UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


                                    FORM 10-K

 (Mark One)
 { X } ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
           ACT OF 1934

                   For the fiscal year ended December 31, 2001

                                   OR

 {   } TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
          EXCHANGE ACT OF 1934

                        For the transition period from to

                        Commission file number 000-17596


         Meridian Healthcare Growth and Income Fund Limited Partnership
             (Exact Name of Registrant as Specified in its Charter)


                   Delaware                                    52-1549486
       (State or Other Jurisdiction of                      (I.R.S. Employer
       Incorporation or Organization)                    Identification Number)

225 East Redwood Street, Baltimore, Maryland                      21202
   (Address of Principal Executive Offices)                     (Zip Code)


Securities registered pursuant to Section 12(b) of the Act:

   Title of each class             Name of each exchange on which registered

                         None


Securities registered pursuant to section 12(g) of the Act:

                 Assignee Units of Limited Partnership Interests
                                (Title of class)


     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
                          Yes     X                      No

     As of December 31, 2001, there were 1,539,000 Units of Assignee Limited
Partnership Interests held by non-affiliates of the Registrant. Because there is
not an established public trading market for the Units, the aggregate market
value of the Units held by non-affiliates of the Registrant cannot be
calculated.

                       Documents Incorporated by Reference

     The Annual Report for 2001 is incorporated by reference.


<PAGE>


         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP



                                      INDEX

<TABLE>
<CAPTION>

                                                                                   Page (s)

<S>                                                                                      <C>
CAUTIONARY STATEMENT REGARDING FORWARD LOOKING STATEMENTS                                3

Part I.

         Item 1.    Business                                                             4
         Item 2.    Properties                                                         5-6
         Item 3.    Legal Proceedings                                                    7
         Item 4.    Submission of Matters to a Vote of Security Holders                  7


Part II.

         Item 5.    Market for Registrant's Common Equity and Related
                           Stockholder Matters                                           7
         Item 6.    Selected Financial Data                                              8
         Item 7.    Management's Discussion and Analysis of Financial
                           Condition and Results of Operations                        8-17
         Item 7a.   Quantitative and Qualitative Disclosures About Market Risk          17
         Item 8.    Financial Statements and Supplementary Data                         17
         Item 9.    Changes in and Disagreements with Accountants on
                           Accounting and Financial Disclosure                          18


Part III.

         Item 10.   Directors and Executive Officers of Registrant                   18-20
         Item 11.   Executive Compensation                                              20
         Item 12.   Security Ownership of Certain Beneficial Owners
                           and Management                                               20
         Item 13.   Certain Relationships and Related Transactions                      20


Part IV.

         Item 14.   Exhibits, Financial Statement Schedules and
                           Reports on Form 8-K                                       21-23

                           Signatures                                                24-25
</TABLE>


<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP




            Cautionary Statement Regarding Forward-Looking Statements


Certain statements contained herein, including certain statements in
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" concerning the Fund's business outlook or future economic
performances, anticipated profitability, revenues, expenses or other financial
items together with other statements that are not historical facts are
"forward-looking statements" as that term is defined under the Federal
Securities Law. Forward-looking statements are necessarily estimates reflecting
the best judgment of the party making such statements based upon correct
information and involve a number of risks, uncertainties and other factors which
could cause actual results to differ materially from those stated in such
statements. Risks, uncertainties and factors which could affect the accuracy of
such forward-looking statements are identified in the Fund's Prospectus and the
Fund's Registration Statement filed by the Fund with the Securities and Exchange
Commission, and forward-looking statements contained herein or in other public
statements of the Fund should be considered in light of those factors. There can
be no assurance that factors will not affect the accuracy of such
forward-looking statements.



                                      -3-

<PAGE>


         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


                                     PART I

Item 1.  Business

         Meridian Healthcare Growth and Income Fund Limited Partnership (the
"Fund") was organized under the laws of the State of Delaware on December 8,
1987. The Fund will continue until December 31, 2037, unless sooner terminated
under the provisions of the Partnership Agreement. The Fund was formed to
acquire 98.99% of the limited partnership interests in seven limited
partnerships, each of which owns and operates a single nursing center (the
"Facilities").

         The Fund's objectives are to (i) preserve Investors' capital; (ii)
obtain capital appreciation through increases in the value of the Facilities;
and (iii) provide quarterly cash distributions to Investors from income
generated by the Facilities' operating income, the income taxation of a portion
of which is anticipated to be deferred.

     The General  Partners of the Fund are Brown  Healthcare,  Inc.,  a Maryland
corporation  (the  "Administrative  General  Partner")  and Meridian  Healthcare
Investments, Inc., a Maryland corporation (the "Development General Partner").

         A maximum of 1,540,000 assignee units of limited partnership interests
("Units") were registered under the Securities and Exchange Act of 1933, as
amended. During 1988 all 1,540,000 Units were sold, and the Fund's net proceeds
available for investment aggregated $31,878,000 (gross proceeds of $38,500,000
less public offering expenses and acquisition fees of $6,622,000). The Assignor
Limited Partner (Brown Healthcare Holding Co., Inc., an affiliate of the General
Partner) also acquired 40 units of limited partnership interests in 1988.

         The Fund acquired 98.99% limited partnership interests (the "Operating
Partnership Interests") in the operating limited partnerships which own and
operate seven nursing center facilities. The Facilities include four nursing
centers located in Maryland; two nursing centers located in North Carolina and
one facility in New Jersey. Each operating partnership owns the real and
personal property of its nursing center facility. (See Note 1, "Organization and
Operations", in Item 8, Financial Statements and Supplementary Data, and Item 2.
Properties, herein.)

         The Fund acquired the Operating Partnership Interests with offering
proceeds and certain indebtedness.

         The nursing centers owned by the operating partnerships are managed by
and purchase drugs, medical supplies and agency nursing and rehabilitation
services from affiliates of the Development General Partner. (See Note 3,
"Related Party Transactions" in Item 8. Financial Statements and Supplementary
Data, herein.)

     On November 30, 1993, Genesis Health Ventures,  Inc.  ("Genesis")  acquired
substantially all of the assets of Meridian Inc., Meridian Healthcare,  Inc. and
their affiliated entities, including all of the stock of the Development General
Partner. See Item 10. Directors and Executive Officers of Registrant, herein.

         The Fund's sole business is its investment in partnerships which own
and operate nursing centers that are healthcare facilities licensed by
individual states to provide long-term healthcare within guidelines established
by the appropriate state health agencies and as directed by each patient's
physician. Healthcare and related services from private pay and other patients
and Medicaid and Medicare patients accounted for approximately 99% of revenues
during each of the years in the three-year period ended December 31, 2001.

         Healthcare facilities, including those owned by the operating
partnerships, are subject to extensive federal, state and in some cases, local
regulatory licensing and inspection requirements. In addition, government
revenue sources, particularly Medicaid and Medicare programs, are subject to
statutory and regulatory changes due to administrative rulings, interpretations
of policy and determination by fiscal intermediaries, and to government funding
restrictions, all of which may materially affect the rate of program payments to
nursing facilities.

         The nursing center Facilities face competition with similar facilities
in their general locations as well as the development of other nursing centers
that are able to obtain Certificates of Need and to meet certain other
requirements.


