Horizon Health Corporation Announces Acquisition of Occupational Health Consultants of America, Inc.

Business Editors, Health & Medical Writers

LEWISVILLE, Texas--(BW HealthWire)--Aug. 1, 2001

Horizon Health Corporation (Nasdaq/NM:HORC) today announced that it has acquired, effective August 1, 2001, all of the outstanding capital stock of Occupational Health Consultants of America, Inc. (OHCA). As a result of the acquisition, OHCA has become wholly owned by Horizon Behavioral Services, Inc., Horizon's employee assistance program and managed behavioral health care subsidiary.

OHCA, headquartered in Nashville, Tennessee, provides employee assistance programs (EAP) and other related behavioral health care services to employers and other third parties. OHCA currently has annual revenues of approximately $4.0 million and has approximately 350 contracts covering nearly 455,000 lives.

James W. McAtee, president and chief executive officer of Horizon Health Corporation, said, "This acquisition signifies a change in focus for the Company. From 1994 through early 1999, we made nine acquisitions as our long-term debt increased to $26 million and revenues grew from $30 million annually to $146 million. From late 1998 to the present, the Company worked on paying down its debt, which prior to this acquisition was down to $3 million, while repurchasing $15 million of stock.

"Now with a committed shareholder base and actual and anticipated debt capacity, we are ready to again focus on accretive acquisitions in health services markets with growth potential. This acquisition is the first example of this growth strategy."

Linda Laitner, president of Horizon Behavioral Services, Inc., said, "OHCA is an attractive addition to our existing employee assistance program business. With its community staff model delivery system, OHCA provides Horizon Behavioral Services with the opportunity to address the needs of clients in a new way, thereby expanding our ability to continue to grow as a national provider of EAP services."

Horizon Health Corporation is a provider, through its four subsidiaries, of employee assistance plans and mental health services to businesses and managed care organizations as well as a leading contract manager of clinical programs offered by general acute care hospitals in the United States. As of May 31, 2001, Horizon had 281 contracts to provide EAP and mental health services covering approximately 1.8 million lives, 128 CQI+ outcomes measurement system contracts, and 112 mental health and 25 physical rehabilitation management contracts with general hospitals in 36 states.

The statements contained herein based on future expectations rather than on historical facts are forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995 that involve a number of risks and uncertainties. Factors that could cause actual results to differ materially from those in any such forward-looking statements include, but are not limited to, the ability to retain OHCA existing contracts, the ability to integrate OHCA existing operations on a cost-effective basis, Horizon's ability to retain its existing contracts, adverse changes in reimbursement to general hospitals by Medicare and other third-party payers, adverse consequences of investigations by governmental regulatory agencies, and various other risks as outlined in Horizon's Securities and Exchange Commission filings. There can be no assurance that statements made in this press release relating to future events will be achieved. The Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.