Other current assets consists of the ~~computation~~following at June 30, 2020 and December 31, 2019:

Property and equipment, net, consists of ~~basic~~the following at June 30, 2020 and ~~diluted (loss) earnings~~December 31, 2019:

Depreciation expense for the six-month periods ended June 30, 2020 and 2019 is $623 and $141, respectively. A laptop was acquired in January of 2020.

Leasehold improvement, net, consists of the following at June 30, 2020 and December 31, 2019:

Amortization expense for the six-month periods ended June 30, 2020 and 2019 is $0 and $299, respectively.

The Company has received financing from Management of the Company as well as from members of our Board of Directors. These individuals are deemed to be related parties to the Company and their indebtedness must be disclosed separately.

As of June 30, 2020 and December 31, 2019, there are the following related party notes payable:

During the six-month period ended June 30, 2020, there have been 10 additional convertible-promissory notes totaling $547,360. There have been 53 convertible-promissory notes totaling $3,727,213 converted to 39,652,283 shares of common stock.

On April 23, 2020, the Company’s wholly owned subsidiary, Pharmacy Value Management Solutions, Inc. (‘PVMS”) received a loan in the principal amount of $1,243,840 from Mechanics Bank (the “Bank”) pursuant to the PPP. On May 22, 2020, the Bank notified PVMS that the loan was in default as a result of false statements made in the loan application. PVMS disputes the Bank’s claim and believes that it made no false statements in its PPP loan application. The statements relate to the number of employees and the monthly payroll amounts. As a result, PVMS’ account with Mechanics Bank has been frozen with a balance of $845,340. Both PVMS and the Bank are seeking guidance from the Small Business Administration as to how to resolve this dispute. Until resolved, it is likely that this account will remain frozen.

Break-out of debt between the parent company and our subsidiary PVMS is as follows:

At Advanzeon, the total notes issued year-to-date and their dollar values were as follows:

All debts issued during the six-month period ended June 30, 2020 are short-term in nature and have a stated interest rate of 10%.

At PVMS, the total of notes issued year-to-date and their dollar values were as follows:

All debt is short-term in nature, one-year maturity date. All debt issued has a stated interest rate of 12%.

As of June 30, 2020 and December 31, 2019, the balance of this indebtedness is as follows:

As of June 30, 2020 and December 31, 2019, the balance of other accrued liabilities is as follows:

The Company entered into two leases, one for office space and one for an automobile lease that are classified as right of use assets and lease liabilities. The Company pays the lease payments on a residential unit in California that is used as an office/residential unit for certain of its marketing personnel. The lease is on a month-to month basis. The Company has occupied this unit for the past approximately 1-1/2 year period and intends to do so for the foreseeable future. The lease for the Company’s office space expire in June 2022.The lease for the automobile expires in June 2021.As the implicit interest rate is not readily identifiable in the leases, the Company calculated the present value of the leases using the average commercial real estate interest rate of 5.50% at the commencement of the office leases and the interest of 2.99% for the automobile lease. Applying the commercial rate, the Company calculated the present value of $339,833 for the office leases and $29,037 for the automobile leasing that are being amortized over the life of the leases.

As of June 30, 2020, the right of use assets associated with future operating leases are as follows:

Total amortization expense related to the right of use assets under the lease agreements was $54,660 and $25,579 for the six-month periods ended June 30, 2020 and 2019, respectively.

As disclosed in Note 10, the Company entered into two leases for office space prior to the quarter ended June 30, 2020 that are classified as right of use assets and lease liabilities.

As of June 30, 2020, the lease liabilities associated with future payments due under the leases are as follows:

The following is a schedule of future minimum lease payments under the right of use lease agreements together with the present value of the net minimum lease payments as of June 30, 2020:

During the six-month period ended June 30, 2020, the Company issued 45,089,783 shares of its common stock as follows:

On April 01, 2020, the Company issued 3,262,500 shares of its common stock to a board of director member who elected to convert director’s fees and salary totaling $652,500. The stock was issued at $0.20 per share.

On April 01, 2020, the Company issued 1,087,500 shares of its common stock to a board of director member who elected to convert director’s fees and salary totaling $217,500. The stock was issued at $0.20 per share.

On April 21, 2020, the Company issued 14,584,350 shares of its common stock to existing note holders who elected to convert promissory notes plus accrued and unpaid interest totaling $2,916,869. The stock was issued at $0.20 per share.

On April 21, 2020, the Company issued 1,327,252 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $265,450. The stock was issued at $0.20 per share.

On April 21, 2020, the Company issued 2,156,515 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $431,303. The stock was issued at $0.20 per share.

On May 15, 2020, the Company issued 1,263,745 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $139,012. The stock was issued at $0.11 per share.

On May 15, 2020, the Company issued 4,284,565 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $471,302. The stock was issued at $0.11 per share.

On May 15, 2020, the Company issued 7,210,168 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $793,118. The stock was issued at $0.11 per share.

On May 18, 2020, the Company issued 700,751 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $77,083. The stock was issued at $0.11 per share.

On May 21, 2020, the Company issued 502,434 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $55,268. The stock was issued at $0.11 per share.

On May 25, 2020, the Company issued 319,627 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $35,159. The stock was issued at $0.11 per share.

On May 25, 2020, the Company issued 333,824 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $36,721. The stock was issued at $0.11 per share.

On May 26, 2020, the Company issued 781,206 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $85,933. The stock was issued at $0.11 per share.

On May 28, 2020, the Company issued 884,555 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $97,301. The stock was issued at $0.11 per share.

On May 29, 2020, the Company issued 937,116 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $103,083. The stock was issued at $0.11 per share.

On June 1, 2020, the Company issued 1,024,189 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $112,661. The stocks was issued at $0.11 per share.

On June 05, 2020, the Company issued 668,797 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $73,568. The stock was issued at $0.11 per share.

On June 05, 2020, the Company issued 603,987 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $66,439. The stock was issued at $0.11 per share.

On June 12, 2020, the Company issued 1,564,245 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $172,067. The stock was issued at $0.11 per share.

On June 18, 2020, the Company issued 504,957 shares of its common stock to an existing note holder who elected to convert promissory notes plus accrued and unpaid interest totaling $55,545. The stock was issued at $0.11 per share.

During the six-month period ended June 30, 2019, the Company issued 700,000 shares of its common stock as follows:

On March 21, 2019, the Company issued 200,000 shares of its common stock to its Securities Exchange Commission counsel, who elected to take common stock in the Company as partial payment of its legal fees. The total value shares were valued at $0.08 per share ~~attributable~~on the total value of $16,000.

Additionally, on March 29, 2019, the Company issued 500,000 shares of its common stock to an existing shareholder and warrant holder, who elected to exercise his warrants to purchase 500,000 shares of the Company's common ~~stockholders (dollars~~stock for $15,000. The warrants were issued during May of 2017 for $0.03 per share.

The Company previously reported that the litigation between Rotech Healthcare, Inc. and Pharmacy Value Management Solutions, Inc. settled. The Company rejected the draft settlement terms and continues to aggressively defend this litigation.

~~Other than~~Item 1, all of the ~~changes~~legal proceedings for the six-month period ended June 30, 2020, are disclosed in our ~~outstanding debt instruments described in Note 3, no~~annual report on Form10-K filed on April 9, 2020.

In accordance with ASC Topic 855, “Subsequent Events”, the Company evaluated subsequent events ~~were identified that in our opinion require accounting recognition or disclosure in~~through August 19, 2020, the date these financial statements were available to be issued. During its evaluation, the following subsequent events were identified:

Subsequent to the balance sheet date, the Company has issued $56,180 of convertible-promissory notes. All of the debt matures in 2021 and has a stated interest rate of 22% and is unsecured. Concurrent with the ~~exception~~issuance of debt, the ~~following:~~

~~During July 2013, we~~Company has issued 300,000 warrants ~~to purchase 2.3 million common shares to three individuals in lieu of cash compensation for marketing services. The warrants expire in July 2016 and can be exercised~~ at aan average exercise price of ~~$0.25~~$0.25. At the time of issuance, all warrants had a three or five year term.

The Company issued 765,399 shares of common stock for the conversion of debt and accrued interest. The total debt and accrued interest converted was $84,194 or $0.11 per share. ~~Of the 2.3 million total issued, 2.1 million were immediately vested at issuance with the remaining vesting over the next 24 months.~~

In addition to historical information, the following information contains forward-looking statements as defined under federal securities laws for Comprehensive Care Corporation (referred to herein as the “Company,” or “CompCare”) and its subsidiaries (collectively referred to herein as “we,” “us” or “our”). In our case, such statements include, but are not limited to, the overall performance of the healthcare market, our anticipated operating results, the success of our Pharmacy Savings Management Program, financial resources, increases in revenues, increased profitability, interest expense, growth and expansion, anticipated favorable results from legal actions, the ability to obtain new and maintain existing behavioral healthcare contracts and the profitability, if any, of such behavioral healthcare contracts. These statements are based on current expectations, estimates and projections about the industry and markets in which we operate, the customers we serve and management’s beliefs and assumptions. Forward-looking statements are not guarantees of future performance and involve certain known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to, changes in local, regional, and national economic and political conditions, the effect of governmental regulation, competitive market conditions, varying trends in member utilization, our ability to manage healthcare operating expenses, our ability to achieve expected results from new business, the profitability of our capitated contracts, cost of care, seasonality, our ability to obtain additional financing, and other risks detailed herein and from time to time in our filings with the SEC.

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

The following ~~discussion~~information should be read in conjunction with the ~~accompanying condensed consolidated~~ financial statements and notes thereto and in conjunction with Managements’ Discussion and Analysis of ~~CompCare~~Financial Condition and ~~subsidiaries appearing elsewhere~~Results of Operations in ~~this report.~~our Annual Report on Form 10-K for the fiscal year ended December 31, 2019.

~~OVERVIEW~~This report includes forward-looking statements, the realization of which may be affected by certain important factors discussed previously above under Item 1A, “Risk Factors.”

The Company through its wholly owned subsidiary Pharmacy Value Management Solutions, Inc. administers and operates a medically driven sleep apnea program branded SleepMaster Solutions™ (“SMS”). Management believes that SMS is the largest provider of these combined services in the ~~behavioral~~nation. We are in all 50 states and provide a turnkey solution designed to effectively keep drivers on the road with no down time, compliant with DOT regulations, improve their health, ~~substance abuse,~~ and ~~pharmacy~~significantly decrease legal liability risk for the employer. We are vertically integrated, and we provide a “Program” of services that addresses all the needs of a corporate transportation system, union or other driver-related organizations. We believe we are the only company capable of providing the full range of needed services in a timely manner.

Our services start with the identification of the target population and the potential risk the client currently has. We can do this through our SMS Program, which includes the ability to screen every driver to identify if signs and symptoms of sleep apnea are present. We can then take this data and provide the employer with a list of those drivers that should be tested and the statistical likelihood of the percentage of those drivers who will test positive for obstructive sleep apnea (OSA). Together with the employer/union, SMS provides a realistic time frame, actual total cost, and process for testing all drivers who need to be tested. For those drivers testing positive for OSA, we then provide the appropriate treatment such that the driver will meet the DOT requirements and remain on the road. We monitor 365 days per year driver’s usage of the treatment device according to DOT standards and we report that usage to all stakeholders as required/permitted. We utilize mathematical algorithms to determine if the driver is predicatively meeting the annual DOT requirements for usage. Using those predictive algorithms, we reach out to those drivers and provide case management, ~~fields, primarily~~encouragement designed to solve problems such that the driver increases usage, if necessary, and remains compliant.

SMS constructed its model based upon the foregoing principles. The SMS Program includes all processes attended in sleep apnea screening, testing, treatment, monitoring and overall management of commercial ~~Medicare, Medicaid, Children’s Health Insurance Program (“CHIP”) health plans,~~drivers’ as well as ~~self-insured companies, unions,~~their employers’ needs. We have successfully established relationships with national health care clinic providers, all with certified medical examiner (“CME”) status. These clinics total almost 1,000 throughout the U.S. We also have both formal and ~~Taft-Hartley health~~informal relationships with employers; municipalities; a significant veteran’s group; union and ~~welfare funds. Our managed care operations include administrative service agreements, fee-for-service agreements,~~non-union driving organizations; suppliers of home sleep testing equipment and ~~capitation contracts.~~

~~Our revenue can be segregated into the following significant categories (amounts in thousands):~~

~~Our customer base primarily includes regional health plans that do not have their own behavioral network. We provide services primarily through~~ a variety of OSA treatment devices; and, a national network of ~~contracted providers~~telemedicine sleep specialists covering all 50 states. We have an internal medical team for governance and protocol purposes and a customer service department that ~~includes:~~interfaces directly with our drivers. We also have a marketing team that regularly interfaces with our existing accounts and markets our services to potential new accounts. Our services are performed utilizing a best medical practices model and an efficient, cost-effective delivery system. We obtain the required equipment on a per order basis from a durable medical equipment distributor.

