Coram Healthcare Reports 1999 Financial Results

DENVER, March 9, 2000 (PRIMEZONE) -- Coram Healthcare Corporation (OTCBB:CRHE) today reported financial results for the fourth quarter and year ended December 31, 1999.

Comparing the year-end results:

    -- The 1999 net loss includes $79.3 million, or $(1.60) per share,
       in losses for the ongoing bankruptcy and liquidation of the 
       Company's Resource Network (R-Net) subsidiaries, reserves for 
       litigation and various other balance sheet charges.  These 
       included restructuring charges of $5.8 million and impaired 
       assets of $9.1 million, primarily for goodwill.
    -- The 1998 results were affected positively by a $3.9 million, or
       $0.08 per share, reversal of restructuring costs charged in 
       prior years.  Certain amounts in the previously reported 1998 
       financial statements have been reclassified to conform with the
       1999 year-end presentation, primarily due to the discontinued 
       operations of R-Net.

The 1999 fourth quarter charges of $50.0 million included $17.6 million related to R-Net, $15.9 million for severance, impaired assets and branch consolidations, $13.3 million for accounts deemed uncollectable and $3.2 million for other balance sheet adjustments.

Year-end 1999 results for the core infusion business were $432.8 million in revenues and $23.6 million in operating income from continuing operations. In the fourth quarter, infusion revenues were $109.4 million and the operating loss from continuing operations was $(6.2) million, which included $17.5 million in restructuring and other charges specific to infusion.

"Since my arrival November 30, 1999, we have focused the management team on attracting more of the core therapies, reducing fixed and variable costs and improving our cash collection," said Daniel D. Crowley, Chairman, President and Chief Executive Officer of Coram. "Our goal is to target activities providing the best opportunity to achieve an operational and financial turnaround in 2000, and I believe we are making progress. We have installed product leaders for our core therapies, created management tools to measure progress and establish accountability, reduced ongoing costs by more than $15 million annually while maintaining our commitment to quality, initiated an effort to identify and implement best practices in a more streamlined cash collection organization and established incentive programs targeted to drive the desired outcome. "

Mr. Crowley also reported the following based on unaudited 2000 data:

     -- A small operating profit for January;
     -- A higher percentage of new sales are of core therapies to date
        in 2000;
     -- Modestly positive cash flow from operations, including capital
        expenditures, in both January and February. For the two 
        months, the Company's cash flow from operations, including 
        capital expenditures, was more than $16 million better than 
        last year's first quarter level, which was negative;
     -- Accounts payable at the end of February down 38 percent from 
        November 30, 1999;
     -- Payment of $2.5 million in principal on the Company's 
        revolving line of credit between December 31, 1999 and 
        March 6, 2000.

"It's early in the year, additional improvement is needed and many significant challenges remain," Mr. Crowley said. "We are not prepared to make any predictions regarding the Company's 2000 financial performance, but we believe Coram's core infusion business is sound and capable of operating profitably and generating positive cash flow.

"It is likely that some of our debt will have to be converted to equity by the end of this year, and we have initiated a process to review alternatives," said Mr. Crowley. "In preliminary discussions, Series A and B note holders have indicated their willingness to discuss such a conversion. The outcome or terms of a conversion cannot be predicted. It is possible under these circumstances that the existing equity may be significantly diluted."

Coram also disclosed that the lenders, under its credit agreement, have agreed to waive rights to enforce certain covenants related to financial performance for the remainder of 2000. However, after the current forbearance period, Coram's quarterly interest obligations of approximately $6.7 million will resume as scheduled beginning no later than May 15.

Regarding the Company's previously disclosed review of strategic alternatives, including a possible sale of Coram Prescription Services, the process is ongoing and the results are expected to be announced in the near future. The Company cannot predict whether a sale will occur or what the proceeds would be from any sale.

In the ongoing litigation with Aetna/US Healthcare, a series of summary judgments limited the claims on each side to breach of contract issues. The case is currently on the court's trial calendar for April, but Aetna has requested a postponement until May and Coram has not objected. The company believes it has meritorious claims and defenses, but the outcome cannot be predicted.

The Chapter 11 bankruptcy of the R-Net units is currently proceeding according to the expected timetable. While no assurance can be made, management believes that all significant associated future costs were included in the 1999 loss for discontinued operations.

Denver-based Coram Healthcare, through its subsidiaries, is a national leader in providing quality home infusion therapies. Company subsidiaries also provide support for clinical trials, medical product development and medical informatics, as well as specialty pharmacy benefit management and mail order services.

