UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

Form 10-Q

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

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2009

¨	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

FOR THE TRANSITION PERIOD FROM _________ TO ______________

Commission File Number: 0-19195

MODERN MEDICAL MODALITIES CORPORATION

(Exact name of small business issuer as specified in its charter)

New Jersey		22-3059258
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

439 Chestnut Street, Union, New Jersey 07083

(Address of principal executive offices)

(908) 687-8840

(Issuer’s telephone number)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filings requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b2 of the Exchange Act.

¨	Large accelerated filer		Accelerated filer ¨
¨	Non-accelerated filer (Do not check if a smaller reporting company)		Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

As of November 2, 2009, there were 25,323,385 shares of the registrant’s common stock, $0.0002 par value, outstanding.

MODERN MEDICAL MODALITIES CORPORATION AND SUBSIDIARIES

SEPTEMBER 30, 2009

QUARTERLY REPORT ON FORM 10-Q

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements

		Condensed Consolidated Balance Sheets as of September 30, 2009 (unaudited) and December 31, 2008	3-4

		Condensed Consolidated Statements of Operations for the nine and three months ended September 30, 2009 and 2008 (unaudited)	5

		Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2009 and 2008 (unaudited)	6

		Notes to Interim Condensed Consolidated Financial Statements	7-8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		9-12

Item 3.	Quantitative and Qualitative Disclosures About Market Risk		13

Item 4.	Controls and Procedures		13

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings		13

Item 1A.	Risk Factors		13

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		14

Item 3.	Defaults Upon Senior Securities		14

Item 4.	Submission of Matters to a Vote of Security Holders		14

Item 5.	Other Information		14

Item 6.	Exhibit Index		14

SIGNATURES			15

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

MODERN MEDICAL MODALITIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	September 30, 2009 (Unaudited)		December 31, 2008
Assets
Current assets:
Cash and cash equivalents	$	177,138	$	46,518
Accounts receivable (less contractual allowances of $3,319,500 and $2,813,800, respectively)		1,068,867		989,544
Note Receivable		49,646		-
Prepaid expenses		14,026		41,808

Total Current Assets		1,309,677		1,077,870

Property and equipment, net of accumulated depreciation of $3,542,265 and $3,351,672, respectively		906,173		1,088,894

Other assets:
Purchased software		1,287,917		1,287,917
Deposits		36,270		37,670

Total Other Assets		1,324,187		1,325,587

Total Assets	$	3,540,037	$	3,492,351

See notes to financial statements.

MODERN MEDICAL MODALITIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	September 30, 2009 (Unaudited)		December 31, 2008
LIABILITIES AND STOCKHOLDERS' (DEFICIENCY)
Current liabilities
Accounts payable	$	1,331,335	$	708,911
Accrued expenses		1,230,762		1,302,839
Current portion long term debt		1,430,518		1,406,840

Total Current Liabilities		3,992,615		3,418,590

Other liabilities
Long term debt, net of current portion		94,652		211,387
Loans payable shareholders		235,899		235,899

Total Other Liabilities		330,551		447,286

Total Liabilities		4,323,166		3,865,876

Minority interest		-		-

Commitments and contingencies		-		-

Stockholders' deficiency:
Preferred stock, $0.0002 par value, authorized - 1,000,000 shares—issued and outstanding - 0 shares		-		-
Common stock, $0.0002 par value, authorized - 99,000,000 shares—issued 26,527,051 shares and outstanding 25,323,385 shares at September 30, 2009 and issued – 26,527,051 shares and outstanding 25,673,385 shares at December 31, 2008		5,305		5,305
Additional paid-in capital		11,905,803		11,799,216
(Deficit)		(12,556,737)		(12,115,546	)
Treasury stock, 1,203,666 and 853,666 shares, respectively, at cost		(137,500)		(62,500	)

Total stockholders'(deficiency)		(783,129)		(373,525	)

TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIENCY)	$	3,540,037	$	3,492,351

