UNITED STATES
                    SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C.  20549
                                     
                                 Form 10-Q

(Mark One)
[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934

                  For the period ended September 30, 1996
                                     
                                    OR

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


                    Commission File Number:  000-19854
                                     
                                     
                        APRIA HEALTHCARE GROUP INC.
          (Exact name of registrant as specified in its charter)


                                                     
                DELAWARE                        33-0488566
    (State or other jurisdiction of          (I.R.S. Employer
     incorporation or organization)       Identification Number)


   3560 HYLAND AVENUE, COSTA MESA, CA             92626
(Address of principal executive offices)        (Zip Code)

     Registrant's telephone number, including area code: (714)427-2000

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
                         -----          -----

There  were 51,151,760 shares of Common Stock, $.001 par value, outstanding
at November 8, 1996.

<PAGE>

                        APRIA HEALTHCARE GROUP INC.
                                     
                                 FORM 10-Q
                                     
                  For the period ended September 30, 1996
                                     





PART I. FINANCIAL INFORMATION
------------------------------

Item 1.   Financial Statements (unaudited)

          Consolidated Balance Sheets

          Consolidated Statements of Operations

          Consolidated Statements of Cash Flows

          Notes to Consolidated Financial Statements

Item 2.   Management's Discussion and Analysis of
          Financial Condition and Results of Operations

PART II.  OTHER INFORMATION
---------------------------

Item 1.   Legal Proceedings
Item 2.   Changes in Securities
Item 3.   Defaults Upon Senior Securities
Item 4.   Submission of Matters to a Vote of Security
          Holders
Item 5.   Other Information
Item 6.   Exhibits and Reports on Form 8-K

SIGNATURES
----------
<PAGE>
<TABLE>

                        APRIA HEALTHCARE GROUP INC.
                                     
                        CONSOLIDATED BALANCE SHEETS
                                     
<CAPTION>
                                                September 30,   December 31,
                                                     1996           1995
                                                  ----------    ------------
                 ASSETS                          (unaudited)
                                                   (dollars in thousands)
<S>                                              <C>            <C>
CURRENT ASSETS
  Cash                                           $   25,046     $   18,829
  Accounts receivable, less allowance for
    doubtful accounts of $83,504 and $86,567
    at September 30, 1996 and December 31,
    1995, respectively                              354,338        258,332
  Inventories                                        61,699         45,198
  Deferred income taxes                              33,170         45,883
  Refundable income taxes                            14,408         27,710
  Prepaid expenses and other current assets          12,149          7,770
                                                  ---------      ---------
      TOTAL CURRENT ASSETS                          500,810        403,722
PATIENT SERVICE EQUIPMENT, less accumulated
  depreciation of $185,849 and $161,953 at
  September 30, 1996 and December 31, 1995,
  respectively                                      204,534        167,090
PROPERTY, EQUIPMENT AND IMPROVEMENTS, NET           113,611         80,108
INVESTMENT IN OMNICARE plc                            1,623          1,504
COVENANTS NOT TO COMPETE, NET                        16,896         20,272
GOODWILL, NET                                       294,997        298,870
OTHER ASSETS                                         12,466          8,419
                                                  ---------      ---------
                                                 $1,144,937     $  979,985
                                                  =========      =========

                                     
  LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Accounts payable                               $   75,897     $  100,653
  Accrued payroll and related taxes
    and benefits                                     25,202         26,792
  Accrued restructuring costs                         8,065         19,085
  Other accrued liabilities                          44,337         48,910
  Current portion of long-term debt                  11,237          9,652
                                                  ---------      ---------
      TOTAL CURRENT LIABILITIES                     164,738        205,092
LONG-TERM DEBT                                      608,701        490,655

STOCKHOLDERS' EQUITY
  Preferred Stock, $.001 par value:
     10,000,000 shares authorized; none issued            -              -
  Common Stock, $.001 par value:
    150,000,000 shares authorized; 51,134,305
      and 49,692,266 shares issued and
      outstanding at September 30, 1996
      and December 31, 1995, respectively                51             50
  Additional paid-in capital                        318,831        294,522
  Retained earnings (deficit)                        52,616        (10,334)
                                                  ---------      ---------
                                                    371,498        284,238
COMMITMENTS AND CONTINGENCIES                             -              -
                                                  ---------      ---------
                                                 $1,144,937     $  979,985
                                                  =========      =========
</TABLE>
              See notes to consolidated financial statements.
<PAGE>
<TABLE>
                        APRIA HEALTHCARE GROUP INC.
                                     
