<PAGE>  

                               UNITED STATES
                     SECURITIES AND EXCHANGE COMMISSION  
                          Washington, D.C. 20549  
  
                                FORM 10-QSB  
  
          Quarterly Report Pursuant to Section 13 or 15(d) of the   
                      Securities Exchange Act of 1934  
  

           For the quarterly period ended          June 30, 1998
  
           Commission file Number                   000-28976  


                     Acadia National Health Systems, Inc.
          (Exact name of registrant as specified in its charter.)  


                     Colorado                      10509781
          (State or other jurisdiction of       (I.R.S. Employer  
          incorporation or organization)       Identification No.)  

                  95 Park Street, Lewiston, Maine U.S.A.04240
              (Address of principal executive offices)(Zip Code)  
  

            Registrant's telephone number, including area code:
                                (207) 777-3423
                                (800) 274-9185
 
<PAGE>

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 [  ]  
 
 
Indicate the number of shares outstanding of each of the 
issuer's classes of common stock, as of the latest practical 
date:  
  
Common Stock, $0 Par Value - 
3,737,987 shares as of June 30, 1998.


<PAGE>  1

PART I - FINANCIAL INFORMATION 

ITEM 1

                      ACADIA NATIONAL HEALTH SYSTEMS, INC. 
                               BALANCE SHEETS  
                                 (Unaudited)
 
                                         June 30, 1998     June 27, 1997
                                         _____________     _____________
 
Current Assets:
     Cash-Operating                      $     2,963       $   101,585
     Accounts Receivable                     400,826           498,667
     Un-billed Work at Estimated
          Realizable Value                   133,525            74,836
     Inventories                               4,256             4,091
     Other Current Assets                     69,035             4,371
                                         -------------     -------------
     Total Current Assets                $   610,605       $   683,550

Prop., Plant & Equip.:
     Cost                                    218,150           169,596
     Less Accum. Depr.                      (101,281)          (73,837)
                                         -------------     -------------
                                         $   116,869       $    95,758

Other Assets:
     Other                                     7,000             7,500
     Organization Cost                        35,502            34,110
     Less Accum. Amort.                       (8,272)           (4,912)    
     Notes Receivable                         52,400
                                         --------------    -------------
                                         $    86,630       $    36,698   
Total Assets                             $   814,104       $   816,006
                                         ==============    =============

Current Liabilities:
     Accounts Payable                    $    12,358       $     1,568 
     Line of Credit                          269,127           259,446
     Accrued Expense                          38,159           196,220
     Current Portion of
          Long Term Notes                     18,000            18,000
                                         --------------    -------------

Total Current Liabilities                $   337,644       $   475,233

<PAGE> 2

                                         June 30, 1998     June 27, 1997
                                         ______________    _____________

Long Term Liabilities:
     Long Term Debt                          114,578            93,349
     Other Non-Current Liabilities                 0                 0
                                         --------------    -------------
Total Liabilities                        $   452,222       $   568,582

Stockholders' Equity:
     Common Stock                            276,640           251,640
     Treasury Stock                           (1,272)                0      
     Paid In Capital                          43,961             1,175
     Retained Earnings                        42,553            (5,391)
                                         --------------    -------------
Total Equity                             $   361,882       $   247,424
                                         --------------    -------------
Total Liabilities & Equity               $   814,104       $   816,006
                                         ==============    =============

See Accompanying  
Notes to Financial Statements  
  
<PAGE>  3

                     ACADIA NATIONAL HEALTH SYSTEMS, INC. 