                                      -4-

<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP



Item 2.  Properties

         The Fund owns Operating Partnership Interests in operating partnerships
that own four nursing facilities in the State of Maryland, two nursing
facilities in the State of North Carolina, and one nursing facility in New
Jersey. The Facilities are described below:
<TABLE>
<CAPTION>
                                                                                  Property & Equipment      Patient
                                                                                  (before depreciation)    Revenues
                                                                                  at December 31, 2001       2001
  Name and Location                         Description                                    (Dollars in Thousands)

<S>                                                                                      <C>                <C>
Facility 1.   Hamilton             A 104-bed nursing facility located on                 $ 4,924            $ 6,016
6040 Harford Road                  1.06 acres, constructed in 1972
Baltimore City,  Maryland          consisting of a "T" shaped two-story
                                   plus partial basement masonry structure
                                   containing 22,082 square feet. The facility
                                   contains 104 comprehensive care beds of which
                                   all are Medicare-certified. There are two
                                   private rooms, 15 semi-private rooms, 4
                                   three-person rooms and 15 four-person rooms.


Facility 2.                        A 215-bed nursing facility located on                  11,607              11,747
Randallstown                       2.83 acres, constructed in 1971
9109 Liberty Road                  consisting of a rectangular-shaped
Randallstown,  Maryland            two-story plus partial basement masonry
                                   structure containing a total of 72,780 square
                                   feet. The facility contains 215 comprehensive
                                   care beds of which all are
                                   Medicare-certified. There are 96 semi-private
                                   rooms and 23 private rooms.


Facility 3.   Caton Manor          A 168-bed nursing facility located on                   8,280              9,899
3330 Wilkens Avenue                0.92 acres, constructed in 1972
Baltimore City,                    consisting of an "L" shaped four-story
Maryland                           plus basement masonry structure
                                   containing a total of 48,660 square
                                   feet.  All 168 beds are comprehensive
                                   care beds and are all
                                   Medicare-certified.  All rooms are
                                   semi-private.


Facility 4.  Frederick             A 143-bed nursing facility located on                   7,709              8,423
(Collegeview)                      1.13 acres, originally constructed in
400 North Avenue                   1966 consisting of a two-story plus
Frederick, Maryland                partial basement masonry structure, the
                                   second floor added in 1968, containing a
                                   total of 52,661 square feet. The facility
                                   contains 143 comprehensive care beds of which
                                   all are Medicare-certified.

</TABLE>



                                      -5-
<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


Item 2.  Properties (continued)
<TABLE>
<CAPTION>
                                                                                  Property &Equipment         Patient
                                                                                  (before depreciation)      Revenues
                                                                                  at December 31, 2001         2001
    Name and Location                           Description                                 (Dollars in Thousands)

<S>                                                                                        <C>                <C>
Facility 5.  Mooresville           A 160-bed nursing facility located on 11.38             6,321              7,491
550 Glenwood Road                  acres, originally constructed with 100 beds
Mooresville,                       in 1988 with a 60-bed addition completed in
North Carolina                     1992 consisting of a one-story slab on grade
                                   building containing a total of 47,657 square
                                   feet. The facility contains 130 beds for
                                   skilled care and intermediate care residents,
                                   of which all are Medicare certified. There
                                   are 30 beds in the Home for the Aged (HA)
                                   wing. There are 8 private rooms and 76 semi-
                                   private rooms.



Facility 6.  Salisbury             A 180 bed nursing facility located on  6.02             6,186              8,484
710 Julian Road                    acres, originally constructed with 120 beds
Salisbury,                         in 1988 with a 60-bed addition completed in
North Carolina                     1991 consisting of a one-story slab on grade
                                   building containing a total of 50,500 square
                                   feet. The facility contains 160 beds for
                                   skilled care and intermediate care residents,
                                   of which all are Medicare certified. There
                                   are 20 beds in the Home for the Aged (HA)
                                   wing. There are 16 private rooms and 82
                                   semi-private rooms.




Facility 7.  Woodlands             A 140-bed nursing facility located on 6.52              8,533              7,722
1400 Woodland Avenue               acres, constructed in 1989 consisting of a
Plainfield, New Jersey             two-story slab on grade building containing a
                                   total of 54,000 square feet. The facility
                                   contains 120 comprehensive nursing home beds,
                                   of which 26 are Medicare certified, and 20
                                   residential care beds. There are 12 private
                                   rooms, 46 semi-private rooms and 9 four-bed
                                   rooms.


                                                                                        --------           --------
                                                                                        $ 53,560           $ 59,782
                                                                                        ========           ========


</TABLE>


                                       -6-

<PAGE>


         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP



Item 3.  Legal Proceedings

         The Fund is a party to litigation arising in the ordinary course of
business. The Fund does not believe the results of such litigation, even if the
outcome is unfavorable to the Fund, would have a material adverse effect on its
consolidated financial position or results of operations.

Item 4.  Submission of Matters to a Vote of Security Holders

There were no matters submitted to the security holders for a vote during the
last quarter of the fiscal year covered by this report.





                                     PART II



Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters

An established public trading market for the Units does not exist and the Fund
does not anticipate that a public market will develop. Transfer of Units by an
investor and purchase of Units by the Fund may be accommodated under certain
terms and conditions. The Partnership Agreement imposes certain limitations on
the transfer of Units and may restrict, delay or prohibit a transfer primarily
if:

o        the transfer of Units would result in 50% or more of all Units having
         been transferred by assignment or otherwise within a 12-month period;

o        such a transfer would be a violation of any federal or state securities
         laws that may cause the Fund to be classified other than as a
         partnership for federal income tax purposes;

o        such transfers would cause the Fund to be treated as a "publicly traded
         partnership" under Sections 7704 and 469(k) of the Internal Revenue
         Code; and

o        the transfer of Units would cause a technical termination of the
         Partnership within meaning of Section 708(b)(1)(A) of the
         Internal Revenue Code.


         As of December 31, 2001, there were 1,714 holders of Units of the
registrant, owning an aggregate of 1,540,040 Units, including 40 Units held by
the Assignor Limited Partner. The Fund made four quarterly distributions
totaling approximately $3,306,000 in each of the years in the three-year period
ended December 31, 2001. See Note 5, "Distributions to Partners and Allocation
of Net Earnings", in Item 8. Financial Statements and Supplementary Data,
herein.




                                       -7-

<PAGE>


         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


Item 6.  Selected Financial Data
<TABLE>
<CAPTION>
                                                                 Years Ended December 31,
                                               2001           2000        1999         1998         1997
                                            --------------------------------------------------------------
                                                     (Dollars in thousands - except per Unit amounts)
Statement of Earnings Data

<S>                                           <C>            <C>         <C>          <C>          <C>
Net revenue                                   $59,933        $55,764     $51,278      $54,108      $49,568
Operating earnings before capital costs**       6,892          6,710       6,612        9,594        6,286
Net earnings                                    2,191          2,282       2,865        5,768        2,268

Net earnings per assignee Unit-basic          $  1.41        $  1.47     $  1.84      $  3.71      $  1.46


Operating Data

Payor mix (as a percent of revenue):
     Medicaid and Medicare                        83%            80%         84%          80%          77%
     Private                                      17%            20%         16%          20%          23%

Occupancy percentage                            90.0%          86.2%       87.9%        91.7%        93.2%

Patient Days Available                        406,000        430,000     429,000      429,000      429,000


Balance Sheet Data

Total assets                                  $48,777        $49,398     $48,646      $50,305      $49,707
Property and equipment, net of
     accumulated depreciation                  31,927         32,934      33,346       33,653       34,839
Debt, including loan payable to
     Development General Partner               24,588         24,964      23,742       24,422       25,070
Partners' capital                              16,233         17,348      18,372       18,813       16,351

Cash distributions paid per Unit:
     from operations                          $  2.12        $  1.69     $  2.12      $  2.12      $  2.12
     from return of capital                         -            .43           -            -            -
                                              $  2.12        $  2.12     $  2.12      $  2.12      $  2.12

</TABLE>

     **Capital costs include depreciation, amortization and interest expense.


Item 7. Management's Discussion and Analysis of Financial Condition
             and Results of Operations

Liquidity and Capital Resources

         The Fund closed its mortgage loan refinancing with a new bank for loans
totaling $24,000,000 on June 12, 2000. The renewal terms became effective on
June 12, 2000 and provide for a term of five years at an interest rate of 9.75%.
Monthly payments are based on a 20-year amortization schedule with a balloon
payment due at the end of the 5-year term.