See notes to financial statements

MODERN MEDICAL MODALITIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

	For the nine months ended						For the three months ended
	September 30,						September 30,
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)
	2009			2008			2009			2008
Revenues:
Net revenues from services	$	5,189,334		$	5,629,012		$	1,659,832		$	2,086,809
Cost of services provided		4,308,782			4,283,750			1,550,570			1,446,320

Total operating income		880,552			1,345,262			109,262			640,489

Operating expenses:
Selling, general and administrative		991,140			2,178,481			376,483			1,425,236
Depreciation and amortization		190,593			211,112			61,858			67,425

Total operating expenses		1,181,733			2,389,593			438,341			1,492,661

(Loss) from operations		(301,181	)		(1,044,331	)		(329,079	)		(852,172	)

Other income (expenses):
Interest expense		(204,832	)		(305,435	)		(48,454	)		(39,982	)
Gain from restructured debt		-			625,274			-			625,274

Total other (expenses)		(204,832	)		(319,839	)		(48,454	)		585,292

(Loss) before income taxes and minority interest		(506,013	)		(724,492	)		(377,533	)		(266,880	)

(Benefit)/provision for income taxes		(64,822	)		125,855			88,924			109,150

(Loss) before minority interest		(441,191	)		(850,347	)		(466,457	)		(376,030	)

Minority interests		-			-			-			-

Net (loss)	$	(441,191	)	$	(850,347	)	$	(466,457		$	(376,030	)

(Loss) per share, basic and diluted	$	(0.02	)	$	(0.03	)	$	(0.02	)	$	(0.02	)
Number of weighted average shares outstanding		25,432,760			24,425,736			25,323,385			24,873,607

See notes to financial statements.

MODERN MEDICAL MODALITIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the nine months ended September 30,
	(Unaudited)			(Unaudited)
	2009			2008
Cash Flows from Operating Activities
Net (loss)	$	(441,191	)	$	(850,347	)
Adjustments to reconcile net loss to net cash provided by/(used) in operating activities:
Depreciation and amortization		190,593			211,112
Contractual allowances		505,700			(594,000	)
(Decrease) in minority interest		-			(65,622	)

Increase (decrease) in cash attributable to changes in operating assets and liabilities:
Accounts receivable		(585,023	)		432,425
Prepaid expenses		27,782			(55,310	)
Deposits and other assets		1,400			1,991
Accounts payable		622,425			(67,519	)
Accrued expenses		( 72,078	)		170,349
Total adjustments		690,799			33,426
Net cash provided by operating activities		249,608			(816,921	)
Cash flows from Investing Activities:
Fixed asset acquisitions		(7,872	)		(39,276	)
(Increase) decrease note receivable		(49,646	)		15,884
(Increase) in purchased software		-			(55,739	)
Increase in common stock from issuance of shares and conversion of debt		-			386
Increase in additional paid in capital from issuance of shares and conversion of debt		-			90,273
Increase in additional paid in capital from stock-based compensation resulting from issuance of employee stock options and warrants		106,587			1,550,716
(Increase) in Treasury Stock resulting from the purchase of the Company’s common stock		(75,000	)		(62,500	)
Net cash (used in) provided by investing activities		(25,931	)		1,499,744
Cash flows from financing activities:
Increase long term debt		231,713			25,748
(Decrease)long term debt		(324,770	)		(663,349	)
Net cash (used in) financing activities		(93,057	)		(637,601	)
Net increase in cash and cash equivalents		130,620			45,222
Cash and equivalents, beginning of period		46,518			52,425

Cash and equivalents, end of period	$	177,138		$	97,647
Supplemental cash flow information:
Interest paid	$	182,232		$	216,170
Income taxes paid	$	65,318		$	-
Common Shares issued in payment of consulting and other agreements		-			1,483,000

See notes to financial statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - BASIS OF PRESENTATION:

The financial information included herein is unaudited; however, such information reflects all adjustments (consisting solely of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of results for the interim period. The results of operations for the three and nine month periods ended September 30, 2009 are not necessarily indicative of the results to be expected for the full year. The accompanying unaudited consolidated financial statements and footnotes have been condensed and, therefore, do not contain all required disclosures. Reference should be made to the Company's annual report filed on Form 10-K for the year ended December 31, 2008.

