FORM 10-Q



                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


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


(Mark One)
{ X }  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
       SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended         June 30, 1999

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

For the transition period from                     to


For Quarter Ended   June 30, 1999       Commission file number   000-17596

                 Meridian Healthcare Growth and Income Fund Limited Partnership
                      (Exact Name of Registrant as Specified in its Charter)


                 Delaware                                   52-1549486
         (State or Other Jurisdiction of                 (I.R.S. Employer
         Incorporation or Organization)               Identification Number)



     225 East Redwood Street, Baltimore, Maryland              21202
       (Address of Principal Executive Offices)             (Zip Code)

       Registrant's Telephone Number, Including Area Code: (410) 727-4083

                                       N/A
              (Former Name, Former Address, and Former Fiscal Year,
                         if Changed Since Last Report.)

  Indicate  by check  mark  whether  the  registrant  (1) has filed all  reports
required to be filed by Section 13 or 15 (d) of the  Securities  Exchange Act of
1934  during  the  preceding  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



<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


                                      INDEX

                                                                       Page No.

CAUTIONARY STATEMENT REGARDING FORWARD LOOKING STATEMENTS                     2

Part I.  Financial Information


     Item 1.  Financial Statements

              Consolidated Balance Sheets                                     3
              Consolidated Statements of Operations                           4
              Consolidated Statements of Partners' Capital                    5
              Consolidated Statements of Cash Flows                           6
              Notes to Consolidated Financial Statements                      7


     Item 2.  Management's Discussion and Analysis of
                 Financial Condition and Results of Operations             8-13


     Item 3.  Quantitative and Qualitative Disclosures
                 About Market Risk                                           14

Part II.   Other Information


     Item 1. through Item 6.                                                 14

     Signatures                                                              15
<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP





            Cautionary Statement Regarding Forward Looking Statements



Certain   statements   contained  herein,   including   certain   statements  in
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations"   concerning  the  Fund's   business   outlook  or  future  economic
performances,  anticipated profitability,  revenues, expenses or other financial
items  together  with  other  statements  that  are  not  historical  facts  are
"forward-looking   statements"  as  that  term  is  defined  under  the  Federal
Securities Law. Forward-looking  statements are necessarily estimates reflecting
the best  judgement  of the party  making  such  statements  based upon  correct
information and involve a number of risks, uncertainties and other factors which
could  cause  actual  results to differ  materially  from  those  stated in such
statements.  Risks, uncertainties and factors which could affect the accuracy of
such forward looking  statements are identified in the Fund's Prospectus and the
Fund's Registration Statement filed by the Fund with the Securities and Exchange
Commission,  and forward looking statements  contained herein or in other public
statements of the Fund should be considered in light of those factors. There can
be no  assurance  that  factors  will not affect the  accuracy  of such  forward
looking statements.




                                       -2-

<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP
                          Consolidated Balance Sheets
                             (Dollars in thousands)
<TABLE>
<CAPTION>
                                                                June 30,
                                                                  1999       December 31,
                                                               (Unaudited)       1998
Assets
Current Assets
<S>                                                           <C>           <C>
 Cash and cash equivalents                                    $     1,970   $      2,928
 Accounts receivable, net                                           7,445          7,279
 Estimated third-party payor settlements                              778            882
 Prepaid expenses                                                     390            565
   Total current assets                                            10,583         11,654

Property and equipment, net of accumulated depreciation            33,413         33,653

Other assets - goodwill, net                                        4,871          4,998

   Total assets                                               $    48,867   $     50,305

Liabilities and Partners' Capital
Current liabilities
 Current portion of long-term debt                            $    22,960   $        720
 Accrued compensation and related costs                               740            941
 Accounts payable and other accrued expenses                        2,285          3,184
 Estimated third  party payor settlements                           2,033          2,093
   Total current liabilities                                       28,018          6,938

Deferred management fee payable                                       875            852
Loan payable to the Development General Partner                     1,111          1,086
Long-term debt                                                        -           22,616
                                                                    1,986         24,554

Partners' capital
 General partners                                                    (128)          (128)
 Assignee limited partners; 1,540,040
  units issued and outstanding                                     18,991         18,941
   Total partners' capital                                         18,863         18,813

   Total liabilities and
    partners' capital                                         $    48,867   $     50,305
</TABLE>


