Strategy

     The  Company  continues  to  move rapidly towards its objective to become a
comprehensive  provider  of  efficient  and  high quality home health care to an
increased  share  of  expanding  markets.  The primary elements of the Company's
strategy to achieve this objective are geographic expansion of its branch office
network  by  investment  in  additional branch offices and by the acquisition of
other  home  health care companies, and by expansion of the services provided by
its  licensed professional nurses, principally in the areas of infusion therapy,
pediatrics and maternal/child care. The Company intends to initially concentrate
its  expansion  efforts in its current market areas and the counties surrounding
those  market areas. In addition to expansion into geographic areas in proximity
to  the  Company's  current  branch  offices, the Company will generally seek to
enter  and  expand  into  new  metropolitan areas in the Northeast and Southeast
regions  of  the  United  States  which  have  large patient populations and, in
particular,  patients  traveling  between  these  regions.


                                        8
<PAGE>
Acquisitions

     On  December  8,  1997,  Helping  Hands  Healthcare  purchased  from  Metro
Healthcare  Services,  Inc.,  a  New Jersey corporation ("Metro"), the home care
business  assets  (other  than accounts receivable) which Metro operated in West
Orange, Budd Lake and Jersey City, New Jersey for a purchase price consisting of
$580,000 paid at closing and a promissory note in the principal sum of $200,000,
which  has  been  paid in full.  As part of the acquisition transaction, Helping
Hands Healthcare assumed various leasehold obligations for offices together with
various  equipment  leases  for  items  of  business  equipment.

     On February 8, 1998, Helping Hands Healthcare purchased from Metro the home
care  business  assets  (other than accounts receivable) which Metro operated in
Edison, Shrewsbury and Toms River, New Jersey for a purchase price consisting of
$500,000 paid at closing and a promissory note in the principal sum of $580,000,
which  has  been  paid in full.  As part of the acquisition transaction, Helping
Hands  Healthcare  assumed  various  leasehold  obligations.

     On  March  26, 1998, Helping Hands Healthcare purchased from Heart to Heart
Healthcare  Services, Inc., a New Jersey corporation ("Heart to Heart") the home
care  business  assets  (other  than  accounts  receivable) which Heart to Heart
operated  in  East  Orange  and  Hackensack,  New  Jersey  for  a purchase price
consisting  of  a  promissory note in the principal sum of $1,150,000, which has
been  paid  in  full.  As  part  of  the  acquisition transaction, Helping Hands
Healthcare assumed various leasehold obligations together with various equipment
leases  for  items  of  business  equipment.

     Certain of the directors are principal stockholders of Heart to Heart.  The
Company  therefore obtained an independent opinion that the terms and conditions
of  the  acquisition  were,  under  all  circumstances,  fair  to  the  Company.

     On February 22, 1999, Helping Hands Healthcare completed the acquisition of
the  assets  of  a  home  health care office in Shrewsbury, New Jersey, formerly
owned  by Staff Builders Services, ("Staff Builders") Inc., for a purchase price
of  $65,000.

     On  June 11, 1999 Helping Hands Healthcare completed the acquisition of the
assets  of  a  Staff Builders home health care office in Hackensack, New Jersey,
for  the  purchase  price  of  $25,700.

     On  October  23, 1999 New York Health Care completed the acquisition of the
assets  of  a Staff Builders home health care office in Manhattan, New York, for
the  purchase  price of $30,000.  The business of this office was transferred to
other  existing  New  York  Health  Care  offices.


                                        9
<PAGE>
     Due  to  a decrease in revenue and projected reductions in revenue from the
operations  of  certain  offices  the  closing of Shrewsbury, Budd Lake and West
Orange offices located in New Jersey, the Company evaluated the ongoing value of
its  intangible assets associated with those acquisitions which were made by the
Company  from December 1997 through February 1999. Based on this evaluation, the
Company  determined  that  the  intangible  assets  with  a  carrying  amount of
$1,688,134  were  impaired.  Accordingly, the Company reduced the estimated fair
value  of  those  intangible  assets  by  $1,487,192  as a charge to operations.
Estimated fair value was based on the value associated with current purchases of
similar  companies  in  the  home  health  care  industry.

     The  Company management believes that it has successfully integrated all of
its  acquisitions,  with minimum interruptions to its daily operations. This has
been  accomplished by the formation of a mergers and acquisitions ("M&A") group,
which includes Chief Executive Officer, Chief Operating Officer, Chief Financial
Officer  and  Vice  President of Clinical Operations. The Company has integrated
its  billing,  payroll and clinical services to all new locations to ensure they
meet  its  high  quality  standards. The experience acquired during this process
should  allow  the Company to continue down its path of significant M&A activity
in  order  to  become  one  of  the leading home health agencies in the New York
metropolitan  area.

     The Company is accounting for each of these acquisitions as a "purchase" in
accordance  with  Generally  Accepted  Accounting  Principles.


Branch  Offices

     The  home health care industry is, fundamentally, a local one in which both
the  patients and the referral sources (such as hospitals, home health agencies,
social service agencies and physicians) are located in the local geographic area
in  which  the  services  are provided.  The Company seeks to serve local market
needs  through  its  branch  office  network,  run  by  branch  managers who are
responsible  for  all  aspects  of  local  office  decision-making,  including
recruiting,  training,  staffing,  and marketing.  In December 1997, the Company
acquired  three  branch  offices  in West Orange, Budd Lake and Jersey City, New
Jersey.  In  February  1998,  the  Company  acquired  an additional three branch
offices  in  Edison,  Shrewsbury  and Toms River, New Jersey. In March 1998, the
Company  acquired  another two branch offices in East Orange and Hackensack, New
Jersey.  In February 1999, the Company acquired the assets of a branch office in
Shrewsbury,  New  Jersey.  In  June  1999,  the Company acquired the assets of a
branch  office in Hackensack, New Jersey.  In October 1999, the Company acquired
the assets of a branch office in Manhattan.  See Item 1(a) - General Development
of  Business;  Item  2  -  Description  of  Properties;  Item  6  - Management's
Discussion  and  Analysis  of  Financial  Condition  and Results of Operations -
Liquidity and Capital Resources; and Item 12 - Certain Relationships and Related
Transactions.  The Company intends to open additional branch offices in New York
State,  subject  to  entering  agreements  with the local New York Department of
Social  Services agencies. In addition, the Company hopes to expand further into
New  Jersey,  Pennsylvania  and Connecticut in order to offer a wider geographic
coverage  to  the  health  maintenance  organizations  ("HMO's") and health care
insurance  organizations  with  which  it  deals,  and  to  add  additional
organizations.  This  further  expansion  is subject to the completion of market
surveys  in the various locations to ascertain the extent to which existing home
care  medical  needs  are  not  being met as well as competition and recruitment
issues.


                                       10
<PAGE>
Expansion  of  Infusion  Therapy

     The  Company  presently  provides  infusion  therapy  service  to patients,
utilizing  pharmaceuticals  provided  by licensed suppliers. Management believes
that  the  total  market  for home infusion therapy is continuing its growth and
that  increasing  the  provision of infusion therapy will build on the Company's
strength in providing nursing services, because such therapies generally require
administration  by  specialty  nurses.  The  Company  will  also  seek to supply
infusion  therapy  patients  with  the  other  home  health  care  services  and
therapies,  which they often require and which are offered by the Company. While
the Company has no current commitments to establish infusion therapy facilities,
it  intends  to pursue the establishment of such facilities in order to increase
its very small market share. However, there can be no assurance that the Company
will  expand its infusion therapy business or, if expanded, that it will conduct
such  a  business  on  a  profitable  basis.


Professional  Care  Resources

     The Company intends to expand its skilled nursing programs in order to meet
the  needs  which  management  believes  are  being  created  by early discharge
programs.  The  existing  referral base utilized by the Company from the various
agencies, social workers, case managers and physicians will be used to meet what
management  perceives  to  be  a  need not being met by the current pool of home
health  care  agencies.  The  Company expects that the expansion of this program
will  require  the  hiring  of an additional service directors with an extensive
background  in skilled nursing to assist the Directors of Nursing in each of the
Company's  branch  offices.  Additional  support staff will also be required, as
well as new training, materials, assistant directors, coordinators and marketing
staff.


Organization and Operations

     The  Company  operates  24  hours  a  day,  seven  days  a week, to receive
referrals  and  coordinate services with physicians, case managers, patients and
their  families.  The  Company  provides  services  through its 12 principal and
branch offices and one  recruitment  and training, offices. The Company seeks to
achieve  economies  of  scale by having each branch office serve a large patient
population. Each office conducts its own marketing efforts, negotiates contracts
with  referral  sources, recruits and trains professionals and paraprofessionals
and  coordinates  patient care and care givers. Each office is typically staffed
with  a  branch  manager,  director  of  nursing,  nursing supervisor, home care
coordinators,  clerical  staff  and  nursing  services  staff.

     The  Company's  principal  office retains all functions necessary to ensure
quality  of  patient  care  and  to  maximize  financial  efficiency.  Services
performed  at  the  principal  office  include  billing  and collection, quality
assurance, financial and accounting functions, policy and procedure development,
system design and development, corporate development and marketing.  The Company
uses  financial reporting systems through which it monitors data for each branch
office,  including patient mix, volume, collections, revenues and staffing.  The
Company's systems also provide monthly budget analysis, financial comparisons to
prior  periods  and comparisons among the Company's branch offices.


                                       11
<PAGE>
Work  Flow

     A  case  is initiated by one of the Company's referral sources contacting a
branch  office  and  advising  it  of the patient's general location, diagnosis,
types  of  services required, hours of service required and the time of day when
the  services  are  to be rendered. The branch office then contacts the referral
source  as  promptly as possible with the identification of the staff person who
will  be rendering the service, after which the referral source transmits to the
branch  office  a  detailed  copy of the plan for the patient's home care, which
includes  the  type  of  care  to  be rendered, the method by which it should be
rendered,  the  precise  location  and  hours.

     The  supervisory staff at the branch office then reviews the care plan with
the staff member(s) who will be providing the care and then dispatches the staff
member(s)  to  begin  rendering  the  care,  usually  the  next  day.

     The  clerical  staff  at  the  branch  office enters all of the information
regarding  the  case  into the local area computer network of the branch office,
which then generates the work schedule for the staff member(s), which provides a
detailed  description  of  the  services to be rendered, the hours and number of
days  during  which  the  care  is  to  be provided.  All of this information is
spontaneously received by the Company's principal office by way of the wide area
computer  network  linking  the  principal office to each of the branch offices.
This  information is then processed by the principal office computer system on a
weekly  basis  to  (generate the  documentation of the services being provided).
Such  documentation is then used to generate the billing for the service as well
as process the payroll for the staff member(s) providing the service.


Referral  Sources

     The  Company  obtains  patients primarily through contracts, referrals from
hospitals, community-based health care institutions and social service agencies,
case  management and insurance companies. Referrals from these sources accounted
for  substantially  all  of  the  Company's  net  revenues  in 2000. The Company
generally  conducts  business  with  most of its institutional referral sources,
including  those referred to below, under one-year contracts which fix the rates
and terms of all future referrals but do not require that any referrals be made.
Under  these  contracts,  the referral sources refer patients to the Company and
the  Company bills the referral sources for services provided to patients. These
contracts  also  generally designate the kinds of services to be provided by the
Company's employees, liability insurance requirements, billing and recordkeeping
responsibilities,  complaint  procedures,  compliance  with applicable laws, and
rates  for  employee  hours  or  days  depending on the services to be provided.
Approximately  200  such  contracts  were  in  effect  as  of December 31, 2000.

     In  January  1999,  the Company obtained a significant referral source from
The  City  of  New  York  to  provide services for Medicaid patients residing in
Brooklyn,  New  York.  In October 1999, the Company was recommended for an award
of  an  extension  of  up  to  six  years.  The annualized gross revenues to the
Company  during  each  of  the  years  of  contract  implementation  would  be
approximately  $12  million,  for a potential total $72 million over the life of
the  agreement.  The  revenue  for  year  ended  2000  from  this  contract  was
approximately  $11,000,000.

     One  or  more referring institutions have accounted for more than 5% of the
Company's  net revenues during the Company's last two fiscal years, as set forth
in  the  following  table:


                                       12
<PAGE>
                                     Percentage of Net Revenues
                                     -----------------------------
Referring Institution                       2000         1999
---------------------                      ------       ------

New York City Medicaid (HRA)               37.58%       22.94%
New Jersey Medical Assistance Program      15.17%       18.97%
County Departments of Social Services (1)   6.60%        9.26%
Mount Sinai Medical Center                  5.32%        2.57%
Beth Abraham Health Services                5.27%        6.25%

(1)  The  various  county  departments  of social services are funded by the New
York  State  Department  of  Health  which,  as  of October 1, 1996, assumed the
responsibility  for  the overall administration of Medicaid programs in New York
formerly  administered  by  the  New  York  Department  of  Social  Services.

     Overall,  the  Company's  ten  largest referring institutions accounted for
approximately 81.2% of net revenues for 2000 and 71.1% of net revenues for 1999.


Billing  and  Collection

     The  Company  screens  each  new  case  to  determine  whether  adequate
reimbursement  will  be  available  and  has  developed substantial expertise in
processing  claims. The Company makes a concerted effort to provide complete and
accurate  claims  data  to the relevant payer sources in order to accelerate the
collectibility  of  its  accounts  receivable.

     Days  Sales  Outstanding ("DSO") is a measure of the average number of days
taken  by  the  Company  to collect its accounts receivable, calculated from the
date services are billed. For the year ended December 31, 2000 the companies DSO
was 84 compared to 100 for the year ended December 31, 1999.  The improvement of
16  days in DSO is the net effect of combining the New Jersey DSO (which consist
primarily  of  Medicaid  billing)  of 49 days, the Home Attendant program (which
consist  primarily  of Medicaid billing) DSO of 47 days and New York's DSO which
are  134  days.

     The  Company licenses the Dataline Home Care System, a computerized payroll
system  designed  to  produce  invoices for services rendered as a by-product of
employee  compensation.  Automated  schedules  and  staffing  requirements  are
maintained  in  the  Company's  offices,  with the ability to enter all relevant
patient and employee demographic information. The payroll is processed weekly at
the  Company's  principal office in Brooklyn. This office is responsible for the
processing  of  data,  ensuring  the  availability  of  all  required  billing
documentation  and  its accuracy, and the printing and distributing of payments.

     Once  payroll  processing  is  completed,  the  Company's  computer  system
generates  the resulting invoices automatically.  The necessary documentation is
attached  to  all  invoices  that  are  mailed  to  clients.

     In  the  opinion  of  management,  there  is  no reason to believe that any
computer  system  or  software  used  internally  by the Company will materially
affect  transactions  with any customer, supplier or business partner, now or in
the  future.


                                       13
<PAGE>
     Management  reviews  reports  for  all  phases  of  the billing process and
prepares reconciliations for the purpose of ensuring accuracy and maintenance of
controls.  When  errors  are found, new processes are developed, as appropriate,
to  ensure  and  improve  the  quality  and  accuracy of the billing process and
responsiveness  to  clients'  needs  and  requirements.

     Accounts  receivable  reports  are  produced  weekly  and  are analyzed and
reviewed  by staff and management to locate negative trends or emerging problems
which  would  require immediate attention.  All unpaid invoices are reviewed and
telephone  contacts  established  for  invoices over 90 days old.  The Company's
experience  with  collection  of  accounts  receivable  has been favorable, with
uncollectible  accounts  within  the  allowances  provided  by  the  Company.

     Private  patients are required to pay the one-week fee for their service in
advance,  as a deposit for services to be provided.  For patients with insurance
covering  home  health services, the Company accepts assignment of the insurance
and  submits  claims  if  the  carrier  first verifies coverage and eligibility.
Payments  from  private patients are required to be made weekly, as invoices are
submitted  and,  if unpaid over three weeks, result in follow-up telephone calls
to  ensure  prompt  payment.  Requests  for  terms  from  private  patients  are
generally  honored  and  payment  arrangements structured based on the patient's
financial  resources  and ability to pay.  Unresponsive accounts are referred to
outside  collection  agencies.