                   CONSOLIDATED STATEMENTS OF OPERATIONS
                                (unaudited)
                                     
<CAPTION>
                                       Three Months Ended Nine Months Ended
                                         September 30,      September 30,
                                        ----------------  -----------------
                                          1996    1995     1996     1995
                                         ------  ------   ------   ------
                                      (in thousands, except per share data)
<S>                                    <C>      <C>       <C>      <C>
Net revenues                           $306,026 $277,670  $907,908 $849,565
Costs and expenses:
   Cost of net revenues                  93,917   98,837   284,951  272,643
   Selling, distribution and
     administrative                     147,584  161,540   433,021  453,630
   Provision for doubtful accounts       15,118   47,781    42,976   74,144
    Amortization of intangible assets     4,176    4,116    12,627   12,250
   Restructuring costs                        -   73,885         -   76,546
   Merger costs                               -    5,205         -   12,193
   Employee contract, benefit
     plan and claim settlements               -   20,254         -   23,460
   Loss on disposition of
     U.K. subsidiary                          -        -         -      500
                                        -------  -------   -------  -------
                                        260,795  411,618   773,575  925,366
                                        -------  -------   -------  -------
     OPERATING INCOME (LOSS)             45,231 (133,948)  134,333  (75,801)
Interest expense                         12,816   10,201    35,927   32,017
                                        -------  -------   -------  -------
     INCOME (LOSS) BEFORE TAXES
     AND EXTRAORDINARY CHARGE            32,415 (144,149)   98,406 (107,818)
Income tax expense (benefit)             11,666  (31,983)   35,423  (18,941)
                                        -------  -------   -------  -------
     INCOME (LOSS) BEFORE
     EXTRAORDINARY CHARGE                20,749 (112,166)   62,983 (88,877)
Extraordinary charge on debt
  refinancing, net of taxes                   -        -         -   2,998
                                        -------  -------   ------- -------
     NET INCOME (LOSS)                  $20,749$(112,166)  $62,983$(91,875)
                                        =======  =======   =======  =======




EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARE:
  Income (loss) before
    extraordinary charge                $  0.40 $  (2.32) $  1.20 $ (1.92)
  Extraordinary charge on debt
    refinancing, net of taxes                 -        -        -   (0.06)
                                         ------- -------  ------- -------
  Net income (loss)                     $  0.40 $  (2.32) $  1.20 $ (1.98)
                                         ======= =======  ======= =======

Weighted average number of common
  and common equivalent shares
  outstanding                            52,257   48,410   52,276  46,301

EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARE
ASSUMING FULL DILUTION:
  Income (loss) before
    extraordinary charge                $  0.40  $ (2.32) $  1.20 $ (1.92)
  Extraordinary charge on debt
    refinancing, net of taxes                 -        -        -   (0.06)
                                         ------- -------  ------- -------
  Net income (loss)                     $  0.40  $ (2.32) $  1.20 $ (1.98)
                                         ======= =======  ======= =======

Weighted average number of common
  and common equivalent shares
  outstanding                            52,257   48,410   52,351  46,301
</TABLE>
              See notes to consolidated financial statements.
<PAGE>
<TABLE>
                        APRIA HEALTHCARE GROUP INC.
                                     
                   CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (unaudited)
<CAPTION>
                                                      Nine Months Ended
                                                        September 30,
                                                     -------------------
                                                     1996           1995
                                                    ------         ------
                                                    (dollars in thousands)
<S>                                                <C>           <C>
OPERATING ACTIVITIES
Net income (loss)                                  $ 62,983      $(91,875)
Items included in net income (loss)
  not requiring (providing) cash:
  Provision for doubtful accounts                    42,976        74,144
  Depreciation                                       65,937        66,560
  Amortization of intangible assets                  12,627        12,250
  Amortization of deferred debt costs                   793         6,330
  Loss on sale of property,
    equipment and improvements                          165         4,131
  Impairment losses                                       -        31,140
  Deferred income taxes                              13,840       (23,966)
Changes in operating assets and liabilities,
  net of effects of acquisitions:
  Increase in accounts receivable                  (138,915)      (70,687)
  Increase in inventories                           (15,939)       (1,320)
  Decrease (increase) in prepaids and
    other current assets                             18,311        (9,533)
  Decrease in other non-current assets                  348         1,969
  Decrease in accounts payable                      (24,755)       (3,590)
  (Decrease) increase in accrued
    payroll and other liabilities                    (5,942)       21,779
  (Decrease) increase in accrued
    restructuring costs                             (11,020)       33,484
Other                                                   (22)          609
Net purchases of patient service equipment,
  net of effects of acquisitions                    (84,462)      (59,903)
                                                   --------       --------
    NET CASH USED IN OPERATING ACTIVITIES           (63,075)       (8,478)

