Emergency Medical Services (EMS)

EmCare

For the quarter ended September 30, 2009, EmCare generated net revenue of $326.3 million, an increase of 28.5% compared to the same quarter last year.  The increase in revenue is attributable primarily to the addition of 87 net new contracts since June 30, 2008 (of which 45 were a part of our acquisition of Clinical Partners in August 2008 with related management fee revenue of $2.3 million during the quarter) and revenue increases at existing contracts.  Adjusted EBITDA was $40.4 million for the quarter compared to $26.3 million last year, an increase of 53.8%.  The increase in Adjusted EBITDA was driven primarily by revenue increases and a reduction of compensation and benefits expenses as a percentage of net revenue.  Insurance expense in the third quarter 2009 included an unfavorable prior period insurance adjustment of $1.3 million compared to an unfavorable prior period adjustment of $3.9 million in the same period last year.  Income from operations was $36.3 million, an increase of 66.3% over the same period in 2008.

For the nine months ended September 30, 2009, EmCare’s net revenue was $904.7 million, an increase of 22.1% compared to the same period last year.  Adjusted EBITDA was $112.7 million compared to $81.9 million, an increase of 37.6% compared to the same period last year.  Insurance expense in the nine months ended September 30, 2009 included unfavorable prior period adjustments of $4.5 million compared to unfavorable prior period adjustments of $1.3 million in the same period last year.  Income from operations was $99.2 million, an increase of 44.5% over the same period in 2008.

EmCare

For the quarter ended June 30, 2009, EmCare generated net revenue of $301.8 million, an increase of 22.0% compared to the same quarter last year.  The increase in revenue is attributable primarily to the addition of 98 net new contracts since March 31, 2008 (of which 45 were a part of our acquisition of Clinical Partners in August 2008 with related management fee revenue of $2.0 million during the quarter) and revenue increases at existing contracts.  Adjusted EBITDA was $40.5 million for the quarter compared to $29.5 million last year, an increase of 37.2%.  The increase in Adjusted EBITDA is driven primarily by revenue increases and a reduction of

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EmCare

Of EmCare’s net revenue for the three months ended March 31, 2009, approximately 85% was derived from our hospital contracts for emergency department staffing and approximately 15% was derived from hospitalist, anesthesiology, radiology and other hospital management services. Approximately 79% of EmCare’s net revenue was generated from billings to third party payors and patients for patient encounters and approximately 21% was generated from billings to hospitals and affiliated physician groups for professional services. EmCare’s key net revenue measures are patient encounters (segregated into emergency department visits, radiology reads, and anesthesiology and hospitalist encounters, and weighted in certain of our analyses), net revenue per patient encounter, and number of contracts.  Due to our expansion in the radiology and anesthesiology markets which typically generate lower net revenue per encounter than emergency room visits, patient encounters are now being weighted to make net revenue per encounter comparable across all of EmCare’s markets.

 The change from period to period in the number of patient encounters under our “same store” contracts is influenced by general community conditions as well as hospital-specific elements, many of which are beyond our direct control.

The costs incurred in our EmCare business segment consist primarily of compensation and benefits for physicians and other professional providers, professional liability costs, and contract and other support costs. EmCare’s key cost measures include provider compensation per patient encounter and professional liability costs.

We have developed extensive professional liability risk mitigation processes, including risk assessments on medical professionals and hospitals, extensive incident reporting and tracking processes, clinical fail-safe programs, training and education and other risk mitigation programs which we believe have resulted in a continued reduction in the frequency, severity and development of claims.

EmCare

Net revenue. Net revenue for the three months ended March 31, 2009 was $276.6 million, an increase of $37.1 million, or 15.5%, from $239.5 million for the three months ended March 31, 2008. The increase was due primarily to an increase in patient encounters from net new hospital contracts and net revenue increases in existing contracts. Following December 31, 2007, we added 86 net new contracts which accounted for a net revenue increase of $28.1 million for the three months ended March 31, 2009.  Of the 86 net new contracts added since December 31, 2007, 79 were added in 2008 resulting in an incremental increase in 2009 net revenue of $26.9 million. Of the 79 contracts added in 2008, 45 were from our acquisition of Clinical Partners in August 2008 with related management fee revenue totaling $2.0 million during the three months ended March 31, 2009.  During the three months ended March 31, 2009, EmCare added 24 new contracts and terminated 17 contracts resulting in an increase in net revenue of $1.2 million.  Net revenue under our “same store” contracts (contracts in existence for the entirety of both periods) increased $6.7 million, or 3.3%, for the three months ended March 31, 2009.  The change is due primarily to a 3.9% increase in revenue per weighted patient encounter as a result of rate increases from our third-party payors.  The number of current period same store weighted patient encounters decreased 0.6% over same store weighted patient encounters in the prior period due primarily to a milder flu season and one less day in the first quarter of 2009.

Compensation and benefits. Compensation and benefits costs for the three months ended March 31, 2009 were $218.3 million, or 78.9% of net revenue, compared to $190.4 million, or 79.5% of net revenue for the same period in 2008. Provider compensation costs increased $20.8 million from net new contract additions. Same store provider compensation costs were $2.6 million over prior period due primarily to a 2.6% increase in provider compensation per weighted patient encounter.  Non-provider compensation and benefits costs increased by $4.5 million due primarily to our recent acquisitions and additional incentive related accruals.