          See accompanying notes to consolidated financial statements

                                      -3-
<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP
                      Consolidated Statements of Earnings
                                  (Unaudited)
                 (Dollars in thousands except per unit amounts)
<TABLE>
<CAPTION>

                                                              Three Months Ended    Six Months Ended

                                                              June 30,   June 30,   June 30,   June 30,
                                                                1999       1998       1999       1998


Revenues
<S>                                                          <C>        <C>        <C>        <C>
 Medicaid and Medicare patients                              $ 10,049   $  9,821   $ 19,785   $ 19,425
 Private patients                                               2,547      2,677      5,083      5,469
 Investment and other income                                       30         57         65        133
                                                               12,626     12,555     24,933     25,027

Expenses
 Operating, including $2,845,  $1,712,
  $4,124 and $3,528 to related parties                          9,766      9,963     19,316     19,836
 Management and administration fees
  to related parties                                              820        825      1,620      1,623
 General and administrative                                       237        204        488        384
 Depreciation and amortization                                    487        483        984        969
 Interest expenses                                                407        399        822        938
                                                               11,717     11,874     23,230     23,750

Net earnings                                                 $    909   $    681   $  1,703   $  1,277


Net earnings per unit of assignee
 limited partnership interest-basic
 (computed based on 1,540,040
  units)                                                     $   0.58   $   0.44   $   1.09   $   0.82
</TABLE>


                 See accompanying notes to financial statements

                                      -4-
<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP
                  Consolidated Statements of Partners' Capital
                 For the Six Months Ended June 30, 1999 and 1998
                                   (Unaudited)
                              Dollars in thousands

<TABLE>
<CAPTION>
                                                                        Assignee
                                                             General    Limited
                                                             Partners   Partners    Total



<S>                                                         <C>        <C>        <C>
Balance at December 31, 1998                                $   (128)  $ 18,941   $ 18,813

Net earnings                                                      17      1,686      1,703

Distributions to partners                                        (17)    (1,636)    (1,653)

Balance at June 30, 1999                                    $   (128)  $ 18,991   $ 18,863





Balance at December 31, 1997                                $   (153)  $ 16,504   $ 16,351

Net earnings                                                      13      1,264      1,277

Distributions to partners                                        (17)    (1,636)    (1,653)

Balance at June 30, 1998                                    $   (157)  $ 16,132   $ 15,975
</TABLE>


          See accompanying notes to consolidated financial statements

                                       -5-
<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP
                     Consolidated Statements of Cash Flows
                       For the Six Months Ended June 30,
                                  (Unaudited)
                             (Dollars in thousands)
<TABLE>
<CAPTION>
                                                                 1999       1998

Cash flows from operating activities
<S>                                                           <C>        <C>
 Net earnings                                                 $  1,703   $  1,277
 Adjustments to reconcile net earnings to net
  cash provided by operating activities
   Depreciation and amortization                                   984        969
   Minority interest in net earnings of operating
    partnerships                                                    19         12
   Increase in loan payable to Development General Partner          25         26
   Increase in deferred management fee payable                      23         21
   Change in other assets and liabilities
    Accounts receivable                                           (185)      (873)
    Estimated third-party payor settlements                         44        834
    Prepaid expenses                                               175        204
    Accrued compensation and related costs                        (201)      (381)
    Accounts payable and other accrued expenses                   (899)       997

Net cash provided by operating activities                        1,688      3,086

Cash flows from investing activities-
 additions to property and equipment                              (617)      (237)


Cash flows from financing activities
 Repayment of long-term debt                                      (376)      (389)
 Distributions to partners                                      (1,653)    (1,653)

Net cash used in financing activities                           (2,029)    (2,042)

Net increase (decrease) in cash and cash equivalents              (958)       807
Cash and cash equivalents
 Beginning of period                                             2,928      2,275

 End of period                                                $  1,970   $  3,082
</TABLE>


          See accompanying notes to consolidated financial statements

                                      -6-
<PAGE>

         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP

                   Notes to Consolidated Financial Statements
                                  June 30, 1999
                                   (Unaudited)

NOTE 1 - THE FUND AND BASIS OF PREPARATION

The Fund, through its seven operating partnerships, derives substantially all of
its  revenue  from  extended  healthcare  provided to nursing  center  residents
including room and board, nursing care, drugs and other medical services.

