SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D. C. 20549
                              ---------------------

                                    FORM 10-Q

     (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, 1999

                                       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 OCTOBER 29, 1999
    Common stock, par value $.01 per share             5,136,754 Shares

<PAGE>
<TABLE>
<CAPTION>
                                 ACCUHEALTH, INC. AND SUBSIDIARIES

                                               INDEX


PART I.   FINANCIAL INFORMATION

                                                                                           Page No.
                                                                                           --------

<S>          <C>                                                                               <C>
Item 1.      Condensed Consolidated Financial Statements.

             Condensed Consolidated Balance Sheets at
             September 30, 1999 and March 31, 1999..............................................3

             Condensed Consolidated Statements of Operations and Comprehensive Gain
             for the three and six months ended September 30, 1999 and 1998.....................4

             Condensed Consolidated Statements of Cash Flows
             for the six months ended September 30, 1999 and 1998...............................5

Item 2.      Management's Discussion and Analysis of
             Financial Condition and Results of Operations......................................6-8

Item 3       Quantitative and Qualitative Disclosures About Market Risk
             Not Applicable.....................................................................8

PART II.     OTHER INFORMATION..................................................................9


SIGNATURES......................................................................................9
</TABLE>


<PAGE>
<TABLE>
<CAPTION>
                                ACCUHEALTH, INC. AND SUBSIDIARIES
                              CONDENSED CONSOLIDATED BALANCE SHEETS
                     (AMOUNTS IN THOUSANDS, EXCEPT SHARES AND PER SHARE DATA)
                                           (UNAUDITED)

                                                                      September 30,      March 31,
                                                                          1999             1999
                                                                      -------------      ---------
<S>                                                                     <C>              <C>
ASSETS
Current Assets:
   Cash .............................................................   $     48         $     85
   Marketable securities ............................................         --            2,372
   Accounts receivable, net .........................................     15,142           14,499
   Inventories ......................................................      1,441            1,653
   Prepaid expenses and other current assets ........................        238              267
                                                                        --------         --------

   Total Current Assets .............................................     16,869           18,876
Revenue producing equipment, net ....................................        962              901
Fixed assets, net ...................................................      2,270            2,100
Other ...............................................................        171               93
                                                                        --------         --------

   Total Assets .....................................................   $ 20,272         $ 21,970
                                                                        ========         ========
LIABILITIES AND STOCKHOLDERS' (DEFICIENCY) EQUITY

Current Liabilities:
   Notes payable - revolving credit facility ........................   $  9,152         $  7,765
   Current portion of notes payable - other .........................        742              857
   Margin payable ...................................................         --            1,281
   Accounts payable .................................................      6,096            5,517
   Accrued expenses and other current liabilities ...................      2,372            2,245
   Current portion of capital lease - Facility ......................        249              232
   Current portion of other capital lease obligations ...............        386              430
                                                                        --------         --------

     Total Current Liabilities ......................................     18,997           18,327

12% Subordinated Debentures .........................................      6,250            6,250
Notes payable - term loan ...........................................        688              750
Notes payable - other, less current portion .........................         --              109
Other capital lease obligations, less current portion ...............        329              388
                                                                        --------         --------

     Total Liabilities ..............................................     26,264           25,824

Stockholders' Deficiency:
   Preferred Stock, $.01 par value: authorized 3,650,000 shares; no
     shares issued and outstanding ..................................
   Preferred  stock,  $.01  par  value;  6%  cumulative  convertible,  $213  and
      liquidation preference, authorized 1,350,000 shares; issued
      and outstanding 105,000 shares ................................          1          1
   Common stock $0.1 par value;  authorized  15,000,000 shares;
      5,136,754, and 5,127,593 shares issued and outstanding,
      respectively ..................................................         51            51
   Additional paid-in capital .......................................      7,612         7,606
   Accumulated other comprehensive income (loss) ....................         --              (42)
   Accumulated deficit ..............................................    (13,032)         (10,846)
                                                                        --------         --------
                                                                          (5,368)          (3,230)
   Less treasury stock (308,004 shares) at cost .....................       (624)            (624)
                                                                        --------         --------
Total Stockholders' Deficiency ......................................     (5,992)          (3,854)
                                                                        --------         --------

Total Liabilities and Stockholders' Deficiency ......................   $ 20,272         $ 21,970
                                                                        ========         ========
</TABLE>

                                       3
<PAGE>
<TABLE>
<CAPTION>
                                         ACCUHEALTH, INC. AND SUBSIDIARIES
                            CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE GAIN
                              (AMOUNTS IN THOUSANDS, EXCEPT SHARES AND PER SHARE DATA)
                                                    (UNAUDITED)