NOTE 2 - LITIGATION:

In October 2008, in exchange for Siemens Medical Solutions, USA, Inc. (“Siemens Medical”) and Spur Imaging Service, LLC (“Spur”) agreeing to forbear from exercising their enforcement rights under the Consent Judgment through February 15, 2009. We paid Siemens Medical $525,000 between October 6, 2008 and February 15, 2009 and paid Spur $25,000 between October 6, 2008 and February 28, 2009 in full payment of the $550,000 settlement of a sub-lease involving Siemens Medical and Spur. On April 24, 2009 we received documentation confirming that the Judgment was satisfied.

On April 3, 2009, we received copies of a lawsuit from Mary Monar and David R. Monar, her husband. The lawsuit claims that on or about December 29, 2004 and July 5, 2006, Plaintiff Mary Monar underwent a mammography at the facilities at Union Imaging Center, LLC and that at such time, the suit claims a deviation and departure from acceptable medical practice and negligence in failing to properly diagnose the plaintiff. As a result, the plaintiff developed breast cancer that went untreated for two years. This suit is under discovery and we will defend against any alleged claims being made.

NOTE 3 – SHARE-BASED PAYMENTS IN ACCORDANCE WITH SFAS 123R:

Under SFAS 123(R), we estimate the fair value of stock options and share-based awards using the Simple Black-Scholes European Option Pricing Model.

For the three and nine months ended September 30, 2009, we conducted an outside independent analysis and our own review, and based on the results, we recognized $39,197 and $81,529, respectively, in share-based payments related to warrants and stock options issued with the rights to exercise 390,000 and 1,390,000 shares, respectively, in of our common stock.

At September 30, 2009, the Company had approximately $39,000 of total unrecognized compensation cost related to unvested stock options. This cost is expected to be recognized over a weighted-average period of approximately 1.0 years.

NOTE 4 – LOAN AGREEMENTS:

On October 3, 2008, we entered into a Loan Agreement with Moseh & Aliza Lazarian for $100,000. The terms of the Agreement include an annual interest rate of 12% and the loan is to be paid in amounts of $50,000 on or before February 1, 2009 and $50,000 on or before October 1, 2009. In addition, the Company issued a Warrant for the rights to 500,000 shares of the Company’s common stock with a term of 5 years and an exercise price of $0.10 per share. The February and October 1, 2009, payments were not made by the Company and under the terms of the loan agreement the interest rate on the note increased from 12% to 15% until the payments are made. Interest payments have been kept current.

On December 8, 2008, we entered into a Loan Agreement with Union Imaging Associates, P.A., for $71,834.24. The terms of the Agreement include monthly interest payments of $718.34 (12% per annum) starting January 9, 2009, and the loan was to be paid in full March 6, 2009. The note was extended by mutual agreement of the Note Holder and the Borrower. Interest payments have been kept current.

On December 8, 2008, we entered into a Loan Agreement with Union Imaging Associates, P.A., for $100,000.00. The terms of the Agreement include monthly interest payments of $1,000.00 (12% per annum) starting January 9, 2009, and the loan is to be paid in full March 6, 2009. The note was extended by mutual agreement of the Note Holder and the Borrower. Interest payments have been kept current.

On March 18, 2005 Modern Medical entered into a Loan agreement with Dr. Howard Kessler MD PA, in the amount of $300,000 payable in 12 monthly payments of $8,333 with a lump sum due on the 13th month in the amount of $221,826.71 and bears an interest rate of 8% per annum. This loan funded the settlement of the DVI/US Bank loan settlement. The note was extended by mutual agreement of the Note Holder and the Borrower and currently interest only is being paid. At September 30, 2009 the principal balance is approximately $73,000 and interest payments have been kept current.

On January 15, 2009, we entered into a Loan Agreement with Issak Hayut for $112,500. The terms of the Agreement include interest payments of $10,000 per month for 3 months and the loan is to be paid in full on or before April 15, 2009. In addition, the Company issued a Warrant for the rights to buy 500,000 shares of the Company’s common stock with a term of 5 years and an exercise price of $0.10 per share. The loan agreement was entered into in order to have sufficient funds to meet a deadline on a debt settlement payment due and to help realize a gain on the restructured debt with Siemens Medical Solutions, USA, Inc. The note was extended by mutual agreement of the Note Holder and the Borrower.