Reimbursement

     The  Company  is  reimbursed  for  its  services,  primarily  by  referring
institutions,  such  as  health  care  institutions and social service agencies,
which in turn receive their reimbursement from Medicaid, Medicare and, to a much
lesser  extent,  through  direct  payments  by  insurance  companies and private
payers. New York State and New Jersey Medicaid programs constitute the Company's
largest  reimbursement source, when including both direct Medicaid reimbursement
and  indirect  Medicaid  payments  through  many  of  the  Company's  referring
institutions.  For  each  of 1999 and 2000, payments from referring institutions
which  receive  direct payments from Medicare and Medicaid, together with direct
reimbursement  to  the Company from Medicaid, accounted for approximately 95% of
net revenues. For the same periods, five referring institutions with home health
care  programs  accounted  for  approximately  44% and 17%, respectively, of net
revenues for 1999 and 2000. Direct reimbursements from private insurers, prepaid
health  plans, patients and other private sources accounted for approximately 5%
of  net  revenues  for  each  of  the  calendar  years  1999  and  2000.

     The  New  York  State  Department  of  Health,  in  conjunction  with local
Departments  of  Social  Services,  promulgates  annual  reimbursement rates for
patients  covered  by  Medicaid.  These  rates  are  generally  established on a
county-by-county  basis,  using  a complex reimbursement formula applied to cost
reports  filed  by  providers.  Generally,  the  first  report  filed  (called a
"budgeted"  report) uses projections to develop the current year's reimbursement
rate,  subject  to retroactive recapture of any monies paid by local Departments
of  Social  Services  for  budgeted  expenses  which are greater than the actual
expenses  incurred.  The  Company has filed all required annual cost reports for
each  of  its  offices,  which  provide  services  to  Medicaid  recipients. The
Company's  expenses  have  always  equaled  or  exceeded  the  budgeted amounts.


                                       14
<PAGE>
     Third party payers, including Medicaid, Medicare and private insurers, have
taken  extensive  steps  to  contain  or reduce the costs of health care.  These
steps  include  reduced  reimbursement  rates,  increased  utilization review of
services  and  negotiated  prospective  or  discounted pricing and adoption of a
competitive  bid  approach  to  service  contracts.  Home  health care, which is
generally  less  costly  to  third  party  payers  than hospital-based care, has
benefited  from  many  of  these  cost  containment  measures.

     On June 28, 2000, the Health Care Financing Administration (HCFA) finalized
a  new  Medicare  Payment  System  to help assure appropriate reimbursements for
quality,  efficient home health care.  On October 1, 2000, Medicare began paying
all  certified  home  health  agencies  under a prospective payment system.  The
change  was  mandated  by  the  Balanced  Budget  Act of 1997 amended by Omnibus
Consolidated  and  Emergency  Supplemental  Appropriations  Act  of 1998 and the
Balanced  Budget  Refinement  Act of 1999.  While the Company is not currently a
Medicare-Certified  Home  Health  Agency  subject  to these changes, most of the
Company's  referral  sources  are  and  they  may be negatively impacted by this
legislation  which  was  adopted  to  control  home  health  care  costs.

     The  New  York  State  Department of Health issues Certificates of Need for
Certified  Home  Health  Agencies ("CHHA's"), which provide post-acute home care
services  for  people  who have just been discharged from a hospital but are not
yet  fully recovered, and Long-Term Home Health Care Programs ("LTHHCP's"), also
known  as the "Nursing Home Without Walls," which is intended to provide elderly
people  with  an alternative for long-term care other than by entering a nursing
home  at  less  than  the  cost of nursing home care. The Company negotiates its
contracts  with  CHHA's and LTHHCP's on the basis of services to be provided, in
connection  with  contracts  either currently in effect with the Company or with
other  agencies.  Prevailing market conditions are such that, despite escalating
operating  expenses, reduced contract rates are regularly "demanded" as a result
of  internal budget restraints and reductions mandated by managed care contracts
between  the  Company's  clients and HMO's and other third party administrators.
While  management  anticipates  that  this  trend  is likely to continue for the
foreseeable  future,  it  does  not  expect  the  impact  on  the  Company to be
significant,  since its rates are competitive and, therefore, are expected to be
subject  to  only  minor reductions. However, as expenditures in the home health
care  market continue to grow, initiatives aimed at reducing the costs of health
care  delivery  at  non-hospital  sites  are increasing. A significant change in
coverage or a reduction in payment rates by third party payers, particularly New
York  State  Medicaid,  would  have a material adverse effect upon the Company's
business.


Quality  Assurance

      The Company has established a total quality management program including a
quality  assurance  program to ensure that its service standards are implemented
and that the objectives of those standards are met. The Company believes that it
has  developed  and implemented service standards that comply with or exceed the
service  standards  required by JCAHO. The Company received "Accreditation" from
JCAHO after its triannual survey in November 1997. In February 1996, the Company
was selected by the University of Colorado Health Sciences Center as one of only
22 home health care agencies participating in a two to three year study known as
the  New York State Outcome-Based Quality Improvement in Home Care Demonstration
project  being  funded  by the New York State Department of Health, by reason of
the  Company's  commitment to both quality assurance and improvement. In January
2000,  the  company renewed it's contract with OBQI for an additional year.  The
Company  believes that its reputation for quality patient care has been and will
continue  to be a significant factor in its success. An adverse determination by
JCAHO  regarding  the  Company  on  any branch office could adversely affect the
Company's  reputation  and  competitive  position.


                                       15
<PAGE>
     In  November  2000, New York Health Care was surveyed by JCAHO and received
accreditiation  of  its  New  York offices for the next three years (expiring in
November  2003).  New York Health Care did not seek JCAHO accreditation for it's
New  Jersey  offices  because  it's not required by any of the contracts in that
state.

     The  Company's  quality  assurance  program  includes  the  following:

     Quality  Advisory  Board.  The  Company  maintains  a Professional Advisory
Board   for  its  branch  offices,  which   consists  of  a  physician,  nursing
professionals  and  representatives  of  branch  management.   The  Professional
Advisory  Board  identifies  problems  and suggests ways to improve patient care
based  on  internal  quality compliance audits and clinical and personnel record
reviews.

     Internal  Quality Compliance Review Process.  Periodic internal reviews are
conducted  by  the  Company's  management  to  ensure  compliance  with  the
documentation  and  operating  procedures required by state law, JCAHO standards
and  internal  standards.  Written  reports  are  forwarded  to  the director of
nursing  and  branch  managers.  The  Company  believes that the internal review
process  is  an effective management tool for the director of nursing and branch
managers.

     Case  Conferences.  Staff  professionals regularly hold case conferences to
review  problem  and  high  risk  cases,  the  physician's treatment and Company
services  provided  for  such cases in order to ensure appropriate, safe patient
care  and  to  evaluate  patient  progress  and  plans  for  future  care.

     Clinical  Record Review.  Clinical record review is the periodic evaluation
of  the  documentation in patient clinical records.  In this review process, the
Company  evaluates  the performance of the nursing services staff to ensure that
professional  and  patient  care  policies are followed in providing appropriate
care  and  that  the  needs  of  patients are being met.  Clinical record review
findings  are  documented  and reviewed by the applicable Quality Advisory Board
for  recommendations.


Sales  and  Marketing

     The  Company's  executive  officers,  Jerry  Braun and Jacob Rosenberg, are
principally responsible for the marketing of the Company's services. Each branch
office  director is also responsible for sales activities in the branch office's
local  market  area.  The  Company  attempts  to  cultivate  strong,  long-term
relationships  with  referral sources through high quality service and education
of local health care personnel about the appropriate role of home health care in
the  clinical  management  of  patients.


Government  Regulation

     The federal government and the States of New York and New Jersey, where the
Company currently operates, regulates various aspects of the Company's business.
Changes  in  the law or new interpretations of existing laws can have a material
effect  on  permissible activities of the Company, the relative costs associated
with  doing  business  and  the  amount of reimbursement by government and other
third-party  payers.


                                       16
<PAGE>
     The  Company  is licensed by New York State as a home care services agency.
The  state  requires  approval  by  the  New  York  State  Public Health Council
("Council")  of  any  change  in  "the  controlling  person" of an operator of a
licensed  home care services agency ("LHCSA").  Control of an entity is presumed
to  exist if any person owns, controls or holds the power to vote 10% or more of
the  voting securities of the LHCSA.  A person seeking approval as a controlling
person of a LHCSA, or of an entity that is the operator of a LHCSA, must file an
application  for  Council approval within 30 days of becoming controlling person
and,  pending a decision by the Council, such person may not exercise control of
the  LHCSA.  If any person should become the owner or holder, or acquire control
of  or  the right to vote 10% or more of the issued and outstanding Common Stock
of  the  Company,  such person could not exercise control of the Company's LHCSA
until  an  application  for  approval of such ownership, control or holding, has
been submitted to the Council and approved.  In the event such an application is
not  approved, such owner or holder may be required to reduce their ownership or
holding  to  less than 10% of the Company's issued and outstanding Common Stock.

     The  Company is also subject to federal and state laws prohibiting payments
for  patient  referrals  and  regulating  reimbursement procedures and practices
under  Medicare, Medicaid and state programs.  The federal Medicare and Medicaid
legislation  contains  anti-kickback provisions, which prohibit any remuneration
in  return  for the referral of Medicare and Medicaid patients.  Courts have, to
date,  interpreted  these  anti-kickbacks  laws  to  apply  to  a broad range of
financial relationships.  Violations of these provisions may result in civil and
criminal  penalties,  including fines of up to $15,000 for each separate service
billed  to Medicare in violation of the anti-kickback provisions, exclusion from
participation  in  the  Medicare  and state health programs such as Medicaid and
imprisonment  for  up  to  five  years.

     The  Company's healthcare operations potentially subject it to the Medicare
and  Medicaid  anti-kickback  provisions  of  the  Social  Security  Act.  These
provisions  are broadly worded and often vague, and the future interpretation of
these  provisions  and their applicability to the Company's operations cannot be
fully predicted with certainty.  There can be no assurance that the Company will
be  able  to  arrange its acquisitions or business relationships so as to comply
with  these  laws or that the Company's present or future operations will not be
accused  of violating', or be determined to have violated, such provisions.  Any
such  result  could  have  a  material  adverse  effect  on  the  Company.

     Various Federal and state laws regulate the relationship among providers of
healthcare  services,  including employment or service contracts, and investment
relationships.  These laws include the broadly worded fraud and abuse provisions
of  the  Social  Security  Act  that are applicable to the Medicare and Medicaid
programs,  which  prohibit  various  transactions involving Medicare or Medicaid
covered  patients  or  services.  Among  other things, these provisions restrict
referrals  for certain designated health services by physicians to entities with
which  the physician or the physician's immediate family member has a "financial
relationship"  and  the  receipt  of remuneration by anyone in return for, or to
induce,  the  referral  of  a  patient  for  treatment  or purchasing or leasing
equipment  or  services  that  are paid for, in whole or in part, by Medicare or
Medicaid.  Violations  of  these  provisions  may  result  in  civil or criminal
penalties for individuals or entities and/or exclusion from participation in the
Medicare  and  Medicaid programs.  The future interpretation of these provisions
and  their  applicability  to the Company's operations cannot be fully predicted
with  certainty.


                                       17
<PAGE>
     In  May  1991,  the  United  States Department of Health and Human Services
adopted  regulations  creating  certain "safe harbors" from federal criminal and
civil  penalties  by  identifying  certain types of joint venture and management
arrangements  that  would  not be treated as violating the federal anti-kickback
laws  relating  to  referrals  of patients for services paid by the Medicare and
Medicaid programs.  It is not possible to accurately predict the ultimate impact
of  these  regulations  on  the  Company's  business.

     New  York  and  other states also have statutes and regulations prohibiting
payments  for  patient  referrals and other types of financial arrangements with
health  care  providers  which,  while  similar  in many respects to the federal
legislation,  vary  from  state  to state, are often vague and have infrequently
been  interpreted  by courts or regulatory agencies.  Sanctions for violation of
these  state  restrictions  may include loss of licensure and civil and criminal
penalties.  In  addition,  the  professional  conduct of physicians is regulated
under  state  law.  Under  New  York  law,  it  is  unprofessional conduct for a
physician to receive, directly or indirectly, any fee or other consideration for
the  referral  of  a  patient.  Finally,  under New York law, a physician with a
financial  interest  in a health care provider must disclose such information to
the  patients  and  advise  them  of  alternative  providers.

     The  Company believes that the foregoing arrangements in particular and its
operations  in  general  comply in all material respects with applicable federal
and  state  laws relating to anti-kickbacks, and that it will be able to arrange
its  future  business  relationships  so  as  to comply with the fraud and abuse
provisions.

     Management  believes  that the trend of federal and state legislation is to
subject  the  home  health  care  and  nursing  services  industry  to  greater
regulation,  particularly  in  connection  with  third-party  reimbursement  and
arrangements  designed  to  induce  or  encourage  the referral of patients to a
particular  provider  of  medical  services.  The  Company  is  attempting to be
responsive  to  such  regulatory  climate.  However,  the  Company  is unable to
accurately  predict  the  effect,  if  any,  of  such  regulations  or increased
enforcement  activities  on  the  Company's  future  results  of  operations.

     In  addition,  the Company is subject to laws and regulations, which relate
to  business  corporations  in  general,  including antitrust laws, occupational
health and safety laws and environmental laws (which relate, among other things,
to  the  disposal,  transportation  and  handling  of  hazardous  and infectious
wastes).  None  of  these laws and regulations has had a material adverse effect
on  the  Company's  business  or  competitive  position  or  required  material
expenditures on the part of the Company, although no assurance can be given that
such  will  continue  to  be  the  case  in  the  future.

     The Company is unable to accurately predict what additional legislation, if
any,  may  be  enacted  in  the future relating to the Company's business or the
health  care  industry,  including third-party reimbursement, or what effect any
such  legislation  may  have  on  the  Company.

     The  Company has never been denied any license it has sought to obtain. The
Company  believes  that its operations are in material compliance with all state
and  federal  regulations  and  licensing  requirements.


                                       18
<PAGE>
Competition

     The  home  health  care  market  is  highly  fragmented  and  significant
competitors  are  often  localized  in  particular  geographical  markets.  The
Company's  largest  competitors include Gentiva Health Services, Premiere Health
Services,  National  Home Health Care, Star Multicare, Inc., Patient Care, Inc.,
and  Personal  Touch  Home Care Services, Inc.  The home health care business is
marked  by  low  entry  costs.  The  Company believes that, given the increasing
level  of demand for nursing services, significant additional competition can be
expected to develop in the future.  Some of the companies with which the Company
presently  competes in home health care have substantially greater financial and
human  resources  than  the  Company.  The Company also competes with many other
small  temporary  medical  staffing  agencies.

     The  home  infusion  therapy  market  is highly competitive and the Company
expects that the competition will intensify.  As the Company seeks to expand its
provision  of  infusion therapy services, it will compete with a large number of
companies  and  programs in the areas in which its facilities are located.  Many
of  these  are  local  operations  servicing a single area; however, there are a
number  of  large  national  and  regional  companies,  including Gentiva Health
Services,  Coram  Health  Care  Corp.,  and  Staff  Builders, Inc.  In addition,
certain  hospitals,  clinics  and  physicians,  who  traditionally may have been
referral  sources  for  the  Company,  have entered or may enter the market with
local  programs.

     The Company believes that the principal competitive factors in its industry
are  quality  of  care,  including  responsiveness  of  services  and quality of
professional  personnel;  breadth  of  therapies  and  nursing services offered;
successful  referrals  from  referring Government agencies, hospitals and health
maintenance  organizations;  general  reputation with physicians, other referral
sources  and  potential  patients;  and  price.  The  Company  believes that its
competitive  strengths  have  been  the quality, responsiveness, flexibility and
breadth  of  services and staff it offers, and to some extent price competition,
as  well  as  its  reputation  with  physicians,  referral sources and patients.

     The  United  States  health  care  industry  generally  faces a shortage of
qualified  personnel.  Accordingly,  the Company experiences intense competition
from  other companies in recruiting qualified health care personnel for its home
health  care  operations.  The  Company's  success  to  date  has depended, to a
significant  degree,  on its ability to recruit and retain qualified health care
personnel.  Most  of  the  registered  and  licensed  nurses  and  health  care
paraprofessionals  who are employed by the Company are also registered with, and
may  accept  placements  from  time to time through, competitors of the Company.
The  Company  believes  it  is  able  to  compete  successfully  for nursing and
paraprofessional  personnel  by  aggressive  recruitment  through  newspaper
advertisements,  work  fairs/job  fairs, flexible work schedules and competitive
compensation arrangements.  There can be no assurance, however, that the Company
will  be  able  to  continue  to  attract  and  retain qualified personnel.  The
inability  to  either  attract  or  retain such qualified personnel would have a
material  adverse  effect  on  the  Company's  business.