Revenue is recognized when billed, which is approximately when the testing service is performed, or CPAP machine is shipped.

During the three-month period ending June 30, 2020, the majority of our revenue was received from patient referrals from only certain of the clinics operated by Concentra Health Services. During this period and as a result of the Coronavirus pandemic, the Department of Transportation (DOT), which had previously suspended the requirement that interstate commercial drivers have a prescribed DOT medical exam from a DOT certified medical examiner, extended the DOT medical exam suspension to expire September 30, 2020. This action by the DOT, coupled with the effect of the pandemic, caused a significant number of clinics that we rely upon for referrals to either continue to be closed, close anew or operate with reduced staffing and reduced capacity. All of the foregoing resulted in fewer patients. Additionally, many commercial drivers, who, but for the aforesaid medical exam suspension, would have gone to the Concentra clinics for their required DOT medical exam, elected to wait until the suspension expires. All of those events materially reduced our referral resources. We did continue to receive revenue from certain Concentra referrals, other clinic referrals and some of our in-house account, such as PG&E, the Veteran’s organization with whom we contract, and others, but this patient flow was materially reduced, as well. Our recently announced launch of our CoreChoice account (April 29, 2020), scheduled to launch this period, did not launch as a result of the pandemic. During this period, we successfully added new accounts which, principally due to the pandemic, have not yet launched. However, they are in the process of preparing to do so. As clinics reopen and staff returns, management expects to see revenue from these new accounts. We continue to experience the effect of these closures/reduced staffing and cannot predict when either our referral sources or our own operation will begin to normalize, resulting in more positive financial results. However, we continue to aggressively seek new accounts and work with our existing accounts to achieve increased patient flow.

A quantitative summary of our revenues by source category for the three-month periods ended June 30, 2020 and 2019:

OSA services increased to $103,444 in 2020 from $90,453 in 2019. The increase was primarily the result of the Concentra account. Last year, on May 14, 2019, we reached an agreement with Concentra whereby Concentra engaged the Company, and the Company accepted the engagement, to serve as one of Concentra’s preferred national sleep apnea services provider. The launch was initiated during the fourth quarter of 2019.

While there was an increase in OSA services, the increase would have been greater without the clinics having to shut down due to the COVID-19 pandemic. As demonstrated in the first quarter of 2020, OSA services increased by $59,625 than in the comparable period of 2019. With the clinics having to be closed during the three months period ended June 30, 2020 due to the COVID-19 pandemic, there was only an increase of $12,990.

Cost of revenues decreased to $65,000 in 2020 from $66,157 in 2019. In 2019, the cost allocation was changed to reflect the cost and sales in the same month. This caused two months’ worth of charges in the month of April 2019. April 1, 2019 and April 30, 2019

General and administrative expense in total for the three month periods ended June 30, 2020 and 2019 was as follows:

~~therapists;~~

~~other licensed healthcare professionals;~~

~~psychiatric hospitals;~~

~~general medical facilities with psychiatric beds;~~

~~residential treatment centers; and~~

~~other treatment facilities.~~

The services provided through our provider network include outpatient programs (such as counseling or therapy), intermediate care programs (such as intensive outpatient programs and partial hospitalization services), inpatient programs and crisis intervention services. We do not directly provide treatment or own any treatment facility.

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

We ~~typically enter into contracts on an annual basis to provide managed behavioral healthcare, substance abuse,~~evaluate expenses at the Parent company level as well as at our PVMS subsidiary. Expenses at the Parent company level include overhead and ~~pharmacy management services to our customers’ members. Our arrangements with our clients fall into two broad categories:~~

~~At-risk arrangements under which our clients pay us a fixed fee per member in exchange for our assumption of the financial risk of providing services; and~~

ASO arrangements where we manage behavioral healthcare programs or perform various managed care services, such as clinical care management, provider network development, and claims processing without assuming financial risk for member behavioral healthcare costs.

We also cover pharmacy management services, where we receive an additional per-member per-month amount. We manage pharmacy services through the collection and analysis of pharmacy claims data which is provided by the health plan’s pharmacy benefit manager (“PBM”), whose primary functions are claims adjudication and drug cost negotiation. Through data analysis and usage evaluation against clinically sound, evidence-based criteria, we are able to identify ineffective, inappropriate and costly drug utilization. Our approach is to address these issues in a collaborative manner with the primary care physicians and psychiatrists through the provision of useful information based on our analysis. Our goal is to produce positive outcomes for patients while controlling pharmacy costs.

~~Under at-risk arrangements, the number of covered members as reported to us by our clients determines the amount of premiums we receive, which is independent of~~ the cost of ~~services rendered to members. The amount of premiums we receive for each member is fixed by our contract~~being a public entity. Expenses at the beginning of our contract term. Under certain circumstances these premiums may be subsequently adjusted up or down, or the contract terminated, generally at the commencement of each renewal period.

~~Our largest costs~~PVMS are those of behavioral health services and pharmacy drugs that we provide, which is based primarily on our arrangements with healthcare providers. Since we are subject to increases in healthcare operating costs based on an increase in the number and frequency of our members seeking behavioral care services, our profitability depends on our ability to predict and effectively manage these costs in relationsolely related to the ~~fixed premiums we receive under at-risk arrangements. Providing~~OSA services on an at-risk basis exposes us to the risk that our contracts may ultimately be unprofitable if we are unable to control or otherwise anticipate healthcare costs. Accrued claims payable and claims expense are our most significant critical accounting estimates. See “~~Critical Accounting Policies and Estimates~~~~” below.~~

We manage programs through which services are provided to recipients in five states. Our objective is to provide easily accessible, high quality behavioral healthcare and pharmacy services and to manage costs through measures such as the monitoringsegment. A breakdown of hospital inpatient admissions and the review of authorizations for various types of outpatient therapy. Our goal is to combine access to quality behavioral healthcare services with effective management controls in order to ensure the most cost-effective use of healthcare resources.

~~Our programs and services include:~~

~~management of prescription drugs on an at-risk basis for health plans;~~

~~fully integrated behavioral healthcare and pharmacy management services;~~

~~analytic services for medical and pharmacy claims for medical integration of behavioral and medical care coordination;~~

~~case management/utilization review services;~~

~~administrative services management;~~

~~preferred provider network development;~~

~~management and physician advisor reviews; and~~

~~overall care management services.~~

We continue our efforts to expand our new Pharmacy Savings Management Program, marketed through our dedicated, wholly-owned subsidiary CompCare Pharmacy Solutions, Inc. For health plans, self insured entities, unions, and Taft-Hartley health and welfare funds, we will offer to manage on an at-risk basis prescription drug programs. Through the use of selected pharmacy benefits managers, pharmacy data analytics, and the development of cost-saving ancillary pharmacy programs, we believe we can materially reduce drug costs for our clients that utilize our program. Our marketing efforts of this program are receiving positive traction.

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

R~~ECENT~~ D~~EVELOPMENTS~~

~~Pharmacy Savings Management Program; New Business~~

In March of 2013, we entered into an agreement with Local No. 29 of the Laborers International Union of North America to provide our Pharmacy Savings Management Program, and in May 2013, we signed a Pharmacy Savings Management agreement with Utica City (NY) School District. Both programs are scheduled to launch in January of 2014.

~~Contract Terminations~~

On July 31, 2013, our contract to provide ASO services to a health plan serving approximately 49,000 Medicare and Healthy Families program members expired without renewal. The contract accounted for 12.5%, or $0.3 million of our revenuesthese expenses for the ~~six months~~three month periods ended June 30, ~~2013.~~2020 and 2019 is as follows:

	2020		2019		Change		Percent Change

Parent	$	296,036	$	156,686	$	139,350		88.94	%
PVMS		419,361		259,353		160,008		61.70	%

Total	$	715,397	$	416,039	$	299,358		71.95	%

Parent Company Level

	2020			2019		Change			Percent Change

Professional fees	$	243,494		$	86,804	$	156,690			180.51	%
Travel expense		—			815		(815	)		-100.00	%
Board of Directors fees		57,500			37,500		20,000			53.33	%
Office supplies		417			287		130			45.30	%
Rent expense		(23,181	)		25,448		(48,629	)		-191.09	%
Other		17,806			5,832		11,974			205.33	%

Total G & A	$	296,036		$	156,686	$	139,350			88.94	%

Explanations of variations by line item follow:

Professional fees increased by $156,690. The ~~health plan had been a client since January~~increase is mainly due to new consulting service expenses in the total of ~~2011.~~

~~Our at-risk contract with a health plan serving approximately 37,000 CHIP members is expected to expire without renewal during~~$118,250 and an increase of $43,827 in legal fees in the ~~third or fourth quarter of 2013 at a point yet to be chosen by the health plan. The contract accounted for 20.9%, or $0.5 million of our revenues for the six months~~three-month period ended June 30, ~~2013. The health plan has been a client since April of 2000.~~

~~Retirement of President and Appointment of Pharmacy Savings Management Program President~~

~~On April 22, 2013, we were notified by our President, Robert R. Kulbick, that he needed~~2020 compared to retire for medical reasons effective May 1, 2013. We have named Ramon Martinez to direct our Pharmacy Savings Management Program as President of CompCare Pharmacy Solutions, Inc., our wholly-owned subsidiary dedicated to marketing our pharmacy savings program. Mr. Martinez was working with the ~~Company on its new, innovative pharmacy savings program as a Senior Management Advisor since August 2012.~~

~~Debt Matters~~

~~See~~L~~IQUIDITYAND~~ C~~APITAL~~ R~~ESOURCES~~~~, below.~~

R~~ESULTS~~OF O~~PERATIONS~~

~~Three months~~three month period ended June 30, ~~2013~~vs~~. 2012~~2019.

~~With~~Travel expense decreased by $815 due to due to the ~~expiration of our at-risk behavioral health~~COVID-19 pandemic. Many clinics have been closed and ~~pharmacy contracts in Puerto Rico on December 31, 2012, which then comprised approximately 83% of the Company’s total revenue, our operating revenues~~those that are open have decreased significantly. Prior to December 31, 2012, anticipating this decrease, we accelerated our efforts to advance the Company’s Pharmacy Savings Management Program so that we would be prepared to commence aggressively marketing it by January 1, 2013, which we did in early January. Simultaneously, we significantly reduced ~~salaries, decreased our work force~~staffs and ~~generally cut back expenses. To date,~~ we have ~~entered into two pharmacy savings management agreements, both scheduled for launch~~been requested to not conduct any in ~~January 2014. We are actively engaged in discussions with~~person visits.

Board of Directors fees increased by $20,000 due to an additional $20,000 paid to a ~~number~~Board of other potential pharmacy account customers. The Company’s shift of focus away from the behavioral health/Medicare/Medicaid segments of the healthcare market to pharmacy savings market was occasioned by reason of the Company’s management’s belief that significantly greater margins, less regulation and ease of closing transactions exists in the pharmacy management sector of healthcare. The Company believes that its focus on its Pharmacy Savings Management Program, coupled with its decreased operating expenses, will give the Company the best opportunity to achieve profitability during 2014.director member.

~~Revenues:~~

~~At-risk behavioral health contracts:~~ ~~Operating revenues from at-risk contracts~~Rent expense decreased by ~~87.7%, or approximately $6.6 million,~~48,629 due to ~~$0.9 million for~~office lease moving to subsidiary level as of January 01, 2020. The same will show as an increase on the subsidiary level.

Other general and administrative expense increased by $11,974. This increase was due to a new D&O Insurance expense of $14,205 while other miscellaneous items decreased by $1,421.

PVMS Subsidiary Level

	2020		2019		Change			Percent Change

Payroll related	$	243,871	$	110,167	$	133,704			121.36	%
Travel and related expense		9,059		51,897		(42,838	)		-82.54	%
Professional fees		57,265		39,250		18,015			45.90	%
Marketing costs		17,758		9,729		8,029			82.53	%
Dues and subscriptions		27		200		(173	)		-86.50	%
Office supplies		1,135		8,718		(7,583	)		-86.98	%
Rent expense		54,096		12,452		41,644			334.44	%
Other		36,150		26,940		9,210			34.19	%

Total G & A	$	419,361	$	259,353	$	160,008			61.70	%

Explanations of variations by line item follow:

Payroll related expenses increased $133,704. The company hired 4 employees in the three months ended June 30, ~~2013, compared to $7.5 million for~~2020 that were not included in the comparable period in 2019. The Company paid our CEO $32,699 and accrued wages in the amount of $33,456 during the three months ended June 30, ~~2012. As noted above, the decrease was primarily attributable~~2020.

Travel expense decreased by $42,838 due to due to the ~~expiration of our Puerto Rico contract during the fourth quarter of 2012~~COVID-19 pandemic. Many clinics have been closed and those that ~~accounted~~are open have reduced staffs and we have been requested to not conduct any in person visits.

