Needham, MA, September 2, 1998 – CareMatrix Corporation (AMEX: CMD), a fully integrated assisted living company, today announced that it closed on the majority of facilities in its SeniorCare Group, Ltd. acquisition. The closing on the one facility in New Jersey is pending subject to the license transfer. SeniorCare is an assisted living and Alzheimer’s care provider located on Long Island, New York.

The transaction is valued at approximately $150 million including cash and the assumption of debt and will increase CareMatrix’s facilities in operation to 41 with a resident capacity of over 5,200. Additionally, it will bring the number of units in operation or development in the Metropolitan New York area to over 6,500.

Robert M. Kaufman, Chief Executive Officer of CareMatrix, stated, "This is a very strategic acquisition for us. It’s consistent with our growth strategy of cluster concentration and it strengthens our position in our largest cluster market, the New York marketplace. It also provides opportunities for significant marketing and operating synergies. The transaction will have a minimal impact on 1998, and is expected to add six to eight cents to earnings in 1999."

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.

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