The accompanying consolidated financial statements of Meridian Healthcare Growth
and Income  Fund  Limited  Partnership  (the  "Fund") do not  include all of the
information  and note  disclosures  normally  included in  financial  statements
prepared in  accordance  with  generally  accepted  accounting  principles.  The
unaudited  interim  consolidated  financial  statements  reflect all adjustments
which are, in the opinion of  management,  necessary to a fair  statement of the
results for the interim periods presented.  All such adjustments are of a normal
recurring nature. The unaudited interim financial  information  contained in the
consolidated  financial  statements  should  be read  in  conjunction  with  the
consolidated financial statements contained in the 1998 Annual Report.

NOTE 2 - RELATED PARTY TRANSACTIONS

The Fund is  obligated  to pay the  Administrative  General  Partner  an  annual
administration fee of the greater of $75,000 per year or 1/2 of 1% of the Fund's
annual  revenues.  The nursing centers owned by the operating  partnerships  are
managed by Meridian  Healthcare,  Inc., an affiliate of the Development  General
Partner,  under the terms of ten year  management  agreements  which provide for
management  fees  equal to 6% of the annual  revenues  of each  nursing  center.
Certain of the operating  partnerships  also purchase drugs and medical supplies
and other services from  affiliates of the  Development  General  Partner.  Such
purchases  are in turn billed to patients or third party  payors at prices which
on average approximate the nursing center's cost.

     Transactions with these related parties for the three months ended June 30,
1999 and 1998 are as follows:
<TABLE>
<CAPTION>
                                                        1999             1998

<S>                                                <C>                <C>
         Management and administration fees        $ 820,000          $ 825,000
         Drug and medical supplies purchases       1,370,000            478,000
         Nursing and rehabilitation services       1,475,000          1,234,000
         Interest expense on borrowings               23,000             23,000
</TABLE>

Loans outstanding  under an arrangement with the Development  General Partner to
fund operating  deficits  generated by the Mooresville,  Salisbury and Woodlands
nursing  centers were $1,111,000 at June 30, 1999 and $1,086,000 at December 31,
1998.

NOTE 3 - DEBT

On March 3, 1998,  the Fund  entered  into a renewal  commitment  with a bank to
refinance all of the existing indebtedness.  Under the terms of the refinancing,
the  mortgages  will mature on February 28, 2000 and will bear interest at LIBOR
(5.07%  at March 31,  1999)  plus  1.55%.  The  refinancing  also  extended  the
$4,000,000  line of credit  commitment  until  February 28, 2000.  There were no
borrowings outstanding under the line of credit commitment at June 30, 1999.

The Fund has classified the balance of the long-term debt as a current liability
on the June 30, 1999 balance sheet as a result of its February 28, 2000 maturity
date. The Fund's  managers are in discussion  regarding  several options for the
extension of the loan balances and line of credit.

NOTE 4 - NET EARNINGS PER UNIT OF ASSIGNEE LIMITED PARTNERSHIP INTEREST

Net earnings per unit of assignee limited  partnership  interest is disclosed on
the Consolidated Statements of Operations and is based upon 1,540,040 units.



                                       -7-
<PAGE>

         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP



                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations


Liquidity and Capital Resources

         The Fund has  sufficient  liquid  assets  and  other  available  credit
resources to satisfy its operating  expenditures and anticipated routine capital
improvements at each of the seven nursing home facilities.

         On March 3, 1998,  the Fund  entered into a renewal  commitment  with a
bank to  refinance  all of the  existing  indebtedness.  Under  the terms of the
refinancing,  the  mortgages  will  mature on  February  28,  2000 and will bear
interest at LIBOR plus 1.55%.  The refinancing  also extended the line of credit
commitment  until  February 28, 2000.  The Fund has a $4,000,000  line of credit
which is designated  for working  capital needs and is primarily  secured by the
accounts  receivable  of the Fund. At June 30, 1999,  there were no  outstanding
borrowings under this line of credit.

         The Fund has  classified the balance of the long-term debt as a current
liability  on the June 30, 1999  balance  sheet as a result of its  February 28,
2000 maturity  date.  The Fund's  managers are in discussion  regarding  several
options for the extension of the loan balances and line of credit.

