<PAGE>


FORM 10QSB FOR MID-ATLANTIC HOME HEALTH NETWORK, INC. FILED ON AUGUST 16, 1999



                                   FORM 10-QSB

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


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


For Quarter Ended June 30, 1999


Commission File Number D-24165


                     MID-ATLANTIC HOME HEALTH NETWORK, INC.

         Nevada                                                 93-1108124


                         7504 Diplomat Drive, Suite 101
                               Manassas, Virginia
                                   20109-2631

                                  703/335-1957


Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days.
Yes  x    No
    ---      ---

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: 12.631,202 shares of $.001 par
value common stock as of June 30, 1999.
<PAGE>


                     MID-ATLANTIC HOME HEALTH NETWORK, INC.

                         PART I - FINANCIAL INFORMATION



                                                                            PAGE


Condensed Balance Sheets for June 30, 1999 and December 31, 1998...............1


Condensed Statements of Income for the Six Months ended
June 30, 1999 and 1998.........................................................2


Condensed Statements of Cash Flows for the Six Months ended
June 30, 1999 and 1998.........................................................3


Notes to Condensed Financial Statements........................................4


Management's Discussion and Analysis or Plan of Operation......................8


<PAGE>

<TABLE>


MID-ATLANTIC HOME HEALTH NETWORK, INC.
CONSOLIDATED BALANCE SHEET
<CAPTION>
                                                                                  UNAUDITED                  AUDITED
                                                                                  30-Jun-99                 31-Dec-98
Current Assets
<S>                                                                            <C>                       <C>
   Cash and cash equivalents                                                   $       419,989           $       816,294
   Accounts receivable, net                                                          4,689,029                 2,998,489
   Due from affiliates                                                                 452,373                   228,805
   Prepaid expenses and other current assets                                           260,960                   157,449
   Deferred tax asset                                                                   37,000                    37,000
                                                                               ----------------          ----------------
           Total current assets                                                      5,859,351                 4,238,037

                                                                               ----------------          ----------------
Property and Equipment, net                                                            248,222                   253,221
                                                                               ----------------          ----------------

Other Assets
   Deposits
   Goodwill                                                                            651,016                   671,360
   Other assets                                                                         54,118                     3,058
                                                                               ----------------          ----------------
           Total other assets                                                          705,134                   674,418
                                                                               ----------------          ----------------
           Total assets                                                        $     6,812,707           $     5,165,676
                                                                               ================          ================

     LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
   Accounts payable                                                            $       258,415           $       152,724
   Accrued salaries and benefits                                                       412,608                   255,220
   Other current liabilities                                                           138,571                   119,162
   Current portion of long-term debt                                                    13,194                    15,988
   Notes Payable                                                                     3,849,502                 2,606,175
                                                                               ----------------          ----------------
   Deferred revenue
                                                                               ----------------          ----------------
           Total current liabilities                                                 4,672,290                 3,149,269
                                                                               ----------------          ----------------
   Long-term debt                                                                      302,232                   306,739
                                                                               ----------------          ----------------
           Total liabilities                                                   $     4,974,522           $     3,456,008
                                                                               ================          ================

STOCKHOLDERS' EQUITY
   Common stock, Class A, $.001 par value,
    200,000,000 shares authorized 12,621,202
    shares issued and outstanding at 12/31/98                                  $        12,621           $        12,621
   Common stock, Class B, $.001 par value,
    10,000 shares authorized, issued and
    outstanding                                                                             10                        10
   Preferred stock, $1 par value, 5,000,000
    shares authorized, 10,000 shares issued
    and outstanding                                                                     10,000                    10,000
   Additional paid-in capital                                                        1,103,485                 1,103,485
   Retained earnings                                                                   901,319                   772,802

   Stock subscription receivable                                                      (189,250)                 (189,250)
                                                                               ----------------          ----------------
           Total stockholders' equity                                                1,838,185                 1,709,668

                                                                               ----------------          ----------------
   Total Liabilities and Stockholders' Equity                                  $     6,812,707           $     5,165,676
                                                                               ================          ================
</TABLE>


                                       1
<PAGE>

<TABLE>

U N A U D I T E D
MID-ATLANTIC HOME HEALTH NETWORK, INC.
CONSOLIDATED INCOME STATEMENT
<CAPTION>

                                                                                     30-Jun-99                30-Jun-98

<S>                                                                            <C>                      <C>
REVENUES                                                                       $     8,492,997          $     7,090,168

EXPENSES
   Salaries                                                                          6,528,949                5,419,290
   General and administrative                                                        1,520,482                1,580,821
   Depreciation & amortization                                                          31,865                   60,747
   Interest                                                                            200,179                  154,266

                                                                               ----------------         ----------------
           Total expenses                                                            8,281,475                7,215,124
                                                                               ----------------         ----------------