INVESTING ACTIVITIES
  Purchases of property, equipment and
    improvements, net of effects of
    acquisitions                                    (40,579)      (34,675)
  Proceeds from sale of property,
    equipment and improvements                          168           229
  Acquisitions and payments of
    contingent consideration                        (13,920)      (41,360)
                                                   --------       --------
    NET CASH USED IN INVESTING ACTIVITIES           (54,331)      (75,806)

FINANCING ACTIVITIES
   Proceeds under revolving credit facility         686,900       408,822
   Payments under revolving credit facility        (568,200)     (194,294)
   Proceeds from senior and other long-term debt          -       120,107
   Payments of senior and other long-term debt       (8,606)     (264,874)
  Capitalized debt costs, net                        (1,296)       (1,414)
  Issuances of Common Stock                          14,825        10,628
                                                   --------      --------
     NET CASH PROVIDED BY FINANCING ACTIVITIES      123,623        78,975
                                                   --------      --------

NET INCREASE (DECREASE) IN CASH                       6,217        (5,309)
Cash at beginning of period                          18,829        21,188
Net activity for Homedco - October 1, 1994
  to December 31, 1994                                    -         3,697
                                                   --------      --------
      CASH AT END OF PERIOD                        $ 25,046      $ 19,576
                                                   ========      ========
</TABLE>
              See notes to consolidated financial statements.
<PAGE>

                        APRIA HEALTHCARE GROUP INC.
                                     
                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE A - POOLING OF INTERESTS AND BASIS OF PRESENTATION

The accompanying consolidated financial statements include the accounts  of
Apria  Healthcare  Group Inc. ("the Company") and  its  subsidiaries.   All
significant  intercompany transactions and accounts have  been  eliminated.
On  June  28,  1995, Homedco Group, Inc. ("Homedco") merged with  and  into
Abbey  Healthcare  Group Incorporated ("Abbey") to  form  Apria  Healthcare
Group  Inc.  ("the merger").  The merger was accounted for as a pooling-of-
interests  and, accordingly, the consolidated financial statements  reflect
the  combined financial position and operating results of Abbey and Homedco
and  have been adjusted to conform the differing accounting policies of the
separate companies for all periods presented.

In  the  opinion  of  management,  all adjustments,  consisting  of  normal
recurring  accruals, necessary for a fair presentation of  the  results  of
operations  for the interim periods presented, have been reflected  herein.
The   results  of  operations  for  interim  periods  are  not  necessarily
indicative of the results to be expected for the entire year.  For  further
information,  refer to the consolidated financial statements and  footnotes
thereto for the year ended December 31, 1995, filed with the Company's 1995
Form 10-K as amended on November 8, 1996 by Amendment #2 on Form 10K/A.

NOTE B - RECLASSIFICATIONS AND USE OF ACCOUNTING ESTIMATES

Certain amounts from prior periods have been reclassified to conform to the
current year presentation.

The  preparation  of  financial  statements in  conformity  with  generally
accepted accounting principles requires management to make assumptions that
affect  the  amounts reported in the financial statements and  accompanying
notes.   Such  amounts  include, among others, the allowance  for  doubtful
accounts,   patient  service  equipment  reserves,  other  asset  valuation
allowances and certain liabilities.  Management periodically re-evaluates the
estimates  inherent in certain financial statement amounts, and may  adjust
accordingly.  Actual results could differ from the estimates.

NOTE C - CHANGE IN ACCOUNTING ESTIMATE

In connection with a review of depreciable lives, the Company determined
that certain classes of patient service equipment would continue in service
beyond the economic lives over which they were being depreciated.
Accordingly, effective July 1, 1996 the lives for certain assets were
extended.  The effect of the increased lives was an increase to net income
of $2,064,000 and an increase to earnings per share of $.04.


NOTE D - INCOME TAXES

Income taxes have been provided at the effective tax rate expected for  the
year.  The Company's effective tax rate differs from the statutory rate  as
a  result of state income taxes (net of federal benefit) and the use of net
operating loss carryforwards.


NOTE E - ACQUISITIONS

The Company periodically makes acquisitions of complementary businesses  in
specific  geographic  markets.  Acquisitions that closed  during  the  nine
month  period  ended  September  30, 1996  resulted  in  cash  payments  of
approximately $13,015,000.