                                      -8-
<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


Item 7. Management's Discussion and Analysis of Financial Condition
             and Results of Operations (continued)


Liquidity and Capital Resources (continued)

         The Fund also replaced its $4,000,000 line of credit facility with the
same lender under terms similar to the mortgage loan terms described above,
except that the line of credit facility requires annual reaffirmation.

         The Fund's working capital (excluding the current portion of long-term
debt) decreased $105,000 to $5,337,000 at December 31, 2001 as compared to
$5,442,000 at December 31, 2000. The Fund has sufficient liquid assets and other
available credit resources to satisfy its operating expenditures and anticipated
routine capital improvements at each of the seven nursing home facilities.

         Cash flow from operating activities was $5,703,000 for the year ended
December 31, 2001 as compared to $2,640,000 during 2000. The increase in cash
flow was due primarily to collection of estimated third-party settlements and
improved collection of receivables.

         Cash used from investing activities during 2001 was $902,000 and
included improvements to the Fund's seven operating facilities. Similar
improvements of $1,421,000 and $1,458,000 were made during 2000 and 1999,
respectively.

         Cash flows from financing activities during 2001 included repayment of
long term debt of $428,000 and distributions to partners and minority interests
totaling $3,415,000.

         The Fund believes that the short-term liquidity needs will be met
through expected cash flow from operations and available working capital from
the existing line of credit.

         Between 1988 and 1999 the Development General Partner loaned the Fund
$597,000 to support operating deficits generated by the Mooresville, Salisbury
and Woodlands nursing centers during each centers' first two years of operation.
Loans outstanding under this arrangement, including interest at 9% per annum,
were $1,240,000 at December 31, 2001.

         On February 15, 2002 the Fund made its fourth quarter 2001 distribution
to partners of $826,410. This distribution was funded by fourth quarter 2001
operations. During 2001 operations funded the distributions to partners. Review
of the 2002 budget suggests operations from the seven nursing centers will be
sufficient to fund a similar distribution in 2002.

         The major challenge to the Fund in the foreseeable future is to control
operating expenses in light of Medicare's conversion to the Prospective Payment
System, to maintain a quality mix of patients and to increase the overall census
at each of the facilities.

Results of Operations

                   December 31, 2001 versus December 31, 2000

         Overall 2001 revenues of $59,933,000 increased $4,169,000 or 7.5% from
the same period in 2000.

         Revenues of $49,022,000 from Medicaid and Medicare patients for the
twelve months ended December 31, 2001 increased $4,508,000 or 10.1% from the
same period in the prior year. This increase is primarily the result of Medicaid
rate increases and an increase in the number of Medicare days. Medicaid revenue
increased $2,365,000 primarily due to an overall rate increase of approximately
8.7% driven primarily by the four Maryland centers, which received their annual
Medicaid rate adjustment in July 2001. Medicare revenue increased $2,143,000
relating to growth in Medicare census. In fiscal year 2001, Medicare census made
up 13.9% of the overall census as compared to 12.8% in fiscal year 2000.


                                      -9-

<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


Item 7. Management's Discussion and Analysis of Financial Condition
             and Results of Operations (continued)

Results of Operations (continued)

         Revenues from private and other patients decreased $200,000 to
$10,760,000 in fiscal year 2001 as compared to $10,960,000 in fiscal year 2000.
This decrease is a result of lower private and insurance census. Private census
made up 9.9 % of the overall census in fiscal year 2001 compared to 10.3% in
fiscal year 2000. In fiscal year 2001, insurance census made up 2.6% of the
overall census as compared to 3.1% in fiscal year 2000. Investment and other
income decreased $139,000 due primarily to a decrease in interest income.

         Operating expenses increased $4,269,000 or 9.6 % from the same period
in the prior year. This increase is primarily due to the increased cost of
nursing services and ancillary costs. Nursing costs increased $2,194,000 for the
year ended December 31, 2001 as compared to the same period in 2000. This
increase is primarily due to increases in salary and wages and the increased
utilization of temporary nurse staffing. Salary and wage expense for nurses
increased $1,180,000, and temporary nurse staffing expense increased $825,000
for the year ended December 31, 2001 compared to the same period in the prior
year. The increase in nursing salary and wages and utilization of temporary
nurse staffing is a result of an overall shortage of nurses within the
healthcare industry. Ancillary expenses increased $663,000 or 9.5% for the year
ended December 31, 2001 as compared to the same period in 2000. This increase is
primarily due to the increase in the Medicare census and the increased
utilization of Part B ancillary services. The remaining increase in operating
costs is due to increased health insurance costs of $241,000 to $1,677,000 and
general inflationary cost increases.

         Management and administrative fees decreased $334,000 or approximately
9.2% in 2001 as compared to 2000. This decrease is due to an amendment to the
management agreement effective January 1, 2001, which reduced the management fee
from 6% to 5% of net patient service revenue.

         Interest expense increased $250,000 in fiscal year 2001 as compared to
fiscal year 2000. This increase is the result of the first full year with the
new mortgage, which increased the beginning principal balance to $24,000,000 at
a higher interest rate. The refinancing was effective June 12, 2000.


                   December 31, 2000 versus December 31, 1999

         Overall 2000 revenues of $55,764,000 increased $4,486,000 or 8.7% from
the same period in 1999.

         Revenues of $44,514,000 from Medicaid and Medicare patients for the
twelve months ended December 31, 2000 increased $3,483,000 or 8.5% from the same
period in the prior year. This increase is primarily the result of Medicaid rate
increases and an increase in the number of Medicare days. Medicaid revenue
increased $1,978,000 primarily due to overall rate increases of approximately
11.1% driven primarily by the four Maryland centers. The Maryland centers
received a rate adjustment in October 1999, which was implemented to reflect a
modification to the state reimbursement program, and their annual rate
adjustment was received in July 2000. Medicare revenue increased $1,505,000
relating to growth in Medicare census. In fiscal year 2000 Medicare census made
up 12.8% of the overall census as compared to 11.5% in fiscal year 1999.

         Revenues from private and other patients increased $995,000 to
$10,960,000 as compared to $9,965,000 in 1999. This increase is a result of
higher insurance census and rates and higher private rates. In fiscal year 2000,
insurance census made up 3.1% of the overall census as compared to 2.8% in
fiscal year 1999. Insurance rates increased 14.8% and private rates increased
6.3% resulting in additional revenue of approximately $395,000 and $386,000,
respectively.