Operating expenses. Operating expenses for the three months ended March 31, 2009 were $10.1 million, or 3.7% of net revenue, compared to $9.1 million, or 3.8% of net revenue, for the same period in 2008.  Operating expenses increased due primarily to the increase in off-hours radiology coverage for new contracts.

Insurance expense. Professional liability insurance expense for the three months ended March 31, 2009 was $11.4 million, or 4.1% of net revenue, compared to $9.8 million, or 4.1% of net revenue, for the three months ended March 31, 2008.  We recorded an increase of prior year insurance provisions of $0.1 million during the three months ended March 31, 2009 compared to a decrease of $0.9 million during the three months ended March 31, 2008.

Selling, general and administrative. Selling, general and administrative expense for the three months ended March 31, 2009 was $5.8 million, or 2.1% of net revenue, compared to $5.3 million, or 2.2% of net revenue, for the three months ended March 31, 2008.

Depreciation and amortization. Depreciation and amortization expense for the three months ended March 31, 2009 was $4.1 million, or 1.5% of net revenue, compared to $3.3 million, or 1.4% of net revenue, for the three months ended March 31, 2008.

EmCare

For the quarter ended March 31, 2009, EmCare generated net revenue of $276.6 million, an increase of 15.5% compared to the same quarter last year.  The increase in revenue is attributable primarily to the addition of 86 net new contracts since December 31, 2007 (of which 45 were a part of our acquisition of Clinical Partners in August 2008 with related management fee revenue of $2.0 million during the quarter) and revenue increases at existing contracts. Adjusted EBITDA was $31.7 million for the quarter compared to $26.0 million last year, an increase of 21.7%.  The increase in Adjusted EBITDA is driven primarily by revenue increases and by a reduction of compensation and benefits expenses as a percentage of net revenue.

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EmCare

        Over its more than 30 years of operating history, EmCare has become the largest provider of outsourced emergency department staffing and related management services to healthcare facilities based on number of contracts with hospitals and affiliated physician groups. EmCare has an 8% share of the total emergency department services market and a 12% share of the outsourced emergency department services market. During 2008, EmCare had approximately 8.0 million patient encounters in 41 states.

        EmCare primarily provides hospital-based physician services and related management services to healthcare facilities. EmCare recruits and hires or subcontracts with physicians and other healthcare professionals, who then provide professional services within the healthcare facilities with which we contract. We also provide billing and collection, risk management and other administrative services to our healthcare professionals and to independent physicians. EmCare has 474 contracts with hospitals and independent physician groups to provide emergency department, hospitalist, anesthesiology and radiology staffing and other administrative services.

EmCare

        Of EmCare's net revenue for the year ended December 31, 2008, approximately 89% was derived from our hospital contracts for emergency department staffing and approximately 11% was derived from hospitalist, anesthesiology, radiology and other hospital management services. Of this revenue, approximately 78% was generated from billings to third party payors and patients for patient encounters and approximately 22% was generated from billings to hospitals and affiliated physician groups for professional services. EmCare's key net revenue measures are:

•

Patient encounters.  We utilize patient encounters to evaluate net revenue and as the basis by which we measure certain costs of the business.



•

Number of contracts.  This reflects the number of contractual relationships we have for outsourced emergency department staffing, hospitalist, radiology, and anesthesiology services and other management services. We analyze the change in our number of contracts from period to period based on "net new contracts," which is the difference between total new contracts and contracts that have terminated.



•

Revenue per patient encounter.  This reflects the expected net revenue for each patient encounter based on gross billings less all estimated provisions for contractual discounts and uncompensated care. Net revenue per patient encounter also includes net revenue from billings to third party payors and hospitals.

        The change from period to period in the number of patient encounters under our "same store" contracts is influenced by general community conditions as well as hospital-specific elements, many of which are beyond our direct control. The general community conditions include: (1) the timing, location and severity of influenza, allergens and other annually recurring viruses and (2) severe weather that affects a region's health status and/or infrastructure. Hospital-specific elements include the timing and extent of facility renovations, hospital staffing issues and regulations that affect patient flow through the hospital.

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        The costs incurred in our EmCare business segment consist primarily of compensation and benefits for physicians and other professional providers, professional liability costs, and contract and other support costs. EmCare's key cost measures include:

•

Provider compensation per patient encounter.  Provider compensation per patient encounter includes all compensation and benefit costs for all professional providers, including physicians, physician assistants and nurse practitioners, during each patient encounter. Providers include all full-time, part-time and independently contracted providers. Analyzing provider compensation per patient encounter enables us to monitor our most significant cost in performing services under our contracts.



•

Professional liability costs.  These costs include provisions for estimated losses for actual claims, and claims likely to be incurred in the period, within our self-insurance limits based on our past loss experience, as well as actual direct costs, including investigation and defense costs, claims payments, reinsurance costs and other costs related to provider professional liability.