Professional Fees increased by $18,015. The increase is mainly due to an increase in accounting fees by $25,000 due to services for ~~$4.4 million of revenue for~~special projects. There was a decrease in legal fees by $13,485. The Company no longer used a law firm in the three months ended June 30, ~~2012,~~2020 that were used in the comparable period in 2019.

Marketing costs increased by $8,029. The company hired an advertising firm in the 3rd quarter of 2019 to work on the company's website and other marketing responsibilities and is still with the ~~expiration~~company as of ~~contracts~~June 30, 2020.

Office supplies decreased by $7,583 due to office supplies were fully stocked going into the new year of 2020.

Rent expense increased by $41,644 due a decrease on to rent expense moving from parent level to subsidiary level as of January 01, 2020. The same will show as a decrease on the parent level.

Other general and administrative expense increased by $9,210. The increase is mainly due to a fraudulent charge of $9,500 and an increase in ~~Louisiana and Michigan that generated~~payroll taxes of $13,371 due to an increase in wages. There is a decrease in automobile expenses of $4,912 due to the COVID-19 pandemic.

Interest expense

Interest expense in total ~~of $2.1 million in revenue during~~for the ~~quarter~~three-month periods ended June 30, ~~2012.~~2020 and 2019 was as follows:

2020	$	707,774
2019		341,178
Change	$	366,596
Percentage Change		107.45	%

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

~~ASO contracts:~~ ~~Revenue from ASO contracts decreased by 81.7%, or approximately $0.7 million, to $0.2 million~~A breakdown of the interest expense for the ~~three months~~three-month periods ended June 30, ~~2013 due~~2020 and 2019 is as follows:

	2020		2019		Change

Parent	$	492,340	$	163,093	$	329,247
PVMS		215,434		178,085		37,349

Total	$	707,774	$	341,178	$	366,596

Sources of Revenue

Six-month periods ended June 30, 2020 and 2019

A quantitative summary of our revenues by source category for the six-month periods ended June 30, 2020 and 2019:

		2020		2019		Change

OSA- related	$	230,992	$	158,376	$	72,616

Results of Operations

OSA services increased to $230,992 in 2020 from $158,376 in 2019. The increase was primarily the result of the Concentra account. Last year, on May 14, 2019, we reached an agreement with Concentra whereby Concentra engaged the Company, and the Company accepted the engagement, to ~~the loss~~serve as one of ~~a customer~~Concentra’s preferred national sleep apnea services provider. The launch was initiated during the fourth quarter of ~~2012 that had accounted for approximately $0.4 million~~2019.

While there was an increase in OSA services, the increase would have been greater without the clinics having to shut down due to the COVID-19 pandemic. As demonstrated in the first quarter of ~~business~~2020, OSA services increased by $59,625 than in the comparable period of 2019. With the clinics having to be closed during the ~~quarter~~three months period ended June 30, ~~2012.~~

~~Pharmacy management contracts:~~ ~~Due~~2020 due to the ~~expiration~~COVID-19 pandemic, there was only an additional increase of ~~our major contract~~$12,990.

Cost of revenues increased to $129,909 in ~~Puerto Rico, we did not generate any revenue~~2020 from $107,817 in 2019 due to an increase in sales.

General and administrative expense

General and administrative expense in total for the ~~three months~~six-month periods ended June 30, ~~2013,~~2020 and 2019 was as ~~compared~~follows:

2020	$	1,311,462
2019		841,843
Change	$	469,619
Percentage Change		55.78	%

We evaluate expenses at the Parent company level as well as at our PVMS subsidiary. Expenses at the Parent company level include overhead and the cost of being a public entity. Expenses at PVMS are solely related to ~~$9.8 million for~~ the ~~same period in 2012.~~OSA services segment. A breakdown of these expenses as June 30, 2020 and 2019 is as follows:

	2020		2019		Change		Percent Change

Parent	$	539,259	$	352,821	$	186,438		52.84	%
PVMS		772,203		489,022		283,181		57.91	%

Total	$	1,311,462	$	841,843	$	469,619		55.78	%

Parent Company Level

~~Costs~~

Percent
2020 2019 Change Change

Professional fees $ 409,870 $ 211,265 $ 198,605 94.01 %
Travel expense 67 3,815 (3,748 ) -98.24 %
Board of Directors fees 95,000 75,000 20,000 26.67 %
Office supplies 495 351 144 41.03 %
Rent expense — 51,277 (51,277 ) -100.00 %
Other 33,827 11,113 22,714 204.40 %

Total general and administrative $ 539,259 $ 352,821 $ 186,438 52.84 %

Explanations of ~~revenues:~~ ~~Anticipating our decrease~~variations by line item follow:

Professional fees increased $198,605. The increase is mainly due to new consulting service expenses in ~~revenue commencing January 1, 2013, we successfully decreased our costs by 95.1%, or approximately $13.0 million, for~~ the ~~three months~~total of $236,500 and an increase of $55,023 in legal fees in the six-month period ended June 30, ~~2013 as~~2020 compared to the ~~three months~~six-month period ended June 30, ~~2012 for reasons set forth in the following three paragraphs.~~

~~Behavioral health contracts:~~ ~~Claims expense on at-risk contracts~~2019. Audit fees decreased ~~approximately $6.0 million due to expense reductions~~by $66,300 and ~~cost containment measures mentioned above and a reduction to claims expense of approximately $0.3 million relating to favorable claims experience from our former major Puerto Rico contract.~~

~~Pharmacy drug costs:~~ ~~Pharmacy costs~~accounting fees decreased ~~100%, or approximately $6.2 million,~~by $22,957 due to the ~~expiration of our Puerto Rico pharmacy contract on December 31, 2012.~~fact that the 2015 - 2017 10-K was filed in January 2019.

~~Other healthcare operating costs:~~ ~~Other healthcare costs, attributable to servicing both at-risk contracts and ASO contracts,~~Travel expense decreased approximately $1.2 million from approximately $1.8 million for the three months ended June 30, 2012 to approximately $0.6 million for the three months ended June 30, 2013 due primarily to reductions in salaries and benefits attributable to workforce reductions.

~~General and administrative expense~~: General and administrative expenses decreased by 33.2%, or approximately $0.7 million, to $1.5 million for the three months ended June 30, 2013 as compared to $2.2 million for the three months ended June 30, 2012, primarily consisting of a $0.3 million decrease in salaries and benefits$3,748 due to ~~workforce reductions,~~due to the COVID-19 pandemic. Many clinics have been closed and those that are open have reduced staffs and we have been requested to not conduct any in person visits.

Board of Directors fees increased $20,000 due to an additional $20,000 paid to a ~~$0.2 million reduction in miscellaneous fees, reduced~~Board of director member.

Rent expense decreased $51,277 due to rent expense moving from parent level to subsidiary level as of ~~$0.1 million due to lease renegotiation, and a $0.1 million reduction in consulting fees due to less usage. As a percentage of total operating revenue,~~January 01, 2020. The same will show as an increase on the subsidiary level.

Other general and administrative expense increased ~~to 137.9% for the three months ended June 30, 2013, compared to 12.3% for the three months ended June 30, 2012,~~by $22,714. This increase was due to ~~significantly lower operating revenue.~~

~~Interest expense.~~ Interest expense, excluding amortization of debt discount, increased by 26.5%, or approximately $0.1 million for the three months ended June 30, 2013, as compared to the three months ended June 30, 2012 due to an increase in the effective interest rate on debt for the three months ended June 30, 2013, to approximately 21.4% from 16.7% for the same period in 2012, net of the effect of a ~~small decline in the weighted average amount of debt outstanding to $9.2 million from $9.3 million for the three months ended June 30, 2013,~~vs~~. 2012 . The increase in the effective interest rate is attributable to the inclusion in interest~~new D&O Insurance expense of ~~a pro-rata share~~$26,174 while other miscellaneous items decreased $3,463.

PVMS Subsidiary Level

								Percent
	2020		2019		Change			Change

Payroll related	$	419,743	$	212,312	$	207,431			97.70	%
Travel and related expense		75,224		91,324		(16,100	)		-17.63	%
Professional fees		109,057		81,747		27,310			33.41	%
Marketing costs		34,592		17,229		17,363			100.78	%
Dues and subscriptions		208		640		(432	)		-67.50	%
Office supplies		4,077		17,577		(13,500	)		-76.80	%
Rent expense		65,933		23,001		42,932			186.65	%
Other		63,369		45,192		18,177			40.22	%

Total general and administrative	$	772,203	$	489,022	$	283,181			57.91	%

Explanations of ~~origination and other closing~~variations by line item follow:

Payroll related ~~fees from the six-month senior secured credit facility that began May 3, 2013.~~

~~Six months ended June 30, 2013~~vs~~. 2012~~

~~Revenues~~:

~~At-risk behavioral health contracts:~~ Operating revenues from at-risk contracts decreased by 87.7%, or approximately $13.1 million, to $1.8 million for the six months ended June 30, 2013, compared to $15.0 million for the six months ended June 30, 2012. As noted above, the decrease was primarily attributable to the expiration of the Puerto Rico contract during the fourth quarter of 2012 that accounted for $8.7 million of revenue for the six months ended June 30, 2012, and the expiration of contracts in Louisiana and Michigan that generated a total of $4.2 million in revenueexpenses increased $207,431. The Company hired 4 employees during the six months ended June 30, ~~2012.~~

~~ASO contracts:~~ ~~Revenue from ASO contracts decreased by 72.5%, or approximately $1.2 million, to $0.5 million for~~2020 that were not included in the ~~six months ended June 30, 2013 due primarily to the loss of a customer during the fourth quarter of 2012 that had accounted for $0.9 million of business during the same period ended June 30, 2012.~~

~~Pharmacy management contracts:~~ ~~Due to the expiration of our major contract in Puerto Rico, we did not generate any revenue for the six months ended June 30, 2013, as compared to $19.4 million for the same~~comparable period in ~~2012.~~

~~Costs of revenues~~:~~Anticipating~~2019. The Company paid our decrease in revenue commencing January 1, 2013, we successfully decreased our costs by 95.2%, or approximately $28.9 million for the six months ended June 30, 2013, as compared to the six months ended June 30, 2012 for reasons set forth in the following three paragraphs.

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

~~Behavioral health contracts:~~ Claims expense on at-risk contracts decreased by 99.1%, or approximately $11.0 million, to $0.1 million for the six months ended June 30, 2013 as compared to the six months ended June 30, 2012 due to expense reductionsCEO $32,699 and ~~cost containment measures mentioned above and a reduction to claims expense of approximately $1.0 million relating to favorable claims experience from our former major Puerto Rico contract.~~

~~Pharmacy drug costs:~~ ~~Pharmacy costs decreased 100%, or approximately $15.9 million, due to the expiration of our Puerto Rico pharmacy contract on December 31, 2012.~~

~~Other healthcare operating costs:~~ Other healthcare costs, attributable to servicing both at-risk contracts and ASO contracts, decreased approximately 63.9%, or $2.4 million, from approximately $3.8 million for the six months ended June 30, 2012 to approximately $1.4 million for the six months ended June 30, 2013. The reduction is primarily due to a $1.5 million decrease in salaries and benefits due to workforce reductions, a $0.4 million reduction in purchased services, and a $0.2 million decrease in medical director and case review fees.

~~General and administrative expense~~: General and administrative expenses decreased by 33.7%, or approximately $1.5 million (after excluding a $1.6 million adjustment of legal expense for the six months ended June 30, 2012), to $2.9 million for the six months ended June 30, 2013 as compared to $4.3 million for the six months ended June 30, 2012 due primarily to a $0.7 million decrease in salaries and benefits due to workforce reductions, a $0.2 million reduction in miscellaneous fees, and a $0.2 million reduction in rent expense as a result of lease renegotiation. As a percentage of total operating revenue, general and administrative expense increased to 125.4% for the six months ended June 30, 2013, compared to 12.1% for the six months ended June 30, 2012, due to significantly lower operating revenue.

~~Interest expense~~: Interest expense, excluding amortization of debt discount, increased by 11.6%, or approximately $88,000, for the six months ended June 30, 2013, as compared to the six months ended June 30, 2012 due to an increase in the effective interest rate on debt for the six months ended June 30, 2013, to approximately 18.3% from 16.2% for the same period in 2012. It is also affected by an increase in the weighted average amount of debt outstanding to $9.2 million for the six months ended June 30, 2013 from $9.3 million for the comparable prior period. The increase in the effective interest rate is attributable to the inclusion in interest expense of a pro-rata share of origination and other closing related fees from the six-month senior secured credit facility that began May 3, 2013.