         Between 1988 and 1989 the  Development  General Partner loaned the Fund
$597,000 to support operating deficits  generated by the Mooresville,  Salisbury
and Woodlands nursing centers during each center's first two years of operation.
Loans outstanding under this  arrangement,  including  interest at 9% per annum,
were  $1,111,000  at June 30,  1999.  The Fund is obligated to repay these loans
when certain specified financial criteria are met, the most significant of which
is the payment of a preferred return to the assignee limited partners as defined
in the Fund's partnership agreement.

         On August 12,  1999,  the Fund will make its second  quarter  1999 cash
distribution of $826,410 to its partners.  This  distribution  will be funded by
second quarter 1999 operations after payment of approximately  $117,360 of upper
tier expenses.

         Based on  operations  through the second  quarter and the 1999  budget,
distributions to partners are expected to remain at current levels and be funded
from the cash flow of the seven nursing  facilities.  The major challenge to the
Fund in the  foreseeable  future is to control  operating  expenses  in light of
Medicare's  conversion to the Prospective  Payment System ("PPS"), to maintain a
favorable  quality mix of patients and to increase the overall census at each of
the facilities.

Results of operations

      Three Months Ended June 30, 1999 vs. Three Months Ended June 30, 1998

         Net  earnings  were  $909,000  for the three months ended June 30, 1999
compared to $681,000  for the same  period in the prior  year,  representing  an
increase of $228,000 or 33.5%.

         The Fund's  second  quarter  1999  revenues  of  $12,626,000  increased
$71,000 or .6% over the same  period in 1998.  Medicare  and  Medicaid  revenues
increased while revenues from Private and Investment and other income  reflected
declines.

         Medicaid and Medicare revenues  increased $228,000 for the three months
ended June 30,  1999  compared  to the same  period in 1998.  This  increase  is
primarily  the  result of an  increase  in the  number of  Medicare  days and an
increase  in  Medicaid  rates.  The  Medicare  census  increased  1,641  days or
approximately 17.6% for the second quarter of 1999 compared to 1998 resulting in
increased  revenue of $474,000.  Medicaid  rates  increased  approximately  8.3%
representing  an increase in revenue of  approximately  $533,000  for the second
quarter of 1999 compared to the same period in 1998.  Partially offsetting these
increases has been a decrease in Medicare Part B revenue of $160,000, a decrease
in  Medicaid  census of 4,067 days which  resulted  in a decrease  in revenue of
$416,000 and a decrease in Medicare rates which  negatively  impacted revenue by
approximately $203,000.



                                       -8-

<PAGE>

         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP



                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations


Results of operations (continued)

         Private  revenue of $2,547,000 for the second quarter of 1999 decreased
$130,000 or 4.8% when compared to the second  quarter of 1998.  This decrease is
primarily the result of a decrease in Private and Veterans  Administration  (VA)
patient days and a decrease in insurance rates.  Private and VA census decreased
387 and 801 days,  in the second  quarter of 1999 compared to the same period as
the prior year.  Partially  offsetting these census decreases was an increase in
Insurance  census  of 334 days.  In the  aggregate,  the  census  variances  for
Private,  VA and  Insurance  resulted in a decrease  in revenue of $59,000.  The
average  insurance  rate decreased  approximately  4.8% in the second quarter of
1999  compared  to the  second  quarter of 1998.  This  insurance  rate  decline
resulted in an overall revenue decrease of approximately $40,000.

         Second quarter 1999 expenses of $11,717,000  decreased $157,000 or 1.3%
from the three months ended June 30, 1998.

         Operating  expenses  decreased  $197,000 primarily due to a decrease in
the cost of ancillary  services.  Ancillary  expenses overall decreased $475,000
for the  second  quarter  of 1999  compared  to the same  period  in 1998.  This
decrease  is  primarily  due to a  decrease  in the  cost of  Physical,  Speech,
Occupational  and  Respiratory  therapies.  In  response  to the  transition  to
Medicare's  PPS, the contracts with the therapy  providers were  renegotiated at
lower rates.  Offsetting  the  decrease in  ancillary  expense is an increase in
Salaries & Wages and  Benefits of $318,000  for the three  months ended June 30,
1999 compared to the same period in 1998.  This  represents a 5% increase and is
primarily the result of annual salary and wage increases.