        Depreciation expense relates primarily to charges for usage of medical equipment, computer hardware and software, and other technologies. Amortization expense relates primarily to intangibles recorded for customer relationships.

EmCare

        Over its more than 30 years of operating history, EmCare has become the largest provider of outsourced emergency department
staffing and related management services to healthcare facilities based on number of contracts with hospitals and affiliated physician groups. EmCare has an 8% share of the total emergency department
services market and a 12% share of the outsourced emergency department services market. During 2008, EmCare had approximately 8.0 million patient encounters in 41 states.

        EmCare
primarily provides hospital-based physician services and related management services to healthcare facilities. EmCare recruits and hires or subcontracts with
physicians and other healthcare professionals, who then provide professional services within the healthcare facilities with which we contract. We also provide billing and collection, risk management
and other administrative services to our healthcare professionals and to independent physicians. EmCare has 474 contracts with hospitals and independent physician groups to provide emergency
department, hospitalist, anesthesiology and radiology staffing and other administrative services.

EmCare

        Over its more than 30 years of operating history, EmCare has become the largest provider of outsourced emergency department
staffing and related management services to healthcare facilities based on number of contracts with hospitals and affiliated physician groups. EmCare has an 8% share of the total emergency department
services market and a 12% share of the outsourced emergency department services market. During 2008, EmCare had approximately 8.0 million patient encounters in 41 states.

        EmCare
primarily provides hospital-based physician services and related management services to healthcare facilities. EmCare recruits and hires or subcontracts with
physicians and other healthcare professionals, who then provide professional services within the healthcare facilities with which we contract. We also provide billing and collection, risk management
and other administrative services to our healthcare professionals and to independent physicians. EmCare has 474 contracts with hospitals and independent physician groups to provide emergency
department, hospitalist, anesthesiology and radiology staffing and other administrative services.

EmCare

        Of EmCare's net revenue for the year ended December 31, 2008, approximately 89% was derived from our hospital contracts for
emergency department staffing and approximately 11% was derived from hospitalist, anesthesiology, radiology and other hospital management services. Of this revenue, approximately 78% was generated
from billings to third party payors and patients for patient encounters and approximately 22% was generated from billings to hospitals and affiliated physician groups for professional services.
EmCare's key net revenue measures are:

•

Patient encounters.  We utilize patient encounters to
evaluate net revenue and as the basis by which we measure certain costs of the business.




•

Number of contracts.  This reflects the number of
contractual relationships we have for outsourced emergency department staffing, hospitalist, radiology, and anesthesiology services and other management services. We analyze the change in our number
of contracts from period to period based on "net new contracts," which is the difference between total new contracts and contracts that have terminated.




•

Revenue per patient encounter.  This reflects the expected
net revenue for each patient encounter based on gross billings less all estimated provisions for contractual discounts and uncompensated care. Net revenue per patient encounter also includes net
revenue from billings to third party payors and hospitals.

        The
change from period to period in the number of patient encounters under our "same store" contracts is influenced by general community conditions as well as hospital-specific elements,
many of which are beyond our direct control. The general community conditions include: (1) the timing, location and severity of influenza, allergens and other annually recurring viruses and
(2) severe weather that affects a region's health status and/or infrastructure. Hospital-specific elements include the timing and extent of facility renovations, hospital staffing issues and
regulations that affect patient flow through the hospital.

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        The costs incurred in our EmCare business segment consist primarily of compensation and benefits for physicians and other professional providers, professional
liability costs, and contract and other support costs. EmCare's key cost measures include:

•

Provider compensation per patient encounter.  Provider
compensation per patient encounter includes all compensation and benefit costs for all professional providers, including physicians, physician assistants and nurse practitioners, during each patient
encounter. Providers include all full-time, part-time and independently contracted providers. Analyzing provider compensation per patient encounter enables us to monitor our
most significant cost in performing services under our contracts.




•

Professional liability costs.  These costs include
provisions for estimated losses for actual claims, and claims likely to be incurred in the period, within our self-insurance limits based on our past loss experience, as well as actual
direct costs, including investigation and defense costs, claims payments, reinsurance costs and other costs related to provider professional liability.

        Depreciation
expense relates primarily to charges for usage of medical equipment, computer hardware and software, and other technologies. Amortization expense relates primarily to
intangibles recorded for customer relationships.

EmCare

        Of EmCare's net revenue for the year ended December 31, 2008, approximately 89% was derived from our hospital contracts for
emergency department staffing and approximately 11% was derived from hospitalist, anesthesiology, radiology and other hospital management services. Of this revenue, approximately 78% was generated
from billings to third party payors and patients for patient encounters and approximately 22% was generated from billings to hospitals and affiliated physician groups for professional services.
EmCare's key net revenue measures are:

•

Patient encounters.  We utilize patient encounters to
evaluate net revenue and as the basis by which we measure certain costs of the business.




•

Number of contracts.  This reflects the number of
contractual relationships we have for outsourced emergency department staffing, hospitalist, radiology, and anesthesiology services and other management services. We analyze the change in our number
of contracts from period to period based on "net new contracts," which is the difference between total new contracts and contracts that have terminated.