                                      -10-

<PAGE>


Item 7. Management's Discussion and Analysis of Financial Condition
             and Results of Operations (continued)

Results of Operations (continued)

         Operating expenses increased $4,109,000 or 10.2% from the same period
in the prior year. This increase is primarily due to the increased cost of
nursing services and ancillary costs. Nursing costs increased $1,937,000 for the
year ended December 31, 2000 as compared to the same period in 1999. This
increase is primarily due to increases in salary and wages and the increased
utilization of temporary nurse staffing. Salary and wage expense for nurses
increased $575,000, and temporary nurse staffing expense increased $1,078,000
for the year ended December 31, 2000 compared to the same period in the prior
year. The increase in nursing salary and wages and utilization of temporary
nurse staffing is a result of an overall shortage of nurses within the
healthcare industry. Ancillary expenses increased $1,395,000 or 24.9% for the
year ended December 31, 2000 as compared to the same period in 1999. This
increase is primarily due to the increase in the Medicare census and the
increased utilization of Part B ancillary services. The remaining increase in
operating costs is due to increased health insurance costs of $174,000 to
$1,406,000 and general inflationary cost increases.

         Management and administrative fees increased $261,000 or approximately
7.7% in 2000 as compared to 1999. This increase is due to fees paid to the
Fund's manager, which are calculated as a percentage of net revenues, and are
reflective of the revenues increase in fiscal year 2000 as compared to 1999.

         Depreciation and amortization expense increased $203,000 in fiscal year
2000 as compared to fiscal year 1999. This increase is due primarily to the
amortization of fees incurred of $134,000 for the extension of the existing
mortgage and fees associated with refinancing of the mortgage.

Interest expense increased $478,000 in fiscal year 2000 as compared to fiscal
year 1999. This increase is the result of higher variable interest rates during
the year coupled with the refinancing which resulted in a larger principal
balance $24,000,000 and a higher interest rate. The refinancing became effective
June 12, 2000.

Contractual Obligations

         The Fund is committed to making cash payments in the future on two
types of contracts: a loan payable to the Development General Partner and
indebtedness on mortgage loans. The Fund has no off-balance sheet debt or other
such unrecorded obligations and has not guaranteed the debt of any other party.

         The Fund is obligated to repay the loan payable to the Development
General Partner when certain specified financial criteria are met, the most
significant of which is the payment of a preferred return to the assignee
limited partners as defined in the Fund's partnership agreement. The loan
payable balance is $1,240,000 as of December 31, 2001. See the discussion in
Note 3 of the Notes to the Consolidated Financial Statements for additional
information on this loan payable.

         Principal payments on the mortgage loans during the next four years and
in the aggregate are as follows: $435,000 in 2002, $519,000 in 2003, $564,000 in
2004, $21,830,000 in 2005. See the discussion in Note 4 to the Consolidated
Financial Statements for additional information on the Fund's mortgage loans.

         The Fund believes it has, or has access to, sufficient resources to
meet these contractual obligations and its operating requirements for the
foreseeable future. The Fund currently has in place an agreement to borrow up to
$4 million on a revolving credit facility, of which no amount is outstanding at
December 31, 2001. The Company's ability to meet its capital requirements will
depend on a number of factors, including the ability to meet the loan covenant
requirements necessary under its current debt agreements, the success of its
nursing center operations, competitive advances, future relationships with
corporate partners, government regulation, and the Fund's marketing strategy.


                                      -11-
<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


Item 7. Management's Discussion and Analysis of Financial Condition
             and Results of Operations (continued)

Critical Accounting Policies

         The Fund's accounting policies are described in Note 2 of the Notes to
Consolidated Financial Statements. The Fund prepares its Consolidated Financial
Statements in conformity with accounting principles generally accepted in the
United States of America, which require the Fund to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the year. On
an on-going basis, the Fund evaluates its estimates, including those related to
bad debts and contingencies. The Fund bases its estimates on historical
experience and on various other assumptions that it believes is reasonable under
the circumstances. The results form the basis for making judgments about the
carrying values of assets and liabilities that are not readily apparent from
other sources. Actual results could differ from those estimates. The Fund
considers the following policies to be most critical in understanding the
judgments that are involved in preparing the financial statements and the
uncertainties that could impact the results of operations, financial condition
and cash flows.

         Valuation of Accounts Receivable - The accounts receivable as of
December 31, 2001 and 2000 was net of an allowance for doubtful accounts of
$1,656,000 and $1,245,000 respectively. The recorded allowance is continually
evaluated based on current market conditions, an analysis of customer specific
facts and circumstances, and the size and composition of the overall portfolio.
If receivables become uncollectible, the Fund charges these write-offs against
the allowance.

         Revenue Recognition - Revenue is recognized by the Fund in the period
the related services are rendered. The Fund derives a substantial portion of its
revenue under Medicaid and Medicare reimbursement programs. Under certain
retrospective Medicaid systems, revenues are generally based on reimbursement of
the reasonable direct and indirect costs of providing services to program
participants. The Fund separately estimates revenues due from each third party
with which it has a contractual arrangement and records anticipated settlements
with these parties in the contractual period during which services were
rendered. The amounts actually reimbursable under the cost based reimbursement
programs are determined by filing cost reports which are then subject to audit
and retroactive adjustment by the payor. The Fund provides an allowance for
potential audit adjustments to the interim reimbursement amounts received under
these cost reimbursement programs. Revisions to this allowance, if any, are
recorded as an adjustment to revenues in the year such amounts are determined.
Factors that management considers when establishing or adjusting an allowance
for potential audit adjustments include, but are not limited to, changes in
estimates resulting from improved cost information and preliminary results of
third-party audits and reviews. Adjustments and final settlements with
third-party payors are reflected in operations at the time of the adjustment or
settlement as an increase or decrease to the balance of estimated third-party
payor settlements and revenue.

         Revisions to prior year cost reimbursement settlements resulted in an
increase to revenues of $362,000, $797,000 and $389,913 for fiscal years ended
in 2001, 2000 and 1999, respectively. The revenue adjustments for these years
are primarily due to the revision of the estimated settlements based upon final
and interim audit settlements of the open cost report years.

         There can be no assurances that any future healthcare legislation will
not adversely affect the business of the Fund. There can be no assurance that
payments under government and private third-party payor programs will be timely,
will remain at levels comparable to present levels or will, in the future, be
sufficient to cover the costs allocable to patients eligible for reimbursement
pursuant to such programs. The Fund's financial condition and results of
operations may be affected by the revenue reimbursement process, which in the
Fund's industry is complex and can involve lengthy delays between the time that
revenue is recognized and the time that reimbursement amounts are settled.


                                      -12-

<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP

Item 7. Management's Discussion and Analysis of Financial Condition
         and Results of Operations (continued)

Revenue Sources

         Congress has enacted three major laws during the past five years that
have significantly altered payment for nursing home services. The Balanced
Budget Act of 1997 ("the 1997 Act"), signed into law on August 5, 1997, reduced
federal spending on the Medicare and Medicaid programs. The Medicare Balanced
Budget Refinement Act ("BBRA"), enacted in November 1999 addressed a number of
the funding difficulties caused by the 1997 Act. A second enactment, the
Benefits Improvement and Protection Act of 2000 ("BIPA"), was enacted on
December 15, 2000, further modifying the law and restoring additional funding.

         Under the 1997 Act, participating skilled nursing facilities are
reimbursed under a prospective payment system ("PPS") for inpatient Medicare
covered services. The PPS system commenced with a facility's first cost
reporting period beginning on or after July 1, 1998. Under PPS, nursing
facilities are paid a predetermined amount per patient, per day ("per diem")
based on the anticipated costs of treating patients. The per diem rate is
determined by classifying each patient into one of forty-four resource
utilization groups ("RUG") using the information gathered during the minimum
data set ("MDS") assessment. There is a separate per diem rate for each of the
RUG classifications. The per diem rate also covers rehabilitation and
non-rehabilitation ancillary services. The law phased in PPS over a three-year
period. PPS reimbursement is based largely on a nursing facility's costs for the
services it provided to Medicare beneficiaries in the 1994-1995 base year.