Employees

     On  January  26,  2001,  the  Company  had 1,295 employees, of whom 102 are
salaried,  including  2  executive  officers,  1  vice  president  of  clinical
operations,  20  administrators/branch managers, 17 nurses, 10 accounting staff,
14 clerical staff and 38 field staff supervisors.  The remaining 1,193 employees
are  paid  on  an  hourly basis and consist of professional and paraprofessional
employees.  None  of  the  Company's employees are compensated on an independent
contractor  basis.  None  of  the Company's employees are represented by a labor
union.  The  Company  believes  that  its  employee  relations  are  good.


                                       19
<PAGE>
Common  Stock

     The Company is authorized to issue up to 50,000,000 shares of Common Stock,
$.01  par  value each.  The holders of Common Stock are entitled to one vote for
each  share  held of record on all matters to be voted on by stockholders. There
is  no  cumulative  voting  with  respect  to the election of directors with the
result that the holders of more than 50% of the shares of Common Stock can elect
all  of  the  directors.  The  holders  of  Common Stock are entitled to receive
dividends  when,  and if declared by the Board of Directors out of funds legally
available therefore.  In the event of the liquidation, dissolution or winding up
of the Company, the holders of Common Stock are entitled to share ratably in all
assets remaining available for distribution to them after payment of liabilities
and  after  provision  has  been  made  for  each class of stock, if any, having
preference  over  the Common Stock, as such, having no conversion, preemptive or
other  subscription rights, and there are no redemption provisions applicable to
the  Common  Stock.  The  Company  currently has outstanding 3,668,730 shares of
Common  Stock.

Preferred  Stock

     The  Board  of  Directors  of  the  Company  is  authorized  to issue up to
2,000,000 shares of preferred stock in one or more series and to fix the rights,
preferences, privileges and restrictions thereof, including the dividend rights,
dividend  rate, conversion rights, voting rights, terms of redemption (including
sinking  fund  provisions), redemption price or prices, liquidations preferences
and  the  number  of  shares constituting any series or the designations of such
series,  without  any  further  vote  or action by the stockholders. It would be
possible for the Board of Directors to issue shares of such preferred stock in a
manner  which  would  make  acquisition of control of the Company, other than as
approved  by  the  Board,  exceedingly  difficult.

     The  Company  currently  has outstanding 590,375 of its Class A Convertible
Preferred Stock, each share of which is convertible into one share of its common
stock.

Transfer  Agent

     Continental  Stock  Transfer  &  Trust  Company, New York, New York, is the
transfer  agent  for  the  shares  of  Common  Stock.


Item  2.     DESCRIPTION  OF  PROPERTIES.

     The  Company's  principal  place  of  business  is  a  one-story commercial
building  of  approximately  6,000  square feet located at 1850 McDonald Avenue,
Brooklyn, New York 11223, which is leased from an unaffiliated person. The lease
is  for  a  period  ending  March 30, 2005.  The rent is $6,084 per month and is
subject  to  annual increases equal to 4% of the total prior year's monthly rent
and  all  increases  in  real  estate  taxes for the original and renewal terms.


                                       20
<PAGE>
     The  table below sets forth certain information with respect to each of the
Company's  existing  branch  and  recruitment office locations, all of which are
leased,  from  non-affiliated  lessors.

<TABLE>
<CAPTION>
                                                              Lease  Terms
                                                              ------------
                                            Approximate
                                    Opening    Square     Expiration     Annual
    Location                          Date    Footage       Date        Rental(l)
    --------                          ----   ---------      ----        ---------
<S>                                   <C>    <C>           <C>          <C>
Kings County (2)
Branch Office
1667 Flatbush Avenue
Brooklyn, NY 11210                    11/95    2,000           4/30/01  $   43,758

Nassau County Office
175 Fulton Avenue
Hempstead, NY 11550                    9/93    1,600          10/31/03  $   24,225

Westchester County Office
6 Gramatan Avenue
Mt. Vernon, NY 10550                  12/96    2,000          10/30/01  $   25,603

Rockland County Office
49 South Main Street
Spring Valley, NY 10977               10/94    1,500           9/30/01  $   20,700

Orange County Office
45 Grand Street
Newburgh, NY 11250                     9/92    1,500           4/30/01  $   11,800

Queens Recruitment Office (3)
91-31 Queens Blvd.
Elmhurst, NY 11373                    11/97      500          10/31/00  $   10,861

Jersey City Office
2780 Kennedy Blvd.
Jersey City, NJ 07306                  5/98    1,000           4/30/01  $   18,200

Budd Lake Office (4)
389 Route 46
Budd Lake, NJ 07828                   12/97    1,700          11/30/01  $   16,000

Shrewsbury Office
167 Avenue at the Commons, Suite 8B
Shrewsbury, NJ 07702                   3/98    1,750           4/30/02  $   26,504

Toms River Office
617 Highway 37 West
Toms River, NJ 08753                   2/98    2,400           5/31/01  $   33,000


                                       21
<PAGE>
Edison Office
629 Amboy Avenue
Edison, NJ 08837                       8/99    1,450           7/31/01  $   19,575

East Orange Office
60 Evergreen Place
East Orange, NJ 07018                  9/97    2,000           8/31/02  $   20,800

Hackensack Office
144 Main Street, Suite 211
Hackensack, NJ 07601                   7/99     1000  (month to month)  $   19,206

Bronx Recruitment Office
2488 Grand Concourse
Bronx, NY  10458                      10/00     1000          10/31/02  $   15,360

<FN>
(1) All of the leases  provide for  additional  rentals based upon  increases in
real estate taxes and other cost escalations.

(2) The Company's Kings County Branch Office occupies two of the three floors of
a commercial  building  owned by 1667 Flatbush  Avenue,  LLC, a New York limited
liability  company owned by the  Company's  current  stockholders.  See "Certain
Relationships  and  Related  Transactions."  The lease is  subject  to a renewal
option  for five  years in favor of the  Company.  The rent is subject to annual
increases  equal to 5% of the total prior  year's  monthly rent for the original
term and all renewal terms of the lease.

(3) The Company did not renew this lease.

(4) The Company has since moved out from the space and is still  responsible for
lease obligations.
</TABLE>


Item  3.     LEGAL  PROCEEDINGS.

     The  Company  is  subject  to  various legal proceedings and claims, either
asserted  or  unasserted,  which arise in the ordinary course of business. While
the  outcome of these claims cannot be predicted with certainty, management does
not  believe that the outcome of any of these legal matters will have a material
adverse  effect  on  the  Company's results of operations or financial position.


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

      At  the  annual shareholders meeting held at the offices of the Company on
December  18,  2000,  the  Company's  shareholders  took  the  following action:

     (1)  elected  the Board of Directors to serve until the next annual meeting
and  until  their  successors  are  elected  and  qualify;


                                       22
<PAGE>
     (2)  ratified  an  amendment  to  the  Company's Performance Incentive Plan
authorizing the reservation of an additional 450,000 shares of the Corporation's
$.01  par value common stock for issuance under that plan after January 1, 2001;

     (3)  ratified  an  amendment  to the Company's Certificate of Incorporation
authorizing  an additional 37,500,000 shares of the Corporation's $.01 par value
common  stock  so that the authorized shares of common stock were increased to a
total  of  50,000,000  shares;  and

     (4)  approved  the  selection  of  M.R.  Weiser  & Co. LLP as the Company's
independent  auditors  for  the  fiscal  year  ending  December  31,  2000.



                                     PART II


Item  5.     MARKET FOR COMPANY'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

     The  Company's  Common  Stock  is  quoted  on  the  National Association of
Securities  Dealers Automated Quotation System ("NASDAQ") SmallCap Market and is
traded on the Boston Stock Exchange. The following table sets forth the range of
the  last  price  on  NASDAQ  for  the  Company's  Common  Stock for the periods
indicated.  Quotations do not necessarily present actual transactions and do not
reflect  related  mark-ups,  mark-downs  or  commissions:

Fiscal 2000     High    Low
-----------     ----    ---

First Quarter    1.75  1.125

Second Quarter  1.313   .625

Third Quarter   1.125    .50

Fourth Quarter  1.031    .25


     At  February  23, 2001, the Company had 104 holders of record and more than
352 beneficial holders of its shares of Common Stock.  On February 26, 2001, the
last  sale  price  of the shares of Common Stock as reported by NASDAQ was $2.25
per  share.

ITEM  6.     MANAGEMENT'S  DISCUSSION  &  ANALYSIS  OF  FINANCIAL  CONDITION AND
             RESULTS  OF  OPERATIONS.


                                       23
<PAGE>
Results  of  Operations:
-----------------------

          Fiscal  year  ended  December  31,  2000  compared
          with  fiscal  year  ended  December  31,  1999.

     Revenues  for  the  year  ended  December  31,  2000  increased  23.6%  to
approximately  $29,384,000  from  approximately  $23,772,000  for the year ended
December  31,  1999.  Most of the increase is attributable to increased hours of
service  provided  under  the  new  HRA  contract  with  the  City  of New York.

     Cost  of professional care of patients for the year ended December 31, 2000
increased  to  approximately  $21,698,000 from approximately $17,165,000 for the
year ended December 31, 1999.  The increase resulted from hiring additional home
health  care  personnel to service the increased business in New York.  The cost
of  professional  care of patients as a percentage of revenues increased 1.6% to
approximately  73.8%  for  the  year  ended December 31, 2000 from approximately
72.2% for prior year ended December 31, 1999.  The increase was primarily caused
by  the  lower  gross  margin  on  the  HRA  contract.

     Selling,  general  and  administrative expenses for the year ended December
31, 2000 increased to approximately $6,478,000 from approximately $6,188,000 for
the year ended December 31, 1999.  The increase resulted primarily from the cost
associated  with  the  increased  revenue.  Selling,  general and administrative
expenses as a percentage of revenue decreased to 22% for the year ended December
31,  2000  from  26%  for  the  year  ended  December  31,  1999.

     Interest  expense  for  the  year ended December 31, 2000 was approximately
$322,000  as  compared to approximately $323,000 for the year ended December 31,
1999.

     The  benefit for federal, state and local taxes for the year ended December
31,  2000  of  $35,000 is the result of the loss for the year as compared to the
benefit  for  taxes  of  $180,000  for  the  year  ended  December  31,  1999.

     Due  to  a decrease in revenue and projected reductions in revenue from the
operations  of  certain offices located in New Jersey, the Company evaluated the
ongoing  value of its intangible assets associated with those acquisitions which
were  made  by  the  Company from December 1997 through February 1999.  Based on
this  evaluation,  the  Company  determined  that  intangible  the assets with a
carrying  amount  of $1,688,134 were impaired.  Accordingly, the Company reduced
the estimated fair value of those intangible assets by $1,487,192 as a charge to
operations.  Estimated fair value was based on the value associated with current
purchases  of  similar  companies  in  the  home  health  care  industry.


                                       24
<PAGE>
     In  view  of  the foregoing, the Company recognized a net loss for the year
ended  December  31, 2000 amounting to approximately $1,195,000 as compared to a
net loss of approximately $236,000 for the year ended December 31, 1999.  If not
for  the  one  time write-off of intangible assets the Company would have had an
approximate  pretax  income  of $223,000 for the year ended December 31, 2000 as
compared to a net loss of approximately $236,000 for the year ended December 31,
1999.


Liquidity  and  Capital  Resources

     The  Company's  liquidity  and  capital  resources  are  generated  through
internally generated funds, cash on hand and amounts available under its line of
credit.  The  Company  has  recently  established  a  new  line of credit with a
lending  institution  for  $4,000,000  that  expires  November  28,  2002.

     As  of  December  31, 2000, approximately $6,621,000 (approximately 76%) of
the Company's total assets consisted of accounts receivable from clients who are
reimbursed  by third-party payers, as compared to $6,365,000 (approximately 62%)
as  of  December  31,  1999,  an increase of 14%.  Such payers generally require
substantial  documentation in order to process claims.  The increase of accounts
receivable from clients who are reimbursed by third-party payers as a percentage
of  total assets is the result of an increase in revenue due to the new contract
with the City of New York and the reduction of total assets due to the write-off
of  $1,487,192  of  intangible  assets.

     Days  Sales  Outstanding ("DSO") is a measure of the average number of days
taken  by  the  Company  to collect its accounts receivable, calculated from the
date  services  are  billed.  For the year ended December 31, 2000 the Company's
DSO  was  84  compared  to  100  for  the  year  ended  December  31, 1999.  The
improvement  of 16 days in DSO is the net effect of combining the New Jersey DSO
(which consist primarily of Medicaid billing) of 49 days with the Home Attendant
program  DSO  (which  consist  primarily of Medicaid billing) of 47 days and New
York's  DSO  of  134  days.

     The Company is actively pursuing potential acquisitions.  Further expansion
of  the  Company's  business may require the Company to incur additional debt or
offer  additional equity if internally generated funds, cash on hand and amounts
available  under  its  bank credit facilities are inadequate to meet such needs.
There  can be no assurance that such additional debt or equity will be available
to  the  Company,  or, if available, will be on terms acceptable to the Company.


Potential  Regulatory  Changes

     There  has  been recent news reports concerning federal budget negotiations
regarding potential changes in the way the Government will reimburse home health
care companies in the future, including the possibility of capitation. While the
Company  is  not  currently  a  Medicare-Certified Home Health Agency subject to
these  changes,  most  of  the  Company's  referral  sources are and they may be
negatively impacted by this legislation which was adopted to control home health
care  costs.  While  it  is  still premature to discern what impact, if any, the
potential  changes  may  have  on  the  Company's  operations,  there  can be no
assurance that future legislation will not result in reduced reimbursement rates
from  referral  sources.


                                       25
<PAGE>
Item  7.     FINANCIAL  STATEMENTS.

     (1)  FINANCIAL  STATEMENTS:

     Report  of  Independent  Certified  Public  Accountants.

     Consolidated  Balance  Sheet  at  December 31, 2000.

     Consolidated Statements of Operations for the Years Ended December 31, 1999
     and 2000.

     Consolidated  Statements  of  Shareholders  Equity  for  the  Years  Ended
     December 31, 1999  and  2000.

     Consolidated Statements of Cash Flows for the Years Ended December 31, 1999
     and  2000.

     Notes  to  consolidated  Financial  Statements.

     (2)  FINANCIAL  STATEMENT  SCHEDULES.

     NONE


                                       26
<PAGE>
                           NEW YORK HEALTH CARE, INC.
                                 AND SUBSIDIARY

                        CONSOLIDATED FINANCIAL STATEMENTS

                               FOR THE YEARS ENDED
                           DECEMBER 31, 1999 AND 2000



                                       27
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


NEW YORK HEALTH CARE, INC.:

  Independent Auditors' Report                                           F-1

  Consolidated Balance Sheet at December 31, 2000                        F-2

  Consolidated Statements of Operations for the Years Ended
    December 31, 1999 and 2000                                           F-3

  Consolidated Statements of Shareholders' Equity for the Years Ended
    December 31, 1999 and 2000                                           F-4

  Consolidated Statements of Cash Flows for the Years Ended
    December 31, 1999 and 2000                                           F-5

  Notes to Consolidated Financial Statements                          F-6 - F-20


<PAGE>
                          INDEPENDENT AUDITORS' REPORT
                          ----------------------------



To  the  Board  of  Directors
New  York  Health  Care,  Inc.

We  have  audited the accompanying consolidated balance sheet of New York Health
Care,  Inc.  and Subsidiary (the "Corporation") as of December 31, 2000, and the
related  consolidated  statements  of  operations, shareholders' equity and cash
flows  for  the  years  ended  December  31,  1999  and  2000.  These  financial
statements  are  the  responsibility  of  the  Corporation's  management.  Our
responsibility  is  to express an opinion on these financial statements based on
our  audits.

We conducted our audits in accordance with auditing standards generally accepted
in  the  United  States  of  America.  Those  standards require that we plan and
perform  the  audit  to  obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test  basis,  evidence  supporting  the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made  by  management,  as well as evaluating the overall
financial  statement  presentation.  We  believe  that  our  audits  provide  a
reasonable  basis  for  our  opinion.

In  our  opinion,  the financial statements referred to above present fairly, in
all material respects, the financial position of New York Health Care, Inc.  and
Subsidiary  as  of  December 31, 2000, and the results of its operations and its
cash  flows  for  the  years ended December 31, 1999 and 2000 in conformity with
accounting  principles  generally  accepted  in  the  United  States of America.