C~~RITICAL~~ A~~CCOUNTING~~ P~~OLICIESAND~~ E~~STIMATES~~

Preparation of our consolidated financial statements requires us to make significant estimates and judgments to develop the amounts reflected and disclosed in the consolidated financial statements. On an on-going basis, we evaluate the appropriateness of our estimates and we maintain a thorough process to review the application of our accounting policies. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

~~We believe our accounting policies specific to our revenue recognition,~~ accrued ~~claims payable, premium deficiencies and claims expense, and income taxes are critical to the preparation of our consolidated financial statements.~~

~~Revenue recognition.~~ The majority of our managed care activities are performed under at-risk arrangements pursuant to terms of agreements primarily with health plans to provide contracted behavioral healthcare and pharmacy management services to subscribing members. Revenue under these agreements is earned continuously over time regardless of services actually provided and, therefore, is recognized monthly based on the number of qualified members. The information regarding qualified members is supplied by our clients, and we review member eligibility records and other reported information to verify its accuracy and determine the amount of revenue to be recognized. The remaining balance of our revenues is earned and recognized as services are delivered on a non-risk basis.

~~Accrued claims payable.~~Claims expense, a major component of cost of care, is recognized in the period in which an eligible plan member actually receives services and includes incurred but not reported (“IBNR”) claims. We contract with various healthcare providers including hospitals, physician groups and other licensed behavioral healthcare professionals either on a discounted fee-for-service or a per-case basis. We determine that a member has received services when we receive a claim within the contracted timeframe with all required billing elements correctly completed by the service provider. We then determine whether the member is eligible to receive the service, the service provided is medically necessary and is covered by the benefit plan’s certificate of coverage, and the service is authorized by one of our employees, if required. If all of these requirements are met, the claim is entered into our claims system for payment.

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

The accrued claims payable liability represents the estimated ultimate net amounts owed for all behavioral healthcare services provided through the respective balance sheet dates, including estimated amounts for claims IBNR. We have used the same methodology and assumptions for estimating the IBNR portion of the accrued claims liability for the last two years.

Our unpaid claims liability is estimated using an actuarial paid completion factor methodology and other statistical analyses. These estimates are subject to the effects of trends in utilization and other factors. Any significant increase in member utilization that falls outside of our estimates would increase claims expense and could adversely affect our ability to achieve and sustain improvements in profitability and positive cash flow. Although considerable variability is inherent in such estimates, we believe that our unpaid claims liability is adequate.

Whenever we believe it is probable that a future loss will be incurred under a managed care contract based on an expected premium deficiency and we are unable to cancel our obligation or renegotiate the contract, we record a losswages in the amount of the expected future losses. We perform our loss accrual analysis on a contract-by-contract basis by taking into consideration various factors such as future contractual revenue, estimated future healthcare and maintenance costs, and each contract’s specific terms related to future revenue increases as compared to expected increases in healthcare costs. The estimated future healthcare and maintenance costs are based on historical trends and expected future cost increases. Our analysis at June 30, 2013 did not identify any loss contracts.

Accrued claims payable consists primarily of amounts established for reported claims and IBNR claims, which are unpaid through the respective balance sheet dates. Our policy is to record management’s best estimate of IBNR. The IBNR liability is estimated monthly using an actuarial paid completion factor methodology and is continually reviewed and adjusted, if necessary, to reflect any change in the estimated liability as more information becomes available. In deriving an initial range of estimates, we use an industry accepted actuarial model that incorporates past claims payment experience, enrollment data and key assumptions such as trends in healthcare costs and seasonality. Authorization data, utilization statistics, calculated completion percentages and qualitative factors are then combined with the initial range to form the basis of management’s best estimate of the accrued claims payable balance. However, estimating IBNR claims involves a significant amount of judgment by our management. The following are the principal factors that would have an impact on our future operations and financial condition:

~~Changes in the number of employee plan members due to economic factors;~~

~~Other changes in utilization patterns;~~

~~Changes in healthcare costs;~~

~~Changes in claims submission timeframes by providers;~~

~~Success in renegotiating contracts with healthcare providers;~~

~~Occurrence of catastrophes;~~

~~Changes in benefit plan design; and~~

~~The impact of present or future state and federal regulations.~~

The accrued claims payable ranges were between $11.6 and $11.7 million at June 30, 2013 and between $12.9 and $13.1 million at December 31, 2012. Based on the information available, we determined our best estimate of the accrued claims liability to be $11.7 million at June 30, 2013 and $13.1 million at December 31, 2012. Our accrued claims liability at June 30, 2013 and December 31, 2012 includes approximately $9.7 million and $9.8 million, respectively, of submitted and approved but unpaid claims and $1.9 million and $3.3 million for IBNR claims, respectively. A 5% increase in assumed healthcare cost trends from those used in our calculations of IBNR at June 30, 2013 could increase our claims expense by approximately $23,000. Actual claims incurred could differ from estimated claims accrued.

~~Income taxes.~~ Computing our provision for income taxes involves significant judgment and estimates particularly in relation to the realization of deferred tax assets from net operating loss carryforwards, uncertain income tax positions, and in estimating the probable annual effective income tax rates for interim financial reporting periods.

At June 30, 2013, we have federal net operating loss carryforwards of approximately $35.5 million, the deductibility of $29.1 million of which is presently limited under Section 382 of the Internal Revenue Code to approximately $361,000 annually due to recent changes in control of the Company. We are particularly vulnerable to additional changes in control in the near term due to probable future equity dilution or possible takeover resulting in further loss of our ability to utilize the remaining carryforwards pursuant to Section 382. In addition, as of June 30,

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

2013, the Company continues to be in a deficit position. Based on this evidence, and the uncertainty as to our ability to continue as a going concern, we concluded that at this time, it is likely that the Company’s deferred tax assets, which relate primarily to the federal net operating losses, will not be realizable within the carryforward period. Accordingly, the Company continues to maintain an effective 100% valuation allowance against the balance of these deferred tax assets at this time. Our judgments regarding future taxable income may change due to many factors, including changes in operating results from changing economic or market conditions, or changes in tax laws, operating results or other factors.

R~~ECENT~~ A~~CCOUNTING~~ P~~RONOUNCEMENTS~~

No recent accounting pronouncements have been issued that are not yet effective and that have not been early adopted that, in our opinion, have a significant effect on our consolidated financial statements in future periods.

S~~EASONALITY~~OF B~~USINESS~~

Historically, we have experienced increased member utilization during the months of March, April and May and consistently low utilization by members during the months of June, July, and August. Such variations in member utilization affect our costs of care during these months, having a generally positive impact on our operations during June through August and a negative impact from March through May.

L~~IQUIDITYAND~~ C~~APITAL~~ R~~ESOURCES~~

At June 30, 2013, we had a working capital deficiency of approximately $25.3 million and a stockholders’ equity deficiency of approximately $25.2 million resulting from a history of operating losses. We were unable to repay our 14% senior promissory notes in the amount of approximately $1.8 million on the maturity date of April 15, 2013. However, as of June 30, 2013, we have executed agreements to extend the maturity date for approximately $1.7 million of the notes to April 15, 2014. We are currently in discussions with the holders of the remaining senior notes and do not anticipate difficulty in completing extension agreements. In addition, we were not able to repay a $1 million loan due May 8, 2013. As of August 14, 2013, past due principal and interest totaled approximately $6.7 million, of which $4.8 million was owed to a related party who had not provided the Company with formal notice of default.

Our ability to continue as a going concern will be dependent upon the success of management’s plans, as set forth in the following paragraphs, and is subject to significant uncertainty. In their report on our most recent audited financial statements as of and for the year ended December 31, 2012, our independent auditors expressed substantial doubt as to our ability to continue as a going concern. Except for its consideration in establishing our valuation allowance for deferred tax assets, and an impairment write-down of goodwill taken in 2012, the accompanying consolidated financial statements do not include any adjustments that may result from the outcome of this uncertainty.

~~Revolving Credit Facility Agreement~~

On May 3, 2013, we entered into a Senior Secured Revolving Credit Facility Agreement that will allow us to borrow up to $5,000,000 to fund our general working capital needs. On the closing date, our current maximum allowable amount to borrow was $1,000,000. Increased borrowing amounts above the $1 million are subject to the sole and absolute discretion of the lender. Our initial $1,000,000 draw on the credit facility less transaction expenses of approximately $116,000 occurred May 3, 2013. As of August 8, 2013, our current outstanding balance on the credit facility is approximately $800,000 and there is currently no availability to draw additional funds on the credit facility. The credit facility is guaranteed by the current and future assets of CompCare and its subsidiaries, with the exception of our Puerto Rico subsidiary. Borrowings under the credit facility will bear interest at 12%, payable weekly. The credit facility will mature on November 3, 2013, at which time we may request an extension of the maturity date for an additional six-month period provided that we are not in default in any respect, which, however, may be accepted or rejected by the lender in its sole discretion.

The credit facility agreement contains financial covenants such as, but not limited to, minimum revenues, positive earnings before interest, tax, depreciation and amortization expenses, and loan-to-value ratio. The agreement also specifies events of default and related remedies, including acceleration and increased interest rates following an event of default. In the event of a default by the Company, the lender may convert all or any portion of the outstanding principal, accrued but unpaid interest and other sums payable under the note into shares of our common

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

stock at a price equal to (i) the amount to be converted, divided by (ii) 85% of the lowest daily volume weighted average price of our common stock during the five business days immediately prior to the conversion date. The note or any portion thereof may also be converted in a likewise manner with the consent of the Company. As consideration for investment banking and advisory services provided to us by the lender, we issued 1,470,588 shares of our common stock to the lender as a fee, which in accordance with the terms of the Agreement, was equivalent to $125,000.

~~Debt Modifications~~

On May 21 and June 18, 2013, we reached agreement with five holders of our senior promissory notes aggregating approximately $0.4 million of principal to extend the maturity date of the notes from April 15, 2013 to April 15, 2014. In connection with the renewals we issued a total of 194,688 shares of our common stock to the holders as partial payment of interest and fees owed as of April 15, 2013.

On May 13, 2013, we executed an agreement with a holder of approximately $1.3 million of our senior promissory notes to extend the maturity date of the notes from April 15, 2013 to April 15, 2014. We also agreed to extend the term of approximately 5.2 million warrants that had been issued at the time the notes were issued in April 2010 for an additional two years, such that the warrants will now expire in 2017. In conjunction with the renewal, we issued 774,391 shares of our common stock to the lender relating to 50% of the interest and fees owed as of April 15, 2013.

On March 15, 2013, we executed an agreement with a creditor to modify the terms of a previously matured but unpaid promissory note in the amount of $1.4 million. Under the modified terms of the note, the maturity date was extended from February 28, 2013 to January 31, 2014 and the conversion price at which the note may be converted into our common stock was reduced to $0.125 from $0.25. In addition, the exercise price of a warrant to purchase our common stock issued in conjunction with the note was reset from $0.44 to $0.22. We also assigned a customer receivable (see Note 2 “Accounts Receivable”) and a potential arbitration recovery to the creditor as a source of future repayment of a second loan from the creditor in the amount of $625,000 that matured May 14, 2013 and a $75,000 loan from an individual related to the creditor, also due on May 14, 2013. By agreement with the creditor on May 8, 2013, the maturity date of the $625,000 loan was extended to July 15, 2013 and the conversion price at which the note may be converted into our common stock was reduced to $0.125 from $0.25. Additionally, the exercise price of a warrant to purchase our common stock issued in conjunction with the note was decreased from $0.44 to $0.22. The note was not repaid on its July 15, 2013 due date and is currently the subject of ongoing resolution negotiations. The $75,000 loan from the individual related to the creditor was repaid on May 6, 2013.

~~Need for Additional Financing~~

~~Our existing capital may not be sufficient to meet our cash needs. We expect that with:~~

~~i. our new Senior Secured Revolving Credit Facility;~~

~~ii. existing customer contracts;~~

~~iii. collection of receivables;~~

~~iv. extension of vendor payments;~~

~~v. the addition of significant new pharmacy management contracts that we have reason to believe will be obtained through:~~

~~(a)~~

~~the expansion of our pharmacy management sales force;~~

~~(b)~~

~~the signing of an agreement with a national leader in pharmacy benefit management;~~

~~(c)~~

~~the integration of care management and wellness programs;~~

~~(d)~~

~~our ability to commit to saving our clients substantial sums of money on their pharmacy expenses, backed by a performance bond to be issued by a surety company;~~

~~(e)~~

~~our CEO joining the Board of Directors of “America’s Agenda: Health Care for All,”~~

that the Company will have the best opportunity to sustain and grow current operations over the near term. We continue to look at various alternative sources of financing if operations cannot support our ongoing plan. Nevertheless, there can be no assurance that we will be able to achieve the growth expected from all or some of the above factors, nor find such financing in amounts or on terms acceptable to us, if at all, or that we will be able to achieve or sustain profitable operations and positive operating cash flows in the near term. While management believes that our current cash position will likely be sufficient to meet our current levels of operations in the short term, our ability to achieve our business objectives and continue as a going concern for a reasonable period of time may be dependent upon the success of our plans to obtain sufficient debt or equity financing, and, ultimately, to achieve profitable operations and positive cash flows from operations during 2013.