         As implemented by The Centers for Medicare and Medicaid Services, (CMS
formerly HCFA) PPS has had an adverse impact on the Medicare revenues of many
skilled nursing facilities. There have been three primary problems. First, the
base year calculations understate costs. Second, the market basket index used to
trend payments forward does not adequately reflect market experience. Third, the
RUGs case mix allocation is not adequately predictive of the costs of care for
patients, and does not equitably allocate funding, especially for non-therapy
ancillary services.

         In November 1999, the BBRA was passed in Congress. This enactment
provided relief for certain reductions in Medicare reimbursement caused by the
1997 Act. For covered skilled nursing facility services furnished on or after
April 1, 2000, the federal per diem rate was increased by 20% for 15 RUG payment
categories. While this provision was initially expected to adjust payment rates
for only six months, CMS withdrew proposed RUG refinement rules. These payment
add-ons will continue until CMS completes certain mandated recalculations of
current RUG weightings. For fiscal years 2001 and 2002, the BBRA mandated
federal per diem rates for all RUG categories be increased by an additional 4%
over the required market basket adjustment. The law provided that certain
specific services (such as prostheses and chemotherapy drugs) would be
reimbursed separately from and in addition to the federal per diem rate. A
provision was included that provided that for cost report years beginning on or
after January 1, 2000, skilled nursing facilities could waive the PPS transition
period and elect to receive 100% of the federal per diem rate. The enactment
also lifted for two years the $1,500 cap on rehabilitation therapy services
provided under Medicare Part B.

         On December 15, 2000 Congress passed BIPA that, among other provisions,
increases the nursing component of Federal PPS rates by approximately 16.7% for
the period from April 1, 2001 through September 30, 2002. The legislation will
also change the 20% add-on to 3 of the 14 rehabilitation RUG categories to a
6.7% add-on to all 14 rehabilitation RUG categories beginning April 1, 2001. The
Part B consolidated billing provision of BBRA will be repealed except for
Medicare Part B therapy services and, the moratorium on the $1,500 therapy caps
will be extended through calendar year 2002. The Fund has not yet evaluated what
effect BIPA will have on its operating results.

         A number of the provisions of the BBRA and BIPA enactments providing
additional funding for Medicare participating skilled nursing facilities expire
on September 30, 2002. Expiring provisions are estimated to, on average, reduce
per beneficiary per diems by $30. Moreover, CMS has indicated its desire to
complete refinements to the case mix classification system as part of the Fiscal
2003 rule-making. Under the law, when these revisions are implemented, the
add-on's authorized by the BBRA and BIPA will expire. Combined, the Medicare
skilled nursing facility sector face

                                      -13-
<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


Item 7. Management's Discussion and Analysis of Financial Condition
             and Results of Operations (continued)

Revenue Sources (continued)

an 18% reduction in the average median per diems. If the Fund were to experience
an 18% decline in our current average Medicare rate per patient day, the
estimated annual reduction in Medicare revenues of approximately $2,800,000
would have a material adverse affect on our financial position, results of
operations, and cash flows. Trade organizations representing the skilled nursing
facility sector are aggressively pursuing strategies to minimize the potential
impact of the "Medicare Rate Cliff".

         The 1997 Act included several provisions affecting Medicaid. The 1997
Act repealed the "Boren Amendment" federal payment standard for Medicaid
payments to nursing facilities effective October 1, 1997. The Boren Amendment
required that Medicaid payments to certain health care providers be reasonable
and adequate in order to cover the costs of efficiently and economically
operated healthcare facilities. Under the 1997 Act, states must now use a public
notice and comment period in order to determine rates and provide interested
parties a reasonable opportunity to comment on proposed rates and the
justification for and the methodology used in calculating such rates. With the
repeal of the Federal payment standards, there can be no assurances that budget
constraints or other factors will not cause states to reduce Medicaid
reimbursement to nursing facilities and pharmacies or that payments to nursing
facilities and pharmacies will be made on timely basis. The 1997 Act also grants
greater flexibility to states to establish Medicaid managed care projects
without the need to obtain a federal waiver. Although these projects generally
exempt institutional care, including nursing facilities, no assurances can be
given that these projects ultimately will not change the reimbursement
methodology for nursing facility services from fee-for-service to managed care
negotiated or capitated rates. The Fund anticipates that federal and state
governments will continue to review and assess alternative health care delivery
systems and payment methodologies.

         Congress and state governments continue to focus on efforts to curb
spending on health care programs such as Medicare and Medicaid. We cannot at
this time predict the extent to which these proposals will be adopted or, if
adopted and implemented, what effect, if any, such proposals will have on the
Fund. Efforts to impose reduced allowances, greater discounts and more stringent
cost controls by government and other payors are expected to continue.

Legislative and Regulatory Issues

         Our business is subject to extensive federal, state and, in some cases,
local regulation with respect to, among other things, licensure, certification
and health planning. These regulations relate, among other things, to the
adequacy of physical plant and equipment, qualifications of personnel, standards
of care and operational requirements. Compliance with such regulatory
requirements, as interpreted and amended from time to time, can increase
operating costs and thereby adversely affect the financial viability of our
business. Failure to comply with current or future regulatory requirements could
also result in the imposition of various remedies including fines, restrictions
on admission, the revocation of licensure, decertification, imposition of
temporary management or the closure of the facility.

         In July 1998, the Clinton administration issued a new initiative to
promote the quality of care in nursing homes. Following this pronouncement, it
has become more difficult for nursing facilities to maintain licensing and
certification. We have experienced and expect to continue to experience
increased costs in connection with maintaining our licenses and certifications
as well as increased enforcement actions.

         The Fund face additional federal requirements that mandate major
changes in the transmission and retention of health information. The Health
Insurance Portability and Accountability Act of 1996 ("HIPAA") was enacted to
ensure, first, that employees can retain and at times transfer their health
insurance when they change jobs, and secondly, to simplify health care
administrative processes. This simplification includes expanded protection of
the privacy and security of personal medical data and requires adoption of
standards for the exchange of electronic health information. Among the standards
that the Department of Health and Human Services will adopt pursuant to HIPAA
are standards


                                      -14-

<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


Item 7. Management's Discussion and Analysis of Financial Condition
             and Results of Operations (continued)

Legislative and Regulatory Issues (continued)

for the following: electronic transactions and code sets; unique identifiers for
providers, employers, health plans and individuals; security and electronic
signatures; privacy; and enforcement.

         Although HIPPA was intended to ultimately reduce administrative
expenses and burdens faced within the healthcare industry, we believe that
implementation of this law will result in additional costs. The Fund has
approximately two years to comply with the regulation. Genesis have established
a HIPAA task force consisting of both clinical and information services
professionals focused on HIPAA compliance.

         The Fund pays insurance premiums for property and professional
liability insurance at coverage levels deemed adequate by Genesis. The Fund's
workers' compensation and health insurance are purchased by Genesis, since
Genesis employees operate the Facility according to the terms of the management
agreement. If the Fund were to terminate this coverage then it would not be
liable for claims incurred during the management period but were reported
following the termination date.