           Income before income taxes                                                  211,522                 (124,956)

PROVISION FOR INCOME TAXES                                                             (82,404)

                                                                               ----------------         ----------------
           Net income                                                          $       129,118          $      (124,956)
                                                                               ================         ================


EARNINGS PER COMMON SHARE                                                      $         0.010          $        (0.010)

</TABLE>


                                       2
<PAGE>

<TABLE>

MID-ATLANTIC HOME HEALTH NETWORK, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
<CAPTION>

                                                                               1999                       1998
                                                                          ----------------          ----------------
<S>                                                                       <C>                       <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
      Net Income (loss)                                                   $       129,118           $      (124,956)
      Adjustments to reconcile net income to net
       cash provided by operating activities:
                Depreciation and amortization                                      31,865                    60,747
                Changes in assets and liabilities:
                  Accounts receivable                                          (1,690,540)                 (806,991)
                  Due from affiliates                                            (223,568)                   26,796
                  Prepaid expenses                                               (103,511)                 (132,330)
                  Other assets                                                    (58,045)                   (8,167)
                  Deferred tax asset                                                    -                         -
                  Accounts payable                                                105,691                    93,805
                  Accrued salaries                                                157,388                    19,705
                  Other current liabilities                                        19,409                    77,760

                                                                          ----------------          ----------------
                Net cash provided by operating activities                      (1,632,193)                 (793,631)

CASH FLOWS FROM INVESTING ACTIVITIES:
      Acquisition of property, plant and equipment                                    462                   (12,422)

                                                                          ----------------          ----------------
                Net cash provided by investing activities                             462                   (12,422)

CASH FLOWS FROM FINANCING ACTIVITIES
      Repayment of long term debt                                                  (7,301)                   69,196
      Dividends paid on preferred stock                                              (600)                     (600)
      Changes in notes payable                                                  1,243,327                   664,021

                                                                          ----------------          ----------------
                Net cash provided by financing activities                       1,235,426                   732,617

                Net increase (decrease) in cash                                  (396,305)                  (73,436)

CASH AND CASH EQUIVALENTS
Cash balance, December 31,                                                        816,294                   578,699

                                                                          ----------------          ----------------
Cash balance, June 30,                                                    $       419,989           $       505,263
                                                                          ================          ================
</TABLE>


                                       3
<PAGE>


                     MID-ATLANTIC HOME HEALTH NETWORK, INC.
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             June 30, 1999 and 1998


NOTE 1.  ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

         ORGANIZATION. The consolidated financial statements include the
         accounts of Mid-Atlantic Home Health Network, Inc. (MAHN) and its
         subsidiaries (collectively referred to herein as the company). The
         subsidiaries include Hunt Country Nursing Services, Inc. (Hunt Country
         Nursing), Hunt Country Home Health, Inc. (Home Health), and National
         Nurses Service, Inc. Approximately 80% of MAHN's outstanding shares
         are owned by Oak Springs Nursing Home Limited Partnership (Oak
         Springs). The Company is engaged in the services with an emphasis in
         providing nursing staff services to hospitals, nursing homes and other
         facilities. The Company operates in Virginia, Maryland, and the
         District of Columbia.

                  BASIS OF CONSOLIDATION. All significant intercompany accounts
                  and transactions have been eliminated.

                  NET REVENUES. Net revenues are reported at the estimated net
                  realizable amounts from patients, third party payors, and
                  others for services rendered, including estimated retroactive
                  adjustments under reimbursement agreements with third party
                  payors. Revenue received under third-party agreements is
                  subject to audit/review. Any adjustments as a result of these
                  audits/reviews are reflected in current operations.
                  Approximately 11% and 12% of the Company's net revenues for
                  the years ended December 31, 1999 and 1998, respectively, were
                  from participation in Medicare and state Medicaid programs. In
                  addition, approximately 33% and 35% of the Company's net
                  revenues for the year ended December 31, 1999 and 1998, was
                  from contracts with state and local governmental correctional
                  facilities, including the Commonwealth of Virginia and the
                  District of Columbia. At December 31, 1999 and 1998, 8% and
                  20%, respectively, of net accounts receivable were due from
                  Medicare and Medicaid. The ability of payors to meet their
                  obligations depends upon their financial stability, future
                  legislation and regulatory actions. The Company does not
                  believe there are any significant credit risks associated with
                  receivables from Medicare and Medicaid.

                  PROPERTY AND EQUIPMENT. Property and equipment are recorded at
                  cost. The cost and the related accumulated depreciation are
                  removed from the accounts in the year the related asset is
                  sold or retired. Depreciation is computed using the straight
                  line method over the estimated economic lives of the assets,
                  commencing at the time the assets are placed into service.