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

Our primary internal source of liquidity on an on-going basis has been from operations, which consists of the monthly capitation payments we receive from our clients for providing managed care services. Based on historical experience, there is a high degree of certainty with respect to the reliability and timing of these payments from continuing contracts. However, the commencement of new contracts or the expiration of existing contracts, such as our major Puerto Rico contract that ended December 31, 2012, may cause our operational cash flow to vary significantly from period to period, which would require us to seek external sources of liquidity.

Our external sources of liquid funds consist primarily of the use of debt and equity instruments. Our ability to continue to borrow funds on a secured or unsecured basis cannot be predicted, nor can our ability to sell shares of our common stock in private placement offerings. With the exception of contracted maturities of debt, there are no other future liquidity demands due to known commitments or events. We do not have any off-balance sheet financing arrangements. The duration of our borrowings has typically ranged from one week to three years, with stated interest rates ranging from 7% to 24%. Certain of the loans have contained features such as the ability to convert all or a portion of the loan into our common stock, or have had a detachable warrant for the future purchase of our common stock typically issued in conjunction with the loan, or both.

~~As evident in our statement of cash flows,~~$33,456 during the six months ended June 30, ~~2013, our cash balance~~2020.

Travel expense decreased $16,100 due to the COVID-19 pandemic. Many clinics have been closed and those that are open have reduced staffs and we have been requested to not conduct any in person visits.

Professional Fees increased $27,310. There is an increase in accounting fees by $25,000 due to services for special projects. Consulting fees increased $33,750 because the company hired 5 new consultants to bring in additional revenue. There was a decrease in legal fees by $23,657. The Company no longer used a law firm in the six months ended June 30, 2020 that was used in the comparable period in 2019.

Marketing costs increased by ~~$325,000~~$17,363. The company hired an advertising firm in the 3rd quarter of 2019 to work on the company's website and other marketing responsibilities and is still with the company as of June 30, 2020.

Office supplies decreased by $13,500 due ~~primarily~~ to ~~collections~~office supplies were fully stocked going into the new year of ~~receivables, receipts~~2020.

Rent expense increased $42,932 due to rent expense moving from parent level to subsidiary level as of January 01, 2020. The same will show as a decrease on the parent level.

Other general and administrative expense increased by $18,180 due to a fraudulent charge of $9,500 and an increase in payroll taxes of $10,764 because of an increase in wages. Other miscellaneous items increased by $6,876 due to revamp of website, employee benefits, and printing and postage for a conference. Automobile expenses decreased $3,078 due to the COVID-19 pandemic. Bad debt expense decreased $3,510 due to a decrease in bad debt in the six months ended June 30, 2020 than in the comparable period in 2019.

Interest expense

Interest expense in total for the six-month periods ended June 30, 2020 and 2019 was as follows:

2020	$	1,102,403
2019		669,193
Change	$	433,210
Percentage Change		64.74	%

A breakdown of the interest expense for the six-month periods ended June 30, 2020 and 2019 is as follows:

	2020		2019		Change

Parent	$	636,453	$	326,185	$	310,268
PVMS		465,950		343,008		122,942

Total	$	1,102,403	$	669,193	$	433,210

Financial Condition

Liquidity and Capital Resources

During the six-month period ended June 30, 2020, we funded our ~~revolving credit facility,~~operations from revenues and $547,360 in private borrowings. As a result of the coronavirus pandemic some of our traditional sources of private borrowing have not been accessible. We have had to obtain private borrowing on terms less favorable than we were able to prior to the pandemic. We will continue to fund our operations from these sources until we are able to produce operating revenue sufficient to cover our cost ~~reduction initiatives~~structure. In the event we are not able to secure such funding, our operations will be adversely affected.

Short Term: We funded our operations with revenues from sales and private borrowings.

On April 23, 2020, the Company’s wholly owned subsidiary, Pharmacy Value Management Solutions, Inc. (‘PVMS”) received a loan in the principal amount of $1,243,840 from Mechanics Bank (the “Bank”) pursuant to the Paycheck Protection Program. On May 22, 2020, the Bank notified PVMS that the loan was in default as a result of false statements made in the loan application. PVMS disputes the Bank’s claim and believes that it made no false statements in its PPP loan application. The statements relate to the number of employees and the monthly payroll amounts. As a result, PVMS’ account with Mechanics Bank has been frozen with a balance of $845,340. Both PVMS and the Bank are seeking guidance from the Small Business Administration as to how to resolve this dispute. Until resolved, it is likely that this account will remain frozen.

During the period we continued toward our goal to be able to uplist our Common Stock to another trading platform. Among the actions is our attempt to reduce our stockholder’s deficiency by, among, other things, being able to convert a large portion of our corporate debt to equity. For the six months ended June 30, 2020, $3,727,213 of debt plus accrued interest was converted into 39,652,283 shares of Common Stock. All of the holders of the converted debt agreed, subject to several different conditions, to a one year lock-up from publicly offering the shares. The primary condition being to not publicly sell the shares until the earlier of (i) one year from the date of the exchange, or ~~otherwise managing~~(ii) until the shares are tradable on the NASDAQ or comparable national exchange. The other condition for a block of 14,584,350 shares received in an exchange has the lock-up as the earlier of one year or such time as our ~~cash outflows related~~Common Stock has an average trading volume of no less than 500,000 shares for 30 consecutive trading days.

Subsequent Events

Subsequent to June 30, 2020, we issued a convertible promissory note in the principal amount of $56,180. The term of the note is 12 months and the interest rate is 10% per annum.

In August we announced that we will start using a disposable home sleep test device known as the WatchPAT™ ONE which utilizes cloud-based technology for the immediate upload of testing data. This feature will streamline the Company's receipt of test data and its ability to render faster obstructive sleep apnea (“OSA”) test results - critical, in light of the increased OSA testing reasonably to be anticipated when DOT-required medical exams resume. With the WatchPAT™ ONE, we can measure the patient's PAT® signal, heart rate, oximetry, actigraphy, body position, snoring, and chest motion. As discussed, in March of this year, the Federal Motor Carrier Safety Association (FMCSA) suspended the commercial driver's required annual/biennial medical exams. This suspension was a reaction to the COVID-19 pandemic, and the nation's need to keep its commercial drivers on the road delivering essential supplies. The suspension is currently scheduled to expire on September 30, 2020. We anticipate that almost seven months of drivers will need to schedule and complete their required medical exams shortly after September 30th. Thus, whenever the suspension is lifted, it is anticipated that there will be an increased number of drivers all needing completion of their medical exams including OSA testing (when indicated).. These drivers would be in addition to our ~~costs, and from delaying payments~~new patient accounts acquired during the past four-month period. With our implementation of this new technology, we expect to ~~providers and other creditors, sometimes causing defaults~~not only be more efficient in our ~~obligation~~testing process, but to greatly enable our clinic partners to process the OSA portion of their drivers' DOT medical exams faster and ~~sometimes negotiating successfully for extended terms. We also repaid existing debt, including certain capitalized leases,~~more efficiently. While there is an additional cost to the ~~extent of $574,000.~~Company for the WatchPAT™ ONE process, we have elected to not pass this cost on to the clinic, the driver or the driver's employer.

I~~TEM~~ Item 3. Q~~UANTITATIVEAND~~ Q~~UALITATIVE~~ D~~ISCLOSURES~~ A~~BOUT~~ M~~ARKET~~ R~~ISK~~Quantitative and Qualitative Disclosures about Market Risk:

As a smaller reporting company, ~~as defined by Rule 229.10(f)(1) of the Exchange Act,~~ we are not required to ~~provide the information under this item.~~make any disclosure.

I~~TEM~~ Item 4. C~~ONTROLSAND~~ P~~ROCEDURES~~Controls and Procedures

~~(a)~~

~~Evaluation of Disclosure Controls and Procedures~~

Our management ~~with the participation of~~is responsible for establishing and maintaining adequate internal control over our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based upon this evaluation, our Chief Executive Officer along with the Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report are functioning effectivelyfinancial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles.

Our internal control over financial reporting includes those policies and procedures that the information required to be disclosed by the Company in reports filed under the Exchange Act is (1) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (2) accumulated and communicated(i) pertain to the ~~Company’s~~maintenance of records that in reasonable detail accurately and fairly reflect our transactions; (ii) provide reasonable assurance that transactions are recorded as necessary for preparation of our financial statements; (iii) provide reasonable assurance that receipts and expenditures of company assets are made in accordance with management ~~including~~authorization; and (iv) provide reasonable assurance that unauthorized acquisition, use or disposition of company assets that could have a material effect on our financial statements would be prevented or detected on a timely basis.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the ~~Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding disclosure.~~risk that controls may become inadequate because changes in conditions may occur or the degree of compliance with the policies or procedures may deteriorate.

~~(b)~~

~~Change in Internal Control over Financial Reporting~~

~~No change in~~Our management assessed the effectiveness of our internal control over financial reporting ~~occurred during~~as of June 30, 2020. This evaluation was based on criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission, or COSO, Internal Control-Integrated Framework. Based upon such assessment, our ~~most recent fiscal quarter~~CFO concluded that, ~~has materially affected, or is reasonably likely to materially affect,~~as of June 30, 2020, our internal ~~control~~controls over financial ~~reporting.~~reporting were not optimally effective in the specific areas described in the paragraphs below.

~~PART II~~As of June 30, 2020, our CFO identified the following specific material weaknesses in the Company’s internal controls over its financial reporting processes:

Policies and Procedures for the Financial Close and Reporting Process – ~~OTHER INFORMATION~~
I~~TEM~~ ~~1. LEGAL~~ P~~ROCEEDINGS~~
InDuring the ~~ordinary conduct~~period of this report, the Company’s policies or procedures did not clearly define the roles in the financial reporting process. The various roles and responsibilities related to this process should be defined, documented, updated and communicated. Not having clear policies and procedures in place amounts to a material weakness in the Company’s internal controls over its financial reporting processes.

Representative with Financial Expertise – For six-month period ended June 30, 2020, the Company did not continuously have an employee with the requisite knowledge and expertise to review the financial statements and disclosures at a sufficient level to monitor the financial statements and disclosures to the Company. Failure to have, continuously, an employee with such knowledge and expertise amounts to a material weakness to the Company’s internal controls over its financial reporting processes.

As a result of our ~~business,~~retaining the services of an Outside Accountant in January 2018 and appointing an internal Company employee to interface with the Outside Accountant, we have instituted the following policies and procedures designed to address the material weaknesses cited above.

All billing invoices prepared by the billing department are ~~subject~~sent to ~~periodic lawsuits~~the Outside Accountant for review and ~~claims. Although we cannot predict~~approval before sending out to the customer.

Copies of all incoming payable invoices are sent to the Outside Accountant for review, approval and data entry into the accounting system. That way Corporate Office has the originals and the outside accountants have duplicate copies. Accounts Payable Aging Report is sent once a week from the Outside Accountants to the Corporate office. The Corporate office, along with ~~certainty the ultimate resolution of lawsuits and claims asserted against us, we do not believe that any currently pending legal proceedings~~Outside Accountants, decide on which bills to ~~which we are a party could~~pay weekly. Electronic payments have a ~~material adverse effect~~duel control approval system (one person is initiating the payment and another person is approving the payment).

Paperwork on ~~our business, or our future results of operations, cash flows or financial condition except as described below:~~
all customer invoices, credit card payments and check payments received at Corporate are copied and forwarded to Outside Accountants. Customer invoices are recorded daily. Customer payments received are recorded daily. Customer payments are reconciled with the bank on a daily basis. Aged Accounts Receivable Reports are sent to Corporate by the Outside Accountants with suggestions on a regular basis.

All bank accounts are reconciled monthly.

Financial Statements are prepared and reviewed monthly.

The Company plans to further augment its addressing of material weaknesses, on an as-needed basis, by hiring additional accounting personnel once its initial corrective steps have been fully implemented, tested and found to be effective.

~~(1)~~24

We initiated an action against Jerry Katzman, a former director, in July 2009 alleging that Mr. Katzman fraudulently induced us to enter into an employment agreement and, alternatively, that Mr. Katzman

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

breached that alleged employment agreement and was rightfully terminated. In September 2010, the matter proceeded to a trial by jury. The jury found that Mr. Katzman did not fraudulently induce CompCare to enter into the contract but also found that Mr. Katzman was not entitled to damages. On defendant’s motion to amend the verdict due to inconsistency, the trial court set aside the jury verdict and awarded Mr. Katzman damages of approximately $1.9 million. The Company appealed the lower court’s decision and posted a collateralized appeal bond for approximately $1.9 million. On February 14, 2013, the 11^th Circuit Court of Appeals of the State of Florida reversed the lower court’s judgment which was in favor of Katzman. The decision of the appellate court also reverses the lower court’s award of attorney’s fees previously awarded to Katzman. As a result of the Court of Appeals reversal, the Company’s need to maintain appellate bonds in the aggregate amount of $1.9 million has been eliminated. The appellate court also taxed appellate costs in favor of CompCare against Katzman in the amount of $76,554. In addition, the Company holds a judgment against Katzman for approximately $1.3 million. The Company intends to pursue collection of this judgment.