                                            M.R. Weiser & Co. LLP
                                            Certified Public Accountants



New  York,  NY
February 9, 2001


                                       F-1
<PAGE>
                 NEW YORK HEALTH CARE, INC. AND SUBSIDIARY
                       CONSOLIDATED  BALANCE  SHEET
                           DECEMBER  31,  2000

                                A  S  S  E  T  S


Current assets:
  Accounts receivable, net of allowance for uncollectible
    amounts of $173,000                                          $6,518,410
  Unbilled services                                                 102,932
  Prepaid expenses                                                  121,095
  Deferred tax asset                                                 69,000
                                                                 -----------
      Total current assets                                        6,811,437

Property and equipment, net                                         394,681
Deferred tax assets                                                  93,000
Intangibles, net                                                  1,346,977
Deposits                                                             53,808
                                                                 -----------

      Total assets                                               $8,699,903
                                                                 ===========

                    LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
  Bank overdraft                                                 $   85,030
  Accrued payroll                                                 2,127,624
  Line of credit                                                  1,889,392
  Current maturities of long term debt                               83,403
  Current portion of lease obligations payable                       42,824
  Accounts payable and accrued expenses                             595,611
                                                                 -----------
      Total current liabilities                                   4,823,884
                                                                 -----------

Lease obligations payable, less current portion                      34,081
                                                                 -----------

Commitments, contingencies and other comments

Shareholders' equity:
  Preferred stock $.01 par value, 2,000,000 shares authorized;
    590,375 issued                                                    5,904
  Common stock, $.01 par value, 12,500,000 shares authorized;
    3,750,000 shares issued; 3,668,730 outstanding                   37,500
  Additional paid-in capital                                      4,758,414
  Deficit                                                          (869,584)
                                                                 -----------
                                                                  3,932,234
      Less: Treasury stock (81,270 common shares at cost)           (90,296)
                                                                 -----------
      Total shareholders' equity                                  3,841,938
                                                                 -----------

      Total liabilities and shareholders' equity                 $8,699,903
                                                                 ===========

    THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL
                                   STATEMENTS.


                                       F-2
<PAGE>
<TABLE>
<CAPTION>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                      CONSOLIDATED STATEMENTS OF OPERATIONS


                                                         For  The  Years  Ended
                                                              December  31,
                                                       --------------------------
                                                           1999          2000
                                                       ------------  ------------
<S>                                                    <C>           <C>


Net patient service revenue                            $23,772,346   $29,383,547
                                                       ------------  ------------

Expenses:
  Professional care of patients                         17,164,782    21,698,189
  General and administrative                             6,188,011     6,478,140
  Bad debts expense                                        236,000       398,856
  Impairment of goodwill                                               1,487,192
  Depreciation and amortization                            263,392       229,605
                                                       ------------  ------------
    Total operating expenses                            23,852,185    30,291,982
                                                       ------------  ------------

Loss from operations                                       (79,839)     (908,435)
                                                       ------------  ------------

Nonoperating expenses:
  Interest expense                                        (323,100)     (322,046)
                                                       ------------  ------------

Loss before (benefit) provision for income taxes          (402,939)   (1,230,481)
                                                       ------------  ------------

(Benefit) provision for income taxes:
  Current                                                  (89,000)       30,000
  Deferred                                                 (91,000)      (65,000)
                                                       ------------  ------------
                                                          (180,000)      (35,000)
                                                       ------------  ------------

Net loss                                                  (222,939)   (1,195,481)

Dividends paid on preferred stock                           13,500
                                                       ------------  ------------

Net loss applicable to common stock                    $  (236,439)  $(1,195,481)
                                                       ============  ============

Basic and diluted loss per share                       $     (0.06)  $      (.33)
                                                       ============  ============

Basic and diluted weighted average shares outstanding    3,684,685     3,668,730
                                                       ============  ============
</TABLE>

    THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL
                                   STATEMENTS.


                                       F-3
<PAGE>
<TABLE>
<CAPTION>
                                            NEW YORK HEALTH CARE, INC. AND SUBSIDIARY
                                          CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                                          FOR THE YEARS ENDED DECEMBER 31, 1999 AND 2000


                                                         Preferred                     Treasury
                                      Common Stock         Stock        Additional       Stock          Retained
                                  ------------------  ----------------   Paid-In    ----------------    Earnings/
                                   Shares    Amount   Shares   Amount    Capital    Shares   Amount      Deficit        Total
                                  ---------  -------  -------  -------  ----------  ------  ---------  ------------  ------------
<S>                               <C>        <C>      <C>      <C>      <C>         <C>     <C>        <C>           <C>
Balance at January 1, 1999        3,750,000  $37,500  480,000  $ 4,800  $4,659,518  41,970  $(50,924)  $   562,336   $ 5,213,230

Treasury stock purchased during
  January through June ($1.06
  average per share)                                                                19,800   (21,079)                    (21,079)

Treasury stock purchased during
  July through September ($0.97
  average per share)                                                                 9,500    (9,203)                     (9,203)

Treasury stock purchased on
  October 26, 1999 ($.91 per
  share)                                                                            10,000    (9,090)                     (9,090)

Dividends paid on preferred
  stock ($.03 per share)                                                                                   (13,500)      (13,500)

Issuance of preferred stock on
  July 29, 1999 in exchange
  for promissory note ($.91
  per share)                                          110,375    1,104      98,896                                       100,000

Net loss                                                                                                  (222,939)     (222,939)
                                  ---------  -------  -------  -------  ----------  ------  ---------  ------------  ------------

Balance at December 31, 1999      3,750,000   37,500  590,375    5,904   4,758,414  81,270   (90,296)      325,897     5,037,419

Net loss                                                                                                (1,195,481)   (1,195,481)
                                  ---------  -------  -------  -------  ----------  ------  ---------  ------------  ------------

Balance at December 31, 2000      3,750,000  $37,500  590,375  $ 5,904  $4,758,414  81,270  $(90,296)  $  (869,584)  $ 3,841,938
                                  =========  =======  =======  =======  ==========  ======  =========  ============  ============
</TABLE>

    THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL
                                   STATEMENTS.


                                       F-4
<PAGE>
<TABLE>
<CAPTION>
                        NEW YORK HEALTH CARE, INC. AND SUBSIDIARY
                          CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                                  For the Years Ended
                                                                     December  31,
                                                               -------------------------
                                                                  1999          2000
                                                               -----------  ------------
<S>                                                            <C>          <C>

Cash flows from operating activities:
  Net loss                                                     $ (222,939)  $(1,195,481)
  Adjustments to reconcile net loss to net cash
    provided by operating activities:
      Depreciation and amortization                               263,392       229,605
      Bad debts expense                                           236,000       398,856
      Deferred tax credit                                         (74,000)      (65,000)
      Impairment of goodwill                                                  1,487,192
      Changes in operating assets and liabilities:
        Increase in accounts receivable and unbilled services    (584,574)     (655,341)
        Decrease in due from affiliates                             6,475
        Decrease (increase) in prepaid expenses                    27,145        (7,293)
        (Increase) decrease in prepaid income taxes
          and income tax receivable                              (154,906)      154,906
        Increase in deposits                                       (6,874)       (1,082)
        Increase in accrued payroll                               405,218     1,157,449
        Increase in accounts payable and accrued expenses         525,989        11,482
        Decrease in other current liabilities                                  (321,544)
        Decrease in income taxes payable                          (35,215)
                                                               -----------  ------------
          Net cash provided by operating activities               385,711     1,193,749
                                                               -----------  ------------

Cash flows from investing activities:
  Acquisition of fixed assets                                    (123,224)      (38,708)
  Payments for purchase of intangible assets in connection
    with acquisitions                                             (50,700)
                                                               -----------  ------------
          Net cash used in investing activities                  (173,924)      (38,708)
                                                               -----------  ------------

Cash flows from financing activities:
  Borrowings (repayments) under notes payable                     250,000      (376,577)
  Repayment of long-term debt                                    (504,476)     (960,608)
  Bank overdraft                                                                 85,030
  Preferred stock dividends paid                                  (13,500)
  Purchase of treasury stock                                      (39,372)
                                                               -----------  ------------
          Net cash used in financing activities                  (307,348)   (1,252,155)
                                                               -----------  ------------

Net decrease in cash and cash equivalents                         (95,561)      (97,114)

Cash and cash equivalents at beginning of year                    192,675        97,114
                                                               -----------  ------------

Cash and cash equivalents at end of year                       $   97,114   $       -0-
                                                               ===========  ============
</TABLE>

    THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL
                                   STATEMENTS.


                                       F-5
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

     BASIS OF CONSOLIDATION AND THE COMPANY:

     The accompanying  consolidated financial statements include the accounts of
     New York Health Care, Inc.  ("NYHC") and its wholly owned  subsidiary which
     was formed on August 20, 1997, NYHC Newco Paxxon,  Inc. D/B/A Helping Hands
     Healthcare   ("Helping   Hands"),   (the   "Corporation").   All   material
     intercompany   transactions   and   accounts   have  been   eliminated   in
     consolidation.

     The   Corporation    provides    services   of   registered    nurses   and
     paraprofessionals to patients throughout New York and New Jersey.

     On October 4, 2000,  the Board of  Directors  approved  an  increase in the
     number of the Corporation's  authorized Common Stock from 12,500,000 shares
     to a total of 50,000,000  shares.  The required filings with the State were
     approved in February 2001.

     Acquisitions:

     On February 22, 1999,  the  Corporation  purchased  customer list and other
     intangible assets from Staff Builders Service,  Inc. (Shrewbury Office) for
     $65,000.  The purchase  price has been  allocated to furniture and fixtures
     for  $25,000  and  the  remaining  $40,000  to  customer  lists  and  other
     intangibles. On June 11, 1999, the Corporation purchased customer lists and
     other  intangible  assets from Staff Builders  Services,  Inc.  (Hackensack
     Office) for $25,700. The purchase price has been allocated to furniture and
     fixtures for $20,000 and the  remaining  $5,700 to customer  list and other
     intangibles.  On October 23, 1999, the Corporation purchased customer lists
     and other intangible assets from Staff Builders Services,  Inc.  (Manhattan
     Office) for $30,000. The purchase price has been allocated to furniture and
     fixtures for $25,000 and the remaining  $5,000 to customer  lists and other
     intangibles.  Operating results of the businesses have been included in the
     consolidated  financial  statements  of the  Corporation  since the date of
     acquisitions.


                                       F-6
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     ESTIMATES:

     The  preparation  of financial  statements  in  conformity  with  generally
     accepted  accounting  principles  requires management to make estimates and
     assumptions  that affect the reported amounts of assets and liabilities and
     disclosure  of  contingent  assets  and  liabilities  at  the  date  of the
     financial  statements  and the  reported  amounts of revenues  and expenses
     during  the  reporting  period.  Actual  results  could  differ  from those
     estimates.

     REVENUE  RECOGNITION:

     The Corporation recognizes net patient service revenue on the date services
     are rendered. Unbilled services represent amounts due for services rendered
     which were not billed at the end of each period.

     In December 1999, the  Securities  and Exchange  Commission  ("SEC") issued
     Staff  Accounting  Bulletin  No. 101,  "Revenue  Recognition  in  Financial
     Statements"  ("SAB 101"). SAB 101 summarizes  certain of the SEC's views in
     applying generally accepted accounting principles to revenue recognition in
     financial  statements.  SAB 101 is not a rule or interpretation of the SEC,
     however,  it  represents  interpretations  and  practices  followed  by the
     Division of Corporation  Finance and the Office of the Chief  Accountant in
     administering the disclosure  requirements of the Federal  securities laws.
     The Company  believes its revenue  recognition  policies are in  compliance
     with the interpretations outlined in SAB 101.

     PROPERTY,  PLANT  AND  EQUIPMENT:

     Property,  plant and equipment is carried at cost and is being  depreciated
     under the straight-line method over the following estimated useful lives of
     the assets or the life of the lease, whichever is shorter.

          Machinery and equipment        5 years
          Furniture and fixtures         7 years
          Leasehold improvements      Life of lease

     LONG-LIVED  ASSETS:

     The Corporation's  policy is to evaluate  long-lived  assets,  goodwill and
     certain identifiable intangibles for possible impairment whenever events or
     changes in  circumstances  indicate that the carrying amount of such assets
     may not be  recoverable.  This  evaluation is based on a number of factors,
     including  expectations for operating  income and  undiscounted  cash flows
     that will result from the use of such assets.


                                       F-7
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     INCOME  TAXES:

     The Corporation uses the asset and liability  method to calculate  deferred
     tax assets and  liabilities.  Deferred  taxes are  recognized  based on the
     differences  between financial reporting and income tax bases of assets and
     liabilities  using  enacted  income  tax  rates.  Deferred  tax  assets and
     liabilities are measured using enacted tax rates in effect for the years in
     which those temporary  differences are expected to be recovered or settled.
     The effect on deferred tax assets and  liabilities of a change in tax rates
     is recognized in income in the period that includes the enactment date.

     CASH  EQUIVALENTS:

     For purposes of the statements of cash flows, the Corporation considers all
     highly  liquid  investments  with  maturities  of three months or less when
     purchased to be cash equivalents.

     STOCK  BASED  COMPENSATION:

     The Corporation  applies SFAS 123 "Accounting for Stock Based Compensation"
     in accounting for its stock based  compensation  plan and other stock based
     compensation  arrangements.  As  permitted  by SFAS  123,  the  Corporation
     applies   Accounting   Principles   Board   Opinion   No.  25  and  related
     interpretations for expense recognition.

     EARNINGS  (LOSS)  PER  SHARE:

     Basic  earnings  (loss) per share  excludes  dilution  and is  computed  by
     dividing income  available to common  shareholders by the weighted  average
     number of common shares outstanding for the period.

     Diluted  earnings (loss) per share is computed by dividing income available
     to common  shareholders  by the weighted  average  number of common  shares
     outstanding  for the  period,  adjusted  to  reflect  potentially  dilutive
     securities  including the presumed  conversion of the Preferred  Stock from
     the date of its  issuance.  Due to a loss in 1999 and  2000,  the  options,
     warrants,   and  Convertible  Preferred  Stock  are  not  included  in  the
     computation of diluted loss per share because the effect would be to reduce
     the loss per share.


                                       F-8
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     OTHER  ACCOUNTING  PRONOUNCEMENTS:

     In June 1999, the Financial  Accounting Standards Board issued Statement of
     Financial   Accounting   Standards  No.  137,  "Accounting  for  Derivative
     Instruments  and Hedging  Activities"  which delayed the effective  date of
     Statement of Financial Accounting Standards No. 133 (SFAS 133), "Accounting
     for Derivative  Instruments and Hedging  Activities" for one year. SFAS 133
     provides  guidance for the  recognition  and measurement of derivatives and
     hedging  activities.  It requires an entity to record,  at fair value,  all
     derivatives as either assets or  liabilities  in the balance sheet,  and it
     establishes specific accounting rules for certain types of hedges. SFAS 133
     is now effective for fiscal years beginning after June 15, 2000 and will be
     adopted by the Corporation  when required.  The Corporation does not expect
     SFAS 133 to have a material effect on the Corporation's financial position,
     results of operations or cash flows for the year ended December 31, 2001.

2.   PROPERTY AND EQUIPMENT:

     Property and equipment consist of the following at December 31, 2000:


              Machinery and equipment                         $393,175
              Furniture and fixtures                           209,796
              Leasehold improvements                           126,703
                                                              --------

                                                               729,674
              Less accumulated depreciation and amortization   334,993
                                                              --------

                                                              $394,681
                                                              ========


     At  December  31,  2000,   the  amounts  shown  above  include   assets  of
     approximately   $160,750   under   capitalized   leases   and   accumulated
     depreciation of approximately $64,300, relating thereto.


                                       F-9
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



3.   IMPAIRMENT OF INTANGIBLE ASSETS:

     Due to a decrease in revenue and projected additional reductions in revenue
     from  the  operations  of  certain  offices  located  in  New  Jersey,  the
     Corporation evaluated the ongoing value of its intangible assets associated
     with those  acquisitions  which were made by the Corporation  from December
     1997  through  1999.  Based  on this  evaluation,  at June  30,  2000,  the
     Corporation has determined that intangible assets with a carrying amount of
     $1,688,134  were  impaired.   Accordingly,   such  amount  was  reduced  by
     $1,487,192 to their estimated fair value by a charge to operations. For the
     year ended December 31, 2000, the impairment charge represented a per-share
     net loss of $.41 both on a basic and diluted  basis.  Estimated  fair value
     was determined based on the management's evaluation of current purchases of
     similar companies in the home health care industry.

