Needham, MA, July 23, 1998 - CareMatrix Corporation (AMEX: CMD), a fully integrated assisted living company, today announced that it has entered into an affiliation agreement with National Assisted Living, LP (NALLP) and George Wagner, its Principal. Under the agreement NALLP will develop and operate senior housing facilities and the Company will acquire these facilities at a pre-determined price upon their reaching stabilized occupancy. Currently, this agreement covers nine facilities, of which two are in operation, five are in construction and two are in development. These facilities total 600 units, including 120 units for Alzheimer's care.

Robert M. Kaufman, Chief Executive Officer of CareMatrix Corporation, commented, "We are very pleased to have consummated this relationship with George Wagner for these well positioned facilities, most of which will offer both Assisted Living and Alzheimer's care. George has had a long and successful career developing and operating senior housing facilities. These nine facilities are in highly desirable locations within our existing cluster markets. In addition to these nine, we are working together to identify a number of additional sites for future development."

CareMatrix Corporation is a leading provider of senior housing services, including assisted living, independent, supportive independent living and specialized programs for people with Alzheimer's disease.

This release contains forward-looking statements regarding the Company's future plans, operations and prospects. The Company's actual results could differ materially from the results anticipated in these forward looking statements as a result of uncertainties, including risks relating to demand, pricing, competition, construction, and other factors identified in the Company's filings with the Securities and Exchange Commission.

EDITOR’S NOTE: This release is available on the Internet at http://www.carematrix.com.