                             STATEMENT OF INCOME  
                            FOR THE THREE MONTHS  
                    ENDED JUNE 30, 1998 AND JUNE 27, 1997  
                                 (Unaudited)  

                                  Three months ended     Three months ended
                                  June 30                June 27 
                                  __________________     __________________
                                  1998                   1997   
                                  __________________     __________________

Sales:                            $     309,228          $     156,355

Operating Expenses                $     278,754          $     159,312
                              
                                  ------------------     ------------------

Net Operating Income              $      30,474          $      (2,957)

Other Income/(Expense), Net       $       5,161          $      (7,767)
                              
                                  ------------------     ------------------

Net Income (Loss) Before Taxes    $      35,635          $     (10,724)

Provision for Income Taxes        $       7,213          $       2,405 
                              
                                  ------------------     ------------------

Net Income                        $      28,422          $      (8,318)
                                  ==================     ==================

Net Income (Loss) Per Share       $       0.008          $      (0.002)

Weighted Average Number
of Common Shares Outstanding          3,737,987              3,733,987      
    
See Accompanying 
Notes to Financial Statements  

<PAGE>  4

                       ACADIA NATIONAL HEALTH SYSTEMS, INC.

                             STATEMENTS OF CASH FLOWS     
                     FOR THE THREE MONTHS ENDED JUNE 30, 1998  
                                 AND JUNE 27, 1997  
                                    (Unaudited)       

                                     Quarter Ending        Quarter Ending
                                     June 30, 1998         June 27, 1997
                                     ---------------       ---------------

Net Income (Loss)                    $     28,422          $      (8,318)

Depreciation & Amortization                 9,602                  8,417

Changes in Assets & Liabilities:
     Accounts Receivable                  269,668                  3,914
     Other Current  Assets                 13,685                  2,688
     Other Non-current Assets                                        244 
     Accounts Payable                     (34,624)                (1,293)
     Other Current Liabilities           (132,395)              (126,248)
                                     ---------------       ---------------

Net Cash (Used for) Provided
     By Operating Activities         $    154,357          $    (120,598)

Investment Activities                     (38,376)                  (908)

Financing Activities                     (132,707)                69,866
                                     ---------------       ---------------
   
Net Increase (Decrease) in
     Cash or Cash Equivalents             (16,726)               (51,639)
 
Cash & Cash Equivalents:
     Beginning of Period                   19,689                153,222
 
     End of Period                   $      2,963          $     101,583
                                     ===============       ===============

See Accompanying Notes to
Financial  Statements  

<PAGE>  5

ACADIA NATIONAL HEALTH SYSTEMS, INC.

NOTES TO FINANCIAL STATEMENTS  
  
  
Note 1. Summary of Significant Accounting Policies  
  
The accompanying unaudited financial statements have been prepared in 
accordance with Generally Accepted Accounting Principles for interim financial 
information and with the instructions to Form 10QSB and Rule 310 of Regulation 
S-B.  Accordingly, they do not include all of the information and footnotes 
required by Generally Accepted Accounting Principles for complete financial 
statements.  In the opinion of management, all adjustments (consisting of 
normal recurring accruals) considered necessary for fair presentation have 
been included.

The accompanying unaudited financial statements should be read in conjunction 
with the audited balance sheet of Acadia National Health Systems, Inc. ("the 
Company") included in the 1997 Annual Report filed on Form 10KSB.  The 
unaudited financial statements have been prepared in the ordinary  course of 
business for the purpose of providing information with respect to the interim 
period.  
  
Note 2. Net Income Per Common Share  
  
Computation of net income per common share was based on the weighted average 
number of shares outstanding during such periods.  These amounted to 3,737,987 
shares for the three months ending June 30, 1998 and 3,733,987 shares for the 
three months ending June 27, 1997.

Note 3. Long Term Debt - Short Term Financing  
  
The total of lines of credit drawn upon (outstanding) from Northeast Bank, FSB 
("Bank") as of June 30, 1998 was $269,127 on a $650,000 demand line limit, 
compared to $259,446 at June 27, 1997 on a line of credit from Peoples 
Heritage Bank.  
  
On July 24, 1997, Bank provided the Company an $100,000 term loan, and on June 
24, l998 an additional $30,000, of which $111,728 is outstanding.  All loans 
made by Bank under such facilities are renewable at six month terms.   