         General and  Administrative  expense of $237,000  increased  $33,000 or
approximately  16%  during the second  quarter  of 1999  compared  to the second
quarter of 1998, due to an increase in administrative  purchased  services costs
incurred for licenses and certifications.

        Six Months Ended June 30, 1999 vs. Six Months Ended June 30, 1998

         Net  earnings  for the six  months  ended June 30,  1999 of  $1,703,000
increased $426,000 or 33.4% over the same period in 1998.

         Fund revenues decreased $94,000 or .4% during the six months ended June
30, 1999 compared to the same period in the prior year. This overall decrease is
the result of a decline in census and a  decrease  in  Medicare  Part B revenue.
Overall  census has  declined  6,015 days for the six months ended June 30, 1999
compared to the same period in 1998.  Private,  Medicaid and Veterans  reflected
census declines of 1,772 days, 5,752 days and 1,346 days respectively. Partially
offsetting  these  declines  were  census  increases  for  insurance  of 573 and
Medicare of 2,282.  The decline in census  resulted  in a revenue  reduction  of
approximately $190,000 during the six months ended June 30, 1999 compared to the
same  period in the prior  year.  Medicare  B  revenue  decreased  approximately
$320,000 due to lower utilization and charges resulting from the January 1, 1999
transition to the Medicare PPS.  Partially  offsetting the decline in census and
Medicare  Part B  revenue  has been an  overall  increase  in rates  which  grew
approximately 1.7% resulting in increased revenue of approximately  $416,000 for
the six months ended June 30, 1999 compared to the same period in 1998.

         Overall expenses decreased $520,000 or 2.18% to $23,230,000 for the six
months ended June 30, 1999 compared to $23,750,000 for the same period in 1998.

         Operating  expenses of $19,316,000  decreased  $520,000 or 2.6% for the
six months  ended June 30, 1999  compared to the six months ended June 30, 1998,
primarily due to a decrease in ancillary expenses. For the six months ended June
30, 1999  ancillary  expenses  decreased  $1,289,000 or 32% compared to the same
period in 1998,  due  primarily to a decrease in the cost of  Physical,  Speech,
Occupational  and Respiratory  therapies.  In response to the transition to PPS,
the  contracts  with the therapy  providers  were  renegotiated  at lower rates.
Offsetting these cost


                                       -9-
<PAGE>

         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP



                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations


Results of operations (continued)

 decreases has been an increase in Salary & Wages and Benefits of $713,000. This
increase is primarily due to annual inflationary increases.

         General and Administrative costs increased $104,000 to $488,000 for the
six months  ended June 30,  1999  compared to the same period in the prior year.
This increase is primarily due to an increase in the cost of purchased  services
in the  dietary  and  administrative  departments,  an increase in the costs for
licenses and certifications and increased  professional fees incurred related to
the  potential  sale  of  the  Fund's  nursing  centers  that  subsequently  was
terminated.

         Interest expense  decreased  $116,000 for the six months ended June 30,
1999 compared to the same period in the prior year.  As a result of  refinancing
the mortgage at lower interest rates.  The  refinancing  took effect on February
28, 1998.


Legislative and Regulatory Issues

         All of the Fund's  facilities,  to the extent  required,  are  licensed
under  applicable  law.  State and local  agencies  survey the  facilities  on a
regular  basis to  determine  whether  the  facilities  are in  compliance  with
governmental  operating and health standards and conditions for participation in
government sponsored third party payor programs. On occasion and in the ordinary
course of business,  the Fund's  facilities  receive notices of deficiencies for
failure  to comply  with  various  regulatory  requirements.  In the case of the
College View facility,  there have been a series of notices alleging violations.
The reviewing  agency may take various  adverse actions against the College View
facility  including  fines,  temporary  suspension of admission of new patients,
suspension or  decertification  from  participation in the Medicare and Medicaid
programs and, in extreme  circumstances,  revocation of the facility's  license.
While the  resolution  of this  matter is  pending,  College  View is working to
remedy all deficiencies and satisfy the reviewing agency.