4.   INTANGIBLES:

     Intangibles consist of the following at December 31, 2000:

                                                                          Lives
                                                                         -------
            Goodwill                                   $1,396,712       25 years
            Contract value                                 60,217       10 years
            Customer lists                                 38,470       10 years
                                                       ----------
                                                        1,495,399
            Less accumulated amortization                 148,422
                                                       ----------

                                                       $1,346,977
                                                       ==========


5.   LINE OF CREDIT:

     The Corporation has a $4,000,000 line of credit with a lending  institution
     that expires  November 28, 2002. The  availability of the line of credit is
     based on a formula of eligible accounts receivable. All property and assets
     of the Corporation collateralize the line of credit. The agreement contains
     various  restrictive  covenants,  which among other  things,  requires that
     certain  ratios  be  maintained.  At  December  31,  2000,  $1,889,392  was
     outstanding.  Borrowings  under  the  agreement bear interest at prime plus
     2  1/2% (12.0% at December 31, 2000).


                                      F-10
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



6.   LONG-TERM DEBT AND CAPITALIZED LEASES:

     Long-term debt consists of the following at December 31, 2000:

       Capitalized  computer  equipment  lease,  payable  in  equal
         monthly installments of  approximately  $1,100,  including
         principal    and    interest    through   December   2003,
         collateralized    by    computer     equipment     costing
         approximately $51,400                                          $ 34,067

       Capitalized  computer  equipment  lease,  payable  in  equal
         monthly installments of  approximately  $2,570,  including
         principal    and    interest    through   November   2001,
         collateralized     by    computer     equipment    costing
         approximately $81,200                                            25,267

       Capitalized phone  system  lease,  payable in equal  monthly
         installments  of  approximately  $600, including principal
         and interest   through  October 2003,  collateralized   by
         the phone system costing approximately $28,150                   17,571

       Note payable in 12 equal quarterly  installments  commencing
         May  1998  of  $48,333,  including principal only, bearing
         interest  at  prime  rate  plus  1% per annum  (10.50%  at
         December 31, 2000)                                               48,334

       Note payable, to a related party,  quarterly installments of
         $35,069  through  January 2001  including  principal only,
         bearing interest at prime rate plus  1% per  annum  (10.5%
         at December 31, 2000).                                           35,069
                                                                        --------
                                                                         160,308
        Less  current  maturities                                        126,227
                                                                        --------

                                                                       $  34,081
                                                                        ========


                                      F-11
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     The following are maturities of long-term debt and capitalized leases:

                                                                  Capital
                                                  Long-term Debt   Leases
                                                  --------------  --------
       2001                                             $83,000   $48,000
       2002                                                        20,000
       2003                                                        19,000
                                                        --------  --------

       Total minimum future payments                     83,000    87,000

       Less amounts representing interest                         (10,000)
                                                        --------  --------

       Present value of net minimum payments            $83,000   $77,000
                                                        ========  ========

     Interest  rates  on  capitalized  leases  vary  from  9.2%  to  11.0%.

7.   INCOME TAXES:

     The  components  of  deferred  tax assets as of  December  31,  2000 are as
     follows:

        Deferred tax assets current:
          Accounts receivable reserve                           $69,000
                                                                ========

        Deferred tax assets non-current:
          Property and equipment                                $(6,000)
          Intangibles                                            99,000
                                                                --------

                                                                $93,000
                                                                ========


     Differences between book and tax are primarily due to temporary differences
     resulting from use of the direct write-off  method for  receivables,  using
     accelerated  methods of  amortization  and  depreciation  for  property and
     equipment,  and using statutory lives for intangibles for tax purposes.  At
     December 31, 2000, the Corporation has computed a deferred tax asset in the
     amount of $483,000  and has  provided a valuation  allowance of $384,000 on
     the deferred tax asset due to the uncertainty  regarding the realization of
     this asset.


                                      F-12
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     The  historical  provision  (benefit)  for income taxes is comprised of the
     following:

                                      1999       2000
                                  ----------  ---------
              Current:
                Federal            $ (69,000)  $(15,000)
                State                (20,000)    45,000
                                   ----------  ---------
                                     (89,000)    30,000
                                   ----------  ---------
              Deferred:
                Federal              (54,600)   (58,500)
                State                (36,400)    (6,500)
                                   ----------  ---------
                                     (91,000)   (65,000)
                                   ----------  ---------

                                   $(180,000)  $(35,000)
                                   ==========  =========

     The statutory Federal income tax rate and the effective rate of the benefit
     for income taxes is reconciled as follows:

                                              1999   2000
                                              -----  -----

    Statutory Federal income tax rate         (34)%  (34)%
    State taxes, net of Federal tax benefit   (10)   (10)
    Valuation allowance                               31
    Other                                             10
                                              -----  -----

                                              (44)%   (3)%
                                              =====  =====

8.   FAIR VALUE OF FINANCIAL INSTRUMENTS:

     As of December  31,  2000,  the  carrying  amount of  accounts  receivable,
     unbilled  services,  accounts  payable  and  accrued  expenses  and accrued
     payroll  approximates fair value due to the short-term  maturities of these
     instruments.

9.   THIRD-PARTY RATE ADJUSTMENTS AND REVENUE AND CERTAIN CONTRACTS:

     Approximately  9% and 7% of net patient  service  revenue was derived under
     New York State  third-party  reimbursement  programs during the years ended
     December 31, 1999 and 2000,  respectively.  These  revenues  are based,  in
     part,  on cost  reimbursement  principles  and are  subject  to  audit  and
     retroactive adjustment by the respective third-party fiscal intermediaries.
     Differences  between  current  rates  and  subsequent   revisions  will  be
     reflected  in the  statement  of  operations  in  the  year  revisions  are
     calculated.


                                      F-13
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     The  Corporation  has an agreement with the City of New York acting through
     the  Department of Social  Services of The Human  Resources  Administration
     ("HRA") to provide personal care services to certain qualified  individuals
     as determined by HRA. Per the agreement with HRA, if the Corporation incurs
     direct costs of home attendant  services below the maximum allowable amount
     per the contract, the Corporation must repay the difference to HRA, subject
     to final  audit by the City of New  York.  As of  December  31,  2000,  the
     Corporation has accrued an amount equivalent to the amount repayable as per
     the requirements of this contract.

10.  PERFORMANCE INCENTIVE PLAN, OPTIONS AND 401(K) PLAN:

     PERFORMANCE  INCENTIVE  PLAN:

     On March  26,  1996,  the  Corporation's  Board of  Directors  adopted  the
     Performance  Incentive Plan,  (the "Option  Plan").  Under the terms of the
     amended  Option  Plan,  1,032,500  shares of common stock may be granted at
     December 31, 2000. On December 18, 2000, the  Corporation  further  amended
     the  Option  Plan  to  provide  for an  additional  450,000  shares  of the
     Corporation's $.01 par value common stock for issuance under the plan after
     January  1,  2001 so that the total  number  of shares  which may be issued
     under the plan  increased from  1,032,500 to 1,482,500  shares.  The Option
     Plan will be administered by the Compensation Committee which was appointed
     by the Board of Directors. The Committee will determine which key employee,
     officer or director on the regular  payroll of the Company,  shall  receive
     stock options.  Granted options are exercisable in either one, two or three
     equal annual installments, at the discretion of the compensation committee,
     commencing  six months after the date of grant,  and expire up to ten years
     after the date of grant.  The exercise price of any incentive  stock option
     or  nonqualified  option granted under the Option Plan may not be less than
     100% of the fair market  value of the shares of common stock of the Company
     at the time of the grant.

     On November  12, 1999,  the  Corporation  granted  200,000  stock  options,
     pursuant to the Option Plan, to key employees at  exercise  prices  ranging
     from $.625 to $.6787 per  share.  The  options  expire in 5-10  years.  The
     exercise  price of these options was not less than the fair market price of
     the Common Stock as of the date of grant.

     On July 10, 2000, the Corporation  granted 400,000 stock options,  pursuant
     to the Option Plan to key employees at exercise prices ranging from $.50 to
     $.55 per share.  The options  expire in 5-10 years.  The exercise  price of
     these  options was not less than the fair market  price of the Common Stock
     as of the date of grant.

     On January 2, 2001, the Corporation granted 430,000 stock options, pursuant
     to the Option Plan, to key employees at an exercise price ranging from $.59
     to $.65 per share.  The options expire in 5-10 years. The exercise price of
     these  options was not less than the fair market  price of the Common Stock
     as of the date of grant.


                                      F-14
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     On March 26,  1996,  the  Corporation  issued an option to purchase  93,750
     shares of Common Stock to the President of the  Corporation  at an exercise
     price of $3.00 per share.  The option may be  exercised at any time through
     March 26, 2006.  These options were not issued under the Option Plan.  None
     of these options have been exercised or cancelled.

     Activity  in stock  options,  and  warrants  including  those  outside  the
     Performance Incentive Plan, is summarized as follows:

<TABLE>
<CAPTION>
                                                  Shares Under     Weighted Average
                                                Options/Warrants    Exercise Price
                                                -----------------  -----------------
<S>                                             <C>                <C>
    Balance at December 31, 1998                         651,250           $    2.34

    Options and warrants granted                         220,000                 .65
    Options cancelled                                    (25,500)               1.22
                                                       ----------          ---------

    Balance at December 31, 1999                         845,750                1.93

    Options and warrants granted                         420,000                 .52
    Options cancelled                                    (16,000)                .98
                                                       ----------          ---------

    Balance at December 31, 2000                       1,249,750           $    1.48
                                                       ==========          =========

    Eligible for exercise at December 31, 2000           829,750           $    1.96
                                                       ==========          =========
</TABLE>

     The  following  table  summarizes  information  about  options and warrants
     outstanding and exercisable at December 31, 2000.

<TABLE>
<CAPTION>
              Options  Outstanding/Warrants                  Options/Warrants Exercisable
             ------------------------------                  ----------------------------
                                                                              Weighted
                               Weighted                                       Average
Range of      Options/         Average          Weighted        Options/      Options/
Exercise      Warrants        Remaining          Average        Warrants      Warrants
Price        Outstanding  Contractual Life   Exercise Price   Exercisable   Exercisable
-----------  -----------  -----------------  ---------------  ------------  ------------
<S>          <C>          <C>                <C>              <C>           <C>
$5.20            125,000      1.00 year          $ 5.20          125,000       $ 5.20
$3.00             93,750      6.25 years           3.00           93,750         3.00
$1.63-$1.79      230,000      5.61 years           1.70          230,000         1.70
$.94-$1.03       161,000      5.83 years            .98          161,000          .98
$.63-$.69        220,000      6.27 years            .65          220,000          .65
$.50-$.55        400,000      7.50 years            .53
$.50              20,000      5.00 years            .50
             -----------                                         -------

               1,249,750      5.95 years         $ 1.48          829,750       $ 1.96
             ===========                         ======          =======       ======
</TABLE>


                                      F-15
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     The Corporation does not recognize  compensation  expense for stock options
     granted at or above fair  market  value,  as  permitted  by the  accounting
     standards.  The fair  value of  options  granted  during  1999 and 2000 was
     $112,000 and $213,400,  respectively.  Fair value is estimated based on the
     Black-Scholes  option-pricing  model  with the  following  assumptions  for
     grants in 1999 and 2000:  expected  volatility  of 90% and 161%;  risk-free
     interest  rates of 4.77% in 1999 and  5.85% in 2000 and  expected  lives of
     approximately  8 years for the year  ended  1999 and 7.5 years for the year
     ended 2000.  Had  compensation  expense been  determined  based on the fair
     value of the options on the grant dates, the  Corporation's  net loss would
     have been  increased by $112,000  ($.03 per share) in 1999 and its net loss
     would have been increased by $213,400 ($.06 per share) in 2000.

     401(K) PLAN:

     NYHC  maintains an Internal  Revenue Code Section  401(k)  salary  deferred
     savings plan (the "Plan") for eligible employees who have been employed for
     at  least  one year and are at least  21  years  old.  Subject  to  certain
     limitations,  the Plan allows participants to voluntarily  contribute up to
     15% of their pay on a pretax basis. The Corporation  currently  contributes
     50% of each dollar  contributed to the Plan by participants up to a maximum
     of 6% of the  participants  salary.  The Plan  also  provides  for  certain
     discretionary  contributions  by the Corporation as determined by the Board
     of  Directors.  The  Corporation's  contributions  amounted  to $63,000 and
     $56,000 for the years ended December 31, 1999 and 2000, respectively.

11.  COMMITMENTS, CONTINGENCIES AND OTHER COMMENTS:

     LEASE  COMMITMENTS:

     The Corporation leases office space under  noncancellable  operating leases
     in New York and New Jersey that expire between April 2001 and October 2003.

     At December 31, 2000,  future  minimum lease  payments due under  operating
     leases approximate:

              2001                                         $242,000
              2002                                          136,000
              2003                                           99,000
              2004                                           82,000
              Thereafter                                     21,000
                                                           --------

              Total minimum future payments                $580,000
                                                           ========


                                      F-16
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     Rental  expense  charged  to  operations  was  approximately  $343,000  and
     $356,000 for the years ended December 31, 1999 and 2000, respectively.

     EMPLOYMENT  AGREEMENTS:

     On November 10, 1999, the Corporation  entered into  employment  agreements
     with two officers, with terms beginning December 27, 1999 expiring in 2004.
     The  agreements  call  for an  initial  aggregate  annual  compensation  of
     approximately  $420,000  with an annual  increase  of 10% and  provide  for
     certain  additional  benefits.  On February 1, 2001, the Board of Directors
     approved a bonus of $100,000 to be paid to the two  officers,  for the year
     ended  December 31,  2000;  such amount has been accrued as of December 31,
     2000.

     BONUS  PLAN:

     The  Corporation  has established a bonus plan pursuant to which 10% of the
     Corporation's  pre-tax net income is  contributed  to a bonus pool which is
     available  for  distribution  to  all  employees  as  decided  upon  by the
     Corporation's  Compensation Committee.  There was no bonus accrual for 1999
     and 2000 due to a net loss for the years.

     CONCENTRATIONS  OF  CREDIT  RISK:

     Financial   instruments  which  potentially   subject  the  Corporation  to
     concentrations  of credit risk consist of temporary cash investments  which
     from  time-to-time  exceed the Federal  depository  insurance  coverage and
     commercial  accounts  receivable.   The  Corporation  has  cash  investment
     policies  that  restrict   placement  of  these  investments  to  financial
     institutions  evaluated as highly  creditworthy.  Cash and cash equivalents
     exceeding  federally insured limits  approximated  $302,000 at December 31,
     2000. The Corporation  does not require  collateral on commercial  accounts
     receivable   as  the   customer   base   generally   consists   of   large,
     well-established institutions.

     MAJOR  CUSTOMERS:

     Two major customers  accounted for approximately 42% and 53% of net patient
     service   revenue  for  the  years  ended   December  31,  1999  and  2000,
     respectively. In addition, the Corporation has two customers whose accounts
     receivable  balance represent  approximately 35% of accounts  receivable at
     December 31, 2000.


                                      F-17
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     BUSINESS  RISKS:

     Certain factors relating to the industry in which the Corporation  operates
     and  the  Corporation's  business  should  be  carefully  considered.   The
     Company's primary business,  offering home health care services, is heavily
     regulated at both the federal and state levels.  While the  Corporation  is
     unable to predict  what  regulatory  changes may occur or the impact on the
     Corporation  of any particular  change,  the  Corporation's  operations and
     financial results could be negatively affected.

     Further,  the Corporation  operates in a highly competitive  industry which
     may limit the  Corporation's  ability to price its  services at levels that
     the  Corporation  believes  appropriate.   These  competitive  factors  may
     adversely affect the Corporation's financial results.

12.  RELATED PARTY TRANSACTION:

     The Corporation leases one of its offices from an affiliated  company.  The
     lease expires on April 30, 2001.  Rent expense for the years ended December
     31,  1999  and  2000  amounted  to   approximately   $42,000  and  $44,000,
     respectively.

13.  SHAREHOLDERS' EQUITY:

     PREFERRED  STOCK:

     On August 6, 1998,  the Board of  Directors  created a series of  Preferred
     Stock to  consist  initially  of  480,000  shares  of  Class A  Convertible
     Preferred  Stock.  On July 29, 1999,  the Board of Directors  authorized an
     increase  in the number of shares of Class A  Convertible  Preferred  Stock
     from  480,000 to  590,375.  The  holders of the  Preferred  Stock  shall be
     entitled to a dividend  equal to 9% of the purchase price for shares of the
     Preferred Stock before any dividend is paid on Common Stock.  Dividends may
     be  declared  quarterly  at  the  discretion  of  the  Board  of  Directors
     commencing with the first calendar  quarter of 1999 and are not cumulative.
     The holders of Preferred  Stock receive no preference  on  liquidation  and
     such shares may be converted into one share of Common Stock at any time.