•

Revenue per patient encounter.  This reflects the expected
net revenue for each patient encounter based on gross billings less all estimated provisions for contractual discounts and uncompensated care. Net revenue per patient encounter also includes net
revenue from billings to third party payors and hospitals.

        The
change from period to period in the number of patient encounters under our "same store" contracts is influenced by general community conditions as well as hospital-specific elements,
many of which are beyond our direct control. The general community conditions include: (1) the timing, location and severity of influenza, allergens and other annually recurring viruses and
(2) severe weather that affects a region's health status and/or infrastructure. Hospital-specific elements include the timing and extent of facility renovations, hospital staffing issues and
regulations that affect patient flow through the hospital.

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Table of Contents

        The costs incurred in our EmCare business segment consist primarily of compensation and benefits for physicians and other professional providers, professional
liability costs, and contract and other support costs. EmCare's key cost measures include:

•

Provider compensation per patient encounter.  Provider
compensation per patient encounter includes all compensation and benefit costs for all professional providers, including physicians, physician assistants and nurse practitioners, during each patient
encounter. Providers include all full-time, part-time and independently contracted providers. Analyzing provider compensation per patient encounter enables us to monitor our
most significant cost in performing services under our contracts.




•

Professional liability costs.  These costs include
provisions for estimated losses for actual claims, and claims likely to be incurred in the period, within our self-insurance limits based on our past loss experience, as well as actual
direct costs, including investigation and defense costs, claims payments, reinsurance costs and other costs related to provider professional liability.

        Depreciation
expense relates primarily to charges for usage of medical equipment, computer hardware and software, and other technologies. Amortization expense relates primarily to
intangibles recorded for customer relationships.

EmCare

Net revenue

        Net revenue for the year ended December 31, 2008 was $1,008.1 million, an increase of $120.3 million, or 13.5%, from $887.8 million for the year ended December 31, 2007. Following December 31, 2006, we added 96 net new contracts which accounted for a net revenue increase of $88.8 million in 2008. Of the 96 net new contracts added since December 31, 2006, 17 were added in 2007 resulting in an increase in 2008 net revenue of $23.9 million. For the year ended December 31, 2008, EmCare added 132 new contracts and terminated 53 contracts resulting in an increase in net revenue of $64.9 million. Net revenue under our "same store" contracts (contracts in existence for the entirety of both years) increased $31.5 million, or 4.4%, for the year ended December 31, 2008 due to a 0.9% increase, 4.5% increase excluding retroactive revenue adjustments discussed below, in revenue per encounter and an increase in same store patient encounters of 3.5%. Retroactive adjustments, which increased revenue for the year ended December 31, 2008 and 2007, were 0.9% and 3.7% of EmCare's net revenue, respectively.

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Compensation and benefits

        Compensation and benefits costs for the year ended December 31, 2008 were $795.8 million, or 78.9% of net revenue, compared to $683.3 million, or 77.0% of net revenue, for the same period in 2007. Provider compensation costs increased $67.4 million from net new contract additions. "Same store" provider compensation and benefits costs were $34.6 million over the prior period due to a 4.1% increase in provider compensation per patient encounter. The increase is due primarily to higher net revenue per patient encounter and additional staffing due to growth in patient volumes.

Operating expenses

        Operating expenses for the year ended December 31, 2008 were $36.4 million, or 3.6% of net revenue, compared to $41.9 million, or 4.7% of net revenue, for the same period in 2007. The decrease is due primarily to lower collection agency and billing fees.

Insurance expense

        Professional liability insurance expense for the year ended December 31, 2008 was $42.3 million, or 4.2% of net revenue, compared to $29.8 million, or 3.4% of net revenue, for the same period in 2007. An increase of prior year insurance provisions of $0.3 million was recorded during the year ended December 31, 2008 compared to a reduction of $10.2 million recorded for the year ended December 31, 2007.

Selling, general and administrative

        Selling, general and administrative expense for the year ended December 31, 2008 was $23.7 million, or 2.4% of net revenue, compared to $19.6 million, or 2.2% of net revenue, for the same period in 2007. The increase is due primarily to an increase in regional travel expense associated with the increase in contracts during the period.

Depreciation and amortization

        Depreciation and amortization expense for the year ended December 31, 2008 was $13.9 million, or 1.4% of net revenue, compared to $13.9 million, or 1.6% of net revenue, for the same period in 2007.

EmCare

Net revenue

        Net revenue for the year ended December 31, 2007 was $887.8 million, an increase of $143.0 million, or 19.2%, from $744.8 million for the year ended December 31, 2006. Following December 31, 2005, we added 60 net new contracts which accounted for a net revenue increase of $72.5 million in 2007. Of the 60 net new contracts added since December 31, 2005, 43 were added in 2006 resulting in an increase in 2007 net revenue of $49.0 million. For the year ended December 31, 2007, EmCare added a net 17 new contracts, from starting 68 new contracts and terminating 51 contracts, resulting in an increase in net revenue of $23.4 million in 2007. Net revenue under our "same store" contracts (contracts in existence for the entirety of both years) increased $70.6 million, or 12.0%, for the year ended December 31, 2007 due to an 8.2% increase in net revenue per patient encounter from rate increases from our third-party payors and from retroactive revenue adjustments of

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1.8% recorded during 2007. For the year ended December 31, 2007, "same store" patient encounters increased 2.0% compared to the same period in 2006.

