Forward Looking Statements

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Forward Looking Statements
Certain statements made in this presentation
which are not historical facts may be
forward-looking statements (as defined in the
private securities litigation reform act of 1995)
that involve risks and uncertainties and are
subject to change at any time these
forward-looking statements may include, but are
not limited to, statements containing words such
as anticipate believe plan estimate
expect intend may and similar expressions.
These forward looking statements involve known
and unknown risks, uncertainties and other
factors that are in some cases beyond our control
and could cause actual results to differ
materially. We caution users of this information
that any forward-looking statements made by us
are not guarantees of future performance. We
disclaim any obligation to update any such
factors or to announce publicly the results of
any revisions to any of the forward-looking
statements to reflect future events or
developments. Furthermore, any reference to
non-GAAP financial information provided herein is
reconciled to comparable GAAP financial
information on our website at http//www.genesishc
c.com.
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Todays Agenda

• Company Overview
• Strategic Initiatives
• Industry Environment
• Financial Overview

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Company Overview Strategic Initiatives
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Company Highlights

• Geographically Concentrated Portfolio
• Significant Facility Ownership with Intent to
  Modernize
• Strong Operating Cash Flow
• Low Interest Rate Risk and Leverage
• Solid Financial Foundation
• Well-positioned for Organic and External Growth

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Strategic Priorities

• Long Term Growth through Internal Investment
• Drive growth through occupancy and mix
  improvements
• Facility renovation
• Specialty units
• Relationship management
• Growth Supplemented Through
• Selective fill-in acquisitions
• Acquisitions of outside joint-venture interests
• Clinical Skill Development
• Expand Genesis Physician Services

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Progress on Strategic Priorities
As of June 30, 2006

• Completed 12 facility renovations in the quarter
• Common area and patient room refurbishments
• Protects facilities with high occupancy

• Completed 3 new specialty units in the quarter
• Addition of clinical capabilities (i.e. dialysis,
  ventilator, Alzheimers, rehab gyms)
• Provides an upside opportunity in occupancy and
  mix

• Signed agreement to enter into long-term lease
• and purchase option for 11 facilities in Maine
• Completed acquisition of 3 joint venture interests

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Industry Environment
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Reimbursement Outlook

• Expect 2 ½ - 3 ½ increase in overall Medicaid
  rates in 2007
• Medicare Reimbursement
• Stable for the remainder of 2006
• 3.1 market basket adjustment effective October
  1, 2006
• Part B therapy cap exception process expires on
  12/31/06

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Financial Overview
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Financial Highlights Quarter Ended 6/30/06

• Q3 2006 Non-GAAP EPS of 0.56 meets Wall Street
  consensus estimates on an as adjusted basis
• Revenues grow 5.9 on adjusted basis over prior
  year
• Occupancy remains strong at 90.9
• Rehabilitation business continues to improve

On an as adjusted basis refers to certain
nonrecurring charges as disclosed in August 1,
2006 press release and related Form 8-K.
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Cash Flow Quarter Ended 6/30/06

• Use of 0.2 million of operating cash due to
• Advanced funding of recently renewed insurance
  programs
• 12.0 million reduction due to permanent PA
  Medicaid payment slowdown
• Capital spending guidance for 2006 at high end of
  90 - 100 million
• CAPEX of 23.5 million in Q3
• CAPEX of 76.6 million YTD
• Capital management
• Retired 6.2 million of 8 senior subordinated
  notes

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Financial Results Quarter Ended 6/30/06

• Inpatient Services
• Revenue grew 5.7 v. Q3 2005
• EBITDA grew 3.5 v. Q3 2005
• Occupancy at 90.9 versus 89.4 in Q3 2005
• Rehabilitation Services
• Revenue grew 13.7 v. Q3 2005
• EBITDA grew 24.2 v. Q3 2005

Assumes adjusting for favorable cost report
settlements and the write-off of obsolete time
clocks in Q3 2005. Includes intercompany
revenues
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Summary

• Focus on internal investment
• Invest in facilities and clinical capabilities
• Reimbursement outlook appears stable
• Substantial free cash flow generation
• Reduced interest rate risk and leverage
• Owned assets conservatively valued on a book and
  market basis

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Appendix
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Genesis HealthCare Corporation
GHC is a leading provider of healthcare and
support services to the post-acute elderly
population in its core markets

• GHC operates 208 facilities, primarily SNFs
• Operate more than 25,000 beds of which 89 are
  SNFs
• Facilities are located along the east coast in 12
  states, but are concentrated in 5
• Own more than 16,000 beds and 80 of facilities
• Focused on higher acuity medically
  complex patients
• 90 of admissions from hospitals
• Inpatient facilities generate approximately 89
  of GHCs total revenues
• Rehabilitation therapy represents 8 of revenues

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Strategic Plan Industry Environment

• Increasing acuity in the SNF setting
• Changes in IRF, LTAC regulations and
  reimbursement
• Skilled nursing is the lowest cost setting
• Significantly lower than IRF and LTAC setting
• Penetration of managed care
• Break down of regulatory barriers (i.e. 3 day
  hospital stay)
• Leverage of complementary rehabilitation therapy
  business

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Information Systems

• Integrated operational, clinical and financial
  operating system operational in 180 facilities as
  of March 31, 2006
• Integrated labor management system
• 100 of facilities are live on labor / time
  collections system
• Online purchasing system

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Payor Continuum
Private Pay Other
Medicaid
Medicare
Care Line

• Includes
• Therapy
• Pharmacy
• Ancillaries

• Excludes
• Therapy
• Pharmacy
• Ancillaries

Hospital
External Care Coordinators

• Excludes
• Pharmacy

• 400 Per Diem
• 15.5 of patients
• ALOS 36 days
• 29 of revenue

• 219 Per Diem
• 20.5 of patients
• ALOS 107 days
• 19 of revenue

• 185 Per Diem
• 64.0 of patients
• ALOS 527 days
• 52 of revenue

Approx. 90 of our patients come from hospitals
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Labor Environment

• Inpatient and rehab challenged by a tight labor
  market
• In Q3 2006, nursing wage costs moderate slightly
• Expect rates to continue to exceed inflation
• Continue to manage agency and overtime usage to
  minimize impact

PPD
Quarters prior to Q3 2006 exclude impact of VIE
restatement
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Complementary Rehab Business

• Strong top line growth
• Tactical plans underway
• New management team in place
• Re-priced external contracts
• Re-designed fee structure
• Well-positioned for evolving care delivery in
  SNFs
• Limited capital required
• Q4 tends to be the most challenging quarter for
  rehab due to a decrease in therapist efficiency
  over the summer months

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Occupancy
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Quality Census Mix
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Inpatient Sites of Service
As of December 1, 2005 does not include
consolidation of 5 joint ventures
Annualized, post consolidation