         Legislative and regulatory action has resulted in continuing changes in
the Medicare and Medicaid reimbursement  programs. The changes have limited, and
are expected to continue to limit, payment increases under these programs. Also,
the timing of payments made under the Medicare and Medicaid  programs is subject
to regulatory action and governmental  budgetary  constraints;  in recent years,
the time period between  submission of claims and payment has increased.  Within
the  statutory  framework  of the  Medicare  and  Medicaid  programs,  there are
substantial areas subject to administrative  rulings and  interpretations  which
may further affect payments made under those programs.  Further, the federal and
state  governments  may reduce the funds  available  under those programs in the
future or require more stringent  utilization  and quality  reviews of eldercare
centers or other  providers.  There can be no assurances that  adjustments  from
Medicare or Medicaid audits will not have a material adverse effect on the Fund.

         Pursuant to the  Balanced  Budget Act  commencing  with cost  reporting
periods beginning on July 1, 1998, PPS began to be phased in for skilled nursing
facilities  at a per diem rate for all covered Part A skilled  nursing  facility
services  as well as many  services  for which  payment may be made under Part B
when a  beneficiary  who is a resident of a skilled  nursing  facility  receives
covered  skilled  nursing  facility  care.  The  consolidated  per diem  rate is
adjusted  based upon the  Resource  Utilization  Group  ("RUG").  In addition to
covering skilled nursing facility services,  this consolidated payment will also
cover  rehabilitation  and  non-rehabilitation   ancillary  services.  Physician
services,  certain nurse practitioner and physician  assistant  services,  among
others,  are not  included  in the per  diem  rate.  For the  first  three  cost
reporting  periods beginning on or after July 1, 1998, the per diem rate will be
based on a blend of a facility  specific  rate and a federal  per diem rate.  In
subsequent  periods,  and for facilities  first receiving  payments for Medicare
services  on or after  October 1, 1995,  the  federal per diem rate will be used
without any facility specific blending.

                                      -10-

<PAGE>

         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP



                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations



Legislative and Regulatory Issues (continued)

         The Balanced Budget Act also required  consolidated billing for skilled
nursing facilities.  Under the Balanced Budget Act, the skilled nursing facility
must submit all Medicare  claims for Part A and Part B services  received by its
residents  with the  exception of  physician,  nursing,  physical  assistant and
certain  related  services,  even if such  services  were  provided  by  outside
suppliers.  Medicare will pay the skilled  nursing  facilities  directly for all
services on the consolidated bill and outside suppliers of services to residents
of the skilled nursing  facilities must collect payment from the skilled nursing
facility.  Although consolidated billing was scheduled to begin July 1, 1998 for
all services,  it has been delayed until further notice for  beneficiaries  in a
Medicare Part A stay in a skilled nursing facility not yet using PPS and for the
Medicare  Part B stay.  There can be no assurance  that the Fund will be able to
provide skilled nursing services at a cost below the established Medicare level.

         Under PPS, the reimbursement for certain speech, occupational, physical
and respiratory  therapy  services  provided to nursing  facility  patients is a
component  of the  total  reimbursement  to the  nursing  facility  allowed  per
patient.  Medicare  reimburses  the skilled  nursing  facility  directly for all
rehabilitation  services and the outside suppliers of such services to residents
of the skilled  nursing  facility must collect  payment from the skilled nursing
facility.   Under  PPS,  a  per  provider   limit  of  $1,500   applies  to  all
rehabilitation  therapy  services  provided  under  Medicare  Part B ($1,500 for
physical  and  speech-language  pathology  services,  and a separate  $1,500 for
occupational  therapy services).  Additionally  Medicare Part B therapy services
are no longer being reimbursed on a cost basis; rather, payment for each service
provided  is based on fee screen  schedules  published  in November  1998.  As a
result  of the  implementation  of  PPS,  the  Fund  has to date  experienced  a
substantial reduction in Medicare B therapy revenues.

         The  Balanced  Budget Act also  repealed  the Boren  Amendment  federal
payment standard for Medicaid payments to Medicaid nursing facilities  effective
October 1, 1997.  The Boren  Amendment  required  Medicaid  payments  to certain
health care  providers to be reasonable  and adequate in order to cove the costs
of efficiently and economically operated health care facilities. States must now
use a public notice and comment  period in order to determine  rates and provide
interested parties a reasonable opportunity to comment on proposed rates and the
justification for and the methodology used in calculating such rates.  There can
be no assurance  that budget  constraints or other factors will not cause states
to reduce Medicaid  reimbursement  to nursing  facilities and pharmacies or that
payments to nursing  facilities and  pharmacies  will be made on a timely basis.
The law also grants greater  flexibility to states to establish Medicaid managed
care projects without the need to obtain a federal waiver. Although these waiver
projects generally exempt  institutional care,  including nursing facilities and
institutional  pharmacy services, no assurances can be given that these projects
ultimately  will  not  change  the  reimbursement  system  for  long-term  care,
including  pharmacy services from  fee-for-service to managed care negotiated or
capitated rates.  The Fund  anticipates that federal and state  governments will
continue  to review and assess  alternative  health  care  delivery  systems and
payment methodologies.