Compensation and benefits

        Compensation and benefits costs for the year ended December 31, 2007 were $683.3 million, or 77.0% of net revenue, compared to $574.1 million, or 77.1% of net revenue, for the same period in 2006. Provider compensation costs increased $57.3 million from net new contract additions. "Same store" provider compensation costs increased $39.6 million due to an 8.7% increase in provider compensation per patient encounter due primarily to increases in net revenue per patient encounter. The remaining variance is related primarily to higher expense for incentive compensation plans and increased variable salary costs due to growth in patient encounters.

Operating expenses

        Operating expenses for the year ended December 31, 2007 were $41.9 million, or 4.7% of net revenue, compared to $35.6 million, or 4.8% of net revenue, for the same period in 2006. The variance is due primarily to growth in patient encounters from net new contracts and from additional off-hours radiology coverage of $3.2 million.

Insurance expense

        Professional liability insurance expense for the year ended December 31, 2007 was $29.8 million, or 3.4% of net revenue, compared to $38.1 million, or 5.1% of net revenue, for the same period in 2006. The decrease is due to the continued improvement in our estimates for current and prior year ultimate claims costs. As a result, a reduction of prior year insurance provisions of $10.2 million was recorded during the year ended December 31, 2007. A reduction of $3.9 million was recorded for the year ended December 31, 2006.

Selling, general and administrative

        Selling, general and administrative expense for the year ended December 31, 2007 was $19.6 million, or 2.2% of net revenue, compared to $17.5 million, or 2.3% of net revenue, for the same period in 2006.

Depreciation and amortization

        Depreciation and amortization expense for the year ended December 31, 2007 was $13.9 million, or 1.6% of net revenue, compared to $13.0 million, or 1.7% of net revenue, for the same period in 2006.

EmCare

Net revenue

        Net revenue for the year ended December 31, 2008 was $1,008.1 million, an increase of $120.3 million, or 13.5%,
from $887.8 million for the year ended December 31, 2007. Following December 31, 2006, we added 96 net new contracts which accounted for a net revenue increase of
$88.8 million in 2008. Of the 96 net new contracts added since December 31, 2006, 17 were added in 2007 resulting in an increase in 2008 net revenue of $23.9 million. For the year
ended December 31, 2008, EmCare added 132 new contracts and terminated 53 contracts resulting in an increase in net revenue of $64.9 million. Net revenue under our "same store" contracts
(contracts in existence for the entirety of both years) increased $31.5 million, or 4.4%, for the year ended December 31, 2008 due to a 0.9% increase, 4.5% increase excluding retroactive
revenue adjustments discussed below, in revenue per encounter and an increase in same store patient encounters of 3.5%. Retroactive adjustments, which increased revenue for the year ended
December 31, 2008 and 2007, were 0.9% and 3.7% of EmCare's net revenue, respectively.

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Compensation and benefits

        Compensation and benefits costs for the year ended December 31, 2008 were $795.8 million, or 78.9% of net revenue,
compared to $683.3 million, or 77.0% of net revenue, for the same period in 2007. Provider compensation costs increased $67.4 million from net new contract additions. "Same store"
provider compensation and benefits costs were $34.6 million over the prior period due to a 4.1% increase in provider compensation per patient encounter. The increase is due primarily to higher
net revenue per patient encounter and additional staffing due to growth in patient volumes.

Operating expenses

        Operating expenses for the year ended December 31, 2008 were $36.4 million, or 3.6% of net revenue, compared to
$41.9 million, or 4.7% of net revenue, for the same period in 2007. The decrease is due primarily to lower collection agency and billing fees.

Insurance expense

        Professional liability insurance expense for the year ended December 31, 2008 was $42.3 million, or 4.2% of net revenue,
compared to $29.8 million, or 3.4% of net revenue, for the same period in 2007. An increase of prior year insurance provisions of $0.3 million was recorded during the year ended
December 31, 2008 compared to a reduction of $10.2 million recorded for the year ended December 31, 2007.

Selling, general and administrative

        Selling, general and administrative expense for the year ended December 31, 2008 was $23.7 million, or 2.4% of net
revenue, compared to $19.6 million, or 2.2% of net revenue, for the same period in 2007. The increase is due primarily to an increase in regional travel expense associated with the increase in
contracts during the period.

Depreciation and amortization

        Depreciation and amortization expense for the year ended December 31, 2008 was $13.9 million, or 1.4% of net revenue,
compared to $13.9 million, or 1.6% of net revenue, for the same period in 2007.