All loans and repayment of lines of credit payable to Bank and future 
borrowings under any such credit facilities have been collateralized by the 
accounts receivable and equipment of the Company.

<PAGE>  6

Note  4. Majority Stockholders  
 
Mr. Paul W. Chute, Mrs. Jacquelyn J. Magno and Mr. Mark T. Thatcher, members 
of the Board of Directors, had total voting authority, on June 30, 1998 and 
owned approximately 67% of the Common Stock of the Company.  
  
Note 5. Additional Bank Financing Events  
            
A. On July 24, 1997 and renewed on July 1, l998,  Northeast Bank FSB of 
Auburn, Maine provided the following loans, which were used to retire all 
outstanding debt obligations to Peoples Heritage Bank,  with the following 
balance for operations:

 1.) $400,000 line of credit for operations and funding
     of its waivered billing/foster care product, variable at 
     1.25% over national prime APR.

 2.) $100,000 term loan, 5 year variable, at 1.25%
     over national prime APR. 
          
 3.) $250,000 line of credit to fund a new billing
     service product, variable at 1% over national
     prime APR.

 4.) On June 24, l998 an additional $30,000 term loan, 4 year 
     variable at  1.25% over national prime APR was authorized
     and combined with loan No. 2 above.

These new term loans and lines of credit are secured by the accounts 
receivable, inventory and equipment of the Company.

Note 6.  Account Receivable Financing

The Company has arrangements with certain customers whereby the Company 
advances the customers amounts based on their security and collateralized by 
their accounts receivable.  The Company then assumes the responsibility for 
billing and collecting such receivables.  

                                       06/30/98     06/27/97

  Accounts Receivable (Trade)          $201,114     $129,405
  Accounts Receivable (Advances)        333,237      444,098

  Total Accounts Receivable            $534,351     $573,503
                                       =========    =========

<PAGE>  7

The Advances are secured by third party collateral and pre-approval from the 
State of Maine Department of Human Services. 

Item 7.  Note Receivable

The Company holds  $86,293 in a conditional note receivable from a vendor of 
which $75,000 earns 10% interest, due in monthly installments of $2,420, 
including interest beginning November 1, l998.  The $75,000 note is secured by 
accounts receivable, equipment and inventory of the vendor. 

<PAGE>  8

ITEM 2. 

                   ACADIA NATIONAL HEALTH SYSTEMS, INC.
                       MANAGEMENT'S DISCUSSION AND  
                   ANALYSIS OF FINANCIAL CONDITION AND  
                          RESULTS OF OPERATIONS  

                              June 30, 1998  

RESULTS OF OPERATIONS:
======================
THREE MONTHS ENDING JUNE 30, 1998
=====================================

The Company's financial statements and notes thereto for the current period 
and the audited financial statements and notes thereto for the fiscal year 
ending September 27, l997, should be read in conjunction with this 
Management's Discussion.  

FORWARD-LOOKING INFORMATION

This Analysis and Discussion contains certain forward-looking statements 
within the meaning of Section 27 (A) of the Securities and Exchange Act of 
1933 and Section 21 (E) of the Securities and Exchange Act of 1934.  Actual 
results could differ materially from those projected in the forward-looking 
statements as a result of certain risks factors set forth below and elsewhere 
in this report.  In addition to the other information contained in this 
report, individuals should carefully consider the following risk factors:

1.     The Company believes that its assumptions are based upon reasonable 
data derived from and known about its business and operations.  No assurances 
are made that actual results of operations or the results of the Company's 
future activities will not differ materially from its assumptions;  

2.     Additional risks factors such as the uncertainty of the Company's 
marketing activities, and the results of bringing additional acquisitions and 
affiliations into a smooth operation with Company are unknown;  

3.     Additional concerns regarding the year 2000 compliance standards as 
they effect the Company's operating technology as well as the technologies of 
the industry which effect payment and processing of Company's billings; 