     On August 6, 1998,  Heart to Heart Care Services,  Inc. ("Heart to Heart"),
     which  was the  holder  of the  Corporation's  promissory  note in the face
     amount of  $1,150,000,  and  bearing  interest at the rate of prime plus 1%
     (9%),  converted  $600,000 of the principal  amount of that promissory note
     into 480,000 shares of Class A Stock. The Class A Stock may be converted at
     a  conversion  price of $1.25 per share,  into shares of the  Corporation's
     $.01 par value Common  Stock at any time.  Heart to Heart is owned by Jerry
     Braun, Jacob Rosenberg,  Samson Soroka,  Hirsch Chitrik and Sid Borenstein.
     Messrs. Braun, Rosenberg,  Chitrik and Borenstein are officers or directors
     of  the  Corporation  and  together  with  Mr.  Soroka  are  all  principal
     shareholders.  The Corporation  therefore  obtained an independent  opinion
     that  the  terms  and  conditions  of  the  transaction   were,  under  the
     circumstances, fair to the Corporation.


                                      F-18
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     On March 31,  1999,  the  Corporation  declared  a dividend  (amounting  to
     $13,500), to holders of preferred stock, which was paid in April 1999.

     On July 29, 1999, Heart to Heart,  which was still then owed  approximately
     $360,000  under the terms of the  promissory  note,  converted  $100,000 of
     principal amount into 110,375 shares of the Corporation's  Class A stock at
     a conversion price of $.91 per share, each share of which is convertible at
     any time into shares of the Corporation's  $.01 par value Common Stock. The
     remaining  balance under the promissory  note is payable,  with interest at
     prime plus 1% (10.5% at December 31, 2000), in quarterly installments until
     January 2001, which was paid in full during January 2001.

     WARRANTS:

     In connection with the initial public offering of the Corporation's  Common
     Stock,  the  underwriter  acquired  for nominal  consideration  warrants to
     purchase an aggregate of 125,000  shares of Common Stock.  The warrants are
     exercisable  at a price of $5.20 for a period of four years  commencing one
     year from December 20, 1996.  These  warrants  grant to the holder  certain
     "piggyback"  registration  rights for a period of seven years from December
     20, 1997, and demand  registration  rights for a period of seven years from
     December 20, 1996 with respect to the registration under the Securities Act
     of the securities issuable upon the exercise of the warrants.

     On November 12, 1999,  the  Corporation  granted two of its board members a
     warrant for each to purchase up to 10,000  shares of Common  Stock at $.625
     per share during a period  commencing May 12, 2000 and concluding  November
     12, 2004.

     On December 18, 2000,  the  Corporation  granted two of its board members a
     warrant for each to purchase  up to 10,000  shares of Common  Stock at $.50
     per share during a period commencing June 18, 2001 and concluding  December
     18, 2005.

     TREASURY  STOCK:

     During 1999, the  Corporation  purchased  39,300 shares of Common Stock for
     the treasury at a cost of $39,372. As of December 31, 2000, the Corporation
     purchased  a total of  81,270  shares of  common  stock  for the  treasury.
     Treasury stock is shown at cost.

     RESERVES:

     The  Corporation  has reserved an  aggregate of 1,577,500  shares of Common
     Stock for the exercise of options under the Option Plan referred to in Note
     10 and warrants.


                                      F-19
<PAGE>
                    NEW YORK HEALTH CARE, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



14.  SUPPLEMENTAL CASH FLOW DISCLOSURES:

                                                         For the Years Ended
                                                           December  31,
                                                         ------------------
                                                           1999      2000
                                                         --------  --------

         Cash paid during the year for:
           Interest                                      $329,583  $350,105
                                                         ========  ========

           Income taxes                                  $184,195  $  7,133
                                                         ========  ========

         Supplemental schedule of noncash investing and
           financing activities:
             The Corporation issued preferred stock
               in exchange for a promissory note         $100,000
                                                         ========


                                      F-20
<PAGE>
Item  8.     CHANGES  IN  DISAGREEMENTS  WITH  ACCOUNTANTS  ON
             ACCOUNTING  AND  FINANCIAL  DISCLOSURES.

             NONE




                                    PART III


Item  9.     DIRECTORS  AND  EXECUTIVE  OFFICERS  OF  THE  COMPANY;
             COMPLIANCE WITH SECTION  16(a) OF  THE  EXCHANGE  ACT.


The  executive  officers  and  directors  of  the  Company  are  as  follows:


Name                 Age                     Position
----                 ---                     --------

Jerry Braun          44          President, Chief Executive Officer and Director

Jacob Rosenberg      43          Vice President, Chief Operating Officer,
                                 Chief Financial and Accounting Officer,
                                 Secretary and Director

Hirsch Chitrik       72          Director

Sid Borenstein       47          Director

H. Gene Berger       60          Director

Charles J. Pendola   55          Director

     Jerry  Braun  has  been  the  President,  Chief Executive Officer and Chief
Operating  Officer  of  the  Company  since  its  inception  in  1983.

     Jacob  Rosenberg,  has  been  Secretary  and a Director since the Company's
inception in 1983, and Vice President and Chief Operating Officer since February
1995.  Jacob Rosenberg is currently acting as the Chief Financial and Accounting
Officer  for  the  Company.

     Hirsch Chitrik has been a Director of the Company since May 1995.  For more
than  the  last five years, Mr.  Chitrik has been the President of Citra Trading
Corporation,  a  privately-held  company  in  New  York  engaged  in the jewelry
business.


                                       28
<PAGE>
     Sid Borenstein has been a Director of the Company since May 1995.  For more
than  the  last  five years, Mr.  Borenstein, a Certified Public Accountant, has
been  a  General  Partner in Sid Borenstein & Co., CPA's, in Brooklyn, New York.

     H.  Gene  Berger  has  been  a director of the Company since February 1998.
Since  1981  Mr.  Berger  has  been  the  president  of  Jay Isle  Associates, a
consulting firm to the health care industry.  From October 1991 to October 1997,
Mr.  Berger  was  employed  by Transworld Health Care, Inc., which is a regional
provider  of  alternate  site  health care services and products, in a number of
capacities  including  executive  vice  president,  president,  chief  operating
officer  and  chief  executive  officer.

     Charles J. Pendola has been a  director of the Company since February 1998.
Since  March  2000,  Mr.  Pendola  has been employed as President by DLJ Managed
Plans  Corporation,  an  investment  banking  company.  Mr.  Pendola has been an
independent  management  consultant  to various organizations in the health care
industry  since  April 1997.  From August 1996 to March 1997 Mr. Pendola was the
president  and  chief  executive  officer  of  First  Medical  Corporation,  an
international  health  care  management  firm  providing services to health care
networks,  managed  care  organizations  and independent health providers in the
United  States  and  Europe.  From  April 1989 to June 1996, Mr. Pendola was the
president  and  chief  executive  officer  of  Preferred  Health  Network,  a
not-for-profit  corporation  which  managed a  diversified  group of health care
providers  and  health related organizations including five acute care hospitals
and  20  ambulatory care centers.  Mr. Pendola is a certified public accountant.

     Directors  hold  their  offices  until  the  next  annual  meeting  of  the
stockholders  and thereafter  until their  successors have been duly elected and
qualified. Executive officers are elected by the Board of Directors on an annual
basis  and  serve at the direction of the Board.  All of the executive  officers
devote  approximately  90% of their time to the business affairs of the Company.
See  "Certain  Relationships  and  Related  Transactions."

     The  Company's  Board  of  Directors met three times during the fiscal year
ended  December  31,  2000 and also took action in lieu of meetings by executing
unanimous  written  consents.

     The  Company  has an Audit Committee, which was formed in February 1998 and
consists  of  three non-employee directors:  Mr. Borenstein, Mr. Pendola and Mr.
Berger.  The  Audit  Committee  assists  in selecting the independent  auditors,
designating  services  they  are  to  perform  and  maintaining  effective
communications  with  those  auditors.


Employment  Agreements

     On  November  10,  1999, the Company entered into new employment agreements
with  Jerry  Braun  and  Jacob  Rosenberg, each of which is for a term beginning
December  27,  1999  and  ending  December  26,  2004.

     Mr.  Braun's  agreement  provides that he will serve as President and Chief
Executive  Officer  in  consideration of (i) initial annual base compensation of
$232,925;  (ii)  reimbursement  of  authorized  business  expenses  incurred  in
connection  with  the  conduct of the Company's business; (iii) participation in
the  Company's  Bonus  Plan,  401  (k)  Plan and Option Plan; (iv) an automobile
reimbursement  allowance  of  $750 per month toward automobile leasing costs and
payment  of  reimbursement of automobile insurance and maintenance costs; (v) an
allowance  of $5,000 per year towards the cost of life and disability insurance;
(vi)  four  weeks  paid  vacation  and eighteen sick or personal leave days; and
(vii)  an  annual  increase  in  salary  of  10%  for  each  year.


                                       29
<PAGE>
     Mr.  Rosenberg's agreement has the same general terms and conditions as Mr.
Braun's,  except  that  he  will  serve  as  Vice President, Secretary and Chief
Operating  Officer,  and  the  annual  base  compensation  is  $186,340.

     These  new executive employment agreements also provide additional benefits
in  the  event there is a "change of control" of the Company, which is generally
defined as a merger or consolidation of the Company with another corporation, or
the sale of all or substantially all of its assets, or the acquisition of either
a  majority  of the Company's assets or its voting equity stock, or the power to
designate  a  majority of the Company's Board of Directors by persons other than
the  present  shareholders  of  the  Company.  In the event of such a "change of
control,"  the  executives'  unexercised  stock  options will become immediately
vested  and exercisable in full, they will each receive a lump-sum payment equal
to 2.99 times the average of their annual base salary and bonus for the previous
five  years  and  the  Company will pay the cost to either maintain the lease or
transfer  the  ownership  of  the  automobile for which the Company has paid the
leasing  costs  for  the  executive.  The  Company  has also agreed that, to the
extent  any  payments  received  by  an  executive from the Company subjects the
executive  to  an excise tax under Section 499 of the Internal Revenue Code, the
Company  will  make an additional payment to the executive so that net after-tax
compensation  is  not  reduced  by  the  excise  tax.  All  "change  of control"
compensation  is  limited, to the extent it may qualify as a "parachute payment"
under  Section 280G of the Internal Revenue Code, to the maximum amount that may
be  paid to that executive without any part of that compensation being deemed to
be an "excess parachute payment." That maximum amount is generally determined by
multiplying  the average of the executive's annual base salary and bonus for the
previous  five  years  by  a  factor  of  three.

     Mr.  Braun  and Mr. Rosenberg also participate, together with all employees
of  the  Company,  in a bonus plan pursuant to which 10% of the Company's annual
pre-tax net income is contributed to the bonus pool which is distributed to such
persons  and  in  such  amounts  as  decided  upon by the Company's Compensation
Committee.

SECTION  16(A)  BENEFICIAL  OWNERSHIP  REPORTING  COMPLIANCE

     The following directors of the Company were late in filing reports required
by  Section  16(a)  of  the  Securities  Exchange  Act  of  1934:

     Hirsch  Chitrik  was  late  in filing one report concerning one transaction
during  the  Company's  fiscal  year  ended  December 31, 2000.

     H.  Gene  Berger  was  late in filing one report concerning one transaction
during  the  Company's  fiscal  year  ended  December  31,  1998 and two reports
concerning  two transactions during the Company's fiscal year ended December 31,
2000.

     Charles  J.  Pendola  was  late  in  filing  one  report  concerning  one
transaction  during  the  Company's  fiscal year ended December 31, 1998 and two
reports  concerning  two  transactions  during  the  Company's fiscal year ended
December  31, 2000.


                                       30
<PAGE>
Item  10.     EXECUTIVE COMPENSATION


Summary  Compensation  Table
----------------------------

          The  following  table  sets forth, for the fiscal years ended December
31, 1999 and 2000, the cash compensation paid by the Company, as well as certain
other  compensation  paid  with  respect  to those years, to the chief executive
officer  and,  to  the  extent  applicable,  each of the three other most highly
compensated  executive  officers  of the Company in all capacities in which they
served.

<TABLE>
<CAPTION>
                                                Annual  Compensation          Long-Term Compensation
                                                --------------------          ----------------------
                                                                              Awards                    Payouts
                                                                              -------                   -------
Principal Position(1)                                     Other Annual    Restricted       Securities
          -----------                                     ------------    ----------       Underlying   LTIP       All other
                               Year   Salary($) Bonus($)  Compensation($) Stock Awards($)  Options/SARs Payouts(#) Compensation($)
                               -----  --------  --------  --------------- ---------------  ------------ ---------- ---------------
<S>                            <C>   <C>        <C>       <C>                              <C>
Jerry Braun (1)                1999  $ 212,395  $37,000   $    25,081 (1)                  573,750 Shares
  President and Chief          2000  $ 251,290  $     0   $    38,893 (1)
  Executive Officer

Jacob Rosenberg (2)            1999  $ 169,726  $25,000   $    25,314 (2)                  480,000 Shares
  Chief Operating Officer and  2000  $ 210,149  $     0   $    34,839 (2)
  Chief Financial Officer

<FN>
(1)          Includes  $18,343  and  $15,898 of medical insurance premiums paid on behalf of such individual for each of the
        years  ended  2000,  and  1999  respectively,  $15,550  and  $9,184  for  automobile and  automobile-related  costs,
        including insurance,  incurred  on  behalf  of  such individual, respectively, for each of the years ended 2000  and
        1999 and $5,000 in expense  allowance  for  each  of  the  fiscal  years  ended  2000  and  1999.

(2)          Includes  $18,343  and  $15,898 of medical insurance premiums paid on behalf of such individual for each of the
        years ended 2000 and 1999 respectively, $11,496 and $9,416 for automobile and  automobile-related  costs,  including
        insurance, incurred  on  behalf  of  such  individual, respectively,  for  each of the years ended 2000 and 1999 and
        $5,000 in expense allowance  for  each  of  the  fiscal  years  ended  2000  and  1999.
</TABLE>


                                       31
<PAGE>
Directors  Compensation

     The  Company  currently  reimburses  each  non-employee  director for their
expenses  in  connection  with  attending  meetings.

Savings  and  Stock  Option  Plans

401(k)  Plan

     The  Company  maintains  an  Internal  Revenue  Code  Section 401(k) salary
deferral  savings  plan  (the "Plan") for all of its eligible New York employees
who  have  been  employed  for  at  least one year and are at least 21 years old
(effective  July  1,  1996, field staff employees at the Company's Orange County
branch  office in Newburgh, New York ceased being eligible to participate in the
Plan).  Subject  to  certain  limitations,  the  Plan  allows  participants  to
voluntarily  contribute  up  to  15% of their pay on a pre-tax basis.  Under the
Plan,  the  Company  may  make  matching  contributions on behalf of the pre-tax
contributions  made  by  participants.

Stock  Option  Plan

     In  March  1996, the Company's Board of Directors and stockholders approved
and  adopted  the  New  York  Health  Care, Inc. Performance Incentive Plan (the
"Option  Plan") providing for options to purchase up to 262,500 shares of Common
Stock  for  to  key  employees  of  the  Company.

     On  June  25, 1998, the Company's shareholders ratified an amendment to the
Option  Plan  authorizing  the  reservation  of  an additional 210,000 shares of
Common  Stock  for  issuance  under  that plan for each of two additional years,
resulting  in  a  total  of  682,500  shares  in  the  Option  Plan.

     On  July  28, 1999, the Company's shareholders ratified an amendment to the
Option Plan that each stock option granted under the plan, including unexercised
options  outstanding  on the date of the amendment, may be exercisable in either
one,  two  or  three  equal  annual  installments  at  the  discretion  of  the
Compensation  Committee.  The  amendment  also  provided  an  additional 350,000
shares  of common stock for issuance under the Option Plan after January 1, 2000
so  that the total number of shares which may be issued under the plan increased
from  682,500  to  1,032,500  shares.

     On  December  18,  2000  the  Company's  shareholders  further  ratified an
amendment  to the Option Plan to provide for an additional 450,000 shares of the
Corporation's  $.01  par  value  common  stock for issuance under the plan after
January 1, 2001 so that the total number of shares which may be issued under the
plan  increased  from  1,032,500  to  1,482,500  shares.

     To  date, options have been granted under the plan for a total of 1,421,000
shares.  The  Option  Plan is administered by a Compensation Committee appointed
by  the  Board  of  Directors  (the  "Committee"),  which is authorized to grant
incentive stock options and non-qualified stock options to selected employees of
the  Company  and  to  determine  the  participants, the number of options to be
granted  and  other  terms  and  provisions  of  each  option.


                                       32
<PAGE>
     The  exercise  price  of  any incentive stock option or nonqualified option
granted under the Option Plan may not be less than 100% of the fair market value
of  the  shares of Common Stock of the Company at the time of the grant.  In the
case  of  incentive  stock  options  granted  to holders of more than 10% of the
voting power of the Company, the exercise price may not be less than 110% of the
fair  market  value.

