SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D. C. 20549

                              ---------------------
                                   FORM 10-Q/A
                              ---------------------
                               (Amendment No. 1)

     (Mark one)

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

                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1998

                                       OR

     [ ]       TRANSITIONAL REPORT PURSUANT TO SECTION 13 0R 15 (d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

             FOR THE TRANSITION PERIOD FROM _________ TO __________

                         COMMISSION FILE NUMBER 0-17292


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

                New York                                   13-3176233
     -------------------------------           ---------------------------------
     (State or other jurisdiction of           (IRS Employer Identification No.)
     incorporation or organization)


         1575 Bronx River Avenue
             Bronx, New York                                     10460
---------------------------------------                     --------------
(Address of principal executive offices)                      (Zip Code)

                              -------------------
       Registrant's telephone number, including area code: (718) 518-9511

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

     APPLICABLE  ONLY TO  CORPORATE  ISSUERS:  Indicate  the  number  of  shares
outstanding  of each of the issuer's  classes of common stock,  as of the latest
practicable date.

                  Class                         Outstanding at November 13, 1998
   Common stock, par value $.01 per share               3,644,498 Shares

<PAGE>

This report hereby amends Item 2 of Part I of Accuhealth,  Inc.'s (the "Company"
or the  "Registrant")  quarterly  report  on  Form  10-Q  for the  period  ended
September  30, 1998 by adding the  following  information  concerning  Year 2000
issues:

Year 2000 Readiness

The Company has completed its assessment of its computer  systems and facilities
that could be affected by the "Year 2000  problem"  and has  developed a plan to
resolve the issue.  The Year 2000 problem arose  because many existing  computer
programs  use  only the last two  digits  to refer to a year.  Therefore,  these
computer programs do not properly recognize a year that begins with "20" instead
of the familiar "19." If not corrected, many computer applications could fail or
create erroneous results.

The Company is implementing  its Year 2000 compliance  program as part of a plan
to  replace  and  upgrade  its  information  technology  systems  (the  "Upgrade
Program").  The Upgrade Program was initiated to replace  information systems of
certain subsidiaries of the Company acquired by merger, to fully integrate those
systems with the Company's  information  technology  systems,  and to update the
Company's  information  technology systems.  The Company has divided the Upgrade
Program  into  the  following  phases:  assessment,  planning,  remediation  and
testing.  The Company is currently  approximately  15% complete with the Upgrade
Program and anticipates  being complete with all phases of the Upgrade  Program,
including  Year 2000  compliance,  by the fourth  quarter of 1999.  Although the
Company believes that it will complete the Upgrade Program by the fourth quarter
of 1999,  there can be no assurance that such  remediation  will be completed or
that the Company's operations will not be disrupted to some degree.

The Company  currently  expects the Upgrade  Program to be  completed  in a time
frame to avoid any material  adverse effect on  operations.  As of September 30,
1998, the Company had incurred  approximately  $70,000 to $90,000 of expenses in
connection with the Upgrade  Program.  The Company  expects to incur  additional
expenses of approximately $400,000 to complete the implementation of the Upgrade
Program.  The Company would have implemented the Upgrade Program irrespective of
the Year 2000 problem,  and although the Company expects that the implementation
of the Upgrade  Program will achieve Year 2000  compliance,  the Company  cannot
separately assess the expenses  relating to Year 2000 compliance.  The Company's
inability to complete Year 2000 compliance on a timely basis or the inability of
other companies with which the Company does business to complete their Year 2000
modifications on a timely basis could adversely affect the Company's operations.

The Company is in the early stages of initiating  communications  with its major
vendors to identify and, to the extent possible, to resolve issues involving the
Year 2000  Problem.  The Company is attempting to mitigate its risk with respect
to the failure of such vendors to be Year 2000 compliant by, among other things,
obtaining Year 2000  compliance  certifications  or written  assurances from its
material  vendors.  However,  the  Company  has  limited or no control  over the
actions of these suppliers. Thus, while the Company expects that it will be able
to resolve any significant  Year 2000 problems with these systems,  there can be
no assurance  that these  suppliers  will resolve any or all Year 2000  Problems
with  these  systems  before the  occurrence  of a  material  disruption  to the
business of the Company or any of its customers.  Any failure of these suppliers
to resolve Year 2000 Problems with their systems in a timely manner could have a
material  adverse effect on the Company's  business,  financial  condition,  and
results of operation.

Management  believes that the most significant risk to the Company from the Year
2000 Problem is the effect such issues may have on third party  payors,  such as
Medicare.  News reports  have  indicated  that  various  agencies of the federal
government  may have  difficulty  becoming Year 2000  compliant  before the Year
2000.  The  Company  has not yet  undertaken  to  quantify  the  effects of such
noncompliance or to determine whether such quantification is even possible.  The
Company is in the early stages of initiating communications with its third party
payors to identify and, to the extent possible,  to resolve issues involving the
Year 2000  problem.  However,  the Company  has  limited or no control  over the
actions of these third party  payors.  Thus,  while the Company  expects that it
will be able to resolve any  significant  Year 2000  problems with these payors,
there can be no  assurance  that these  payors will resolve any or all Year 2000
problems with their systems  before the  occurrence of a material  disruption to
the business of the Company.  Any failure of these third party payors to resolve
Year 2000  problems  with their systems in a timely manner could have a material
adverse effect on the Company's business,  financial  condition,  and results of
operation.

                                      -1-
<PAGE>

The Company is in the process of generating a Year 2000  contingency plan in the
event compliance is not achieved. In connection  therewith,  the Company expects
to identify  reasonably  likely  scenarios which could arise in the event of the
Company's Year 2000  noncompliance.  Once these scenarios have been  identified,
the  Company  will  develop  plans in an  attempt  to reduce the impact of these
noncompliance  scenarios  on the  Company  and its core  functions.  The Company
expects to be  substantially  complete with this  contingency  plan by the third
quarter of 1999.  However,  there can be no assurance that this contingency plan
will be completed on a timely basis or that such a plan will protect the Company
from  experiencing  a material  adverse  effect on its  financial  condition  or
results of operations.

Potential  consequences of the Company's failure to timely resolve its Year 2000
issues could include,  among others,  (i) the inability to accurately and timely
process  claims,  respond to third party payor  inquiries  about claims,  enroll
customers, bill third party payors, collect receivables, pay vendors, record and
disclose accurate data and perform other core functions, (ii) increased scrutiny
by regulators and breach of contractual  obligations,  and (iii)  litigations in
connection therewith.


                                      -2-
<PAGE>


                                   SIGNATURES

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


                                ACCUHEALTH, INC.



Date:  February 22, 1999        By: /s/ GLENN C. DAVIS
                                   -------------------------------------
                                        Glenn C. Davis
                                        President and Chief Executive Officer


Date:  February 22, 1999        By: /s/ PRISCO DEMERCURIO
                                   -------------------------------------
                                        Prisco DeMercurio
                                        Chief Financial Officer


                                      -3-