Note: Except for historical information, all other statements in this press release are "forward-looking" within the meaning of the Private Securities Litigation Reform Act of 1995. The Company's actual results may vary materially from these forward-looking statements due to important risk factors including the Company's history of operating losses and uncertainties associated with future operating results; significant outstanding indebtedness; equity conversion rights held by existing debt holders; limited liquidity; reimbursement-related risks; shifts in the mix of parties that pay for the Company's services; dependence upon relationships with third parties; uncertain future liabilities under capitation arrangements; timing of or ability to complete acquisitions; government regulation of the home health care industry and the Company's ability in the future to comply; certain legal proceedings, including tax disputes and the ultimate resolution of the R-Net bankruptcy; dependence on key personnel; potential volatility of the stock price; stock exchange listing status; and the ability to execute a repositioning of the Company. Certain risk factors are described in greater detail in the Company's Form 10-K Annual Report, as amended, Form 10-Q Quarterly Reports, and Form 8-K Current Reports on file with the Securities and Exchange Commission.

           Consolidated Statements of Operations
          (In Millions, Except Per Share Data)
                                    Three Months    Twelve Months
                                       Ended            Ended
                                     December 31,    December 31,
                                    1999    1998    1999     1998
                                   ------  ------  -------  ------
Net Revenue                        $134.3  $134.3  $521.20  $464.9
Cost of Service                     108.6    99.3    408.9   346.5
                                   ------  ------  -------  ------
Gross Profit                         25.7    35.0    112.3   118.4
Operating Expenses:
Selling, General and 
 Administrative Expenses             30.6    24.5     96.8    83.3
Provision for Estimated 
 Uncollectible Accounts              16.4     4.2     28.3    14.9
Amortization of Goodwill              2.7     2.8     10.8    11.1
Restructuring Costs                   4.9    (3.9)     5.8    (3.9)
Loss on Impairment of Assets          9.1     0.0      9.1     0.0
                                   ------  ------  -------  ------
Total Operating Expense              63.7    27.6    150.8   105.4
                                   ------  ------  -------  ------
Operating Income (Loss)               (38)    7.4    (38.5)   13.0
Interest Expense                     (7.6)   (6.4)   (29.8)  (32.7)
Other Income (Expense), Net           0.4    (0.2)     1.4     1.8
                                   ------  ------  -------  ------
Income (Loss) before Income
 Taxes and Minority Interest        (45.2)    0.8    (66.9)  (17.9)
Income Tax Expense                    0.0     0.5      0.4     2.3
Minority Interest in Net 
 Income of Consolidated 
 Joint Ventures                       0.3     0.4      1.5     1.4
                                   ------  ------  -------  ------
Net Loss from Continuing
 Operations                         (45.5)   (0.1)   (68.8)  (21.6)
Discontinued Operations:
Income (Loss) from 
 Operations of R-Net Segment          1.9     0.9    (28.4)   (0.1)
Loss on Disposal 
 of R-Net Segment                   (17.6)    0.0    (17.6)    0.0
                                   ------  ------  -------  ------
Income (Loss) from
 Discontinued Operations            (15.7)    0.9    (46.0)   (0.1)
                                   ------  ------  -------  ------
Net Income (Loss)                  $(61.2) $  0.8  $(114.8) $(21.7)
                                   ------  ------  -------  ------
                                   ------  ------  -------  ------
Basic and Diluted Earnings
 per Share of Common Stock:
Loss from Continuing
 Operations                        $(0.92) $ 0.00  $ (1.39) $(0.44)
Income (Loss) from
 Discontinued Operations            (0.32)   0.02    (0.93)   0.00
                                   ------  ------  -------  ------
Net Income (Loss)                  $(1.24) $ 0.02  $ (2.32) $(0.44)
                                   ------  ------  -------  ------
                                   ------  ------  -------  ------
Certain amounts in the 1998 financial statement have been 
 reclassified to conform to the 1999 presentation.

                    Consolidated Balance Sheets
                           (In Millions)
                                                December 31,
                                               1999       1998
                                             -----       -----
  Cash and Cash Equivalents                $   6.2     $   0.1
  Cash Limited as to Use                       1.0         1.5 
  Accounts Receivable, Net                   107.4        98.9 
  Other Current Assets                        29.0        32.8
                                             -----       -----
    Total Current Assets                     143.6       133.3
  Goodwill, Net                              216.1       235.7
  Other Assets                                43.5        52.0
                                             -----       -----
     Total Assets                          $ 403.2     $ 421.0
                                             -----       -----
                                             -----       -----
Liabilities and Stockholders' 
 Equity (Deficit):
  Current Liabilities                     $  70.5      $  58.4
  Net Liabilities of 
   Discontinued Operations                   34.5          8.6
  Long-term Debt, including 
   Revolving Lines of Credit                302.7        242.2
  Other Liabilities                          17.2         18.9
  Stockholders' Equity (Deficit)            (21.7)        92.9
                                             -----       -----
   Total Liabilities and 
    Stockholders' Equity (Deficit)        $ 403.2     $  421.0
                                             -----       -----
                                             -----       -----
Certain amounts in the 1998 financial statement have been 
 reclassified to conform to the 1999 presentation.
CONTACT:  Coram Healthcare Corporation
          Kurt Davis
          303-672-8830 or 916-449-1484