     Under  the  terms  of  the  Option  Plan,  the  aggregate fair market value
(determined  at  the time of grant) of shares issuable to any one recipient upon
exercise  of  incentive  stock options exercisable for the first time during any
one  calendar  year  may  not exceed $100,000.  Options granted under the Option
Plan  become  exercisable in whole or in part from time to time as determined by
the  Committee,  but  in  no  event  may  a  stock option granted in conjunction
therewith  be exercisable prior to the expiration of six months from the date of
grant, unless the grantee dies or becomes disabled prior thereto.  Stock options
granted  under  the Option Plan have a maximum term of 10 years from the date of
grant,  except  that  with  respect  to  incentive  stock  options granted to an
employee  who,  at  the  time  of the grant, is a holder of more than 10% of the
voting  power  of the Company,  the stock option shall expire not more than five
years  from the date of the grant.  The option price must be paid in full on the
date  of  exercise  and is payable in cash or in shares of Common Stock having a
fair market value on the date the option is exercised equal to the option price.

     If  a  grantee's  employment  by,  or provision of services to, the Company
shall  be terminated,  the Committee may, in its discretion, permit the exercise
of  stock options for a period not to exceed one year following such termination
of  employment  with respect to incentive  stock options and for a period not to
extend beyond the expiration date with respect to non-qualified options,  except
that no incentive stock option may be exercised after three months following the
grantee's  termination  of  employment,  unless it is due to death or  permanent
disability,  in which case they may be exercised  for a period of up to one year
following  such  termination.


                                       33
<PAGE>
<TABLE>
<CAPTION>
                      Option/SAR Grants in Last Fiscal Year

                                Individual Grants

--------------------------------------------------------------------------------
                  Number of         % of Total
                  Securities        Options/SARs
                  Underlying        Granted to
                  Options/SARs      Employees in    Exercise or    Expiration
Name              Granted           Fiscal Year     Base Price     Date
----------------  ---------------  --------------  --------------  -------------
<S>               <C>              <C>             <C>             <C>
Jerry Braun       100,000 Shares              25%  $    .55/Share  July 10, 2005
                  100,000 Shares              25%  $    .50/Share  July 10, 2010

Jacob Rosenberg   100,000 Shares              25%  $    .55/Share  July 10, 2005
                  100,000 Shares              25%  $    .50/Share  July 10, 2010
--------------------------------------------------------------------------------
</TABLE>


               Aggregated Option/SAR Exercises in Last Fiscal Year
                      and Fiscal Year-End Option/SAR Values

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
                                                       Number of
                                                       Securities       Value of
                                                       Underlying       Unexercised
                                                       Unexercised      In-the-Money
                                                       Options/SARs at  Options/SARs at
                                                       Fiscal Year-End  Fiscal Year-End
                    Shares Acquired                    Exercisable/     Exercisable/
Name                on Exercise       Value  Realized  Unexercisable    Unexercisable
------------------  ----------------  ---------------  ---------------  -----------------
<S>                 <C>               <C>              <C>              <C>
Jerry Braun                                            93,750/0 Shares  $
                                                       55,000/0 Shares  $
                                                       55,000/0 Shares  $          6,875
                                                       35,000/0 Shares  $         25,137
                                                       35,000/0 Shares  $         28,420
                                                       50,000/0 Shares  $         53,125
                                                       50,000/0 Shares  $         56,250
                                                      100,000/0 Shares  $         50,000
                                                      100,000/0 Shares  $         55,000

Jacob Rosenberg                                        55,000/0 Shares                --
                                                       55,000/0 Shares  $          6,875
                                                       35,000/0 Shares  $         25,137
                                                       35,000/0 Shares  $         28,420
                                                       50,000/0 Shares  $         53,125
                                                       50,000/0 Shares  $         56,250
                                                      100,000/0 Shares  $         50,000
                                                      100,000/0 Shares  $         55,000
</TABLE>


                                       34
<PAGE>
     Other than the stock options described in the tables above, the Company has
not  issued  any  options  to  officers  and directors under the Option Plan, or
otherwise, except common stock purchase warrants issued to two outside directors
during  1999  and  2000.

     On  November  12,  1999, the Registrant issued warrants pursuant to warrant
agreements  with  each  of  H.  Gene  Berger  and Charles J.  Pendola, which are
directors  of  the  Registrant.  Each  warrant  provided  that  the holder could
purchase  up to an aggregate of 10,000 shares of the Registrant's $.01 par value
common  stock at an exercise price of $.625 per share at any time commencing May
12,  2000  up  until  November  12,  2004.

     On  December  18,  2000,  the  Company  issued warrants pursuant to warrant
agreements  with  each of H.  Gene Berger and Charles J.  Pendola.  Each warrant
provided  that  the holder could purchase up to an aggregate of 10,000 shares of
the Company's $.01 par value common stock at an exercise price of $.50 per share
at  any  time  commencing  June  18,  2001  up  until  December  18,  2005.

     On  January  2,  2001,  the  Company  issued  warrants  pursuant to warrant
agreements  with  each of H.  Gene Berger and Charles J.  Pendola.  Each warrant
provided  that  the holder could purchase up to an aggregate of 10,000 shares of
the Company's $.01 par value common stock at an exercise price of $.60 per share
at  any  time  commencing  July  2,  2001  up  until  January  2,  2006.

     The Company does not have any other existing stock option or other deferred
compensation  plans,  but  may  adopt  such  plans  in  the  future.


Item  11.     SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL  OWNERS  AND
              MANAGEMENT.

     The  following table sets forth certain information regarding shares of the
Common  Stock  beneficially  owned  as  of February 26, 2001 by (i) each person,
known  to  the  Company, who beneficially owns more than 5% of the Common Stock,
(ii)  each  of the Company's directors and (iii) all officers and directors as a
group:

                                   Shares              Percentage
     Name and Address of           Beneficially        of Stock
     Beneficial Owner              Owned(l)            Outstanding(l)
     -------------------           ------------------  ---------------

     Jerry Braun (2)(9)                    1,615,639           36.19%
     929 East 28th Street
     Brooklyn, NY  11210

     Jacob Rosenberg (3)(9)                  940,096            22.1%
     932 East 29th Street
     Brooklyn, NY  11210


                                       35
<PAGE>
     Samson Soroka(4)                        551,606           14.59%
     1228 East 22nd Street
     Brooklyn, NY  11210

     Hirsch Chitrik(5)                       615,075           16.24%
     1401 President Street
     Brooklyn, NY  11213

     Sid Borenstein(6)                       136,697             3.7%
     1246 East 10th Street
     Brooklyn, NY  11230

     H. Gene Berger (7)(9)                    31,100             .84%
     11 Fenimore Drive
     Scotch Plains, NJ 07076

     Charles J. Pendola(8)(9)                 20,000             .54%
     18 Guild Court
     Plainview, NY 11803-3932

     All officers and directors
     as a group (6 persons)(1)(2)
     (3)(5)(6)(7)(8)(9)                    3,358,607           69.22%


(1)  The shares of Common  Stock owned by each  person or by the group,  and the
     shares included in the total number of shares of Common Stock  outstanding,
     have been  adjusted  in  accordance  with Rule 13d-3  under the  Securities
     Exchange  Act of 1934,  as  amended,  to reflect  the  ownership  of shares
     issuable upon  exercise of  outstanding  options,  warrants or other common
     stock equivalents which are exercisable within 60 days. As provided in such
     Rule,  such shares  issuable to any holder are deemed  outstanding  for the
     purpose of calculating such holder's beneficial ownership but not any other
     holder's beneficial ownership.

(2)  Includes  a total of  573,750  shares of  Common  Stock  issuable  upon the
     exercise of stock options  granted to Mr. Braun and 221,391 shares issuable
     upon the conversion of shares of Class A Convertible Preferred Stock.

(3)  Includes  a total of  480,000  shares of  Common  Stock  issuable  upon the
     exercise of stock  options  granted to Mr.  Rosenberg  and  110,695  shares
     issuable upon the conversion of his shares of Class A Convertible Preferred
     Stock.

(4)  Includes 110,695 shares of Common Stock issuable upon the conversion of Mr.
     Soroka's shares of Class A Convertible Preferred Stock.


                                       36
<PAGE>
(5)  Includes 118,075 shares of Common Stock issuable upon the conversion of Mr.
     Chitrik's shares of Class A Convertible Preferred Stock.

(6)  Includes  29,519 shares of Common Stock issuable upon the conversion of Mr.
     Borenstein's shares of Class A Convertible Preferred Stock.

(7)  Includes 30,000 shares of Common Stock issuable upon the exercise of Common
     Stock Purchase Warrants granted to Mr. Berger.

(8)  Includes  20,000  shares of Common  Stock  issuable  upon the exercise of a
     common stock purchase warrant granted to Mr. Pendola.

(9)  Does not include Options/Warrants that were issued on 1/2/2001 that are not
     exercisable within 60 days of this report. (See "Certain  Transactions" for
     more information.)


Item  12.     CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS.

     Jerry  Braun,  Jacob  Rosenberg,  Samson  Soroka,  Hirsch  Chitrik  and Sid
Borenstein, who are directors of the Company, have been the sole stockholders of
a New Jersey corporation named Heart to Heart Health Care Services, Inc. ("Heart
to  Heart"),  which  began its home health care business in 1995 in northern New
Jersey,  but not in the State of New York, and sold its assets to the Company on
March 26, 1998.  Heart to Heart had net revenues of $1,950,890 in the year ended
December  31,  1997.  Since  its  inception,  Heart  to  Heart  utilized Company
personnel  for  its  administrative  functions  regarding  payroll,  benefits
management  and  data  processing.  The Company and Heart to Heart had a Service
Agreement  pursuant  to  which  the  Company  provided  administrative  services
relating  to  payroll,  benefits  management  and  data processing for which the
Company  was  reimbursed  for  all  expenses  attributable to such operations of
approximately  $15,000  per  year.

     On  March  26, 1998, Helping Hands Healthcare, a wholly-owned subsidiary of
the  Company,  purchased  Heart to Heart's home care business assets (other than
accounts receivable) for a purchase price consisting of a promissory note in the
principal  sum  of  $1,150,000  payable  in  24  equal  quarterly  installments
commencing  June  26,  1998,  which  has  been  paid  in  full.  As  part of the
acquisition transaction, Helping Hands Health Care assumed leasehold obligations
for  the  two  offices  located  in  East  Orange (expiring August 31, 2002) and
Hackensack,  New  Jersey (which expired in May 31, 1998) in the aggregate sum of
$1,815  per  month, together with various equipment leases for items of business
equipment.  Because certain of the directors are principal stockholders of Heart
to  Heart,  the  Company  obtained  an  independent  opinion  that the terms and
conditions  of  the  acquisition  agreement  with Heart to Heart were, under all
circumstances,  fair  to  the  Company.


                                       37
<PAGE>
     On  June  2, 1998, the Company issued stock options pursuant to Option Plan
to  each  of Jerry  Braun,  Jacob  Rosenberg and David  Grossman.  Mr. Braun was
granted  an  Incentive  Stock  Option  to purchase up to an aggregate  of 55,000
shares  of the Company's  Common Stock at an exercise price of $1.7875 per share
at any time up until June 2, 2003 and a  Non-Qualified  Stock Option to purchase
up to an aggregate of 55,000 shares of the Company's Common Stock at an exercise
price  of $1.625 per share at any time up until June 2, 2008.  Mr. Rosenberg was
granted  an  Incentive  Stock  Option  to  purchase up to an aggregate of 55,000
shares of the Company's  Common Stock at an exercise  price of $1.7875 per share
at any time up until June 2, 2003 and a  Non-Qualified  Stock Option to purchase
up to an aggregate of 55,000 shares of the Company's Common Stock at an exercise
price of $1.625  per share at any time up until June 2, 2008.  Mr. Grossman  was
granted an Incentive Stock Option to purchase up to an aggregate of 7,500 shares
of the  Company's  Common Stock at an exercise  price of $1.625 per share at any
time  up  until  June  2,  2008.

     On June 2, 1998, the Company issued warrants pursuant to warrant agreements
with  each  of  H.  Gene  Berger and Charles J.  Pendola.  Each warrant provided
that  the  holder  could  purchase  up  to  an aggregate of 10,000 shares of the
Company's  $.01  par value common stock at an exercise price of $1.625 per share
at any time up until June 1, 2008.  On June 10, 1998, Mr.  Pendola exercised his
warrant  and  purchased  10,000 shares of the $.01 par value common stock of the
Company  for  an  aggregate  purchase  price  of  $16,250.

     On  August  6,  1998, Heart to Heart Health Care Services, Inc.  ("Heart to
Heart") which was the holder of the Company's promissory note in the face amount
of  $1,150,000  bearing interest at the rate of 9% per annum, converted $600,000
of  the  principal  amount  of  that  promissory note into 480,000 shares of the
Company's  newly  authorized Class A Convertible Preferred Stock at a conversion
price  of  $1.25  per share, each share of which is convertible at any time into
shares  of  the Company's Common Stock.  Heart to Heart is owned by Jerry Braun,
Jacob  Rosenberg,  Samson  Soroka,  Hirsch  Chitrik,  and  Sid  Borenstein  (the
"Affiliated  Shareholders")  Mr.  Braun  received  180,000  shares,  Messrs.
Rosenberg and Soroka each received 90,000 shares and Mr. Chitrik received 96,000
shares  and Mr.  Borenstein  received  24,000  shares of such  preferred  stock.
Messrs.  Braun,  Rosenberg,  Chitrik and Borenstein are officers or directors of
the Company and, together with Mr. Soroka, were all principal shareholders.  The
Company  obtained  an independent opinion that the consideration received by the
Company  in the transaction was, under the circumstances,  fair from a financial
point  of  view to  the Company, not including,  the Affiliated Shareholders.

     On  December  23,  1998,  the  Company issued stock options pursuant to the
Option  Plan  to  each  of  Jerry Braun, Jacob Rosenberg and David Grossman, Mr.
Braun  was  granted  an Incentive Stock Option to purchase up to an aggregate of
35,000  shares of the Company's Common Stock at an exercise price of $1.0318 per
share at any time up until December 23, 2003 and a Non-Qualified Stock Option to
purchase up to an aggregate of 35,000 shares of the Company's Common Stock at an
exercise  price  of $.938 per share at any time up until December 23, 2008.  Mr.
Rosenberg  was  granted an Incentive Stock Option to purchase up to an aggregate
of  35,000  shares of the Company's Common Stock at an exercise price of $1.0318
per  share  at  any  time  up  until December 23, 2003 and a Non-Qualified Stock
Option  to  purchase up to an aggregate of 35,000 shares of the Company's Common
Stock  at  an  exercise  price of $.938 per share any time up until December 23,
2008.  Mr.  Grossman  was granted an Incentive Stock Option to purchase up to an
aggregate of 10,000 shares of the Company's Common Stock at an exercise price of
$.938  per  share  at  any  time  up  until  December  23,  2008.


                                       38
<PAGE>
     On  July  29,  1999,  the  Registrant's  Board  of  Directors authorized an
increase  in  the  authorized  shares  of  the  Registrant's Class A Convertible
Preferred Stock (the "Class A Preferred") from 480,000 shares to 590,375 shares.
Immediately  following that authorization, the Company entered an agreement with
Heart  to  Heart  Health  Care  Services,  Inc. ("Heart to Heart"), which is the
holder  of  the  Registrant's  promissory  note (the "Note") in the current face
amount  of  $550,000 currently bearing interest at the rate of 9% per annum, for
the  conversion  of  $100,000  of the principal amount of that Note into 110,375
shares  of  the Registrant's Class A Convertible Preferred Stock at a conversion
price  of  $.906  per share, each share of which is convertible at any time into
shares of the Registrant's $.01 par value common stock.  Heart to Heart is owned
by  Jerry  Braun,  Jacob  Rosenberg,  Samson  Soroka,  Hirsch  Chitrik  and  Sid
Borenstein  (the "Affiliated Shareholders").  Messers. Braun, Rosenberg, Chitrik
and  Borenstien  are  officers or directors of the Registrant and, together with
Mr.  Soroka,  are  all principal shareholders.  The conversion transaction is on
substantially  the same terms as that Registrant and Heart to Heart agreed-to on
August  6,  1998 in which $600,000 of the Note was converted into 480,000 shares
of  the  Class  A Preferred.  The Registrant had obtained an independent opinion
that  the  consideration  received by the Company in that transaction was, under
the  circumstances,  fair  from a financial point of view to the Registrant, not
including  the  Affiliated  Shareholders.