NOTE F - RESTRUCTURING COSTS

In  connection  with the merger, the Company adopted a plan to  restructure
and consolidate its operating locations and administrative functions within
specific  geographic  areas.   The plan, which is  substantially  complete,
resulted  in  a  restructuring charge in 1995 of approximately  $68,304,000
consisting   of  accrued  costs  and  impairments.   The  following   table
summarizes  amounts  paid  through September 30,  1996  and  the  remaining
accrual at September 30, 1996.

Accrual at December 31, 1995                          $19,085,000
Severance amounts paid through September 30, 1996      (7,248,000)
Other amounts paid through September 30, 1996          (3,772,000)
                                                       ----------
Accrual at September 30, 1996                          $8,065,000
                                                       ==========

The   remaining  accrual  balance  consists  primarily  of  $1,861,000  for
severance and related personnel costs and $6,097,000 for branch and billing
center closure costs.

NOTE G - TERMINATION OF AGREEMENT AND PLAN OF MERGER

On June 28, 1996, the Company entered into an agreement to merge with Vitas
Healthcare Corporation, the nation's largest hospice provider.  On November
13,  1996,  the  Company  announced that it had  exercised  its  rights  to
terminate  the merger agreement.  The Company expects to recognize  between
$4,000,000 and $8,000,000 in merger-related costs in the fourth quarter.

NOTE H - LONG-TERM DEBT

Effective  August  9, 1996, the Company entered into an  agreement  with  a
syndicate  of  banks which provides for borrowings of up  to  $800,000,000.
The  agreement is structured as an unsecured, five-year revolving  line  of
credit,  which  provides for variable rate interest options  including  the
higher of the Federal Funds Rate plus 0.5% per annum or the Bank of America
"reference"  rate,  or  a rate based on the London Interbank  Offered  Rate
("LIBOR")  plus an additional increment of 1.0% per annum, which  increment
may  be  reduced  to as little as 0.35% per annum, if the Company  achieves
certain  targeted  ratios  of  debt  to earnings  before  interest,  taxes,
depreciation   and   amortization.    The   agreement   contains   numerous
restrictions  including,  but  not  limited  to,  covenants  requiring  the
maintenance   of  certain  financial  ratios,  limitations  on   additional
borrowings, capital expenditures, mergers, acquisitions and investments and
restrictions on cash dividends, loans and other distributions.

In  August 1996, the Company entered into two one-year swap agreements: one
for  $280,000,000 of notional principal with a fixed interest rate of 5.69%
and  one for $100,000,000 of notional principal with a fixed interest  rate
of 5.59%.  Both agreements were canceled in October 1996 and replaced with:
an  18-month agreement covering $280,000,000 of notional principal  with  a
fixed interest rate of 5.73% and a two-year agreement covering $100,000,000
of notional principal with a fixed interest rate of 5.55%.  Both agreements
allow  the  counterparty an option to terminate after one  year,  with  the
$280,000,000  swap  terminating in February 1998 and the $100,000,000  swap
terminating  in  November 1998 if these options  are  not  exercised.   The
receipt  or  payment of the interest differential is settled  and  recorded
monthly in the financial statements as an adjustment to interest expense.

NOTE I - EQUITY

The  change  in stockholders' equity, other than from net income,  resulted
from shares issued under the employee stock purchase plan, the exercise  of
stock   options   and   the  tax  benefit  associated  with   disqualifying
dispositions of incentive stock options and exercises of nonqualified stock
options.   For the nine months ended September 30, 1996, shares  valued  at
$451,000 were issued under the employee stock purchase plan, proceeds  from
the  exercise of stock options amounted to $14,385,000 and the related  tax
benefit amounted to $9,475,000.

NOTE J - COMMITMENTS AND CONTINGENCIES

The  Company  is  engaged  in the defense of certain  claims  and  lawsuits
arising out of the ordinary course and conduct of its business, the outcome
of  which  are  not determinable at this time.  The Company  has  insurance
policies  covering  such  potential losses  where  such  coverage  is  cost
effective.   In  the  opinion of management, any liability  that  might  be
incurred  by  the Company upon the resolution of these claims and  lawsuits
will  not,  in  the  aggregate,  have a  material  adverse  effect  on  the
consolidated results of operations or financial position of the Company.
<PAGE>