EmCare

Net revenue

        Net revenue for the year ended December 31, 2008 was $1,008.1 million, an increase of $120.3 million, or 13.5%,
from $887.8 million for the year ended December 31, 2007. Following December 31, 2006, we added 96 net new contracts which accounted for a net revenue increase of
$88.8 million in 2008. Of the 96 net new contracts added since December 31, 2006, 17 were added in 2007 resulting in an increase in 2008 net revenue of $23.9 million. For the year
ended December 31, 2008, EmCare added 132 new contracts and terminated 53 contracts resulting in an increase in net revenue of $64.9 million. Net revenue under our "same store" contracts
(contracts in existence for the entirety of both years) increased $31.5 million, or 4.4%, for the year ended December 31, 2008 due to a 0.9% increase, 4.5% increase excluding retroactive
revenue adjustments discussed below, in revenue per encounter and an increase in same store patient encounters of 3.5%. Retroactive adjustments, which increased revenue for the year ended
December 31, 2008 and 2007, were 0.9% and 3.7% of EmCare's net revenue, respectively.

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Compensation and benefits

        Compensation and benefits costs for the year ended December 31, 2008 were $795.8 million, or 78.9% of net revenue,
compared to $683.3 million, or 77.0% of net revenue, for the same period in 2007. Provider compensation costs increased $67.4 million from net new contract additions. "Same store"
provider compensation and benefits costs were $34.6 million over the prior period due to a 4.1% increase in provider compensation per patient encounter. The increase is due primarily to higher
net revenue per patient encounter and additional staffing due to growth in patient volumes.

Operating expenses

        Operating expenses for the year ended December 31, 2008 were $36.4 million, or 3.6% of net revenue, compared to
$41.9 million, or 4.7% of net revenue, for the same period in 2007. The decrease is due primarily to lower collection agency and billing fees.

Insurance expense

        Professional liability insurance expense for the year ended December 31, 2008 was $42.3 million, or 4.2% of net revenue,
compared to $29.8 million, or 3.4% of net revenue, for the same period in 2007. An increase of prior year insurance provisions of $0.3 million was recorded during the year ended
December 31, 2008 compared to a reduction of $10.2 million recorded for the year ended December 31, 2007.

Selling, general and administrative

        Selling, general and administrative expense for the year ended December 31, 2008 was $23.7 million, or 2.4% of net
revenue, compared to $19.6 million, or 2.2% of net revenue, for the same period in 2007. The increase is due primarily to an increase in regional travel expense associated with the increase in
contracts during the period.

Depreciation and amortization

        Depreciation and amortization expense for the year ended December 31, 2008 was $13.9 million, or 1.4% of net revenue,
compared to $13.9 million, or 1.6% of net revenue, for the same period in 2007.

EmCare

Net revenue

        Net revenue for the year ended December 31, 2007 was $887.8 million, an increase of $143.0 million, or 19.2%, from
$744.8 million for the year ended December 31, 2006. Following December 31, 2005, we added 60 net new contracts which accounted for a net revenue increase of $72.5 million
in 2007. Of the 60 net new contracts added since December 31, 2005, 43 were added in 2006 resulting in an increase in 2007 net revenue of $49.0 million. For the year ended
December 31, 2007, EmCare added a net 17 new contracts, from starting 68 new contracts and terminating 51 contracts, resulting in an increase in net revenue of $23.4 million in 2007. Net
revenue under our "same store" contracts (contracts in existence for the entirety of both years) increased $70.6 million, or 12.0%, for the year ended December 31, 2007 due to an 8.2%
increase in net revenue per patient encounter from rate increases from our third-party payors and from retroactive revenue adjustments of

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1.8%
recorded during 2007. For the year ended December 31, 2007, "same store" patient encounters increased 2.0% compared to the same period in 2006.

Compensation and benefits

        Compensation and benefits costs for the year ended December 31, 2007 were $683.3 million, or 77.0% of net revenue,
compared to $574.1 million, or 77.1% of net revenue, for the same period in 2006. Provider compensation costs increased $57.3 million from net new contract additions. "Same store"
provider compensation costs increased $39.6 million due to an 8.7% increase in provider compensation per patient encounter due primarily to increases in net revenue per patient encounter. The
remaining variance is related primarily to higher expense for incentive compensation plans and increased variable salary costs due to growth in patient encounters.

Operating expenses

        Operating expenses for the year ended December 31, 2007 were $41.9 million, or 4.7% of net revenue, compared to
$35.6 million, or 4.8% of net revenue, for the same period in 2006. The variance is due primarily to growth in patient encounters from net new contracts and from additional
off-hours radiology coverage of $3.2 million.

Insurance expense

        Professional liability insurance expense for the year ended December 31, 2007 was $29.8 million, or 3.4% of net revenue,
compared to $38.1 million, or 5.1% of net revenue, for the same period in 2006. The decrease is due to the continued improvement in our estimates for current and prior year ultimate claims
costs. As a result, a reduction of prior year insurance provisions of $10.2 million was recorded during the year ended December 31, 2007. A reduction of $3.9 million was recorded
for the year ended December 31, 2006.

Selling, general and administrative

        Selling, general and administrative expense for the year ended December 31, 2007 was $19.6 million, or 2.2% of net
revenue, compared to $17.5 million, or 2.3% of net revenue, for the same period in 2006.

Depreciation and amortization

        Depreciation and amortization expense for the year ended December 31, 2007 was $13.9 million, or 1.6% of net revenue,
compared to $13.0 million, or 1.7% of net revenue, for the same period in 2006.