                  CASH AND CASH EQUIVALENTS. Cash and cash equivalents include
                  cash on hand and in the bank as well as any investment
                  purchased with an original maturity of three months or less.
                  The Company maintains its cash in bank deposit accounts which,
                  at times, may exceed federally insured limits. The Company has
                  not experienced any losses in such accounts. Cash equivalents
                  are carried at cost which approximates fair value.


                                        4
<PAGE>


                     MID-ATLANTIC HOME HEALTH NETWORK, INC.
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             June 30, 1999 and 1998


NOTE 1.  ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (continued)

                  Under the Company's cash management system, checks issued but
                  not yet presented to banks frequently result in overdraft
                  balances for accounting purposes. The overdraft balances have
                  been netted with positive balances and are classified as "cash
                  and cash equivalents" in the consolidated balance sheet.

                  GOODWILL AND OTHER ASSETS. Goodwill arises from acquisitions
                  and represents the excess of purchase price over identifiable
                  acquired net assets, and is amortized on a straight-line basis
                  over 20 years. Other assets principally consist of the
                  estimated value of the assembled workforce and capitalized
                  fees related to other long-term agreements and transactions.
                  Other assets are amortized on a straight-line basis over a
                  period of 3 to 5 years.

                  INCOME TAXES. The income tax provision includes federal and
                  state income taxes both currently payable and deferred because
                  of differences between financial reporting and tax bases of
                  assets and liabilities. Deferred tax assets and liabilities
                  are measured using the enacted tax rates and laws that will be
                  in effect when necessary to reduce deferred tax assets to the
                  amounts expected to be realized.

                  USE OF 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.

                  STOCKHOLDERS' EQUITY. The Company has three classes of stock.
                  Two hundred million shares of Class A common stock have been
                  authorized. The Class A shareholders have the right to elect
                  one third of the directors of the Company. Ten thousand shares
                  of Class B common stock, with the right to elect two thirds of
                  the directors, have also been authorized. Additionally, five
                  million shares of Class C convertible preferred stock have
                  been authorized. The preferred stock is paid a dividend of
                  12%.

                  EARNINGS PER SHARE. Earnings per common share are computed by
                  dividing the weighted average number of shares outstanding
                  into net income. Diluted earnings per share are not presented
                  because the outstanding stock options are not dilative.


                                        5
<PAGE>


                     MID-ATLANTIC HOME HEALTH NETWORK, INC.
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             June 30, 1999 and 1998


NOTE 2.  YEAR 2000

                  Mid-Atlantic Home Health Network, Inc. does not anticipate any
                  problem in dealing with computer entries in the Year 2000 or
                  thereafter, with any computers currently used at any of their
                  facilities. The company keeps current with all updates and
                  revisions with all software the company currently uses. It is
                  anticipated that the software updates reflect required
                  revisions to accommodate transactions in the Year 2000 and
                  thereafter. Though it is not anticipated that the company will
                  have a problem at the turn of the century, the company intends
                  to coordinate the resolution of any Year 2000 problems with
                  the vendors of the software the company utilizes.

NOTE 3.  CONTINGENT LIABILITY

                  As part of the acquisition of National Nurses Service, Inc. on
                  June 30, 1995, the Company issued 500,000 shares of common
                  stock. The stock purchase agreement calls for an adjustment of
                  the purchase price on June 30, 1998, if the market value of
                  the stock is less than $800,000 ($1.60 per share), during the
                  ten-day period immediately preceding June 30, 1998. The
                  purchase price adjustment, to be paid in cash, is the
                  difference between the market value and $800,000. The stock
                  had limited trading activity with a sales price of $.0625.
                  Based on those prices the purchase price adjustment would be
                  in the range of $487,500.

                  The Company is negotiating with the owners of the claim to
                  settle the potential purchase price adjustment.

                  The Company has also listed its securities on a national
                  securities exchange to increase the level of trading activity.

                  The acquisition of National Nurses Service, Inc. was accounted
                  for as a purchase and the Company recorded approximately
                  $800,000 in good will. The payment of any purchase price
                  adjustment would not change the underlying assets acquired.
                  Accordingly, payments would reduce the originally recorded
                  value of stock issued and reduce the amount of paid-in
                  capital.

                  In the opinion of management, the amount of the purchase price
                  adjustment, if any, will not have a material effect on the
                  Company's financial position.

NOTE 4.  COST REPORT ADJUSTMENT:

                  In June, 1999, the Medicare Cost Reports for the home health
                  agencies were filed for the 1998 year. These reports indicated
                  that the Richmond and Tappahannock agencies exceeded certain
                  Medicare cost limits by $85,000. Therefore, $85,000 was
                  deducted in the second quarter of 1999 (see Note 1 - Net
                  Revenues) for losses that relate to 1998.