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS


Results of Operations
---------------------

      Net  revenues increased 10.2% to $306.0 million for the third quarter
of  1996  compared with $277.7 million for the same quarter  of  the  prior
year.   For  the  nine months ended September 30, 1996, net  revenues  were
$907.9  million  compared with $849.6 million for the same  period  of  the
prior  year,  representing a 6.9% increase. Infusion  therapy,  respiratory
therapy and medical equipment/other grew at rates of 22.0%, 2.4% and 16.5%,
respectively,  for  the third quarter of 1996, and 8.6%,  3.5%  and  12.8%,
respectively,  for  the  nine months ended September  30,  1996,  over  the
comparable   1995   periods.    Growth  in   the   infusion   and   medical
equipment/other lines of business is due to volume increases  primarily  in
managed  care  markets and to a lesser extent traditional  markets.   Also,
since  the  beginning of the year, the sales force has  been  fully  cross-
trained to more adequately represent all business lines with special  focus
on  infusion  expertise.   The minimal growth  in  respiratory  revenue  is
attributable  to  the  disruptions caused by  facility  consolidations  and
system  conversions  following the Abbey/Homedco  merger  ("the  merger").
Revenues from all service lines were negatively impacted by a higher  level
of revenue adjustments in the third quarter.  Revenue adjustments increased
by  approximately  $5.0 million over each of the prior two  quarters  as  a
result of intensified accounts receivable collection efforts.  Management 
believes its long-term  growth opportunities will continue to be strong in
managed  care markets; however, sales efforts for the fourth quarter and into
fiscal year 1997  will  concentrate on the development of business from 
non-discounted, traditional referral/payor sources, such as physicians and 
hospitals.

      Gross margin percentages for the third quarter and nine months  ended
September 30, 1996, were 69.3% and 68.6%, respectively, compared with 64.4%
and  67.9% for the same periods of 1995.  The increases represent  the  net
effect  of  increased  revenue adjustments  in  the  third  quarter  and  a
reduction in cost of sales of approximately $3.2 million resulting  from  a
change  in  the  depreciable lives of certain classes  of  patient  service
equipment.  The change in depreciable lives was made as of July 1, 1996 and
resulted  from management's determination that certain classes  of  patient
service equipment would continue in service beyond the economic lives  over
which  they  were  being depreciated.  Approximately $2.9  million  of  the
reduction to cost of sales is attributable to a single asset type for which
the  depreciable  life was extended from four to twelve months.   The  1995
gross  margins  were negatively impacted by an adjustment of  $5.4  million
necessary  to conform the accounting policies of the predecessor  companies
for  certain low dollar patient service items, supplies and accessories and
a  $7.5 million provision for excess and obsolete patient service equipment
and  shrinkage  associated  with  the  facility  consolidations.   Further,
participation  in  the managed care system requires  a  broad  offering  of
products  and services, including lower-margin services, medical  equipment
and  supplies.   The intense competition in these markets has  also  caused
some  price  compression.  To mitigate the effect  of  these  factors,  the
Company has implemented various initiatives to reduce its operating  costs,
has  instituted  sales force incentives on certain products that  typically
return  higher margins and has implemented a review program to ensure  that
contracted  business meets minimum levels of profitability.  Also,  in  the
third quarter of 1996, the Company established automated purchasing budgets
to  better  control the purchase and use of patient service  equipment  and
supplies.  The use of the purchasing budgets contributed to a reduction  of
approximately  $7.0 million in purchases of patient service  equipment  and
supplies in the third quarter as compared to the second quarter of 1996.

      The provision for doubtful accounts as a percent of net revenues  for
the  third  quarter and nine months ended September 30, 1996 was  4.9%  and
4.7%,  respectively, compared with 17.2% and 8.7% for the same  periods  of
1995.   The  1995 provision was impacted by an adjustment of  approximately
$26.3  million  to  provide  for  an  impairment  in  a  certain  class  of
receivables.

      Selling, distribution and administrative expenses as a percent of net
revenues  for the third quarter and nine months ended September  30,  1996,
were  48.2% and 47.7%, respectively, compared with 58.2% and 53.4% for  the
same  periods  last  year. The 1995 expenses included  various  integration
costs  associated with the merger.  Such costs included relocation, travel,
temporary  help and overtime.  Further improvement in selling, distribution
and  administrative  expenses  is  being realized  due  to  the  successful
execution  of  the  restructuring  and  consolidation  plan  initiated   in
conjunction with the merger.  The primary sources of the savings associated
with   the   plan  are  the  completed  employee  reductions  and  facility
consolidations.

      Also contributing to the improvement in operating income in the  1996
periods  is  the absence of certain charges recorded during the  comparable
periods  in 1995.  The nine month period ended September 30, 1995  included
charges of $76.5 million, $12.2 million and $23.5 million for restructuring
costs,  merger  costs,  and  employee  contract,  benefit  plan  and  claim
settlements, respectively.