On February 15, 2009, we entered into a Loan Agreement with Issak Hayut for $112,500. The terms of the Agreement include interest payments of $10,000 per month for 3 months and the loan is to be paid in full on or before May 15, 2009. In addition, the Company issued a Warrant for the rights to buy 500,000 shares of the Company’s common stock with a term of 5 years and an exercise price of $0.10 per share. The loan agreement was entered into in order to have sufficient funds to meet a deadline on a debt settlement payment due and to help realize a gain on the restructured debt with Siemens Medical Solutions, USA, Inc. The note was extended by mutual agreement of the Note Holder and the Borrower.

NOTE 5 – Dr. Wolkstein Put 350,000 common shares to the Company.

On September 1, 2006, we purchased Dr. Wolkstein's share of his ownership interest in Union Imaging Associates, Inc. ("UIA, Inc.") in exchange for 350,000 shares of the Company's common stock with a valuation of $154,000 at the time of purchase, and a note for $27,000 to be paid in 18 payments of $1,500.00 per month. The 350,000 shares of common stock were issued on October 20, 2006. As a condition of the purchase, the Company agreed to re-purchase the 350,000 shares from Dr. Wolkstein for $75,000 if for any consecutive 20 day period commencing September 1, 2008 through the last day of February 2009, the stock price was below $1.00 per share. On January 22, 2009, Dr. Wolkstein put the 350,000 shares to the Company in accordance with the purchase agreement. We are making interest payments of $500 per month on the $75,000.

NOTE 6 - STATE OF NEW JERSEY TAXES:

On April 20, 2009, we were notified by the State of New Jersey, Division of Taxation that a judgment has been entered in the Superior Court of New Jersey on April 16, 2009 in the amount of $39,386.39 and additional penalty and interest plus costs of collection will accrue. We are currently negotiating a deferred payment plan with the State of New Jersey Department of Taxation.

NOTE 7 - GE HEALTHCARE FINANCIAL SERVICES DEFAULT:

On April 23, 2009, GE Healthcare Financial Services notified us that Union Imaging Associates, Inc (UIA, Inc) is in default under a lease agreement. At September 30, 2009, UIA, Inc. is past due approximately, $472,000 plus continuing accruing fees, costs and expenses, including without limitation, collections costs and attorney’s fees. GE Healthcare Financial Services states that it will pursue all rights and remedies available to it if payment is not paid in full within 7 days of April 23, 2009. We have discussed payment terms and plan to continue to work on a resolution to settle the past due lease payments.

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

Forward-looking Statements

This Quarterly Report on Form 10-Q, including "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this Item 2 of Part I of this Quarterly Report include forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by forward-looking statements.

In some cases, you can identify forward-looking statements by terminology such as "may," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," "proposed," "intended," or "continue" or the negative of these terms or other comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about our future operating results or our future financial condition or state other "forward-looking" information. There may be events in the future that we are not able to accurately predict or control. You should be aware that the occurrence of any of the events described in this Quarterly Report could substantially harm our business, results of operations and financial condition, and that upon the occurrence of any of these events, the trading price of our securities. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, growth rates, levels of activity, performance or achievements. We are under no duty to update any of the forward-looking statements after the date of this Quarterly Report to conform these statements to actual results.

The following discussion should be read in conjunction with Modern Medical Modalities Corporation’s (“Modern Medical”, the “Company”, “we”, or “us”) unaudited condensed consolidated financial statements and notes included herein. The results described below are not necessarily indicative of the results to be expected in any future period. Certain statements in this discussion and analysis, including statements regarding our strategy, financial performance and revenue sources, are forward-looking statements based on current expectations and entail various risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Readers are referred to our Annual Report on Form 10-KSB for the year ended December 31, 2007 as filed with the Securities and Exchange Commission. We undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in our expectations.