                                                       Three Months Ended September 30, Six Months Ended September 30,
                                                       -------------------------------- ------------------------------
                                                              1999           1998           1999            1998
                                                           -----------    -----------    -----------    -----------
<S>                                                        <C>            <C>            <C>            <C>
Net sales ..............................................   $     9,164    $     8,941    $    18,111    $    17,564
Cost of goods sold .....................................         6,895          5,146         12,517         10,285
                                                           -----------    -----------    -----------    -----------
Gross profit ...........................................         2,269          3,795          5,594          7,279
Selling, general and administrative expenses ...........         3,703          4,299          6,730          7,280
                                                           -----------    -----------    -----------    -----------
Operating income (loss) ................................        (1,434)          (504)          (1,136)            (1)
Interest expense .......................................           563            392            1,050            649
                                                           -----------    -----------    -----------    -----------
Net income (loss) ......................................   $    (1,997)   $      (896)        (2,186)          (650)
                                                           ===========    ===========    ===========    ===========

Net income (loss) per common share applicable to common shareholders:
    Basic ..............................................   $      (.39)   $      (.27)   $      (.43)   $      (.20)
    Diluted ............................................   $      (.39)   $      (.27)   $      (.43)   $      (.20)

Weighted number of common shares and equivalents outstanding:
    Basic ..............................................     5,136,754      3,336,496      5,133,684      3,254,814
    Diluted ............................................     5,136,754      3,340,308      5,133,684      3,258,626

    Net income (loss) ..................................        (1,997)          (896)        (2,186)          (650)
Other comprehensive income, net of tax: unrealized
 gain on marketable securities, net ....................            --             --             --             --
                                                           -----------    -----------    -----------    -----------
    Total comprehensive income (loss) ..................   $    (1,997)   $      (896)   $    (2,186)   $      (650)
                                                           ===========    ===========    ===========    ===========
</TABLE>


                                       4
<PAGE>
<TABLE>
<CAPTION>
                                  ACCUHEALTH, INC. AND SUBSIDIARIES
                           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                      (AMOUNTS IN THOUSANDS, EXCEPT SHARES AND PER SHARE DATA)
                                             (UNAUDITED)

                                                                           Six Months Ended September 30,
                                                                           ------------------------------
                                                                                 1999        1998
                                                                               --------    --------
<S>                                                                            <C>         <C>
OPERATING ACTIVITIES
Net income (loss) ..........................................................   $ (2,186)   $   (650)
Adjustments to reconcile net income (loss) to net cash provided by (used in)
    operating activities:
    Depreciation and amortization ..........................................        163         308
    Changes in operating assets and liabilities:
       Accounts receivable .................................................       (643)     (3,909)
       Inventories .........................................................        212       (109)
       Prepaid expenses and other current assets ...........................         29        (125)
       Other assets ........................................................        (78)        429
       Accounts payable ....................................................        714        (380)
       Accrued expenses and other current liabilities ......................        129          37
                                                                               --------    --------

       Cash used in operating activities ...................................     (1,660)     (4,399)
                                                                               --------    --------

INVESTING ACTIVITIES
    Purchase of fixed assets ...............................................       (486)       (186)
    Net change in goodwill .................................................         --         (68)
    Proceeds from sales of marketable securities ...........................       1095      (4,300)
                                                                               --------    --------
    Cash provided by (used in) investing activities ........................        609      (4,554)
                                                                               --------    --------
FINANCING ACTIVITIES
    Proceeds from note payable - revolving credit facility .................      1,387      15,990
    Proceed from notes payable - other .....................................         --       5,750
    Proceeds from term loan ................................................         --         250
    Payments on notes payable - revolving credit facility ..................        (62)    (12,839)
    Payments on notes payable - other ......................................       (224)       (287)
    Principal payments on capital lease - Facility .........................         16         (36)
    Proceeds from issuance of capital stock ................................         --          74
    Payments on other capital lease obligations ............................       (103)       (147)
                                                                               --------    --------
    Cash provided by financing activities ..................................      1,014       8,755
                                                                               --------    --------

    Net increase (decrease) in cash ........................................        (37)       (198)
                                                                               --------    --------
    Cash at beginning of period ............................................         85         249
                                                                               --------    --------
    Cash at end of period ..................................................   $     48    $     51
                                                                               ========    ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
    Interest paid ..........................................................   $    632    $    415
                                                                               ========    ========

NONCASH INVESTING AND FINANCING ACTIVITIES:
    Additions to capital leases ............................................   $     --    $    121
    Accrued dividends and accretion on redeemable preferred stock ..........   $      6    $     27
</TABLE>

                                       5
<PAGE>

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

This Management's Discussion and Analysis should be read in conjunction with the
condensed consolidated financial statements of the Company included elsewhere in
this Form 10-Q.