~~(2)~~

On March 2, 2012, a former health plan client in Missouri instituted an arbitration proceeding against us relating to allegations that we breached our obligation to pay claims submitted to us for payment. The amount demanded is approximately $2 million. We have filed a counter claim for breach of contract and tortious interference in an amount between $500,000 and $1 million. The parties have now completed document production. We intend to vigorously defend against the claims asserted in the arbitration demand.

~~(3)~~

~~On February 7, 2011, a health care provider, Oceans Healthcare, LLC, filed suit in the 19~~^th Judicial District Court for the state of Louisiana claiming breach of contract in that we failed to pay claims submitted to us for payment. On January 14, 2013, the Court granted a motion to add six additional plaintiffs to the Oceans suit. The parties are demanding in excess of $2 million. The litigation is currently in the discovery stage. We intend to vigorously defend against the litigation.

~~(4)~~

On May 30, 2013, a former health plan client in Michigan instituted an arbitration proceeding against us relating to its allegations that we breached our obligation to pay claims submitted to us for payment. The amount demanded is in excess of $5 million. The parties are in the process of selecting an arbitrator to hear the dispute. We intend to vigorously defend against the claims asserted in the arbitration demand.

~~(5)~~

On August 10, 2012, we filed an arbitration demand against a former client in Puerto Rico. The Company believes that it is owed approximately $2.0 million. A hearing date is currently scheduled in October 2013.

~~Management believes that the Company has made adequate provision for any estimated probable losses, including legal defense costs, from the litigation described above.~~

I~~TEM~~ ~~1A. RISK~~ F~~ACTORS~~PART II-OTHER INFORMATION

~~The~~Item 1. Legal Proceedings

With the exception of the matter set forth below, all of the legal proceedings for the six-month period ended June 30, 2020, are disclosed in our annual report on Form 10-K filed on April 9, 2020.

Item 1A. Risk Factors

In addition to the risk factors included in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2012,~~2019, we include the following:

Effect of the Coronavirus Pandemic

The coronavirus pandemic is adversely affecting and is expected to continue to adversely affect our business, financial condition and results of operations. We are unable to predict the extent or nature these effects will have ~~not changed materially.~~on our business at this time.

~~ITEM~~Item 2. U~~NREGISTERED~~ S~~ALES~~OF E~~QUITY~~ S~~ECURITIESAND~~ USEOF P~~ROCEEDS~~Unregistered Sales of Equity Securities and Use of Proceeds

~~During~~With the exception of the matter set forth below, the sale of unregistered securities for the six-month period ~~May 21, 2013 through August 14, 2013,~~ended June 30, 2020 were disclosed in our annual report on Form 10-K filed on April 9, 2020.

On April 15, 2020, we issued ~~shares~~a convertible promissory note (the "Note”) in the principle amount of ~~common stock~~$109,180 with an original issue discount of $6,180. The Note matures on October 15, 2021, and ~~warrants to purchase~~the interest rate is 10%. This Note may not be prepaid in whole or in part except as follows. Should the Note be prepaid within the first ninety days from the date of issuance, the prepayment percentage is one hundred and twenty-five (125%) per cent of the outstanding principal and any accrued and unpaid interest. For the next ninety days the Note may be prepaid and the prepayment percentage is one hundred thirty (130%) per cent of the outstanding principal and any accrued and unpaid interest. Thereafter, the Note may not be prepaid.

On April 21, 2020, we issued a total of 14,584,350 shares of our common stock in ~~private placements not involving a public offering~~exchange for $2,916,869 of our Senior Debt and accrued interest to seven holders of the Debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as ~~follows:~~amended.

On ~~May 31, 2013,~~April 21, 2020, we issued ~~an aggregate~~a total of ~~958,547~~1,327,252 shares of our common stock ~~as payment of $95,855 of past due interest and amendment fees to three holders~~in exchange for $265,450 of our ~~senior promissory notes who had agreed~~convertible debt and accrued interest to ~~renew their notes for an additional year.~~the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On ~~June 3, 2013,~~April 21, 2020, we issued ~~100,000~~a total of 2,156,515 shares of our common stock ~~to a vendor~~ in exchange for ~~website design~~$431,303 of our convertible debt and ~~maintenance services valued at $6,800.~~accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On ~~June 25, 2013,~~May 13, 2020, we issued a ~~warrant~~convertible promissory note in the principle amount of $50,000 to ~~purchase 10,000~~an accredited investor. The interest rate was 12%. The Holder of the note has the right to convert all or a portion of the principle and any accrued interest into shares of our common stock ~~to a vendor. The warrant, which expires June 2016, was vested in full at issuance and can be exercised~~ at a per share price equal to the lesser of ~~$0.25 per share.~~

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

~~On June 26, 2013, we issued an aggregate of 10,531 shares~~(i) 15% below the average daily closing price of our common stock asfor the immediately preceding twenty (20) business days or (ii) $0.11. The principal amount and any accrued but unpaid interest under the note shall be due and payable on the earliest to occur (i) the date which is twelve months from the effective date of the note or (ii) the receipt by the Company of payment on its account receivable owed to it by Universal Health Care, Inc. and Universal Health Care Insurance Company, which accounts receivable is currently being processed in the matter of ~~$1,053~~The Receivership of ~~past due interest~~Universal Health Care, Inc., a Florida corporation and The Receivership of Universal Health Care Insurance Company, Inc., a Florida corporation under case numbers 2013-CA and 2013-CA, respectively. The Company also granted to ~~two holders of our senior promissory notes who had agreed to renew their notes for an additional year.~~

~~On July 15, 2013, we issued two warrants that may be used to purchase~~the purchaser a total of 2,000,000 shares of our common stock. The warrants were issued to two consultants in lieu of cash compensation for marketing services. The warrants, which expire in July 2016, were vested in full at issuance and can be exercised at a price of $0.25 per share.

~~On July 25, 2013, we issued a three year~~five-year warrant to purchase ~~300,000~~100,000 shares of ~~our~~the Company’s common stock at an exercise price of $0.25 to a consultant in lieu of cash compensation for marketing services. One-third of the shares obtainable with the warrant vested at issuance. The remaining shares vest evenly at 12 and 24 months after the issuance date.$0.15 per share.

On ~~July 26,~~May 15, 2020, we issued ~~571,400~~a total 1,263,745 shares of our common stock ~~to an individual~~in exchange for $139,012 of our convertible debt and ~~two companies as payment of $60,000 of fees related~~accrued interest to the ~~Senior Secured Revolving Credit Facility, under which we borrowed $1 million on May 3, 2013.~~

~~Based on certain representations and warranties~~holder of the ~~recipients referenced above, we~~debt. We relied on Section 3(a)(9) of the Securities Act of 1933, as amended.

On May 15, 2020, we issued a total 4,284,565 shares of our common stock in exchange for $471,302 of our convertible debt and ~~4(2)~~accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On May 15, 2020, we issued a total 7,210,168 shares of our common stock in exchange for $793,118 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On May 18, 2020, we issued a total 700,751 shares of our common stock in exchange for $77,083 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On May 21, 2020, we issued a total 502,434 shares of our common stock in exchange for $55,268 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On May 22, 2020, we issued a convertible promissory note in the principle amount of $25,000 to an accredited investor. The interest rate was 12%. The Holder of the note has the right to convert all or a portion of the principle and any accrued interest into shares of our common stock at a per share price equal to the lesser of (i) 15% below the average daily closing price of our common stock for the immediately preceding twenty (20) business days or (ii) $0.11. The principal amount and any accrued but unpaid interest under the note shall be due and payable on the earliest to occur (i) the date which is twelve months from the effective date of the note or (ii) the receipt by the Company of payment on its account receivable owed to it by Universal Health Care, Inc. and Universal Health Care Insurance Company, which accounts receivable is currently being processed in the matter of The Receivership of Universal Health Care, Inc., a Florida corporation and The Receivership of Universal Health Care Insurance Company, Inc., a Florida corporation under case numbers 2013-CA and 2013-CA, respectively. The Company also granted to the purchaser a five-year warrant to purchase 50,000 shares of the Company’s common stock at an exercise price of $0.15 per share.

On May 25, 2020, we issued a total 319,627 shares of our common stock in exchange for $35,159 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On May 25, 2020, we issued a total 333,824 shares of our common stock in exchange for $36,721 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On May 26, 2020, we issued a convertible promissory note in the principle amount of $100,000 to an accredited investor. The interest rate was 12%. The Holder of the note has the right to convert all or a portion of the principle and any accrued interest into shares of our common stock at a per share price equal to the lesser of (i) 15% below the average daily closing price of our common stock for the immediately preceding twenty (20) business days or (ii) $0.11. The principal amount and any accrued but unpaid interest under the note shall be due and payable on the earliest to occur (i) the date which is twelve months from the effective date of the note or (ii) the receipt by the Company of payment on its account receivable owed to it by Universal Health Care, Inc. and Universal Health Care Insurance Company, which accounts receivable is currently being processed in the matter of The Receivership of Universal Health Care, Inc., a Florida corporation and The Receivership of Universal Health Care Insurance Company, Inc., a Florida corporation under case numbers 2013-CA and 2013-CA, respectively. The Company also granted to the purchaser a five-year warrant to purchase 200,000 shares of the Company’s common stock at an exercise price of $0.15 per share.

On May 26, 2020, we issued a total 781,206 shares of our common stock in exchange for $85,933 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On May 28, 2020, we issued a total 884,555 shares of our common stock in exchange for $97,301 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On May 29, 2020, we issued a total 937,116 shares of our common stock in exchange for $103,083 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On June 1, 2020, we issued a convertible promissory note (the "Note”)in the principle amount of $56,180 with an original issue discount of $3,180. The Note matures on June 1, 2021, and the interest rate is 10%. This Note may not be prepaid in whole or in part except as follows. Should the Note be prepaid within the first ninety days from the date of issuance, the prepayment percentage is one hundred and twenty-five (125%) per cent of the outstanding principal and any accrued and unpaid interest. For the next ninety days the Note may be prepaid and the prepayment percentage is one hundred thirty (130%) per cent of the outstanding principal and any accrued and unpaid interest. Thereafter, the Note may not be prepaid.

On June 1, 2020, we issued a total 1,024,189 shares of our common stock in exchange for $112,661 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On June 5, 2020, we issued a total 668,797 shares of our common stock in exchange for $73,568 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On June 5, 2020, we issued a total 603,987 shares of our common stock in exchange for $66,438 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On June 12, 2020, we issued a total 1,564,245 shares of our common stock in exchange for $172,067 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On June 18, 2020, we issued a total 504,957 shares of our common stock in exchange for $55,545 of our convertible debt and accrued interest to the holder of the debt. We relied on Section 3(a) (9) of the Securities Act of 1933, as amended.

On June 21, 2020, we issued a convertible promissory note in the principle amount of $25,000 to an accredited investor. The interest rate was 12%. The Holder of the note has the right to convert all or a portion of the principle and any accrued interest into shares of our common stock at a per share price equal to the lesser of (i) 15% below the average daily closing price of our common stock for the immediately preceding twenty (20) business days or (ii) $0.11. The principal amount and any accrued but unpaid interest under the note shall be due and payable on the earliest to occur (i) the date which is twelve months from the effective date of the note or (ii) the receipt by the Company of payment on its account receivable owed to it by Universal Health Care, Inc. and Universal Health Care Insurance Company, which accounts receivable is currently being processed in the matter of The Receivership of Universal Health Care, Inc., a Florida corporation and The Receivership of Universal Health Care Insurance Company, Inc., a Florida corporation under case numbers 2013-CA and 2013-CA, respectively. The Company also granted to the purchaser a five-year warrant to purchase 50,000 shares of the Company’s common stock at an exercise price of $0.15 per share.

All of the convertible promissory notes listed above were issued to accredited investors, as that term is defined under the Section 501 of Regulation D, promulgated under the Securities Act of 1933, as amended. The warrants issued in connection with the promissory notes all have a cashless exercise feature.

On March 22, 2020, we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On March 31, 2020, we issued 169,551 warrants to our Chief Executive Officer in lieu of 2020 first quarter salary. The warrants have a term of five years and an exercise price of $0.39 per warrant.

On April 14, 2020, we issued 96,058 warrants to a promissory note holder, an accredited investor, in lieu of interest. The warrants have a term of five years and an exercise price of $0.19 per warrant. The warrant has a cashless feature.