     Interest expense increased for the third quarter and nine months ended
September 30, 1996, to $12.8 million and $35.9 million, respectively,  from
$10.2  million  and  $32.0  million for the same  periods  last  year.  The
increase  is primarily due to an increase in long-term debt (see  Liquidity
and  Capital Resources).  In August 1996, the Company entered into two  new
swap  agreements  to  fix the interest rate on $380.0 million  of  notional
principal.   In  October 1996, both agreements were canceled  and  replaced
with new agreements having similar terms and extended effective periods.

     Income tax expense amounted to $11.7 million and $35.4 million in
the third quarter and nine months ended September 30, 1996, respectively as
compared to an income tax benefit of $32.0 million and $18.9 million for the
same periods in the prior year.  The change between the years is due
primarily to the Company's return to profitable operations in 1996.



Liquidity and Capital Resources
-------------------------------

      Cash  used in the Company's operating activities for the nine  months
ended September 30, 1996, was $63.1 million, compared with $8.5 million for
the  same period in the prior year.  The primary contributor to the use  of
cash was the increase in accounts receivable.

     Accounts receivable, before allowance for doubtful accounts, increased
by $138.9 million during the nine months ended September 30, 1996.  In
addition, days sales outstanding increased from 109 days at December 31,
1995 to 129 days at September 30, 1996.  These conditions are primarily
attributable to disruptions and delays in billing and collection activity
associated with the Company's conversion of all field locations to a
standardized information system and, to a lesser degree, to the continuing
impact of facility consolidations and employee reductions made in late 1995
and early 1996 in connection with the Company's restructuring and
consolidation plan.  Of the 445 planned information system conversions,
about 50% were completed by December 31, 1995.  The remaining conversions
were completed by September 30, 1996, with 43, 125 and 50 effected in the
first, second and third quarters, respectively.   These activities
contributed to billing delays and, ultimately, difficulties in receiving
timely reimbursement.  The conversion of a field information system to the
standard system requires from one to four weeks, depending on facility
size, for conversion and employee training, during which time billing and
collection activity is substantially curtailed.  After conversion and
training is complete, billing and collection activity generally resumes at
a slower pace than pre-conversion levels but normalizes within six to nine
months.  To help mitigate the impact of the conversion disruptions, the
Company has, among other steps, initiated collection incentive programs
with special emphasis on older accounts and assembled an accounts
receivable task force and hired additional management personnel to ensure
proper billing and collection practices are being followed. In addition,
commencing in the fourth quarter of 1996, the Company initiated
reinforcement training programs for the billing locations.

     Cash collections at locations that were converted in 1995 and early
1996 have improved recently and are expected to continue to improve in the
fourth quarter.  Because of the significant number of conversions completed
in the second and third quarters of 1996 a return to routine processing and
normal collection time frames on a company-wide basis is not expected until
mid-1997. As a result, the Company's accounts receivable aging may
experience further deterioration and, ultimately, realization may be
impacted.  Management has been carefully monitoring the accounts receivable
conditions, believes the current slowdown in collections is temporary and
is confident that the programs initiated and other steps taken will result
in improved collections and aging of accounts receivable. 
Under the circumstances, management believes that the recorded allowance
for doubtful accounts is adequate at September 30, 1996.  However, if
conditions and trends in the fourth quarter vary negatively from
management's expectations and the programs and steps taken to enhance
collection activity do not achieve their intended results, it is reasonably
possible that the Company's allowance for doubtful accounts will be
increased and the increase could be significant.

      The  Company centralized its accounts payable function in  connection
with  the restructuring and consolidation plan. The centralization  process
disrupted  day-to-day  activities causing a processing  backlog  which  was
reflected in the accounts payable balance at December 31, 1995.  During the
first  two  quarters  of  1996, the backlog was  substantially  eliminated,
resulting in significant outlays of cash.

      Other  factors  contributing to the use  of  cash  and  corresponding
increase  in  long-term  debt include purchases  of  resale  inventory  and
patient  service  equipment to support business growth  and  payments  made
against  the  restructuring cost accrual, comprised primarily of  severance
and  trailing  facility  costs.  Such payments  are  expected  to  continue
through   the  year  2000,  according  to  contractual  terms.   Additional
expenditures    were    made   to   support   the    information    systems
conversions/enhancements  and  facility  consolidations,  resulting  in   a
corresponding  increase  to  property, plant  and  equipment.   Income  tax
refunds  of  $5.0  million  were  received  in  1996.   In  addition,   the
application of prior year payments and alternative minimum tax  credits  to
current  year  estimated tax requirements reduced cash outlays  for  income
taxes by $22.0 million.