EmCare

Net revenue

        Net revenue for the year ended December 31, 2007 was $887.8 million, an increase of $143.0 million, or 19.2%, from
$744.8 million for the year ended December 31, 2006. Following December 31, 2005, we added 60 net new contracts which accounted for a net revenue increase of $72.5 million
in 2007. Of the 60 net new contracts added since December 31, 2005, 43 were added in 2006 resulting in an increase in 2007 net revenue of $49.0 million. For the year ended
December 31, 2007, EmCare added a net 17 new contracts, from starting 68 new contracts and terminating 51 contracts, resulting in an increase in net revenue of $23.4 million in 2007. Net
revenue under our "same store" contracts (contracts in existence for the entirety of both years) increased $70.6 million, or 12.0%, for the year ended December 31, 2007 due to an 8.2%
increase in net revenue per patient encounter from rate increases from our third-party payors and from retroactive revenue adjustments of

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1.8%
recorded during 2007. For the year ended December 31, 2007, "same store" patient encounters increased 2.0% compared to the same period in 2006.

Compensation and benefits

        Compensation and benefits costs for the year ended December 31, 2007 were $683.3 million, or 77.0% of net revenue,
compared to $574.1 million, or 77.1% of net revenue, for the same period in 2006. Provider compensation costs increased $57.3 million from net new contract additions. "Same store"
provider compensation costs increased $39.6 million due to an 8.7% increase in provider compensation per patient encounter due primarily to increases in net revenue per patient encounter. The
remaining variance is related primarily to higher expense for incentive compensation plans and increased variable salary costs due to growth in patient encounters.

Operating expenses

        Operating expenses for the year ended December 31, 2007 were $41.9 million, or 4.7% of net revenue, compared to
$35.6 million, or 4.8% of net revenue, for the same period in 2006. The variance is due primarily to growth in patient encounters from net new contracts and from additional
off-hours radiology coverage of $3.2 million.

Insurance expense

        Professional liability insurance expense for the year ended December 31, 2007 was $29.8 million, or 3.4% of net revenue,
compared to $38.1 million, or 5.1% of net revenue, for the same period in 2006. The decrease is due to the continued improvement in our estimates for current and prior year ultimate claims
costs. As a result, a reduction of prior year insurance provisions of $10.2 million was recorded during the year ended December 31, 2007. A reduction of $3.9 million was recorded
for the year ended December 31, 2006.

Selling, general and administrative

        Selling, general and administrative expense for the year ended December 31, 2007 was $19.6 million, or 2.2% of net
revenue, compared to $17.5 million, or 2.3% of net revenue, for the same period in 2006.

Depreciation and amortization

        Depreciation and amortization expense for the year ended December 31, 2007 was $13.9 million, or 1.6% of net revenue,
compared to $13.0 million, or 1.7% of net revenue, for the same period in 2006.

EmCare

For the quarter ended December 31, 2008, EmCare generated net revenue of $267.2 million, an increase of 15.0% compared to the same quarter last year.  The increase in revenue is driven primarily by 91 net new contracts added since September 30, 2007 for emergency department and other hospital based provider services and volume increases at existing contracts.  Adjusted EBITDA was $31.8 million compared to $32.1 million for the same quarter last year.  The fourth quarter of 2007 included a $4 million benefit from a timing difference in recording current period insurance costs. Prior year favorable developments of $1.0 million were recorded in the fourth quarter 2008 compared to $0.6 million in the fourth quarter 2007.

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EmCare

Net revenue. Net revenue for the nine months ended September 30, 2008 was $740.9 million, an increase of $85.4 million, or 13.0%, from $655.4 million for the nine months ended September 30, 2007. The increase was due primarily to an increase in patient visits from net new hospital contracts and net revenue increases in existing contracts.  Following December 31, 2006, we added 75 net new contracts which accounted for a net revenue increase of $57.9 million.  Of the 75 net new contracts added since December 31, 2006, 17 were added in 2007 resulting in an increase in 2008 net revenue of $21.1 million.  For the nine months ended September 30, 2008, EmCare added 108 new contracts and terminated 50 contracts resulting in an incremental increase in net revenue of $36.8 million.  Of the 108 new contracts added in 2008, 45 were from our acquisition of Clinical Partners in August 2008 with related management fee revenue totaling $1.1 million.  Net revenue under our same store contracts increased $27.5 million, or 5.1%, for the period ended September 30, 2008 due to a 1.1% increase, or a 5.6% increase excluding retroactive revenue adjustments discussed below, in revenue per visit and an increase in same store patient visits of 4.0% over the prior period.  Retroactive adjustments, which increased revenue for the nine months ended September 30, 2008 and 2007, were approximately 0.9% and 4.3% of EmCare’s net revenue, respectively.

Compensation and benefits. Compensation and benefits costs for the nine months ended September 30, 2008 were $586.6 million, or 79.2% of net revenue, compared to $502.8 million, or 76.7% of net revenue for the same period in 2007. Provider compensation and benefits costs increased $49.7 million from net new contract additions.  Same store provider compensation and benefits costs were $29.2 million over the prior period due to a 4.6% increase in provider compensation per patient visit.  The increase is due primarily to higher net revenue per patient visit and additional staffing due to growth in patient volumes.