On April 19, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On April 21, 2020, we issued 101,599 warrants to a promissory note holder in exchange of their notes, principal amount plus accrued and unpaid interest. The warrants have a term of five years and an exercise price of $0.25 per warrant.

On April 21, 2020, we issued 230,630 warrants to a promissory note holder in exchange of their notes, principal amount plus accrued and unpaid interest. The warrants have a term of five years and an exercise price of $0.25 per warrant.

On April 21, 2020, we issued 146,811 warrants to a promissory note holder in exchange of their notes, principal amount plus accrued and unpaid interest. The warrants have a term of five years and an exercise price of $0.25 per warrant.

On April 21, 2020, we issued 1,589,044 warrants to a promissory note holder in exchange of their notes, principal amount plus accrued and unpaid interest. The warrants have a term of five years and an exercise price of $0.25 per warrant.

On April 21, 2020, we issued 368,804 warrants to a promissory note holder in exchange of their notes, principal amount plus accrued and unpaid interest. The warrants have a term of five years and an exercise price of $0.25 per warrant.

On April 21, 2020, we issued 1,095,253 warrants to a promissory note holder in exchange of their notes, principal amount plus accrued and unpaid interest. The warrants have a term of five years and an exercise price of $0.25 per warrant.

On April 25, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On May 1, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On May 10, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On May 11, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On May 19, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On June 3, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On June 6, 2020 we issued 50,000 warrants to a member of our Dental Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On June 8, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On June 10, 2020, we issued 200,000 warrants to our consultant. The warrants have a term of three years and an exercise price of $0.35 per warrant.

On June 11, 2020 we issued 50,000 warrants to a member of our Dental Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On June 14, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On June 20, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On June 22, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On June 24, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On June 27, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

On June 30, 2020 we issued 50,000 warrants to a member of our Medical Advisory Board, an accredited investor. The warrants have a term of three years and an exercise price of $0.25 per warrant.

We relied on Section 4 (2) of the Securities Act of 1933, as amended ~~(the “Securities Act”)~~and or Section 501 of Regulation D promulgated under said Act as ~~applicable, for an exemption from~~ the ~~registration requirements of the Securities Act. The shares purchased have not been registered under the Securities Act and may not be sold in the United States absent registration or an applicable~~ exemption from registration ~~requirements.~~

I~~TEM~~ ~~3. DEFAULTSUPON~~ S~~ENIOR~~ S~~ECURITIES~~

~~As of August 14, 2013, past due principal and interest totaled approximately $6.7 million, of which $4.8 million was owed to a related party who had not provided~~under the ~~Company with formal notice of default. We are currently in negotiations with certain of the holders to resolve the payment defaults.~~Act.

I~~TEM~~ ~~4. MINE~~ S~~AFETY~~ D~~ISCLOSURES~~

~~Not applicable.~~

I~~TEM~~ ~~5. OTHER~~ I~~NFORMATION~~

~~Not applicable.~~

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

I~~TEM~~ ~~6. EXHIBITS~~


~~EXHIBIT~~ ~~NUMBER~~ 29		~~DESCRIPTION~~

~~4.25~~		Loan Extension Agreement dated May 8, 2013 between the Company and Sherfam, Inc., incorporated by reference to Exhibit 4.25 to our Quarterly Report on Form 10-Q dated March 31, 2013 and filed May 20, 2013.

~~4.26~~		Second Note Modification Agreement dated May 13, 2013 between the Company and Lloyd I. Miller, incorporated by reference to Exhibit 4.26 to our Quarterly Report on Form 10-Q dated March 31, 2013 and filed May 20, 2013.

~~4.27~~		Revolving Convertible Promissory Note dated May 3, 2013 between the Company and TCA Global Credit Master Fund, LP, incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K dated May 3, 2013 and filed May 9, 2013.

~~10.20~~		Senior Secured Revolving Credit Facility Agreement dated March 31, 2013 between the Company and TCA Global Credit Master Fund, LP, incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K dated May 3, 2013 and filed May 9, 2013.

~~31.1~~		~~Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002~~

~~31.2~~		~~Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002~~

~~32.1~~		~~Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002~~

~~32.2~~		~~Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002~~

~~101~~		The following materials from Comprehensive Care Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2013, formatted in eXtensible Business Reporting Language (XBRL): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Cash Flows, and (iv) Notes to Consolidated Financial Statements, tagged as blocks of text. Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

~~COMPREHENSIVE CARE CORPORATION AND SUBSIDIARIES~~

Item 3. Exhibits

Documents filed as part of this Report.

Exhibit 31.1 Advanzeon Solutions, Inc. CEO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Exhibit 31.2 Advanzeon Solutions, Inc. CFO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Exhibit 32.1 Advanzeon Solutions, Inc. CEO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Exhibit 32.2 Advanzeon Solutions, Inc. CFO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

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


		~~COMPREHENSIVE CARE CORPORATION~~Advanzeon Solutions, Inc.
		Registrant

~~August 14, 2013~~
Date: August 19, 2020	By:	/s/ Clark A. Marcus

		By	~~/s/ CLARK A. MARCUS~~
			Clark A. Marcus,
			Chief Executive Officer ~~and Chairman~~

Date: August 19, 2020	By:	/s/ Arnold B. Finestone
			~~(Principal Executive Officer)~~	Arnold B. Finestone,

		By	~~/s/ ROBERT J. LANDIS~~
			~~Robert J. Landis~~
			Chief Financial Officer ~~and Chief Accounting Officer~~

	31
				~~(Principal Financial and Accounting Officer)~~

Large accelerated filer	☐	Accelerated filer				☐
~~Large Accelerated Filer~~Non-accelerated filer		¨		~~Accelerated Filer~~		¨

~~Non-Accelerated Filer~~		¨	☐	Smaller reporting company	☒
	x	Emerging growth company	☐

~~14-22~~	2

I~~TEM~~ ~~3 – QUANTITATIVEAND~~ Q~~UALITATIVE~~ D~~ISCLOSURESABOUT~~ M~~ARKET~~ R~~ISK~~		22

I~~TEM~~ ~~4 – CONTROLSAND~~ P~~ROCEDURES~~		22

~~PART II – OTHER INFORMATION~~

I~~TEM~~ ~~1 – LEGAL~~ P~~ROCEEDINGS~~		~~22-23~~

I~~TEM~~ ~~1A – RISK~~ F~~ACTORS~~		23

I~~TEM~~ ~~2 – UNREGISTERED~~ S~~ALES~~OF E~~QUITY~~ S~~ECURITIESAND~~ USEOF P~~ROCEEDS~~		~~23-24~~

I~~TEM~~ ~~3 – DEFAULTS~~ U~~PON~~ S~~ENIOR~~ S~~ECURITIES~~		24

I~~TEM~~ ~~4 – MINE~~ S~~AFETY~~ D~~ISCLOSURES~~		24

I~~TEM~~ ~~5 – OTHER~~ I~~NFORMATION~~		24

I~~TEM~~ ~~6 – EXHIBITS~~		25

S~~IGNATURES~~		26

C~~ERTIFICATIONS~~

	June 30, 2020			December 31,
	(unaudited)			2019
ASSETS
CURRENT ASSETS
Cash	$	145,915		$	69,327
Restricted cash		845,340			—
Accounts receivable		40,990			29,769
Current portion of right of use asset		136,230			113,911
Other current assets		657,025			826,597
Total current assets		1,825,500			1,039,604

PROPERTY, PLANT, AND EQUIPMENT
Property and equipment, net		5,683			1,239
Leasehold improvements, net		—			—
Total property, plant, and equipment		5,683			1,239

RIGHT OF USE ASSET, NET OF CURRENT PORTION		179,221			146,880

TOTAL ASSETS	$	2,010,404		$	1,187,723

CURRENT LIABILITIES
Related party loans payable	$	102,229		$	342,670
Account payable		403,265			99,441
Debt		10,416,176			12,352,189
Contingent liability		642,659			642,659
Current portion of lease liability		136,230			113,911
Other accrued expenses		13,742,192			15,891,787
Total current liabilities		25,442,751			29,442,657

LEASE LIABILITY, NET OF CURRENT PORTION		179,221			146,880

TOTAL LIABILITIES		25,621,972			29,589,537

STOCKHOLDERS' DEFICIENCY
Preferred stock, $.001 par value; 1,000,000 shares authorized as of June 30, 2020 and December 31, 2019		—			—
Series C Convertible Preferred; $.001 par value; 14,400 shares authorized; 10,434 shares issued and outstanding as of June 30, 2020 and December 31, 2019		10			10
Series D Convertible Preferred; $.001 par value; 7,000 shares authorized; 250 shares issued and outstanding as of June 30, 2020 and December 31, 2019		—			—
Remaining Preferred stock; $.001 par value; 978,600 shares authorized as of June 30, 2020 and December 31, 2019		—			—
Common stock, $0.01 par value; 1,000,000,000 shares authorized; 13,201,582 shares reserved; 116,751,439 and 71,661,656 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		1,167,514			716,617
Additional paid in capital		35,361,980			28,719,246
Accumulated deficit		(60,141,072	)		(57,837,687	)
Total stockholders' deficiency		(23,611,568	)		(28,401,814	)

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY	$	2,010,404		$	1,187,723


	June 30, 2013			December 31, 2012
	(Unaudited)
ASSETS
Current assets:
Cash	$	1,245		$	920
Accounts receivable		850			4,546
Other		648			181

		2,743			5,647

Property and equipment, net		107			172
Other		221			305

	$	3,071		$	6,124


LIABILITIES AND STOCKHOLDERS’ EQUITY DEFICIENCY
Current liabilities:
Notes payable:
Related parties	$	2,000		$	2,000
Other		2,996			2,239
Current portion of long-term debt, including $1,000 to related parties		4,005			3,067
Accounts payable		1,001			1,110
Accrued claims payable		11,650			13,099
Other accrued expenses		6,407			5,820

		28,059			27,335

Long-term debt, net of current portion		249			1,732

Total liabilities		28,308			29,067


Stockholders’ equity deficiency:
Preferred stock, $50.00 par value, noncumulative:
Series C Convertible, 14,400 shares authorized; 10,434 shares issued and outstanding		522			522
Series D Convertible; 7,000 shares authorized; 250 shares issued and outstanding; none vested		—			—
Other series; 974,260 shares authorized; none issued		—			—
Common stock, $0.01 par value; authorized: 500,000,000 shares; issued and outstanding: 62,316,502 and 59,451,836 shares		623			594
Additional paid-in capital		26,713			25,982
Deficit		(53,095	)		(50,041	)

Total stockholders’ equity deficiency		(25,237	)		(22,943	)

	$	3,071		$	6,124

	Three-Month Period Ended						Six-Month Period Ended
	June 30,						June 30,
	2020			2019			2020			2019

Revenues:
Obstructive sleep apnea (OSA)	$	103,444		$	90,453		$	230,992			158,376
Total revenues		103,444			90,453			230,992			158,376

Costs and expenses:
Costs of revenues		65,000			66,157			129,909			107,817
General and administrative		715,397			416,039			1,311,462			841,843
Depreciation and amortization		312			235			623			440
Total costs and expenses		780,709			482,431			1,441,994			950,100

Loss from operations		(677,265	)		(391,978	)		(1,211,002	)		(791,724	)

Other income (expense):
Interest expense		(707,774	)		(341,178	)		(1,102,403	)		(669,193	)
Interest income		—			5,994			20			5,994
Legal settlement		—			112,172			—			112,172
Forgivable SBA EIBL loan advance		10,000			—			10,000			—
Total other expense		(697,774	)		(223,012	)		(1,092,383	)		(551,027	)

Net loss	$	(1,375,039	)	$	(614,990	)	$	(2,303,385	)	$	(1,342,751	)

PER SHARE INFORMATION
Net Loss Per Common Share	$	(0.01	)	$	(0.01	)	$	(0.02	)	$	(0.02	)

Weighted Average Number of Common
Shares Outstanding		79,534,495			67,361,656			75,598,076			67,027,954


		~~PAGE~~Pages
PART I.	Financial Information
Item 1.	Consolidated Financial Statements
~~PART I – FINANCIAL INFORMATION~~

I~~TEM~~ ~~1 – CONSOLIDATED~~ F~~INANCIAL~~ S~~TATEMENTS~~

Consolidated Balance Sheets as of June 30, ~~2013~~2020 (unaudited) and December 31, ~~2012~~2019	3
		3

Consolidated Statements of Operations for the ~~three months~~Three and ~~six months ended~~Six-Month Periods Ended June 30, ~~2013~~2020 and ~~2012~~2019 (unaudited)	4
	Consolidated Statement of Stockholders' Deficiency For the Three and Six-Month Periods Ended June 30, 2020 and 2019 (unaudited)	4	5

Consolidated Statements of Cash Flows for the ~~six months ended~~Six-Month Periods Ended June 30, ~~2013~~2020 and ~~2012~~2019 (unaudited)	6
		5

