Acute Care Hospital to Be Built

St. Louis, MO and Peoria, IL, January 19, 2007

RehabCare Group, Inc. (NYSE: RHB) and Methodist Medical Center announced today their intention to form a joint venture that would develop, own and operate a new 50-bed Long-Term Acute Care Hospital (LTACH) near downtown Peoria. The proposed partners are applying for a Certificate of Need (CON) through the state of Illinois and would begin construction of the new hospital following CON approval, as well as necessary licensure through the Illinois Department of Health.

"The physicians and staff of Illinois Lung Institute have worked twenty years to make this project happen," said William Tillis, M.D. "Currently, the closest facility of this type is in Chicago or St. Louis, which removes family involvement for many patients. Patients get better faster when surrounded by their families, so this will be wonderful for local residents. This facility will bring Peoria one step closer to being a world-class healthcare destination."

Elevation provided by Davis Stokes Collaborative PC, Architects.

The 56,000 square-foot LTACH, to be called The Greater Peoria Specialty Hospital, will be located in the three-block area bordered by Richard Pryor Place, Romeo B. Garrett Avenue and Hightower Street in Peoria. An early 2009 opening is projected. Once fully operational, the LTACH will provide jobs for an estimated 150 full-time employees.

LTACHs provide specialized, around-the-clock care for extended stay patients with chronic or medically complex conditions, such as ventilator dependency, brain injury, cardiopulmonary disease, chronic pain and neuropathy. Patients are typically admitted to an LTACH following treatment in a traditional acute care hospital, and the average length of stay is 30 days.

“The lack of a long-term acute care hospital in Peoria creates a great deal of stress for families who need access to these special services,” said John H. Short, Ph.D., RehabCare President and CEO. “This project will give us the opportunity to blend our expertise and resources with one of the area’s leading healthcare providers to not only fill a void for the community but increase our service offerings in a key geographic market.”

Methodist CEO and President W. Michael Bryant added, “We’re proud to lead the way in bringing this new service to our community. It’s a further reflection of Methodist’s commitment to providing the full continuum of care for patients in Central Illinois.”

OSF Saint Francis Medical Center views the LTACH as an important addition to the Peoria medical community and has provided a letter of support to accompany the Certificate of Need application. Sue Wozniak, Chief Operating Officer at OSF Saint Francis, said: “This new hospital will complement the existing facilities in our area and will provide patients with quality healthcare in an environment that will promote healing. We commend Methodist and Rehab Care for taking this initiative.”

Established in 1982, St. Louis-based RehabCare (www.rehabcare.com) is one of the nation’s leading providers of rehabilitation program management, servicing over 24,000 patient visits each day in conjunction with more than 1,400 hospitals and skilled nursing facilities (SNFs) in 42 states, the District of Columbia and Puerto Rico.

Methodist Medical Center of Illinois (www.methodistmedicalcenter.org) is a 353-bed comprehensive care provider serving the more than 300,000 residents of the Greater Peoria area. Founded in 1900, the hospital has been driven by its mission of delivering outstanding healthcare.