         In July 1998,  the Clinton  Administration  issued a new  initiative to
promote the quality of care in nursing homes. This initiative  includes,  but is
not  limited to (I)  increased  enforcement  of nursing  home safety and quality
regulations;  (ii) increased  federal  oversight of state inspections of nursing
homes;  (iii)  prosecution  of egregious  violations  of  regulations  governing
nursing  homes;  (iv) the  publication  of nursing  home  survey  results on the
Internet;  and (v)  continuation  of the  development  of the  Minimum  Data Set
("MDS"), a national automated clinical data system.  Accordingly,  with this new
initiative it may become more  difficult  for  eldercare  facilities to maintain
licensing  and  certification.  The  Fund  may  experience  increased  costs  in
connection with maintaining its licenses and certifications as well as increased
enforcement actions. In addition,  beginning January 1, 1999, outpatient therapy
services  furnished  by a skilled  nursing  facility  to a resident  not under a
covered Part A stay or to  nonresidents  who receive  outpatient  rehabilitation
services will be paid according to the Medicare Physician Fee Schedule.

                                      -11-

<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP



                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations



Year 2000 Compliance

         The  Development  General  Partner ("DGP) has  implemented a process to
address its Year 2000 compliance  issues.  The process includes (i) an inventory
and assessment of the  compliance of the essential  systems and equipment of the
Fund and of Year 2000 mission  critical  suppliers,  customers,  and other third
parties, (ii) the remediation of non- compliant systems and equipment, and (iii)
contingency  planning.  The DGP is in the process of conducting  its  inventory,
assessment and  remediation  of its  information  technology  ("IT") systems and
equipment  and  non-IT  systems  and  equipment  (embedded  technology)  and has
completed  approximately  96% of  its  internal  inventory  and  assessment  and
approximately 80% of the systems and equipment of critical suppliers,  customers
and other third parties.

         With respect to the Year 2000 compliance of critical third parties, the
Fund  derives a  substantial  portion  of its  revenues  from the  Medicare  and
Medicaid  programs.  Congress'  General  Accounting  Office ("GAO") concluded in
September 1998 that it would be highly  unlikely that all Medicare  systems will
be  compliant  on time to ensure the  delivery  of  uninterrupted  benefits  and
services into the Year 2000. While the Fund does not receive  payments  directly
from  Medicare,  but from  intermediaries,  the GAO statement is  interpreted to
apply as well to these intermediaries. Recently, the HCPA Administrator asserted
that all systems  necessary to make payments to fiscal  intermediaries  would be
compliant.  The  Administrator  provided  further  assurance  that  intermediary
systems would also be compliant  well in advance of the deadline.  Additionally,
most  intermediaries  have  reported  to the Fund that they are  either  already
compliant or will be prior to the end of 1999.  Nonetheless,  the DGP intends to
actively  confirm the Year 2000 readiness  status for each  intermediary  and to
work  cooperatively  to ensure  appropriate  continuing  payments  for  services
rendered to all government-insured patients.

         The  DGP  is  remediating  its  critical  IT  and  non-IT  systems  and
equipment.  The DGP has  also  begun  contingency  planning  in the  event  that
essential  systems and  equipment  fail to be Year 2000  compliant.  The Fund is
planning  to be  Year  2000  compliant  for  all of its  essential  systems  and
equipment by October 31, 1999,  although  there can be no assurance that it will
achieve its objective by such date or by January 1, 2000, or that such potential
non-compliance  will not have a material  adverse effect on the Fund's business,
financial  condition  or  results of  operations.  In  addition  there can be no
assurance that all of the Fund's critical suppliers and other third parties will
be Year 2000 compliant by January 1, 2000, or that such potential non-compliance
will not have a  material  adverse  effect  on the  Fund's  business,  financial
condition or results of operations.

