AMERICAN HOMEPATIENT DEVELOPS TWO NEW JOINT VENTURE PARTNERSHIPS IN NORTH CAROLINA.

BRENTWOOD, Tenn.--(BUSINESS WIRE)--Aug. 21, 1997--Edward K. Wissing, president and chief executive officer of American HomePatient, Inc. (Nasdaq: AHOM), one of the nation's largest home health care companies, today announced the signing of two joint venture agreements with key hospitals in the state of North Carolina. The two joint ventures involve four hospitals with a combined total of more than 700 beds.

The first agreement signed is with a consortium of three hospitals located in the western part of the state. This consortium has joined with American HomePatient to form a 50/50 percent equity partnership providing respiratory services and equipment, enteral nutrition and home medical equipment to their patients following discharge to the home or alternate setting.

The hospitals in the consortium include Frye Regional Medical Center, a Tenet hospital located in Hickory, N.C., Caldwell Memorial Hospital of Lenoir, N.C., and Grace Hospital of Morganton, N.C. The joint venture will operate under the name American HomePatient and will be served by existing American HomePatient centers located in Hickory, Morganton, and Maiden, N.C., as well as a new start-up operation in Lenoir, N.C.

Ed Rush, chief operating officer of Frye Regional Medical Center, will serve as president of the new joint venture. "American HomePatient's national reputation for quality and a proven track record of success in hospital joint ventures were key factors in our decision," Rush said. "As partners, we'll be able to provide the continuity of care from hospital to home that our patients deserve and managed care organizations demand," he continued.

American HomePatient's Wissing noted that the trend of hospitals forming networks or consortiums is becoming more prevalent in smaller markets. "Hospitals coming together in this way has been a common event in larger markets for quite some time," he noted. "Now we're beginning to see more examples of hospitals in smaller communities also taking advantage of the opportunities that such cooperative arrangements bring to both them and the patients in the communities they serve."

In a separate agreement, American HomePatient also announced a 50/50 percent equity partnership with Central Carolina Hospital, another Tenet hospital located in Sanford, N.C. American HomePatient has purchased 50 percent of the hospital's existing respiratory services and medical equipment business, known previously as the Homecare Store. This joint venture will also operate under the name American HomePatient.

"American HomePatient is known in North Carolina for its consistent level of quality, cost-effective care. With 17 centers in the state, the company's combination of broad geographic coverage and quality care were certainly leading factors in our decision," said Elaine Hylwa, R.N., M.S.N., chief operating officer of Central Carolina Hospital.

Wissing explains that the formation of joint venture partnerships, like the two North Carolina joint ventures announced today, represents one of the company's strategies for long-term growth. "A key component of our growth strategy is the development of partnerships and contractual arrangements with key hospitals and hospital networks," he said. "We believe the two joint ventures announced today, marking American HomePatient's fourteenth and fifteenth major hospital equity agreements, are both excellent matches for our company and will enhance our strength in the state of North Carolina."

American HomePatient is one of the nation's largest diversified providers of home health care services in the country with 330 centers in 35 states. The company's primary product and service offerings include home respiratory services, home infusion, parenteral and enteral nutrition and home medical equipment. American HomePatient's common stock is traded in the Nasdaq Stock Market (National Market) under the symbol AHOM.

CONTACT: American HomePatient Inc., Brentwood

Edward K. Wissing or Kathey S. Palmer, 615/221-8884