         All of our Facilities, to the extent required, are licensed under
applicable law and are certified or approved as providers under one or more of
the Medicaid and Medicare programs. Licensing, certification and other
applicable standards vary from jurisdiction to jurisdiction and are revised
periodically. State and local agencies survey all skilled nursing centers on a
regular basis to determine whether such centers are in compliance with
governmental operating and health standards and conditions for participation in
government sponsored third party payor programs. We believe that our Facilities
are in substantial compliance with the various Medicare, Medicaid and state
regulatory requirements applicable to them. However, in the ordinary course of
our business, we receive notices of deficiencies for failure to comply with
various regulatory requirements. The Fund reviews such notices and takes
appropriate corrective action. In most cases, the Fund and the reviewing agency
will agree upon the measures to be taken to bring the center into compliance
with regulatory requirements. In some cases or upon repeat violations, the
reviewing agency may take various adverse actions against a provider, including
but not limited to:

o        the imposition of fines;

o        suspension of payments for new admissions to the center;

o        in extreme circumstances, decertification from participation in the
         Medicare or Medicaid programs and revocation of a center's license.

     These actions may adversely affect a nursing facility's ability to continue
to operate, the ability to provide certain services, and/or eligibility to
participate in the Medicare or Medicaid programs or to receive payments from
other payors. Additionally, actions taken against one center may subject other
centers under common control or ownership to adverse remedies.

Recently Issued Accounting Pronouncements

         In July 2001, the FASB issued Statement No. 141, Business Combinations,
and Statement No. 142, Goodwill and Other Intangible Assets. Statement 141
requires that the purchase method of accounting be used for all business
combinations initiated after June 30, 2001 as well as all purchase method
business combinations completed after June 30, 2001. Statement 141 also
specifies criteria intangible assets acquired in a purchase method business
combination must meet to be recognized and reported apart from goodwill.
Statement 142 will require that goodwill and intangible assets with indefinite
useful lives no longer be amortized, but instead tested for impairment at least
annually in accordance with the provisions of Statement 142. Statement 142 will
also require that intangible assets with definite


                                      -15-

<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


Item 7. Management's Discussion and Analysis of Financial Condition
             and Results of Operations (continued)

Recently Issued Accounting Pronouncements (continued)

useful lives be amortized over their respective estimated useful lives to their
estimated residual values, and reviewed for impairment.

         The Fund is required to adopt the provisions of Statement 141
immediately, except with regard to business combinations initiated prior to July
1, 2001, and Statement 142 effective January 1, 2002. Furthermore, any goodwill
and any intangible asset determined to have an indefinite useful life that are
acquired in a purchase business combination completed after June 30, 2001 will
not be amortized, but will continue to be evaluated for impairment in accordance
with the appropriate pre-Statement 142 accounting literature. Goodwill and
intangible assets acquired in business combinations completed before July 1,
2001 will continue to be amortized prior to the adoption of Statement 142.

         As of the date of adoption, the Fund expects to have unamortized
goodwill in the amount of $4,237,000 which will be subject to the transition
provisions of Statement 142. Amortization expense related to goodwill was
$253,000 in 2001, 2000 and 1999.

         FASB Statement No. 143, Accounting for Asset Retirement Obligations
(Statement No. 143), which was released in August 2001, addresses financial
accounting and reporting for obligations associated with the retirement of
tangible long-lived assets and for the associated asset retirement costs.
Statement No. 143 requires an enterprise to record the fair value of an asset
retirement obligation as a liability in the period in which it incurs a legal
obligation associated with the retirement of tangible long-lived assets that
result from the acquisition, construction, development and or normal use of the
assets. The enterprise also is to record a corresponding increase to the
carrying amount of the related long-lived asset (i.e., the associated asset
retirement costs) and to depreciate that cost over the life of the asset.

         The liability is changed at the end of each period to reflect the
passage of time (i.e., accretion expense) and changes in the estimated future
cash flows underlying the initial fair value measurement. Because of the
extensive use of estimates, most enterprises will record a gain or loss when
they settle the obligation. The Fund is required to adopt Statement No. 143 for
its fiscal year beginning January 1, 2003.

         On October 3, 2001, the Financial Accounting Standards Board issued
FASB Statement No. 144, Accounting for the Impairment or Disposal of Long-Lived
Assets (Statement No. 144), which addresses financial accounting and reporting
for the impairment or disposal of long-lived assets. While Statement No. 144
supersedes FASB Statement No. 121, Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed Of, it retains many of the
fundamental provisions of that Statement.

         Statement No. 144 also supersedes the accounting and reporting
provisions of APB Opinion No. 30, Reporting the Results of Operations--Reporting
the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual
and Infrequently Occurring Events and Transactions, for the disposal of a
segment of a business. However, it retains the requirement in Opinion 30 to
report separately discontinued operations and extends that reporting to a
component of an entity that either has been disposed of (by sale, abandonment,
or in a distribution to owners) or is classified as held for sale. Statement No.
144 is effective for the Fund for fiscal years beginning after December 15, 2001
and interim periods within those fiscal years.



                                      -16-

<PAGE>


         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP

Item 7. Management's Discussion and Analysis of Financial Condition
             and Results of Operations (continued)

Outlook

         The major challenge to the Fund in the foreseeable future is to control
operating expenses in light of Medicare's conversion to the Prospective Payment
System, to maintain a quality mix of patients and to increase the overall census
at each of the facilities.

         On October 2, 2001, Genesis Health Ventures, Inc. (Genesis) and certain
of its subsidiaries and affiliates emerged from Chapter 11 Bankruptcy protection
pursuant to a plan of reorganization approved by the U.S. Bankruptcy Court in
Wilmington, Delaware. Certain subsidiaries of Genesis manage the Fund's Nursing
Centers, and provide the centers with drugs, medical supplies and other
services. The Genesis Bankruptcy filing has had no impact on the Fund's
operations, results of operations, or financial position.


Item 7a. Quantitative and Qualitative Disclosures About Market Risks

         The Fund has exposure to changing interest rates and is currently not
engaged in hedging activities. Interest on the Fund's $23.3 million mortgage is
at a fixed rate of 9.75%.


Item 8.  Financial Statements and Supplementary Data

     Index to Financial Statements:
                              Annual Report Page(s)
     Independent Auditors' Report                                 5
     Consolidated Balance Sheets                                  6
     Consolidated Statements of Earnings                          7
     Consolidated Statements of Partners' Capital                 8
     Consolidated Statements of Cash Flows                        9
     Notes to Consolidated Financial Statements               10-19

Supplementary Data

     Quarterly Financial Data ( Unaudited)

     The Fund's unaudited quarterly financial information is as follows (in
thousands):

                                        Total Net           Income from
                                         Revenues           Operations
         Quarter ended:

         March 31, 2001                  $14,251                $351
         June 30, 2001                    14,291                 383
         September 30, 2001               15,288                 963
         December 31, 2001                16,103                 494

         March 31, 2000                   13,338                 518
         June 30, 2000                    13,801                 886
         September 30, 2000               14,154                 747
         December 31, 2000                14,471                 131




                                      -17-
<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


Item 9.  Changes in and Disagreements with Accountants on Accounting
           and Financial Disclosure

None.