         The DGP currently  estimates that its aggregate costs directly  related
to Year 2000  compliance  efforts  will be  approximately  $1,600,000,  of which
approximately  $1,000,000  has been spent through June 30, 1999.  The DGP's Year
2000 efforts are ongoing and its overall plan and cost estimations will continue
to evolve, as new information becomes available. The Fund's analysis of its Year
2000 issues is based in part on information  from third party  suppliers;  there
can be no assurance that such information is accurate of complete.

         The failure of the DGP or third parties to be fully Year 2000 compliant
for  essential  systems  and  equipment  by  January  1,  2000  could  result in
interruptions  of normal business work  operations.  The Fund's  potential risks
include (i) the inability to deliver patient care related services in the Fund's
facilities  and/or in  non-affiliated  facilities,  (ii) the delayed  receipt of
reimbursement  from  the  Federal  or  State  governments,  private  payors,  or
intermediaries,  (iii) the  failure  of  security  systems,  elevators,  heating
systems or other operational  systems and equipment of the Fund's facilities and
(iv) the inability to receive critical equipment and supplies from vendors. Each
of these events  could have a material  adverse  affect on the Fund's  business,
results of operations and financial condition.

         Contingency plans for the DGP's Year 2000-related issues continue to be
developed  and  include,  but are not limited to,  identification  of  alternate
suppliers,  alternate  technologies  and alternate  manual  systems.  The DGP is
planning to have contingency plans completed for essential systems and equipment
by October 31, 1999;  however,  there can be no assurance that it will meet this
objective by such date or by January 1, 2000.


                                      -12-

<PAGE>

         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP



                Management's Discussion and Analysis of Financial
                       Condition and Results of Operations


Year 2000 Compliance (continued)

         The Year 2000 disclosure set forth above is intended to be a "Year 2000
Statement"  as such term is defined in the Year 2000  Information  and Readiness
Disclosure Act of 1998 (the "Year 2000 Act") and, to the extent such  disclosure
relates to Year 2000  processing of the Fund or to products or services  offered
by the Fund, is also  intended by be "Year 2000  Readiness  Disclosure"  as such
term is defined in the Year 2000 Act.



                                      -13-

<PAGE>

         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


                          PART I. FINANCIAL INFORMATION


Item 3.     Quantitative and Qualitative Disclosures About Market Risk

         The market risk  associated  with financial  instruments and derivative
financial and commodity  instruments is the risk of loss from adverse changes in
market prices or rates.  The Fund's market risk arises  primarily  from interest
rate risk relating to its long-term borrowings which bear interest at LIBOR plus
1.55% of a designated  bank.  Long-term  borrowings  are classified as a current
liability  since they have a February 28, 2000 maturity  date. The Fund does not
expect  that it will make  borrowings  under its line of credit  and  intends to
continue  reducing  the  outstanding  balance  of its  long-term  borrowings  in
accordance with its amortization schedule. Assuming that the outstanding balance
were to remain unchanged from that at June 30, 1999  ($22,960,000) a 1% increase
in the  LIBOR  rate  of  interest  would  reduce  the  Fund's  net  earnings  by
approximately $230,000 on an annualized basis.






                           PART II. OTHER INFORMATION


Item 1.     Legal Proceedings

                  Inapplicable

Item 2.     Changes in Securities and Use of Proceeds

                  Inapplicable

Item 3.     Defaults upon Senior Securities

                  Inapplicable

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

                  Inapplicable

Item 5.     Other Information

                  Inapplicable

Item 6.     Exhibits and Reports on Form 8-K

                  a)  Exhibits:    Financial Data Schedule

                  b)  Reports on Form 8-K:     None






                                      -14-

<PAGE>

         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP




                                   SIGNATURES




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


                                MERIDIAN HEALTHCARE GROWTH AND INCOME FUND
                                      LIMITED PARTNERSHIP




DATE:    8/10/99                By:         /s/ John M.  Prugh
                                         John M. Prugh
                                         President and Director
                                         Brown-Healthcare, Inc.
                                         Administrative General Partner




DATE:    8/10/99                By:        /s/ Timothy M.  Gisriel
                                         Timothy M. Gisriel
                                         Treasurer
                                         Brown-Healthcare, Inc.
                                         Administrative General Partner




                                      -15-