                                        6
<PAGE>


                     MID-ATLANTIC HOME HEALTH NETWORK, INC.
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             June 30, 1999 and 1998


NOTE 5.  MEDICARE CONTRACTUAL ALLOWANCES:

                  It was determined in the second quarter that Medicare
                  contractual allowances (deductions from gross revenues) were
                  underestimated for the first quarter by $40,000. Consequently,
                  the adjustment was recorded in the second quarter thereby
                  overstating contractual allowances for the second quarter, but
                  assuring year-to-date accuracy.


                                        7
<PAGE>


                     MID-ATLANTIC HOME HEALTH NETWORK, INC.

                            FILED ON AUGUST 16, 1999

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


         Mid-Atlantic Home Health Network, Inc. (MAHN) is a holding company of
three corporate entities: National Nurses Service, Inc.; Hunt Country Home
Health, Inc.; Hunt Country Nursing Services, Inc. An analysis of each of these
entities is depicted below.


                       NATIONAL NURSES SERVICE, INC. (NNS)

Net Income:
-----------

         Sales for the first six months of this fiscal year totalled $5,774,000
versus $5,053,000 a year ago. The increase is a 14.3% gain in net revenues.
Operating expenses increased $638,100 or 13.1%. Consequently, this staffing
company increased its operating income from $170,000 a year ago to $252,000 in
1999 --- a 32% growth in income. The increased profitability is due to the
continued strong demand for nurse staffing in hospitals, nursing homes, and
correctional facilities and the ability of the company to exact greater
productivity from overhead operations.

         Income for National Nurses Service was impacted by a prior year
adjustment of $85,000 for Medicare Cost Reports filed for 1998 for its
Tappahannock and Richmond Medicare home health agencies.


                      HUNT COUNTRY HOME HEALTH, INC. (HCHH)

Revenues:
---------

         The net revenues for the first six months for this Medicare certified
home health agency totaled $503,000 versus $259,000 a year ago. The increase of
$244,000 is a 94% increase and is due to greater demand in the Warrenton and
Fredericksburg, Virginia areas.

Operating Expenses:
-------------------

         The operating expenses for HCHH increased for the first six months to
$502,000 as compared to $456,000 a year ago. The increase in expenses is only
$46,000 or 10.1%.

         This Medicare home health agency operated at break-even this fiscal
year (January - June) as compared to a loss of $197,000 a year ago. The agency
has now fully adjusted to the new Medicare reimbursement regulations effective
January 1, 1998.

         The company received JCAHO accreditation for three years during the
quarter.


                                        8
<PAGE>


                   HUNT COUNTRY NURSING SERVICES, INC. (HCNS)


Revenues:
---------

         Hunt Country Nursing Services, Inc., our private duty nursing company,
with offices in Warrenton, Winchester, Richmond, Tappahannock and
Fredericksburg, Virginia had significant revenue growth in the first half of the
year. For the first six months, revenues totalled $2,182,000 versus $1,197,000 a
year ago. The increase of $985,000 is an increase of 82%.

Operating Expenses:
-------------------

         Operating expenses for the first six months of 1999 totalled $2,157,000
versus $1,282,000. While expenses increased $875,000, or 68%, the level of
expenses resulted in greater productivity given the 82% increase in revenue.

Income Loss:
------------

         For the first half of 1999, HCNS had an operating gain of $25,000
versus a loss of $83,000 a year ago.

         The company is experiencing rapid growth in the demand for its
services. Continued improvements in its gross margins will result in enhanced
profitability.

         The company received JCAHO accreditation for three years during the
quarter.


                  MID-ATLANTIC HOME HEALTH NETWORK, INC. (MAHN)

         For the first six months, MAHN had consolidated revenues of $8,493,000
versus $7,095,000 in 1998. The increase in revenues of $1,398,000 is 19.7%. The
increased revenues is due to solid growth in staffing, home health and private
duty nursing services.

         While revenues increased 19.7%, operating expenses increased 14.7%,
leaving income before taxes of $212,000 versus a loss of $125,000 a year ago.

         There was a reduction of general and administrative expenses from
$1,585,000 in 1998 to $1,520,000 in 1999, or a 4% reduction. The greater
productivity of general and administrative functions coupled with a revenue
growth of 19.7% has placed MAHN on more solid footing.

         We anticipate continued and increased demand for our staffing, home
health, and private duty nursing services. MAHN does not face difficulties in
marketing its services. Its challenges are in the recruitment of sufficient
nursing personnel to meet the demands for its nursing care services.

         It should also be noted that there was a prior year adjustment of
$85,000 for Medicare Cost Reports filed for 1998 in the second quarter. Without
this adjustment net income before taxes would have been $297,000 for the first
six months of 1999.


                                        9
<PAGE>


                                   SIGNATURES



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


                                          MID-ATLANTIC HOME HEALTH NETWORK, INC.




Dated:  August 16, 1999                   By:    /s/ Dennis Light
                                             ----------------------------------
                                                 Dennis Light, President





                                       10