Results of Operations
---------------------

Three Months Ended September 30, 1999 and 1998
----------------------------------------------

NET  REVENUES.  Net  revenues  increased  approximately  $223,000 or 2% from the
comparable 1998 quarter to approximately $9.2 million for the three months ended
September  30, 1999.  The increase was  primarily the result of increases in the
Company's  institutional  pharmacy  business  mostly  offset by decreases in the
infusion  therapy  revenues  and  decreases  in the sale and  rental of  durable
medical equipment.

GROSS  PROFIT.  Gross profit for the three months ended  September  30, 1999 and
1998  was  approximately  $2.3  and  $3.8  million,  respectively,  representing
approximately  25% of net sales for the three months ended September 30, 1999 as
compared to 42% for the comparable prior year period. Gross profit decreased
primarily  due to write off of  unusable  revenue  producing  equipment  and the
Company also experienced revenue growth in the institutional  pharmacy business,
which  generates  lower gross margin as compared to the other lines of business.
Further,  decreased revenues from the durable medical equipment, which generates
the Company's  highest gross margin,  also contributed to the decline in overall
gross  profit.  Moreover,  declines  in margins in the  higher  margin  infusion
therapies  were incurred due to changes in the customer base.  Compounding  this
downward  pressure on reimbursement  rates has been a change in our managed care
patient mix to lower margin  modalities  as a result of the  prolonged,  reduced
availability of intravenous  immune gamma globulin - a higher margin  medication
frequently administered to our patients.

SELLING,   GENERAL   AND   ADMINISTRATIVE   EXPENSES.   Selling,   general   and
administrative   expenses   were   approximately   $3.7  and  $4.3   million  or
approximately  41% and 48% of net sales for the three months ended September 30,
1999 and 1998,  respectively.  There were  decreases due to the  elimination  of
certain  duplicate   overhead  costs  resulting  from  the  merger  with  Healix
Healthcare,  Inc. on April 9, 1998. Offsetting these decreases were increases in
bad debt  expense  ($400,000).  The  industry in which the  Company  operates is
experiencing  difficulty in  collecting  from  customers who include  hospitals,
HMO's,  and  private  institutions.   There  is  a  growing  number  within  the
aforementioned  customer group who are experiencing  significant lack of working
capital resulting in tremendous payment delays and disputes on billing claims.

INTEREST  EXPENSE.  Interest  increased  by $171,000  for the three months ended
September  30,  1999,  to  approximately  $563,000.  This  increase  was  due to
increased  net  borrowings  under our  revolving  line of credit and  additional
interest on the $6,250,000,  12%  Subordinated  Debentures due to the receipt of
additional  funds in  August,  1998 and  additional  interest  accrued on unpaid
interest per the terms of the agreement.

PROVISION FOR INCOME TAXES.  No provision of income taxes has been reflected due
to the Company's federal and state net operating loss credits.

Six Months Ended September 30, 1999
-----------------------------------

NET  REVENUES.  Net  revenues  increased  approximately  $547,000 or 3% from the
comparable 1998 quarter to approximately  $18.1 million for the six months ended
September  30, 1999.  The increase was  primarily  was  primarily  the result of
increases in the  Company's  institutional  pharmacy  business  mostly offset by
decreases in the infusion  therapy revenues and decreases in the sale and rental
of durable medical equipment.

GROSS PROFIT.  Gross profit for the six months ended September 30, 1999 and 1998
was   approximately   $5.6  and   $7.3   million,   respectively,   representing
approximately  31% of net sales for the three months ended September 30, 1999 as
compared to 41% for the  comparable  prior year period.  Gross profit  decreased
primarily due to the  Company's  growth in sales in the  institutional  pharmacy
business,  which generates a lower gross margin,  continued downward pressure on
its fees within the infusion therapy business,  decreases in the durable medical
equipment  business,  which  generates  high  gross,  margins  and  write off of
unusable revenue  producing  equipment.  Compounding  this downward  pressure on
reimbursement  rates has been a change in our managed  care patient mix to lower
margin  modalities  as a  result  of  the  prolonged,  reduced  availability  of
intravenous  immune  gamma  globulin-  a  higher  margin  dedication  frequently
administered to patients.

                                       6
<PAGE>

SELLING,   GENERAL   AND   ADMINISTRATIVE   EXPENSES.   Selling,   general   and
administrative   expenses   were   approximately   $6.7  and  $7.3   million  or
approximately  38% and 41% of net sales for the three months ended September 30,
1999 and 1998,  respectively.  There were  decreases due to the  elimination  of
certain  duplicate   overhead  costs  resulting  from  the  merger  with  Healix
Healthcare,  Inc. on April 9, 1998. Offsetting these decreases were increases in
bad debt  expense  ($500,000).  The  industry in which the  Company  operates is
experiencing  difficulty in  collecting  from  customers who include  hospitals,
HMO's  and  private   institutions.   There  is  a  growing  number  within  the
aforementioned customer group who are experiencing a significant lack of working
capital resulting in tremendous payment delays and disputes on billing claims.