OVERVIEW

We provide a network of healthcare management and clinical services that is supported by our advanced, web-based, enterprise-wide information system. Our network of healthcare services is currently focused on the diagnostic imaging services specialty market, and has the capacity to service other multi-specialty markets. Our healthcare management and clinical services are delivered through a network of owned diagnostic imaging centers, joint venture operations, and contractual services agreements. The healthcare management services include marketing, procurement of medical equipment, facilities construction and maintenance, recruitment and training of technical and support staff, administrative and information services, such as leasing, managed care and contract management, human resources, inventory management, medical records, and billing and collections. The healthcare clinical services include magnetic resonance imaging (MRI), computerized axial tomography (CT scan), positron emission tomography (PET), ultrasound, densitometry, mammography, nuclear medicine, and general radiography (X-ray).

We believe that our network of centers are being optimized by providing a full array of management and imaging services to better meet the varied needs of our customers, providers of care, and other participants in our growing network. In addition, we are seeking to maximize the productivity and quality of each center that we own, as well as of each network of centers we contract with, by providing integrated technology solutions through state-of-the art medical equipment and industry leading information management systems. As of September 30, 2009, we own, operate, and manage three diagnostic imaging centers located in New Jersey. The Company's ownership interests range from 50% to 100%. We intend to continue to expand through a combination of joint ventures, acquisitions, and targeted marketing activities. On a consolidated basis, we currently recognize the majority of our revenues from a range of diagnostic imaging services and that allow us to leverage the variety of imaging systems in our network of centers, in order to potentially increase operating income once fixed costs are more rapidly covered with higher volumes of procedures performed. In addition, we are creating the infrastructure to expand our revenues through management services contracts with an increasing emphasis on providing web-based, comprehensive information services as the healthcare outpatient services and related markets continue to grow and operate within larger networks.

Our diagnostic imaging centers are dependent on referrals from physicians and other healthcare professionals, and we intend to conduct direct marketing activities to consumers in order to supplement our valued referrals. In addition, the Company accepts referred patients that are insured through managed care contracts that help keep a more consistent volume of business flowing while requiring more competitive rates for procedures performed. We expect to continue to better integrate the optimal mix of managed care and traditional insurance covered services and reimbursements with consumer driven on-demand services and payments while maximizing the ratio of effective diagnostic imaging utilization over capacity in each center, and maintaining high quality patient outcomes and overall service.

We have been providing management services as a supplement to our clinical services, and due to the growing demand for the more profitable information-based management services segment of healthcare, we have been creating the infrastructure to expand more of our revenues through management services contracts. With the two acquisitions of software assets that have been integrated into one common system platform having been accomplished, we are placing increasing emphasis on providing web-based, comprehensive information services as the healthcare outpatient services and related markets continue to grow and operate within larger networks. We have positioned ourselves to participate in the expanding health care market and plan to grow through acquisitions of administrative services companies such as billing companies, and through more joint ventures and larger collaborative contractual arrangements that include networks of clinics, hospitals, physician managed ambulatory centers, employers, and other key participants in the healthcare industry.

Results of Operations:

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2009 COMPARED TO THE NINE MONTHS ENDED SEPTEMBER 30, 2008.

	2009		2008

Net revenues from services	$	5,189,000	$	5,629,000

Cost of services provided	$	4,309,000	$	4,284,000

Selling, general and administrative expenses	$	991,000	$	2,178,000

(Loss) from operations	$	(301,000)	$	(1,044,000	)

Net Revenues from Services:

For the nine months ended September 30, 2009, net revenues from services totaled $5,189,000 as compared to $5,629,000 for the same period in 2008, resulting in a decrease of approximately $440,000. This decrease in net revenues is attributable primarily to a decrease in CT and MRI procedures completed, approximately 11% and 4.5%, respectively. This reduction in procedures amounts to approximately $195,000 in net revenues, $110,000 related to CT and $85,000 related to MRI. Our centers have incurred additional reductions in net revenues related to the deficit reduction act affecting Medicare and Medicaid reimbursements and economic pressures on insurance companies to force down reimbursements, amounting to approximately $175,000. Net revenues were further reduced as a result of an overall increase of our provision for uncollectible accounts receivables resulting from lower reimbursements of approximately 2% or $89,000. These reductions were somewhat offset by increases in other diagnostic procedures.