4.     In addition to the uncertainties regarding Federal and state 
government regulations; specifically, Medicare compliance standards relative 
to fraud, abuse and the Company's approach to defining and maintaining an 
appropriate and thorough compliance program for such Federal and state 
standards;  

<PAGE>  9

5.     Additional uncertainties regarding the ability for operating cash to 
meet the current and projected cash flow needs of the organization;  

6.     Readers are cautioned not to place undue reliance on these 
forward-looking statements, as they attempt to speak only of activities known 
or anticipated as of this date.   

YEAR 2000 COMPLIANCE

The Company continues to review its technology systems to attempt to discover 
what effects year 2000 issues may have on its operations.  Many of the earlier 
systems, found not to be compliant, have been replaced while others are being 
modified to comply.  The Company is working with its known suppliers of  
technology or services controlled by technology that might be effected by the 
year 2000 events and are seeking written assurances from those determined to 
have a potential effect upon Company's operations.  However, there can be no 
assurance that the Company will identify all of its data handling problems in 
its business systems or those of its suppliers or clients in advance of any 
effect  upon Company's operations.  The Company, therefore, bears some 
unlimited and unknown risks to the year 2000 issue and could also be adversely 
effected if other entities (State of Maine Department of Medicaid or 
Medicare)does not adequately or timely resolve their payment mechanisms as it 
relates to the Company's ongoing billing operations for its clients.  

SALES

Sales for the period were $309,228 compared to $156,355 for the corresponding 
period in 1997.  This represents a 98% increase in volume for the period.  
This sales increase was due to new client business starting mid March 1998.  
Acadia has been successful in adding six (6) new clients during mid March with 
annualized revenues of $325,000 and three (3) contracts for mid April 1998 
with revenues of $100,000.  

These new clients are medical specialists in radiology, anesthesiology, 
behavioral and family medicine which further compliments our solid base in 
these disciplines.  

The Company anticipates successfully signing in July 1998 a significant 
contract with a major local behavioral medicine group for a one year term with 
expected revenue of $250,000.  Half of this contract requires Acadia to work 
out old receivables from the client's previous billing company.  No assurances 
of a contract extension for the ongoing work exists and both parties have 
agreed to review the companies results in May 1999 to determine if any future 
contractual relationship should take place.  

Two additional client contracts have been signed effective August 1, l998 and 
September 1, l998, with anticipated gross sales of $50,000 to $65,000 for the 
Company's fiscal year 1999.  

<PAGE>  10

OPERATING EXPENSES

Increases in operating expenses during the period were principally due to 
routine operating expenses, addition to increases in depreciation, office 
expenses, legal and accounting fees and hiring additional members of senior 
management.  Reactive operating expenses are anticipated with the major 
behavioral client contract and the other contracts signed for July, August 
and September.  

OPERATING INCOME

An operating gain for the quarter June 30, l998 was $28,422, compared to a 
loss of  $8,318 for the three month period in 1997. 

INCOME TAXES

Acadia is a C Corporation with current period June 30, l998 accruals for state 
and Federal taxes of $7,213 versus a tax credit of $2,405 for the period 
ending June 27, l997.   

NET INCOME

Acadia's gain of $28,422 was $0.008 per share on 3,737,987 outstanding common 
shares for the three months ended June 30, l998 compared to a loss of $8,318 
or  ($0.002) per share on 3,733,987 outstanding common shares for the period 
ended June 27, l997.  The fiscal year 1998, fourth quarter ending September 
30, l998, should show an improved net income due in part to the large 
behavioral medicine client and its immediate effect on positive cash flow.  

The Company is experiencing an improved cash flow due to improved payments 
from major payers and is anticipating an additional cash flow from the active 
collections of the old receivables of the behavioral medicine client.