Notes to Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	~~6-13~~17
Item 3.	Quantitative and Qualitative Disclosure about Market Risk	23
Item 4.	Controls and Procedures	23
PART II.	Other Information
Item 1.	Legal Proceedings	25
Item 1A.	I~~TEM~~ ~~2 – MANAGEMENT~~’S D~~ISCUSSIONAND~~ A~~NALYSIS~~OF F~~INANCIAL~~ C~~ONDITIONAND~~ R~~ESULTS~~OF O~~PERATIONS~~Risk Factors	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 3.	Exhibits	30


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2013			2012			2013			2012
Managed care revenues	$	1,078		$	18,124		$	2,295		$	36,014


Costs and expenses:
Costs of revenues		682			13,765			1,471			30,409
General and administrative		1,488			2,226			2,879			2,741
Depreciation and amortization		24			60			64			156

		2,194			16,051			4,414			33,306


Operating income (loss)		(1,116	)		2,073			(2,119	)		2,708

Other income (expense):
Interest expense, including amortization of debt discount of $41, $75, $89, and $270		(533	)		(465	)		(934	)		(1,028	)
Other non-operating income, net		4			1			4			12

(Loss) income before income taxes		(1,645	)		1,609			(3,049	)		1,692
Income taxes		2			2			5			5

Net income (loss)	$	(1.647	)	$	1,607		$	(3,054	)	$	1,687

Net income (loss) attributable to common stockholders	$	(1,647	)	$	1,607		$	(3,054	)	$	1,687


(Loss) earnings per common share:
Basic	$	(0.03	)	$	0.03		$	(0.05	)	$	0.03

Diluted		n/a		$	0.02			n/a		$	0.02

Weighted average common shares outstanding:
Basic		61,102			59,252			60,427			59,252

Diluted		n/a			88,434			n/a			81,787

	Series C convertible Preferred Stock Number of Shares		Series C Convertible Preferred Stock Amount		Common Stock Number of Shares		Common Stock Amount		Additional Paid - in Capital		Accumulated Deficit			Total
Balance at December 31, 2018		10,434	$	10		66,661,656	$	666,617	$	28,012,007	$	(54,581,873	)	$	(25,903,239	)
Stock Issued for Services		—		—		200,000		2,000		14,000		—			16,000
Sale of Stock		—		—		500,000		5,000		10,000		—			15,000
Net Loss		—		—		—		—		—		(727,761	)		(727,761	)
Balance at March 31, 2019		10,434		10		67,361,656		673,617		28,036,007		(55,309,634	)		(26,600,000	)
Stock Issued for Services		—		—		—		—		—		—			—
Sale of Stock		—		—		—		—		—		—			—
Net Loss		—		—		—		—		—		(614,990	)		(614,990	)
Balance at June 30, 2019		10,434		10		67,361,656		673,617		28,036,007		(55,924,624	)		(27,214,990	)
Stock Issued for Services		—		—		—		—		—		—			—
Sale of Stock		—		—		—		—		—		—			—
Net Loss		—		—		—		—		—		(747,801	)		(747,801	)
Balance at September 30, 2019		10,434		10		67,361,656		673,617		28,036,007		(56,672,425	)		(27,962,791	)
Stock Issued for Services		—		—		4,300,000		43,000		430,000		—			473,000
Sale of Warrants		—		—		—		—		253,239		—			253,239
Sale of Stock		—		—		—		—		—		—			—
Net Loss		—		—		—		—		—		(1,165,262	)		(1,165,262	)
Balance at December 31, 2019		10,434		10		71,661,656		716,617		28,719,246		(57,837,687	)		(28,401,814	)
Stock Issued for Services		—		—		—		—		—		—			—
Sale of Warrants		—		—		—		—		—		—			—
Sale of Stock		—		—		—		—		—		—			—
Net Loss		—		—		—		—		—		(928,346	)		(928,346	)
Balance at March 31, 2020		10,434		10		71,661,656		716,617		28,719,246		(58,766,033	)		(29,330,160	)
Stock Issued for Services		—		—		—		—		—		—			—
Sale of Warrants		—		—		—		—		18,251		—			18,251
Sale of Stock		—		—		45,089,783		450,897		6,624,483		—			7,075,380
Net Loss		—		—		—				—		(1,375,039	)		(1,375,039	)
Balance at June 30, 2020		10,434		10		116,751,439		1,167,514		35,361,980		(60,141,072	)		(23,611,568	)

	Six-Month Periods Ended
	June 30,
	2020			2019

CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(2,303,385	)	$	(1,342,751	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		623			440
Stock issued for services		—			16,000
Amortization of right of use assets		54,660			25,579
Net changes in assets and liabilities:
Accounts receivable		(11,221	)		(2,756	)
Other current assets		169,572			(712,065	)
Payments on lease liabilities		(54,660	)		(25,579	)
Accounts payable		51,383			210,951
Other accrued expenses		1,215,572			742,356
Net cash used in operating activities		(877,456	)		(1,087,825	)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant, and equipment		(5,067	)		(1,549	)
Net cash used in investing activities		(5,067	)		(1,549	)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from promissory notes		559,360			1,070,250
Proceeds from PPP loan		1,243,840			—
Payments on debt		(17,000	)		—
Sale of stock		18,251			15,000
Net cash provided by financing activities		1,804,451			1,085,250

Net increase (decrease) in cash		921,928			(4,124	)

CASH - Beginning of Year		69,327			25,036

CASH AND RESTRICTED CASH - END OF PERIOD	$	991,255		$	20,912

Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest	$	—		$	—
Income taxes	$	—		$	—

Recording of right of use assets under
lease agreements (ASU 2016-02)	$	135,075		$	119,640

Schedule of non-cash investing transactions:
Convertible promissory note and accrued interest
converted to common stock	$	7,075,380		$	—


Stock price		Additional funds due lender		(Shares due borrower) Shares due lender
$	0.115		n/a		(383,635	)
$	0.105		n/a		(280,114	)
$	0.095		n/a		(154,800	)
$	0.085		n/a		n/a
$	0.075	$	14,706		196,080
$	0.065	$	29,412		452,492
$	0.055	$	44,118		802,145


	Carrying			Estimated
	Amount			Fair Value
Notes Payable	$	2,705		$	2,660
Zero-coupon notes		230			224

Debentures		537			479
Senior notes		1,771			1,761
Long-term notes		225			221
Less unamortized discount		(150	)		—

Net liabilities	$	5,318		$	5,345

	June 30, 2020				December 31, 2019
			Estimated				Estimated
			Fair Value of				Fair Value of
	Carrying		Attached		Carrying		Attached
	Amount		Warrants		Amount		Warrants

Convertible promissory notes	$	5,956,533	$	—	$	7,564,173	$	—
Short term notes payable		3,215,803		—		4,788,016		—
Loan payable related party		102,229		—		342,670		—
PPP Loan		1,243,840		—		—		—
	$	10,518,405	$	—	$	12,694,859	$	—


	Share Quantity 2013		Share Value ($)		Share Quantity 2012		Share Value ($)
Shares outstanding, January 1,		59,451,836				59,251,836
Shares issued as compensation for services		425,000	$	83,805
Shares issued in connection with Revolving Credit Facility		1,470,588	$	125,000
Shares issued as payment for interest and fees		969,078	$	96,908

Shares outstanding, June 30,		62,316,502				59,251,836


Warrants	Shares			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term
Outstanding at January 1, 2013		35,957,583		$	0.33	4.26 years
Granted		1,700,000		$	0.25
Forfeited or expired		(325,000	)	$	0.37

Outstanding at March 31, 2013		37,332,583		$	0.33	4.00 years

Granted		2,010,000		$	0.20
Cancelled		(2,000,000	)	$	0.20

Outstanding at June 30, 2013		37,342,583		$	0.33	3.75 years

Exercisable at June 30, 2013		37,308,583		$	0.33	3.75 years

Outstanding at January 1, 2012		41,057,583		$	0.35	4.86 years
Granted		25,000		$	0.25
Forfeited or expired		(100,000	)	$	0.53

Outstanding at March 31, 2012		40,982,583		$	0.35	4.61 years

Forfeited or expired		(2,300,000	)	$	0.32

Outstanding at June 30, 2012		38,682,583		$	0.35	4.58 years

Exercisable at June 30, 2012		37,615,583		$	0.33	4.62 years


Options	Shares			Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Term
Outstanding at January 1, 2013		6,618,000		$	0.32	8.29 years
Forfeited or expired		(190,000	)	$	0.79

Outstanding at March 31, 2013		6,428,000		$	0.31	8.15 years

Granted		300,000		$	0.25
Forfeited or expired		(185,000	)	$	0.38

Outstanding at June 30, 2013		6,543,000		$	0.31	7.86 years


Exercisable at June 30, 2013		6,196,334		$	0.31	7.86 years

Outstanding at January 1, 2012		8,795,400		$	0.33	7.74 years
Forfeited or expired		(40,000	)	$	0.38

Outstanding at March 31, 2012		8,755,400		$	0.33	7.49 years

Forfeited or expired		(119,500	)	$	0.35

Outstanding at June 30, 2012		8,635,900		$	0.33	7.24 years

Exercisable at June 30, 2012		7,978,000		$	0.33	7.15 years


	Six months ended June 30,
	2013	2012

Expected volatility	160%		160	%
Expected life (in years) of options	3			*
Expected life (in years) of warrants	2-3		3
Risk-free interest rate range, options	0.66%			*
Risk-free interest rate range, warrants	0.23-0.74%		0.57	%
Expected dividend yield	0%		0	%

	June 30, 2020		December 31, 2019

Loans to others	$	34,406	$	42,676
Security and lease deposits		3,500		3,500
Capitalized portion of lease		1,237		1,808
Prepaid expenses		288,487		452,953
Miscellaneous receivable		329,395		325,660

Other current asset	$	657,025	$	826,597

	June 30, 2020			December 31, 2019

Property and equipment	$	6,616		$	1,549
Less accumulated depreciation		(933	)		(310	)
Property and equipment - net	$	5,683		$	1,239

	June 30, 2020			December 31, 2019

Leasehold improvements	$	2,992		$	2,992
Less accumulated amortization		(2,992	)		(2,992	)
Leasehold improvements - net	$	—		$	—

	June 30, 2020		December 31, 2019

Advanzeon parent	$	3,381,163	$	5,010,016
PVMS		7,035,013		7,342,173
	$	10,416,176	$	12,352,189

	June 30, 2020		December 31, 2019

Number of notes issued		2		—

Dollar value	$	165,360	$	—

	June 30, 2020		December 31, 2019

Disputed note payable	$	450,000	$	450,000
Disputed interest payable		171,247		171,247
Pending attorney fees		21,412		21,412

Total contingent liability	$	642,659	$	642,659

	June 30, 2020		December 31, 2019

Management compensation	$	8,907,258	$	8,873,802
Accrued interest non-related party		4,760,728		5,956,368
Board of Director fees		37,500		1,050,000
State fees		—		2,800
Payroll liabilities		14,047		—
Other accrued liabilities		22,659		8,817
Total other accrued debt	$	13,742,192	$	15,891,787

Total present value of right of use assets
under lease agreements	$	368,870

Amortization of right of use assets		(53,419	)

Total right of use assets as of June 30, 2020	$	315,451

Total present value of future lease payments	$	368,870

Principal payments made as of the six month period ended June 30, 2020		(53,419	)

Total right of use lease liabilities as of June 30, 2020	$	315,451

Total future minimum lease payments	$	336,671

Less present value discount		21,220

Total right of use lease liabilities as of June 30, 2020		315,451

Less current portion due within one year		136,230

Long-term right of use liabilities	$	179,221

	Total future
	minimum lease		Present value		Right of use
	payments		discount		lease liabilities
2021	$	150,103	$	13,873	$	136,230
2022		146,568		6,358		140,210
2023		40,000		989		39,011
	$	336,671	$	21,220	$	315,451


	Three Months Ended June 30,					Six Months Ended June 30,
	2013			2012		2013			2012
Numerator:
Net (loss) income attributable to common stockholders	$	(1,647	)	$	1,607	$	(3,054	)	$	1,687
Add impact of assumed conversions:
Interest on convertible debts		—			231		—			223

Net income (loss) attributable to common stockholders after assumed conversions		(1,647	)	$	1,838		(3,054	)	$	1,910
Denominator:
Weighted average common shares – basic		61,102			59,252		60,427			59,252

Effect of dilutive securities:		n/a					n/a
Series C convertible preferred stock					3,300					3,300
Series D convertible preferred stock					5,182					6,551
Stock options					—					—
Warrants					—					—
Convertible debts					20,700					12,684

Weighted average common shares – diluted					88,434					81,787


(Loss) earnings per share:
Basic	$	(0.03	)	$	0.03	$	(0.05	)	$	0.03

Diluted		n/a		$	0.02		n/a		$	0.02