      On June 28, 1996, the Company entered into an agreement to merge with
Vitas  Healthcare Corporation, the nation's largest hospice  provider.   On
November  13, 1996, the Company announced that it had exercised its  rights
to  terminate the merger agreement.  Aproximately $4.0 to $8.0  million  in
merger-related costs will be expensed in the fourth quarter.

     Effective August 9, 1996, the Company entered into an agreement with a
syndicate  of banks which provides for borrowings of up to $800.0  million.
The  agreement is structured as an unsecured, five-year revolving  line  of
credit,  which  provides for variable rate interest options  including  the
higher of the Federal Funds Rate plus 0.5% per annum or the Bank of America
"reference"  rate,  or  a rate based on the London Interbank  Offered  Rate
("LIBOR")  plus  up  to  1.0% per annum. The LIBOR  option  is  subject  to
discount  if  the  Company  achieves certain targeted  ratios  of  debt  to
earnings  before  interest,  taxes,  depreciation  and  amortization.   The
agreement  contains numerous restrictions including, but  not  limited  to,
covenants   requiring   the  maintenance  of  certain   financial   ratios,
limitations  on  additional  borrowings,  capital  expenditures,   mergers,
acquisitions and investments and restrictions on cash dividends, loans  and
other  distributions.   Loan proceeds will be  used  to  meet  the  working
capital needs of the Company.

     Management believes that amounts available under the new credit
facility and cash provided by operations will be sufficient to finance its
operations for at least the next 12 months.  At September 30, 1996,
availability under the credit facility was $394.0 million.

<PAGE>

PART II. OTHER INFORMATION
--------------------------

Item 1.   Legal Proceedings
          -----------------

               Class Action Lawsuit:  On October 7, 1994, Barbara Nowack,
          who claims to have purchased 100 shares of Abbey Common Stock on
          June 16, 1994, filed a class action complaint ("Complaint") on
          behalf of herself and all other persons who purchased or sold the
          Company's Common Stock during the period of September 7, 1993
          through June 16, 1994 ("Class Period") in the United States
          District Court for the Central District of California ("District
          Court") asserting federal securities fraud claims against the
          Company, certain of its directors and officers and certain former
          directors and officers of Total Pharmaceutical Care, Inc.
          ("TPC").

               The Complaint alleges that the defendants knowingly and
          recklessly disseminated false and misleading statements and
          reports with respect to the Company, its financial condition and
          future prospects, in particular, as it is related to the
          acquisition and integration of TPC.  The Complaint also alleges
          that the defendants violated Section 10(b) of the Exchange Act
          and Rule 10b-5 promulgated thereunder, and in addition, that the
          individual defendants have asserted claims against the Company,
          pursuant to the bylaws of the Company and TPC, for advancement of
          expenses and indemnification.

               On January 17, 1995, an amended Complaint was filed
          substituting for the plaintiff, Arthur Kapit and Joseph Opich,
          shareholders who claim to have purchased 1,200 shares and 400
          shares, respectively, of the Company's Common Stock during the
          Class Period.  On February 12, 1996, the Court granted
          plaintiff's Motion for Class Certification.  On October 11, 1996,
          the District Court preliminarily approved a Stipulation of
          Settlement signed by the parties and dated August 8, 1996.  Final
          approval of the settlement of the action is subject to the
          District Court's consideration at a hearing scheduled to take
          place on December 17, 1996.

               The settlement amount totaled $20.5 million, $16.5 of which
          was paid by insurance carriers.  The Company's portion of the
          settlement was paid in the third quarter and charged to
          previously established reserves and, accordingly, had no impact
          on the results of operations for the period.  The Company expects
          to incur related legal fees of approximately $3 million, which
          will be paid and expensed in the fourth quarter.

               Qui Tam Lawsuit:  The Company is one of nine named
          defendants in a qui tam lawsuit, which was filed under seal in
          the Northern District of Georgia on August 23, 1995, by Mark
          Parker, a former employee, and served on the Company on May 31,
          1996.  The suit alleges that the Company violated the Civil False
          Claims Act by paying illegal kickbacks to certain health care
          providers in exchange for patient referrals.  The suit also
          alleges that the Company violated the False Claims Act by
          improperly generating "Certificates of Medical Necessity" for
          certain products, including oxygen and low air-loss beds, and
          providing free benefits, such as pulmonary function testing and
          pulse oximetry testing, to certain physicians.  Finally, the suit
          alleges that Mr. Parker's employment was improperly terminated in
          violation of the whistleblower protection provisions of the False
          Claims Act.