LIQUIDITY AND CAPITAL RESOURCES

The Company's non-trade accounts receivable decreased to $333,237 due to the  
reimbursement from the State of Maine for waivered foster home and non-medical 
billing programs.  These are clean secured receivables with the majority due 
from the State of Maine. Acadia completed most of its  corporate organization 
costs prior to this quarter.  Anticipated public reporting expenses and 
planned acquisitions will place additional demands on liquidity.  Management,
with its new principal lender, Northeast Bank FSB maintain routine analysis 
of the  lines of credit and the Company's capital needs.  

The Company received a $30,000 four (4) year term loan, variable rate of 1.25% 
over national prime APR on June 24, l998.  This Loan was used for capital 
costs of bringing on new clients and working capital. 

<PAGE>  11

The Company plans on investing $75,000 to $100,000 in technology and software 
during the fourth fiscal quarter of 1998 ending September 30th.  The Company 
anticipates cash flow from operations and the $30,000 term loan to adequately 
meet these expenditures.  


PART II - OTHER INFORMATION  


ITEM 1    Legal Proceedings

          Neither the Registrant nor any of its affiliates are a 
          party, nor is any of their property subject, to material 
          pending legal proceedings or material proceedings known 
          to be contemplated by governmental authorities.


ITEM 2    Changes in Securities

          4,000 shares of common stock, no par value, were issued to new 
          management staff as recruiting inducements to join the Company.


ITEM 3    Defaults Upon Senior Securities

          None


ITEM 4    Submission of Matters to a Vote of Security Holders

          None


ITEM 5    Other Information


OTHER INFORMATION
===================
Acadia spent the last of 1997 and first of 1998 preparing our organization for 
rapid sales growth and expansion.  We have completely revised our operating 
policies, installed a new financial management system and recruited 
experienced, operational and management personnel.  We are now adding clients 
at the rate of one to two per month, with current annualized sales more than 
doubling as compared to the prior year.  Additionally, we maintain our current 
public reporting status pursuant to Section 12 of the Securities Exchange of 
1934 (the "Exchange Act")  and have our common equity listed for trading on 
the OTC Bulletin Board under the symbol OTCBB:  ACAD.  During the third 
quarter of 1997 year the Company  negotiated three signed Letters of Intent 
with other medical management service organizations and technology companies.  

<PAGE>  12

Due to the inability of management and advisors of Acadia to negotiate terms 
favorable for the Company and its shareholders, discussions with these 
businesses have been terminated.  Acadia has initiated and maintains 
discussions with other medical service businesses regarding  potential 
business alliances that are ongoing. The Company is working with investment 
firms, specializing in health care companies, who might be interested in
arranging future capitalization.  Acadia is also developing a relationship 
with retail brokerage firms who will assist in providing support to our 
public float.  Due to Acadia's rapid growth, we are relocating our corporate 
and operational office to a larger facility in the downtown business district 
of Lewiston, Maine.  This move will be completed by the end of July, 1998.  

MAJOR ACQUISITION

The Company has ongoing discussions with various companies concerning 
potential business combinations that would continue to strengthen Acadia 
and its product lines.  

SALES TRENDS

Growth in Acadia's existing business lines, medical billing services and 
billing for waivered foster home care are positive.  Current sales run rates 
show a 100% increase in revenue since this same period last year.  
  
BUSINESS AND PROPERTIES OF ACADIA NATIONAL HEALTH SYSTEMS, INC.

HISTORY             

Physician Resources, Inc.  the predecessor of Acadia was formed in 1972 as a 
doctor billing and bookkeeping services company.  In 1990 bookkeeping and 
doctor billing functions were segregated into separate companies.  The 
successor company, Acadia, continued the operations of Physician Resources and 
currently provides practice management, invoicing and accounts receivable 
collection services for doctors offices, foster homes, hospital operating 
departments and hospital-based practices.

