Pacer Health Reports on Financial Turnaround and Capital Investments at South Cameron Memorial Hospital

$500,000 Commitment Results in More Efficient Operations and Substantial Improvements to Patient Care

MIAMI & CAMERON, La.--(BUSINESS WIRE)--May 16, 2005--Pacer Health Corporation (OTCBB:PHLH - News), a Miami-based owner-operator of acute care hospitals, medical treatment centers and psychiatric care facilities, reported today that it has completed its $500,000 infusion to improve operational efficiency and patient care at South Cameron Memorial Hospital as part of the company's overall restructure of the hospital and its facilities.

Pacer Health assumed management and operation of South Cameron Memorial Hospital just over one year ago, when the hospital was in financial distress. Shortly thereafter, Pacer completed its acquisition of the 49-bed hospital, which consists of 25 acute care beds as well as 24 psychiatric beds and a separate medical outpatient center at its off-site campus in Calcasieu Oaks.

The acute care hospital located in Cameron Parish, Louisiana, offers emergency room, in-patient, and skilled nursing services, as well as out-patient doctor's office services, to the residents of Cameron Parish and the area's several thousand oil and gas exploration personnel, commercial and recreational fishermen. South Cameron Memorial Hospital maintains sole community provider status in Cameron Parish.

Pacer Health reported a net profit for South Cameron Memorial Hospital of $49,360.00 for the three-month period ended March 31, 2004, compared to a net loss of $964,109.00 for the year ended December 31, 2003. These positive results reflect early measures taken by Pacer Health management to streamline hospital operations and reduce administrative costs following the company's acquisition of the hospital's assets and facilities during that quarter.

Meanwhile, in a 10KSB report filed last month, Pacer Health reported a companywide net profit of $390,896.00 for the year ended December 31, 2004. The company's profit for the year was derived from net patient revenue of $7,581,505.00 from wholly owned facilities, income from management fees, gains on debt settlement and other revenue. This compares to total income of $199,789.00 for the year ended December 31, 2003.

Over the past year, Pacer Health's commitments to South Cameron Memorial Hospital included an overhaul of the radiology suite at the hospital's main campus. South Cameron Memorial is now equipped with a General Electric x-ray machine and fluoroscopy machine, Kodak CR 500 system, and a Catella web distribution and CD image copy system - a high-tech upgrade that marks a dramatic improvement over the suite's previous capabilities. Patients now receive x-rays utilizing a completely digital format, so the patient, technician, and even a referring physician at a remote location can view the results in real time; and in the absence of x-ray film, results can be sent instantly to other healthcare providers via the Internet.

Two new analyzers have greatly enhanced the hospital laboratory, allowing it to keep current with the changing healthcare environment and the challenges of today's healthcare and CLIA regulations: A new Beckman Coulter Ac*T 5-diff-CP Hematology System has enabled the hospital to perform hematology testing more safely and offer more reliable results. A Dade Behring CA-560 Coagulation Analyzer, the latest technology in coagulation testing and therapeutic drug monitoring, is extremely accurate and fully automated, allowing the laboratory technologist to perform other vital testing while the analyzer does its work.

Pacer Health also has agreed to lease a Dade Behring Dimension Xpand HM Plus Chemistry Analyzer, the latest technology in chemistry testing, that will facilitate enhanced cardiac testing, thyroid testing, and diabetic monitoring. The new purchase will include a fully integrated Laboratory Information System that will allow the lab to monitor each analyzer and its individual quality control programs.

"Through careful planning and strategic purchases, Pacer Health brought South Cameron Memorial Hospital into the 21st century," said Leslie Trahan, Assistant Administrator at South Cameron Hospital, who had been employed with the hospital before it was acquired by Pacer Health. "The improvements not only help streamline operations, they give our patients and area physicians the assurance that they are utilizing a quality healthcare facility."

Minor purchases for South Cameron Memorial Hospital have included 24 Hill-Rom manual hospital beds and a 15-passenger transport van for the hospital's psychiatric unit; a 2002 GMC truck for the maintenance department; a commercial refrigerator and freezer for the hospital's dietary unit; and two Hill-Rom ER stretchers.

Pacer Health also has invested in obtaining highly qualified personnel to ensure that the hospital is operated appropriately and that every patient at the hospital receives the highest quality of patient care regardless of its rural location.

"Far more than simply keeping our hospital open, Pacer Health has removed the healthcare barriers set by our hospital's previous operators, literally breathing new life into our community," added Trahan.