                                    PART III

Item 10.  Directors and Executive Officers of Registrant

         The General Partners of the Fund are Meridian Healthcare Investments,
Inc., the Development General Partner, and Brown Healthcare, Inc., the
Administrative General Partner. The Fund's principal executive offices are
located at 225 East Redwood Street, Baltimore, Maryland 21202. The General
Partners had primary responsibility for the selection and negotiation of terms
concerning the acquisition of the Operating Partnership Interests, selecting a
manager for the interim investments and the structure of the Offering and the
Fund. The General Partners have primary responsibility for overseeing the
performance of those who contract with the Fund as well as making decisions with
respect to the financing, sale and liquidation of the Fund's or the operating
partnerships' assets. The General Partners are responsible for all reports to
and communications with investors and others, all distributions and allocations
to investors, the administration of the Fund's business and all filings with the
Securities and Exchange Commission and other Federal or State regulatory
authorities. The Fund's Partnership Agreement provides certain rights for
investors, which are incorporated herein by reference.

Development General Partner

         Meridian Healthcare Investments, Inc., the Development General Partner,
is a Maryland corporation. On November 30, 1993, Genesis acquired substantially
all the assets of Meridian, Inc., Meridian Healthcare (" MHC") and their
affiliated entities, including all the stock of the Fund's Development General
Partner. As part of the acquisition, MHC, the manager of the Fund's seven
nursing centers, continues to operate the facilities pursuant to management
agreements. Genesis operates primarily in five regional markets in which over
11,400,000 people over the age of 65 reside. The networks include 276 eldercare
centers with approximately 33,000 beds; approximately 81 physicians, physician
assistants and nurse practitioners; 22 medical supply distribution centers
serving over 1,000 eldercare centers with over 80,000 beds; an integrated
NeighborCareSM pharmacy operation with over $1,050,000,000 in annualized
revenues, including 60 long-term care pharmacies serving approximately 253,000
institutional beds; community-based pharmacies; infusion therapy services; and
certified rehabilitation agencies providing services through over 600 contracts.
Genesis also provides diagnostic and hospitality services in selected markets
and operates a group purchasing organization. Genesis has concentrated its
eldercare networks in five geographic regions in order to achieve operating
efficiencies, economies of scale and significant market share. The five
geographic markets that Genesis principally serves are: New England Region
(Massachusetts/Connecticut/New Hampshire/Vermont/Rhode Island); Midatlantic
Region (Greater Philadelphia/Delaware Valley/New Jersey); Chesapeake Region
(Southern Delaware/Eastern Shore of Maryland/Baltimore, Maryland/Washington
D.C./Virginia); Southern Region (Central Florida);and Allegheny Region (West
Virginia/Western Pennsylvania/Illinois/Wisconsin). Genesis believes that it is
the largest operator of eldercare center beds in the states of New Hampshire,
Massachusetts, New Jersey, Pennsylvania, Maryland and West Virginia.

         The following individuals are the directors and principal officers of
Meridian Healthcare Investments, Inc.:

         Michael R. Walker, age 53, is President and a Director of the
Development General Partner and is a co-founder of Genesis and has served as
Chairman and Chief Executive Officer of Genesis since its inception in 1985. In
1998, Mr. Walker became the Chairman of the Board of Trustees of ElderTrustsm, a
healthcare related real estate investment trust. In 1981, Mr. Walker co-founded
Health Group Care Centers ("HGCC"). At HGCC, he served as Chief Financial
Officer and, later, as President and Chief Operating Officer. Prior to its sale
in 1985, HGCC operated nursing homes with 4,500 nursing beds in 12 states. From
1978 to 1981, Mr. Walker was the Vice President and Treasurer of AID Healthcare
Centers, Inc. ("AID"). AID, which owned and operated 20 nursing centers, was
co-founded in 1977 by

                                      -18-

<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


Item 10.  Directors and Executive Officers of Registrant (continued)

Development General Partner (continued)

     Mr.   Walker  as  the  nursing   home   division  of  Hospital   Affiliates
International  ("HAI").  Mr.  Walker  holds a Master of Business  Administration
degree from Temple University and a Bachelor of Arts in Business  Administration
from Franklin and Marshall College.  Mr. Walker serves on the Board of Directors
of Renal Treatment  Centers,  Inc. and the Board of Trustees of Universal Health
Realty and Income Trust.

     Richard R. Howard, age 53, is a Director of the Development General Partner
and has  served as a  Director  of  Genesis  since  its  inception  in 1985,  as
President  from June 1986 to November 1998 and as Vice Chairman  since  November
1998.  From June,  1986 through March,  1998, Mr. Howard served as President and
Chief Operating Officer of Genesis. He joined Genesis in September, 1985 as Vice
President of  Development.  Mr. Howard's  background in healthcare  includes two
years as the Chief  Financial  Officer of HGCC.  Mr.  Howard's  experience  also
includes over ten years with Fidelity Bank,  Philadelphia,  Pennsylvania and one
year with Equibank,  Pittsburgh,  Pennsylvania.  Mr. Howard is a graduate of the
Wharton  School,  University  of  Pennsylvania,  where he received a Bachelor of
Science degree in Economics in 1971.

     George V.  Hager,  Jr.,  age 46, is Vice  President  and  Treasurer  of the
Development  General Partner and is Executive Vice President and Chief Financial
Officer of Genesis.  Mr. Hager was  previously  partner in charge of the health-
care  practice  for KPMG LLP in the  Philadelphia  office.  Mr.  Hager began his
career  at KPMG LLP in 1979 and has over  nineteen  years of  experience  in the
healthcare  industry.  Mr. Hager received a Bachelor of Arts degree in Economics
from Dickinson  College in 1978 and a Master of Business  Administration  degree
from Rutgers Graduate School of Management.  He is a certified public accountant
and a member of the AICPA and PICPA.

Administrative General Partner

     Brown Healthcare,  Inc., the Administrative  General Partner, is a Maryland
corporation,  and is wholly-owned by Alex. Brown Realty, Inc. The Administrative
General  Partner is  responsible  for  administering  the  business of the Fund,
including providing clerical services,  communications,  services and reports to
investors,   and  making  all  reports  and  filings  to  securities  regulatory
authorities.

         The following individuals are the directors and principal officers of
the Administrative General Partner:

     John  M.  Prugh,  age  53,  has  been  a  Director  and  President  of  the
Administrative  General Partner since 1988, and of Alex. Brown Realty,  Inc. and
Armata Financial Corp.  since 1984. Mr. Prugh graduated from Gettysburg  College
in 1970,  and was  designated a Certified  Property  Manager by the Institute of
Real Estate  Management in 1979. He has worked in property  management for H. G.
Smithy Co., in Washington,  D.C., and Dreyfus Bros., Inc. in Bethesda, Maryland.
Since 1977, Mr. Prugh has been involved in managing,  administering,  developing
and selling real estate  investment  projects  sponsored by Alex.  Brown Realty,
Inc. and its subsidiaries.

     Peter E.  Bancroft,  age 49, has been a Director and Vice  President of the
Administrative  General  Partner since 1988 and a Senior Vice President of Alex.
Brown Realty, Inc. and Armata Financial Corp. since 1983. Mr. Bancroft graduated
from Amherst College in 1974, attended the University of Edinburgh, and received
a J.D.  degree from the University of Virginia  School of Law in 1979.  Prior to
joining Alex. Brown Realty, Inc. in 1983, Mr. Bancroft held legal positions with
Venable, Baetjer and Howard and T. Rowe Price Associates, Inc.

     Terry F. Hall, age 55, has been the Secretary of the Administrative General
Partner and a Vice  President and  Secretary  of, and Legal  Counsel for,  Alex.
Brown  Realty,  Inc.  since 1989.  Mr. Hall  graduated  from the  University  of
Nebraska-Lincoln  in 1968,  and received a J.D.  degree from the  University  of
Pennsylvania Law School in 1973.  Prior to joining Alex.  Brown Realty,  Inc. in
1986, Mr. Hall was a Partner at the law firm of Venable, Baetjer and Howard from
1981 to 1986 and an associate at the same firm from 1973 to 1981.