Cost of services provided:

For the nine months ended September 30, 2009, cost of services provided totaled $4,309,000 as compared to $4,284,000 for the same period in 2008, resulting in an increase of approximately $25,000. This increase is attributable primarily to the increased medical equipment rental costs of approximately $145,000, offset set by approximately $120,000 in a reduction in medical supply costs related to reduced procedures.

Selling, general and administrative expenses:

For the nine months ended September 30, 2009, selling, general and administrative expenses totaled $991,000 as compared to $2,178,000 for the same period in 2008, resulting in a decrease of approximately $1,187,000. This decrease relates primarily to $1,469,000 decrease in share based payments offset by approximately $250,000 in legal fees recorded in connection with the Health Diagnostics of New Jersey, LLC transaction. The balance of the decrease related to administrative costs resulting from combining the Nuclear Camera into the MRI facility, resulting is savings in personnel expenses.

Loss from operations:

Loss from operations for the nine months ended September 30, 2009 was $301,000 as compared to a loss of $1,044,000 for the same period in 2008 resulting in a decrease in the loss from operations of approximately $743,000. This decrease in loss from operations relates to the decrease in net revenues of approximately $440,000, the increase in cost of services provided of approximately $25,000, the decrease in selling, general and administrative expense of approximately $1,187,000 and a decrease in depreciation expense of $21,000.

Results of Operations:

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2009 COMPARED TO THE THREE MONTHS ENDED SEPTEMBER 30, 2008.

	2009			2008

Net revenues from services	$	1,660,000		$	2,087,000

Cost of services provided	$	1,551,000		$	1,446,000

Selling, general and administrative expenses	$	376,000		$	1,425,000

(Loss) from operations	$	(329,000	)	$	(852,000	)

Net Revenues from Services:

For the three months ended September 30, 2009, net revenues from services decreased approximately $427,000, from $2,087,000, for the three months ended September 30, 2008 as compared to $1,660,000 for the same period in 2009. This decrease in net revenues is attributable primarily to a decrease in CT and MRI procedures completed, approximately 8.6% and 12.8%, respectively. This reduction in procedures amounts to approximately $105,000 in net revenues, $26,000 related to CT and $79,000 related to MRI. Our centers have incurred additional reductions in net revenues related to the deficit reduction act affecting Medicare and Medicaid reimbursements and economic pressures on insurance companies to force down reimbursements, amounting to approximately $116,000. Net revenues were further reduced as a result of an overall increase of our provision for uncollectible accounts receivables resulting from reduced reimbursement by approximately $206,000.

Cost of services provided:

For the three months ended September 30, 2009, cost of services provided totaled approximately $1,551,000 as compared to $1,446,000 for the same period in 2008, resulting in an increase of approximately $105,000. This increase is attributable primarily to the increased medical equipment rental costs of approximately $213,000, offset set by approximately $108,000 in a reduction in medical supply costs related to reduced procedures.

Selling, general and administrative expenses:

For the three months ended September 30, 2009, selling, general and administrative expenses totaled $376,000 as compared to $1,425,000 for the same period in 2008, resulting in a decrease of approximately $1,049,000. This decrease relates primarily to $1,099,000 decrease in share based payments offset by approximately $25,000 in legal fees recorded in connection with the Health Diagnostics of New Jersey, LLC transaction. The balance of the decrease related to administrative costs resulting from combining the Nuclear Camera into the MRI facility, resulting is savings in personnel expenses.

Loss from operations:

Loss from operations for the three months ended September 30, 2009 was $329,000 as compared to a loss of $852,000 for the same period in 2008 resulting in a decrease in the loss from operation of approximately $523,000. This decrease in loss from operations relates to the decrease in net revenues of approximately $427,000, the increase in cost of services provided of approximately $105,000, the decrease in selling, general and administrative expense of approximately $1,049,000 and a decrease in depreciation expense of $6,000.