               Prior to the service of the lawsuit, the United States
          Department of Justice investigated Mr. Parker's allegations and
          the Company fully cooperated with that investigation.  On June
          27, 1996, the United States intervened in the suit, and on July
          10, 1996, it filed an amended complaint, in which it essentially
          joined Mr. Parker's allegations concerning illegal kickbacks, but
          declined to join any of the other allegations.  In conjunction
          with the qui tam action, a grand jury also is investigating
          allegations contained in the qui tam complaint.  Potential
          remedies under the Civil False Claims Act include recovery of any
          actual damages suffered by the government, statutory fines of up
          to $10,000 per false claim, and certain other remedies.  The
          grand jury investigation could result in the imposition of
          administrative, civil or criminal fines or penalties or
          restitutionary relief.

               The Company intends to defend vigorously against the
          allegations.  In that regard, on July 25, 1996, the Company filed
          a motion to dismiss the qui tam lawsuit, and that motion
          currently is pending.  The Company has also recently engaged in
          preliminary settlement discussions with representatives of the
          Department of Justice.  Regardless of the outcome of the motion
          to dismiss and the settlement discussions the Company believes
          that the ultimate resolution of the qui tam lawsuit and the grand
          jury investigation will not have a material adverse effect on the
          consolidated results of operations or financial position of the
          Company.

Item 2-5. Not applicable


Item 6.   Exhibits and Reports on Form 8-K
          --------------------------------

          (a)  Exhibits:

               Exhibit
               Number    Description and Reference
               -------   -------------------------
               2.5       Agreement and Plan of Merger, dated as of June 28,
                         1996, and amended by an Amendment No. 1 dated  as
                         of August 26,  1996  and   an  Amendment
                         No. 2    dated    as of October 4, 1996 to the
                         Agreement and Plan of Merger, among Apria Healthcare
                         Group Inc., Apria Number Two, Inc. and Vitas
                         Healthcare Corporation.  Incorporated by reference 
                         to Apria Healthcare Group Inc.'s Registration Statement
                         on Form S-4 (Registration No. 333-09407), as filed
                         with the Securities and Exchange Commission on 
                         August 1, 1996 and amended by Amendment No. 1 
                         to Form S-4 filed August 27, 1996, and further 
                         amended by Amendment No. 3 to Form S-4 filed 
                         October 7, 1996.

               10.58     Credit Agreement, dated as of August 9, 1996,
                         between Apria Healthcare Group Inc. and certain
                         of its subsidiaries, Bank of America National
                         Trust and Savings Association, Nationsbank of
                         Texas, N.A. and other financial institutions party
                         to the Credit Agreement.  Incorporated by
                         reference to Apria Healthcare Group Inc.'s
                         Registration Statement on Amendment No. 1 to Form
                         S-4 (Registration No. 333-09407), as filed with
                         the Securities and Exchange Commission on August
                         27, 1996.

               10.59     Guaranty, dated as of August 9, 1996, made by
                         Apria Healthcare Group Inc., Apria Healthcare,
                         Inc., Apria Number One, Inc., Apria Number Two,
                         Inc., Protocare of Metropolitan New York, Inc. and
                         Homedco of New York State, Inc. in favor of Bank
                         of America National Trust and Savings Association.
                         Incorporated by reference to Apria Healthcare
                         Group Inc.'s Registration Statement on Amendment
                         No. 1 to Form S-4 (Registration No. 333-09407), as
                         filed with the Securities and Exchange Commission
                         on August 27, 1996.

               10.62     Standard Industrial/Commercial Single Tenant
                         Lease, dated September 1, 1996, by and between St.
                         Louis Partnership #4, L.P., and Apria Healthcare,
                         Inc. for the premises at 8248 Lackland Road,
                         St. John, Missouri.

               11.1      Statement of Computation of Earnings per Share.

               27.1      Financial Data Schedule.

          (b)  Reports on Form 8-K:

               No reports on Form 8-K were filed during the
               quarter for which this report is filed.

<PAGE>
                                     
                                SIGNATURES




Pursuant  to the requirements of the Securities Exchange Act of  1934,  the
registrant  has duly caused this report to be signed on its behalf  by  the
undersigned thereunto duly authorized.


                               APRIA HEALTHCARE GROUP INC.
                              ------------------------------
                                        Registrant



November 14, 1996             /s/  Lawrence H. Smallen
                              ------------------------------
                              Lawrence H. Smallen
                              Chief Financial Officer,
                              Senior Vice President, Finance
                              and Treasurer
                              (Principal Financial Officer)