                                      -19-

<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


Item 10.  Directors and Executive Officers of Registrant (continued)

Administrative General Partner (continued)

     Timothy M. Gisriel,  age 45, has been the  Treasurer of the  Administrative
General Partner and of Alex. Brown Realty, Inc. and Armata Financial Corp. since
1990. He was Controller of Alex.  Brown Realty,  Inc. and Armata Financial Corp.
from 1984 through 1990.  Mr.  Gisriel  graduated from Loyola College in 1978 and
received  his  Masters  of  Business  Administration  degree  from the Robert G.
Merrick  School of Business,  University of Baltimore in 1993.  Prior to joining
Alex.  Brown Realty,  Inc. in 1984, Mr.  Gisriel was an audit  supervisor in the
Baltimore  office of  Coopers  &  Lybrand.  He is a  Maryland  Certified  Public
Accountant.

         There is no family relationship among the officers and directors of the
General Partner.


Item 11.  Executive Compensation

         The officers and directors of the Administrative General Partner and
Development General Partner received no compensation from the Fund.

     The General Partners are entitled to receive a share of cash  distributions
and a share of  profits  and losses as  described  in the  Agreement  of Limited
Partnership.  (See Note 5,  "Distributions  to Partners  and  Allocation  of Net
Income" in Item 8. Financial Statements, herein.)

         For a discussion of compensation and fees to which the General Partners
are entitled, see Item 13. Certain Relationships and Related Transactions,
herein.


Item 12.  Security Ownership of Certain Beneficial Owners and Management

         No person is known to the Fund to own beneficially more than 5% of the
outstanding Units of the Fund.

         The General Partners each have a .5% interest in the Fund as General
Partners, but do not hold any Units.

     The Assignor  Limited  Partner,  Brown  Healthcare  Holding Co.,  Inc.,  an
affiliate of the Administrative  General Partner, owns for its benefit 40 Units.
The Units held by the Assignor  Limited Partner have all rights  attributable to
such Units under the Limited  Partnership  Agreement except that these Units are
non-voting.

Item 13.  Certain Relationships and Related Transactions

         The General Partners and their affiliates have and are permitted to
engage in transactions with the Fund. For a summarization of fees paid during
2001, 2000, and 1999, and to be paid to the General Partners and their
affiliates at December 31, 2001, see Note 3, "Related Party Transactions" in
Item 8. Financial Statements, herein.


                                      -20-

<PAGE>


         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


                                     PART IV



Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K

     (a) 1.  Financial Statements:  see Index to Financial Statements and
             Supplementary Data in Item 8 on Page 17.

         2.  Financial Statement Schedules: Schedule II - Valuation and
             Qualifying Accounts for the years ended December 31, 2001, 2000
             and 1999.  All other schedules are omitted because they are not
             applicable or the required information is shown in the financial
             statements or notes thereto.

         3.  Exhibits:

             (3,    4) Limited Partnership Agreement on pages 1 through 41 of
                    Exhibit A to the Fund's Prospectus, and the Fund's
                    Registration Statement on Form S-1 (File No. 33-19277)
                    included herein by reference.

             (13)   Annual Report for 2001.

     (b) Reports on Form 8-K:  None.




                                      -21-


<PAGE>



                           INDEPENDENT AUDITORS REPORT



To the Partners of
Meridian Healthcare Growth and
Income Fund Limited Partnership

Under date of March 14, 2002, we reported on the consolidated balance sheets of
Meridian Healthcare Growth and Income Fund Limited Partnership (the Fund) as of
December 31, 2001 and 2000, and the related consolidated statements of earnings,
partners' capital and cash flows for each of the years in the three-year period
ended December 31, 2001, as contained in the annual report on Form 10-K for the
year 2001. In connection with our audits of the aforementioned consolidated
financial statements, we also audited the related consolidated financial
statement schedule in the Form 10-K. This consolidated financial statement
schedule is the responsibility of the Fund's management. Our responsibility is
to express an opinion on this consolidated financial statement schedule based on
our audits. In our opinion, such schedule, when considered in relation to the
basic consolidated financial statements taken as a whole, presents fairly, in
all material respects, the information set forth therein.

                                           /s/  KPMG LLP

Philadelphia, Pennsylvania
March 14, 2002



                                      -22-

<PAGE>


         Meridian Healthcare Growth and Income Fund Limited Partnership
                        Valuation and Qualifying Accounts
                  Years Ended December 31, 2001, 2000 and 1999
                             (Dollars in Thousands)

                                   Schedule II

<TABLE>
<CAPTION>
                                         Balance at Beginning    Charged to                     Balance at End
              Description                      of Period         Operations     Deductions(1)      of Period
-----------------------------------------------------------------------------------------------------------------

<S>                                            <C>                 <C>            <C>               <C>
Year Ended December 31, 2001                   $1,245              1,678          (1,267)           $1,656
Allowance for Doubtful Accounts

Year Ended December 31, 2000                   $1,048                904            (707)           $1,245
Allowance for Doubtful Accounts

Year Ended December 31, 1999                     $479                845            (276)           $1,048
Allowance for Doubtful Accounts
</TABLE>

(1) - Represents amounts written off as uncollectible.






                                      -23-
<PAGE>
         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP



                                   SIGNATURES


Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, as amended, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.


                                   MERIDIAN HEALTHCARE GROWTH AND INCOME
                                       FUND LIMITED PARTNERSHIP


DATE:      3/15/02                 By:     /s/   John M. Prugh
                                   John M. Prugh
                                   President and Director
                                   Brown-Healthcare, Inc.
                                   Administrative General Partner



Pursuant to the requirements of the Securities Exchange Act of 1934 as amended,
this report has been signed by the following in the capacities and on the dates
indicated.




DATE:      3/15/02                 By:      /s/    John M. Prugh
                                   John M. Prugh
                                   President and Director
                                   Brown-Healthcare, Inc.
                                   Administrative General Partner


DATE:      3/20/02                 By:     /s/   Peter E. Bancroft
                                   Peter E. Bancroft
                                   Vice President and Director
                                   Brown-Healthcare, Inc.
                                   Administrative General Partner


DATE:      3/20/02                 By:    /s/   Terry F. Hall
                                   Terry F. Hall
                                   Secretary
                                   Brown-Healthcare, Inc.
                                   Administrative General Partner


DATE:      3/15/02                 By:     /s/   Timothy M. Gisriel
                                   Timothy M. Gisriel
                                   Treasurer
                                   Brown-Healthcare, Inc.
                                   Administrative General Partner




                                      -24 -


<PAGE>


         MERIDIAN HEALTHCARE GROWTH AND INCOME FUND LIMITED PARTNERSHIP


                             SIGNATURES (continued)




DATE:      3/27/02                 By:     /s/    Michael R. Walker
                                   Michael R. Walker
                                   President and Director
                                   Meridian Healthcare Investments, Inc.
                                   Development General Partner



DATE:      3/27/02                 By:    /s/    Richard R. Howard
                                   Richard R. Howard
                                   Director
                                   Meridian Healthcare Investments, Inc.
                                   Development General Partner




DATE:      3/27/02                 By:    /s/    George V. Hager, Jr.
                                   George V. Hager, Jr.
                                   Vice President and Treasurer
                                   Meridian Healthcare Investments, Inc.
                                   Development General Partner



















                                      -25-