Operating expenses. Operating expenses for the nine months ended September 30, 2008 were $26.1 million, or 3.5% of net revenue, compared to $31.4 million, or 4.8% of net revenue, for the same period in 2007.  Operating expenses decreased due primarily to reduced off-hours radiology coverage, lower collection agency fees, and bank fees of approximately $2.1 million, which are now included in selling, general and administrative expenses.

Insurance expense. Professional liability insurance expense for the nine months ended September 30, 2008 was $32.8 million, or 4.4% of net revenue, compared to $25.2 million, or 3.8% of net revenue, for the nine months ended September 30, 2007. An increase of prior year insurance provisions of $1.3 million was recorded during the nine months ended September 30, 2008 compared to a  reduction of $9.7 million recorded for the nine months ended September 30, 2007.

Selling, general and administrative. Selling, general and administrative expense for the nine months ended September 30, 2008 was $16.5 million, or 2.2% of net revenue, compared to $13.8 million, or 2.1% of net revenue, for the nine months ended September 30, 2007.  The increase is due primarily to an increase in regional travel expense associated with the increase in contracts during the period and increased bank fees of approximately $2.1 million, which bank fees were previously included in operating expenses.

Depreciation and amortization. Depreciation and amortization expense for the nine months ended September 30, 2008 was $10.2 million, or 1.4% of net revenue, compared to $10.5 million, or 1.6% of net revenue, for the nine months ended September 30, 2007.

EmCare

For the quarter ended September 30, 2008, EmCare generated net revenue of $254.0 million, an increase of 16.1% compared to the same quarter last year.  The increase in revenue is primarily driven by volume increases at existing contracts and 74 net new contracts added since June 30, 2007.  Of the 74 net new contracts added, 45 were from the acquisition of Clinical Partners in August 2008 with related management fee revenue of $1.1 million during the quarter.  Adjusted EBITDA was $26.3 million compared to $27.0 million last year, a decrease of 2.6%.  The reduction in Adjusted EBITDA is primarily attributable to an unfavorable prior period insurance adjustment of $3.9 million in the quarter ended September 30, 2008 compared to a favorable prior period adjustment of $3.1 million in the same period last year.  Prior period insurance development in the third quarter of 2008 was not consistent with EmCare’s historical experience and the Company does not believe this level of adjustment is indicative of an ongoing trend. Compensation increased as a percent of net revenue due to increased provider costs in both new contract starts and existing contracts, offset by lower operating costs.

For the nine months ended September 30, 2008, EmCare’s net revenue was $740.9 million, an increase of 13.0% compared to the same period last year.  Adjusted EBITDA was $81.9 million compared to $85.4 million last year.  The nine month period last year included incremental positive revenue adjustments of approximately $13 million, with an Adjusted EBITDA impact of approximately $10 million.  Insurance expense in the nine months ended September 30, 2008 included an unfavorable prior period adjustment of $1.3 million compared to a favorable prior period adjustment of $9.7 million in the same period last year.

EmCare

Net revenue. Net revenue for the six months ended June 30, 2008 was $486.9 million, an increase of $50.3 million, or 11.5%, from $436.6 million for the six months ended June 30, 2007. The increase was due primarily to an increase in patient visits from net new hospital contracts and net revenue increases in existing contracts.

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EmCare

For the quarter ended June 30, 2008, EmCare generated net revenue of $247.4 million, an increase of 11.7% compared to the same quarter last year.  The increase in revenue is primarily driven by volume increases at existing contracts and 37 net new contracts added since March 31, 2007.  Adjusted EBITDA was $29.5 million compared to $29.1 million last year, an increase of 1.7%.  The three months ended June 30, 2007 included incremental positive revenue adjustments of approximately $4 million, with an Adjusted EBITDA impact of approximately $1.9 million. Insurance expense in the second quarter 2008 included a reduction in favorable prior period adjustments of $2.9 million compared to the same period last year.  Compensation increased as a percent of net revenue due to increased provider costs in both new and existing contracts offset by lower operating costs.

For the six months ended June 30, 2008, EmCare’s net revenue was $486.9 million, an increase of 11.5% compared to the same period last year.  Adjusted EBITDA was $55.6 million compared to $58.4 million last year.  The six months ended June 30, 2007 included incremental positive revenue adjustments of approximately $13 million, with an Adjusted EBITDA impact of approximately $10 million.

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EmCare

Net revenue. Net revenue for the three months ended March 31, 2008 was $239.5 million, an increase of $24.3 million, or 11.3% (16.1% excluding revenue adjustments described below), from $215.2 million for the three months ended March 31, 2007. The increase was due primarily to an increase in patient visits from net new hospital contracts and net revenue increases in existing contracts. Following December 31, 2006, we added 23 net new contracts which accounted for a net revenue increase of $13.6 million for the three months ended March 31, 2008.  Of the 23 net new contracts added since December 31, 2006, 17 were added in 2007 resulting in an incremental increase in 2008 net revenue of

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