Franciscan Care Center Acquisition Overview

1. Franciscan Care CenterAcquisition Overview April 24, 2014

2. Genesis HealthCare Genesis HealthCare is the nation’s largest long-term care provider. • Genesis operates over 400 skilled nursing and assisted living facilities in 28 states from coast to coast. • Genesis Rehabilitation Services (“GRS”) serves nearly 1,500 providers in 46 states plus the District of Columbia. • Focused on higher acuity & medically complex patients. • A team of approx. 80,000 employees. www.genesishcc.com

3. The Changing Face of Long-Term Care • Over 90% of patients are admitted after an acute medical hospitalization. • We are seeing patients younger than 65 years old. • 60% of patients return home or to the community within 24 days*. • We are seeing an increasing number of short-stay patients with decreasing lengths of stay. • Patients require complex medical care previously provided only in a hospital. • Greater number of patients require rehab therapy. * Based upon Genesis legacy facilities and does not incorporate Sun Healthcare.

4. Acquisition Overview • Genesis to acquire the operations of Franciscan Care Center through a wholly owned subsidiary: 100 St. Claire Drive Operations LLC • Financing: Health Care REIT • Strategic focus: Higher acuity skilled nursing services including short stay rehabilitation, wound care, IV therapy, etc. • Renovation plans: Cosmetic upgrade of entire center

5. Health Resources Mgmt Plan • Balance of access, cost and quality • Facilitate a network of providers • Discharge to community rates – >60% • Reduced hospital readmissions - <11% • Medical indigency • History of service to Medicaid residents in both SNF and ALF settings – in excess of 50% in every Genesis facility in the state. • No change budgeted in Medicaid rates at Franciscan Care Center, other than the inclusion of the new Delaware provider tax • Coordination of health delivery • Care Line • External Care Coordinators • Depth of experience with other providers in the market

6. Health Resources Mgmt Plan • Shared resources • Internal – regional and corporate support • Industry wide - strong relationships with acute care, tertiary care and community based services • Effective and efficient health delivery • Collaborative focus • Savings in overhead, buying power • Sensitivity to cost and quality • Existing center – acquisition does not promote over utilization • Regional and corporate resources • Preventative care • Focus on preventive care, quality of life, discharge to the community

7. CPR Review Criteria • Need/Alternatives • Existing center • No change in capacity or service • Genesis selected for its experience and history as a Delaware provider • Continuity - Genesis already provides clinical management and rehab services

8. CPR Review Criteria Relationship to the health care delivery system: • Churchman Village* 101 Bed SNF Newark • Heritage at Dover 80 Bed ALF Dover • Heritage at Milford 80 Bed ALF Milford • Hillside Center 106 Bed SNF Wilmington • Milford Center 136 Bed SNF Milford • Seaford Center 124 Bed SNF/19 Bed ALF Seaford • Silver Lake Center 120 Bed SNF Dover • Lofland Park 110 Bed SNF Seaford Genesis Rehabilitation Services Genesis Respiratory Health Services Genesis Employees in Delaware: 1,373 employees * Managed center

9. CPR Review Criteria • Access to Resources • Longevity of mgmt team • Regional and corporate support • Clinical approach for SFF graduation • Access to capital • Financing in place with Health Care REIT • No change in rates