Acadia National Health Systems purchased the assets of  Physician Resources, 
Inc. on September 27, 1996, and took over the operations of that Company as of 
September 28, the first day of the fiscal quarter and year.  It did not 
conduct operations prior to this date. All activities for the current quarter 
are compared with the operations for the same quarter a year earlier. 
Comparative results have not been adjusted for the difference between 
Acadia's  calendar quarters ending June 30, l998 in a calendar month end and 
Acadia's fiscal quarter ending  June 27, 1997 on the last Friday of a calendar 
month. 

<PAGE>  13

On January 13, 1997, Acadia's SEC application Form 10SB was effectuated.  On 
May 20, 1997, the Company received NASD clearance pursuant to the filing of a 
Form 211 and accompanying Information and Disclosure Statement, allowing for 
its common equity to commence trading on the OTC market during the third 
quarter of FY 1997.  This will allow the Company to approach capital markets 
and initiate the raising of equity when needed to fuel growth through mergers 
and acquisitions.  Access to public markets is critical, since the growth 
rates will be too rapid to fund through earnings or debt.

The doctor billing service has undergone several technical transitions since 
its inception.  In the early days the service supported physicians who wished 
to avoid an elaborate business function or complex computer systems.  As 
computer systems became simpler and easier to use, the Company found other 
value added services to retain clients.  This led to practice management 
consulting and, in the last few years, electronic billing and medical service 
financing.  Many health service payers, led by Medicare and Medicaid, require 
electronic billing to reduce processing costs.  Electronic billing brought the 
added benefit of improved reliability and timeliness of third party payments, 
therefore, improved medical practice asset utilization and profitability.  
Since electronic billing requires complex data modalities and sophisticated 
software procedures, it is more adaptable to a high volume billing service and 
is a very successful service  for Physician Resources.   

Acadia principally uses MediSense software technology from CompuSense of 
Nashua, New Hampshire.  This software technology is rapidly becoming a major 
supplier of complete medical billing solutions for physicians and medical 
services organizations throughout the northeast.  This system includes the 
capability of:  automated patient appointment scheduling, electronic charting 
features, client/server based medical practice management, electronic billing 
and  direct funds transfer.  The technology is capable of distributed data 
processing with multiple location data entry and discrete paper copy printing, 
unlimited client accounts and patient census, all running on the Novell 
network.  These attributes will provide the technological base that will 
reinforce the Company's long-term objective as a major player in tertiary 
markets.    

The Company will grow through strategic acquisitions, joint ventures and 
internal expansion.  Promotion of our medical billing software technology and 
medical practice management consulting services will add additional growth to 
our front line business of medical billing.  Many smaller billing services and 
some practice management consultants are ill equipped to deal with the changes 
occurring in the health care market and the regulatory environment and these 
are candidates for affiliation.  Acadia intends to grow its business through 
mergers and acquisitions of companies who's business philosophy is based on 
producing a high quality product, who's management is dedicated to long term 
ethical growth and who's organization and structure are complimentary to 
Acadia's vision of a superior company with a superior product.
  
<PAGE>  14

ITEM 6    Exhibits and Reports on Form 8-K  
  
          a.           Exhibits  
  
                       Exhibit 27.  Financial Data Schedule
  
          b.           Reports on Form 8-K  
  
                       No reports have been filed on Form 8-K during this 
                       quarter.   

<PAGE>  15

ACADIA NATIONAL HEALTH SYSTEMS, INC. 

SIGNATURES  
  
  
Pursuant to the requirement of the Securities Exchange Act of 1934,
the registrant has duly cause this report to be signed on its behalf by the
undersigned thereunto duly authorized.  
  
    
  
                    ACADIA NATIONAL HEALTH SYSTEMS, INC.
                    Registrant  
  
  
August 14, l998     /s/ Mark T. Thatcher                


                    MARK T. THATCHER,            
                    Filing Agent  
  
  
August 14, l998     /s/ Paul W. Chute


                    PAUL W. CHUTE
                    Chief Executive Officer