INTEREST  EXPENSE.  Interest  expenses  increased by $401,000 for the six months
ended  September  30,  1999,  to  approximately  $1,050,000.  This  increase was
primarily due to increased net borrowings under our revolving line of credit and
additional  interest on the  $6,250,000 12%  Subordinated  Debentures due to the
receipt of  additional  funds in August 1998 and  additional  interest on unpaid
interest per the terms of the agreement.

PROVISION FOR INCOME TAXES.  No provision of income taxes has been reflected due
to the Company's federal and state net operation loss credits.

Financial Condition
-------------------

As  of  September  30,  1999,  the  Company  had  negative  working  capital  of
approximately $2,128,000.

The Company's cash provided by financing  activities of approximately $1 million
was primarily  attributable  to the net proceeds of  approximately  $1.4 million
under the Company's  revolving credit facility and term loan offset by principal
payments on capital leases and other notes payable.

Accounts receivable  includes amounts due from third party customers,  primarily
governmental  agencies  (Medicare and  Medicaid).  At September 30, 1999,  gross
Medicare and Medicaid receivables aggregated approximately $5.4 million.

The Company  operates  under cash flow  pressure due to difficulty in collecting
its  accounts  receivable.  As of  March  31,  1999  the  Company  had  accounts
receivable that were "ineligible" to borrow against per the terms of its line of
credit. Considering the amount and the issues of collecting these receivables an
increase to the bad debt expense was established of approximately $3,000,000 for
the estimated loss on these receivables and for eligible  receivables  deemed to
be  uncollectible  as of March 31,  1999.  As of  September  30,  1999 a further
deterioration has occurred with respect to the working capital issues facing our
customers  so  additional  bad debt  expenses  were  recorded.  To  address  the
collection issues, the customer service,  billing and collection  department has
been reorganized into specialized teams.  These teams have  responsibility for a
certain number of accounts  determined by the nature and type of business.  This
will enable our  collectors  to better  service and collect  from our  customers
because they will possess a better  understanding  of the issues that need to be
addressed.   Moreover,   an  increased  effort  and  focus  is  to  collect  the
"ineligible"   receivables  by  conducting   face  to  face  meetings  with  the
appropriate  customer  personnel and  curtailing  services  until the collection
issues are resolved. The collection of the "ineligible" accounts receivable will
provide  immediate cash  availability  to the company by increasing the eligible
portion of accounts receivable available to be used for borrowings from its line
of credit.

 As of September 30, 1999, the Company had borrowed the maximum  allowable under
its revolving loan agreement  ($9,000,000),  overdraft line  ($1,000,000),  term
loan ($725,000) and received an advance on the sale of its building  ($250,000).
The Company has recently entered into a contract for the sale of its offices and
has  rented  new  space  where  it  will  be   consolidating   its   operations.
Approximately $650,000 in net cash proceeds is anticipated from the sales of the
building.  Further discussions with key vendors to convert a portion of accounts
payable into notes are presenting in process.

During fiscal year ended March 31, 1999, management determined that the goodwill
resulting from the acquisition of Pro Heath Care Infusion  Services was impaired
and warranted write-off of the remaining balance. The impairment resulted from a
severe decline in revenue, primarily caused by the filing for liquidation of HIP
of New Jersey in February 1999.

                                       7
<PAGE>

Disclosure Regarding Forward Looking Statements
-----------------------------------------------

The Private  Securities  Litigation  Reform Act of 1995 provides a "safe harbor"
for forward-looking  statements.  Certain information in Items 1 and 2 of Part I
of this Form 10-Q  includes  information  that is forward  looking,  such as the
Company's  plans to convert  accounts  payable  to notes  payable.  The  matters
referred  to in  forward-looking  statements  could be affected by the risks and
uncertainties involved in the Company's business.  These risks and uncertainties
include,  but are not limited to; the effect of economic and market  conditions,
the impact of the cost  containment  efforts of  third-party  customers  and the
Company's ability to obtain and maintain required  licenses.  Subsequent written
and oral  forward  looking  statements  attributable  to the  Company or persons
acting on its behalf are expressly qualified in their entirety by the cautionary
statements in this paragraph and elsewhere in this Form 10-Q.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable.

                                       8

<PAGE>
PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

                  None

Item 2.  Changes in Securities

                  None

Item 3.  Default Upon Senior Securities

                  None

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

                  None

Item 5.  Other Information

                  None

Item 6.  Exhibits and Reports on Form 8-K

                  (a) Exhibits

                      None

                  (b) Reports

                      None

                                   SIGNATURES

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

                               ACCUHEALTH, INC.


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



                                       9