     On  November  12,  1999, the Company entered into new employment agreements
with Jerry Braun and Jacob Rosenberg.  See "Management - Employment Agreements."

     On  November  12,  1999,  the Company granted a warrant for each of H. Gene
Berger and Charles J. Pendola to purchase up to an aggregate of 10,000 shares of
the  Company's  $.01  par  value  common stock at an exercise price of $.625 per
share  at  any  time  commencing  May  12,  2000  up  until  November  11, 2004.

     On  November  12,  1999,  the  Company issued stock options pursuant to the
Option  Plan to each of Jerry Braun and Jacob Rosenberg.  They were each granted
an Incentive Stock Option to purchase up to an aggregate of 50,000 shares of the
Company's  Common  Stock at an exercise price of $.6875 per share at any time up
until  May  11,  2004,  and  a  Non-Qualified  Stock Option to purchase up to an
aggregate of 50,000 shares of the Company's Common Stock at an exercise price of
$.625  per  share  at  any  time  up  until  May  11,  2008.

     On  July  10, 2000, the Company issued stock options pursuant to the Option
Plan  to  Jerry  Braun and Jacob Rosenberg.  They were each granted an Incentive
Stock  Option  to purchase up to an aggregate of 400,000 shares of the Company's
Common  Stock  at  exercised  prices  ranging  from $.50 to $.55 per share.  The
options  expire in 5-10 years.  The exercise price of these options was not less
than  the  fair  market  price  of  the  Common  Stock  as of the date of grant.

     On  December  18,  2000,  the Company granted a warrant to each of H.  Gene
Berger  and  Charles J.  Pendola to purchase up to an aggregate of 10,000 shares
of  the  Company's  $.01 par value common stock at an exercise price of $.50 per
share  at  any  time  commencing  June  18,  2001  up  until  December 18, 2005.


                                       39
<PAGE>
     On January 2, 2001, the Company issued stock options pursuant to the Option
Plan  to  Jerry  Braun and Jacob Rosenberg.  They were each granted an Incentive
Stock  Option  to purchase up to an aggregate of 400,000 shares of the Company's
Common  Stock  at  exercised  prices  ranging from  $.59 to $.65 per share.  The
options  expire in 5-10 years.  The exercise price of these options was not less
than  the  fair  market  price  of  the  Common  Stock  as of the date of grant.

     On January 2, 2001, the Company granted a warrant to each of H. Gene Berger
and  Charles  J.  Pendola to purchase up to an aggregate of 10,000 shares of the
Company's  $.01 par value common stock at an exercise price of $.60 per share at
any  time  commencing  July  2,  2001  up  until  January  2,  2006.

     The  transactions described above involve actual or potential  conflicts of
interest  between the Company and its officers or directors.  In order to reduce
the potential for conflicts of interest between the Company and its officers and
directors,  prior to entering into any transaction in which a potential material
conflict  of  interest  might  exist,  the  Company's  policy  has been and will
continue  to be that the Company does not enter into transactions with officers,
directors  or other  affiliates unless the terms of the transaction are at least
as  favorable  to the Company as those which would have been  obtainable from an
unaffiliated  source.  The  Company  has  no  plans to enter into any additional
transactions which involve actual or potential conflicts of interest between the
Company  and  its  officers  or  directors  and  will  not  enter  into any such
transactions  in  the future without first obtaining an independent opinion with
regard  to  the  fairness to the Company of the terms and conditions of any such
transaction.


Item  13.     EXHIBITS  AND  REPORTS  ON  FORM  8-K.

(a)  Exhibits

Exhibit
Number             Description of Exhibit
---------          ----------------------
1.1                Form of Underwriting Agreement.(1)

2.1                Purchase  and Sale  Agreement  dated  December  7, 1997
                   among  NYHC Newco  Paxxon,  Inc.  and Metro  Healthcare
                   Services, Inc.(2)

2.2                Purchase  and Sale  Agreement  dated  February  8, 1998
                   among  NYHC Newco  Paxxon,  Inc.  and Metro  Healthcare
                   Services, Inc.(3)

2.3                Purchase  and Sale  Agreement  dated  February 25, 1998
                   among  NYHC  Newco  Paxxon,  Inc.  and  Heart  to Heart
                   Healthcare Services, Inc.(3)

3.1                Certificate of Incorporation of the Company.(1)


                                       40
<PAGE>
3.2                Restated    Certificate   of   Incorporation   of   the
                   Company.(1)

3.3                Certificate  of Correction of Restated  Certificate  of
                   Incorporation of New York Health Care, Inc.(1)

3.4                Amendment to the  Certificate  of  Incorporation  filed
                   October 17, 1996.(1)

3.5                By-laws of the Company.(1)

3.6                Amendment to the  Certificate of  Incorporation  of the
                   Company filed December 4, 1996.(1)

3.7                Certificate of Designations,  Rights and Preferences of
                   New  York  Health  Care,   Inc.   Class  A  Convertible
                   Preferred Stock.(5)

4.1                Form  of  certificate   evidencing   shares  of  Common
                   Stock.(1)

4.2                Underwriter's    Warrant    Agreement   and   Form   of
                   Underwriter's Warrant.(1)

10.1               Purchase and Sale Agreement by and between the Company,
                   National  Medical  Homecare,  Inc., Jerry Braun and Sam
                   Soroka dated March 18, 1988.(1)

10.2               Lease for 105 Stevens Avenue, White Plains, New York by
                   and between  the Company and Vincent  Rippa as receiver
                   dated October 30, 1992.(1)

10.3               Lease for 175 Fulton Avenue, Suite 30IA, Hempstead, New
                   York by and  between  and  the  Company  and  Hempstead
                   Associates Limited Partnership dated July 2, 1993.(1)

10.4               Deed for 1667 Flatbush Avenue,  Brooklyn, New York from
                   Tiara  Realty  Co.  to  the  Company  dated  April  22,
                   1994.(1)

10.5               Agreement between Jerry Braun, Jacob Rosenberg,  Samson
                   Soroka,  Hirsch Chitrik, Sid Borenstein and the Company
                   dated March 31, 1988.(1)


                                       41
<PAGE>
10.6               Lease for 49 South Main Street, Spring Valley, New York
                   by and between the Company and Joffe  Management  dated
                   November 1, 1994.(1)

10.7               Agreement  for  Provisions  of  Home  Health  Aide  and
                   Personal  Care  Worker  Services  by  and  between  the
                   Company and Kingsbridge  Heights Health Facilities Long
                   Term  Home  Health  Care  Program  dated   November  2,
                   1994.(1)  10.8 State of New York  Department  of Health
                   Office of Health Systems  Management  Home Care Service
                   Agency  License  for  the  Company  doing  business  in
                   Rockland,  Westchester  and Bronx Counties dated May 8,
                   1995.(1)

10.9               State of New York Department of Health Office of Health
                   Systems Management Home Care Service Agency License for
                   the Company doing business in Dutchess, Orange, Putnam,
                   Sullivan and Ulster Counties dated May 8, 1995.(1)

10.10              State  of New  York  Department  of  Health  Office  of
                   Health  Systems  Management  Home Care  Service  Agency
                   License  for the  Company  doing  business  in  Nassau,
                   Suffolk and Queens Counties dated May 8, 1995.(1)

10.11              State  of New  York  Department  of  Health  Office  of
                   Health  Systems  Management  Home Care  Service  Agency
                   License  for the Company  doing  business in Orange and
                   Rockland Counties dated July 1. 1995.(1)

10.12              Lease Renewal for 45 Grand Street,  Newburgh,  New York
                   by  and  between  the  Company  and   Educational   and
                   Charitable  Foundation of Eastern Orange  County,  Inc.
                   dated July 12, 1995.(1)

10.13              Lease for 91-31 Queens  Boulevard,  Elmhurst,  New York
                   by  and  between  the  Company  and  Expressway  Realty
                   Company dated September 15, 1995.(1)

10.14              Settlement   Agreement  and  General   Release  by  and
                   between the Company and Samson  Soroka dated  September
                   28, 1995.(1)

10.15              Personal  Care  Aide   Agreement  by  and  between  the
                   Company and Nassau County Department of Social Services
                   dated October 18, 1995.(1)


                                       42
<PAGE>
10.16              Lease for 1667 Flatbush Avenue,  Brooklyn,  New York by
                   and between the  Company and 1667  Flatbush  Avenue LLC
                   dated November 1, 1995.(1)

10.17              State  of New  York  Department  of  Health  Office  of
                   Health  Systems  Management  Home Care  Service  Agency
                   License for the Company doing business in Bronx, Kings,
                   New York,  Queens and Richmond  Counties dated December
                   29, 1995.(1)

10.18              Home  Health  Agency   Agreement  by  and  between  the
                   Company and the Center for  Nursing and  Rehabilitation
                   dated January 1, 1996.(1)

10.19              Homemaker and Personal  Care  Agreements by and between
                   the Company and the County of  Rockland  Department  of
                   Social Services dated January 1, 1996.(1)

10.20              Home  Health  Aide/   Personal  Care  Worker   Services
                   Agreement  by and between the Company and Beth  Abraham
                   Hospital dated January 12, 1996.(1)

10.21              Homemaker   Services   Agreement  by  and  between  the
                   Company  and the  Orange  County  Department  of Social
                   Services dated February 16, 1996.(1)

10.22              Personal  Care  Service  Agreement  by and  between the
                   Company  and the  Orange  County  Department  of Social
                   Services dated February 16, 1996.(1)

10.23              Certified  Home Health Agency  Agreement by and between
                   the  Company  and New  York  Methodist  Hospital  dated
                   February 28, 1996.(1)

10.24              Employment  Agreement  by and  between  the Company and
                   Jacob Rosenberg dated March 26, 1996.(1)

10.25              Employment  Agreement  by and  between  the Company and
                   Jerry Braun dated March 26, 1996.(1)

10.26              Stock  Option  Agreement by and between the Company and
                   Jerry Braun dated March 26, 1996.(1)


                                       43
<PAGE>
10.27              Home  Health  Agency   Agreement  by  and  between  the
                   Company and the Mount Sinai Hospital Home Health Agency
                   dated April 1, 1996.(1)

10.28              Absolute,   Unconditional,   Irrevocable   and  Limited
                   Continuing  Guaranty  of Payment by and  between  Jacob
                   Rosenberg  and United  Mizrahi  Bank and Trust  Company
                   dated May 9, 1996.(1)

10.29              Absolute,   Unconditional,   Irrevocable   and  Limited
                   Continuing  Guaranty  of Payment by and  between  Jerry
                   Braun and United  Mizrahi Bank and Trust  Company dated
                   May 9, 1996.(1)

10.30              Continuing  General  Security  Agreement by and between
                   the Company and United  Mizrahi Bank and Trust  Company
                   dated May 9, 1996.(1)

10.31              Agreement  for  the  Purchase  of  Accounts  Receivable
                   between the Company and 1667 Flatbush  Avenue LLC dated
                   July 8, 1996.(1)

10.32               401 (k) Plan for the Company.(1)

10.33               Performance Incentive Plan for the Company.(1)

10.34              Services  Agreement  between  the  Company and Heart to
                   Heart  Health Care  Services,  Inc.,  dated  January 1,
                   1996.(1)

10.35              Employment  Agreement  by and  between  the Company and
                   Gilbert Barnett dated August 27, 1996.(1)

10.36              Assignment of lease dated October 8, 1996,  lease dated
                   March 31,  1995 and  sublease  dated May 1995 among the
                   Company, as tenant,  Prime Contracting Design Corp., as
                   assignor,   Bellox  Realty   Corp.,   as  landlord  and
                   Nutriplus Corp., as subtenant.(1)

10.37              Lease for 6 Gramatan  Avenue,  Mount Vernon,  New York,
                   10550 by and between the Company and 6 Gramatan  Avenue
                   Corp. dated December 1, 1996.(1)

10.38              Form  of  Financial   Consulting  Agreement  with  H.J.
                   Meyers & Co., Inc.(1)


                                       44
<PAGE>
10.39              Forms   of   Merger   &   Acquisition   Agreement   and
                   Indemnification with H.J. Meyers & Co., Inc.(1)

10.40              Consulting  Agreement by and between the Company and H.
                   Gene Berger dated July 30, 1997.(4)

10.41              Agreement  between  the  Company  and  Heart  to  Heart
                   Health Care Services, Inc. dated August 6, 1998.(5)

10.42              Agreement  between  the  Company  and  Heart  to  Heart
                   Health Care Services, Inc. dated July 29, 1999. (6)

10.43              Employment  Agreement  by and  between  the Company and
                   Jerry Braun dated November 12, 1999. (7)

10.44              Employment  Agreement  by and  between  the company and
                   Jacob Rosenberg dated November 12, 1999. (7)

10.45              Loan  and  Security  Agreement  by and  among  New York
                   Health Care,  Inc., NYHC Newco Paxxon,  Inc. and Heller
                   Healthcare Finance, Inc. dated November 28, 2000. (8)

10.46              Revolving  Credit Note dated November 28, 2000 from New
                   York Health Care,  Inc. and NYHC Newco Paxxon,  Inc. as
                   Borrowers  to the order of Heller  Healthcare  Finance,
                   Inc. as Lender. (8)

11                 Computation   of  Earnings  Per  Common  Share  of  the
                   Company.

23.1               Consent  of  Scheichet  &  Davis,  P.C.  (contained  in
                   Exhibit 5.1)

23.2               Consent  of M.R.  Weiser & Co. LLP  Independent  Public
                   Accountants.

23.3               Power of  Attorney  (See  "Power  of  Attorney"  in the
                   Registration Statement).

(1)                Incorporated  by reference to Exhibits filed as part of
                   the Company's Registration Statement on Form SB-2 under
                   S.E.C. File No. 333-08152, which was declared effective
                   on December 20, 1996.

(2)                Incorporated  by reference to Exhibit  filed as part of
                   the  Company's  Form 8-K  report  with an event date of
                   December 8, 1997.

(3)                Incorporated  by reference to Exhibits filed as part of
                   the  Company's  Form 8-K  report  with an event date of
                   February 8, 1998.


                                       45
<PAGE>
(4)                Incorporated  by reference to Exhibits filed as part of
                   the  Company's  Form  10-KSB  report for the year ended
                   December 31, 1997.

(5)                Incorporated  by reference to Exhibits filed as part of
                   the Company's  Form 10-QSB report for the quarter ended
                   June 30, 1998.

(6)                Incorporated  by reference to Exhibits filed as part of
                   the Company's  Form 10-QSB Report for the quarter ended
                   June 30, 1999.

(7)                Incorporated  by reference to Exhibits filed as part of
                   the Company's  Form 10-QSB Report for the quarter ended
                   September 30, 1999.

(8)                Incorporated  by reference to Exhibits filed as part of
                   the Company's Form 8-K Report Filed December 8, 2000.

New York Health Care, Inc. will furnish a copy of any exhibit described above to
any  beneficial  holder  of  its  securities  upon receipt of a written request,
provided that the holder pays to New York  Healthcare,  Inc.  a fee compensating
it  for  its  reasonable   expenses  in  furnishing  the  exhibits  requested.

(b)  Reports  on  Form  8-K.
     The  company  filed  a  report on Form 8-K on December 8, 2000.


SIGNATURES

     Pursuant  to  the  requirements  of  Section  13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed on
its  behalf  by  the  undersigned,  thereunto  duly  authorized.

March 14, 2001
                                         NEW  YORK  HEALTH  CARE, INC.

                                         By:  /s/  Jerry  Braun
                                         ----------------------------------
                                         Jerry  Braun
                                         President and Chief Executive Officer

     Pursuant  to  the requirements of the Securities Exchange Act of 1934, this
Report  been  signed  below  by  the  following  persons  on  behalf  of  the
Registrant  and  in  the  capacities  and  on  the  dates  indicated.

/s/ Jerry Braun          President, Chief Executive               March 14, 2001
----------------------   Officer and Director
Jerry Braun


                                       46
<PAGE>
/s/ Jacob Rosenberg      Vice President, Chief Operating          March 14, 2001
----------------------   Officer, Chief Financial and Accounting
Jacob Rosenberg          Officer, Secretary, Director

/s/ Hirsch Chitrik       Director                                 March 14, 2001
---------------------
Hirsch Chitrik

/s/ Sid Borenstein       Director                                 March 14, 2001
---------------------
Sid Borenstein

/s/ H. Gene Berger       Director                                 March 14, 2001
---------------------
H. Gene Berger

/s/ Charles J. Pendola   Director                                 March 14, 2001
----------------------
Charles J. Pendola


                                       47
<PAGE>