Liquidity and Capital Resources:

As of September 30, 2009, we had a working capital deficiency of $2,682,938, as compared to a working capital deficiency of $2,340,720 as of December 31, 2008. We do not believe that our cash flow from operations will be sufficient to fund our ongoing operations and we will continue to have to raise capital to fund our operations. We may raise additional capital through the issuance of debt, equity or a combination thereof. There can be no assurance that any additional financing will be available on terms acceptable to us, if at all.

Debt:

These are the only trends, commitments, events and/or material uncertainties known to Modern Medical.

Off-Balance Sheet Arrangements:

None.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Registrant is a smaller reporting company and is not required to provide a response under this Item 3.

Item 4. Controls and Procedures

Evaluations of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) under the Securities Exchange Act of 1934 as of the end of the period covered by this report (the "Evaluation Date"). Based upon the evaluation, our principal executive officer and principal financial officer concluded as of the Evaluation Date that our disclosure controls and procedures were effective. Disclosure controls are controls and procedures designed to reasonably ensure that information required to be disclosed in our reports filed under the Exchange Act, such as this report, is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. Disclosure controls include controls and procedures designed to reasonably ensure that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the quarterly period covered by this Quarterly report that have materially affected, or are reasonable likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, the Company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm the Company's business. Except as otherwise disclosed herein, the Company is currently not aware of any such legal proceedings or claims that it believes will have, individually or in the aggregate, a material adverse affect on its business, financial condition or operating results.

Item 1A. Risk Factors

As a smaller reporting company, we are not required to provide disclosure under this Item 1A.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults upon Senior Securities

There have not been any defaults on any senior securities during the period covered by this Quarterly Report.

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

None.

Item 5. Other Information

On February 24, 2009, we filed a notice of shareholder action by written consent with the Securities and Exchange Commission. This notice and accompanying information statement were furnished to the holders of our Common Stock, par value $0.0002 per share, informing the shareholders that, on January 30, 2009, our board of directors unanimously approved, and holders of a majority of our issued and outstanding shares of Common Stock consented in writing to, the sale of substantially all of the assets used in connection with the operation of our diagnostic imaging centers located in Union, New Jersey, to Health Diagnostics of New Jersey, LLC, a New Jersey limited liability company.

The notice and accompanying information statement were furnished to holders of the Common Stock pursuant to Section 14(c) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations promulgated thereunder, including Regulation 14C, and in full satisfaction of any notice requirements that we may have under the New Jersey Business Corporation Act, to inform our shareholders of these actions prior to their taking effect. In accordance with Rule 14c-2 under the Exchange Act and Section 14A:5-6(b) under the New Jersey Business Corporation Act, the actions approved by the written consent may be effective no sooner than 20 calendar days following the mailing of this notice and accompanying information statement.

On August 18, 2009 we notified Health Diagnostics of New Jersey, LLC (‘HD”) that we terminated the Asset Purchase Agreement with HD that involved the sale of substantially all of the assets used in connection with the operation of our diagnostic imaging centers located in Union, New Jersey. We terminated the Asset Purchase Agreement as the closing date specified therein had passed and HD informed us that HD would be unable to close the transaction until an indeterminate date. Until we terminated the Asset Purchase Agreement, we were bound by the Asset Purchase Agreement not to enter into any discussions or negotiations with another potential purchaser regarding the sale of our imaging centers.

ITEM 6. EXHIBITS:

Exhibit Index

31.1		* Certification of the Company's Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		* Certification of the Company's Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.1		* Certification of the Company's Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2		* Certification of the Company's Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
* filed herewith

SIGNATURES

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

	MODERN MEDICAL MODALITIES CORPORATION

Dated: November 6, 2009	By:	/s/ Baruh Hayut
		Name: Baruh Hayut
		Title: Chairman and Chief Executive Officer (Principal Executive Officer)

Dated: November 6, 2009	By:	/s/ Minesh Patel
		Name: Minesh Patel
		Title: Chief Operating Officer and Chief Financial Officer (Principal Financial Officer)

MODERN MEDICAL MODALITIES CORP 10-Q