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 March 31, 1998
                                    
                                   OR

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

                    Commission File Number:  1-14316
                                    
                                    
                       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  51,724,059  shares  of  Common  Stock,  $.001  par   value,
outstanding at May 12, 1998.

<PAGE>

                       APRIA HEALTHCARE GROUP INC.
                                    
                                FORM 10-Q
                                    
                   For the period ended March 31, 1998
                                    





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>
                                                  March 31,  December 31,
                                                     1998       1997
                                                  ---------  -----------
                                                 (unaudited)
                        ASSETS                    (dollars in thousands)

<S>                                              <C>         <C>
CURRENT ASSETS
  Cash                                           $   45,463  $   16,317
  Accounts receivable, less allowance 
  for doubtful accounts of $50,497 and  
  $58,413 at March 31, 1998 and December 
  31, 1997,  respectively                           229,756     256,845
  Inventories                                        25,269      26,082
  Prepaid expenses and other current assets           8,768      12,329
                                                 ----------   --------- 
          TOTAL CURRENT ASSETS                      309,256     311,573
PATIENT SERVICE EQUIPMENT, less accumulated
  depreciation of $255,360 and $245,772 at 
  March 31, 1998 and December 31, 1997, 
  respectively                                      172,674     184,704
PROPERTY, EQUIPMENT AND IMPROVEMENTS, NET            83,951      87,583
INTANGIBLE ASSETS, NET                              167,915     167,620
OTHER ASSETS                                          1,484       5,690
                                                 ----------   ---------
                                                 $  735,280  $  757,170
                                                 ==========  ==========                                    
       LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Accounts payable                               $   48,667  $   50,691
  Accrued payroll and related taxes 
  and benefits                                       25,990      40,397
  Accrued insurance                                  12,354      12,247
  Other accrued liabilities                          33,056      30,463
  Current portion of long-term debt                   7,943       8,685
                                                 ----------  ----------
          TOTAL CURRENT LIABILITIES                 128,010     142,483
LONG-TERM DEBT                                      537,879     540,220

STOCKHOLDERS' EQUITY
  Preferred Stock, $.001 par value:  
    10,000,000 shares authorized;
    none issued                                           -           -
  Common Stock, $.001 par value:  
    150,000,000 shares authorized;
    51,724,059 and 51,568,525 shares 
    issued and outstanding at March 31, 
    1998 and December 31, 1997, 
    respectively                                         52          51
  Additional paid-in capital                        325,620     324,090
  Retained deficit                                 (256,281)   (249,674)
                                                 ----------   ---------
                                                     69,391      74,467
COMMITMENTS AND CONTINGENCIES                             -           -
                                                 ----------   ---------
                                                 $  735,280  $  757,170
                                                 ==========  ==========
</TABLE>
             See notes to consolidated financial statements.

<PAGE>
<TABLE>
                       APRIA HEALTHCARE GROUP INC.
                                    
                  CONSOLIDATED STATEMENTS OF OPERATIONS
                               (unaudited)
<CAPTION>
                                                     Three Months Ended
                                                          March 31,
                                                      1998        1997
                                                    ---------  --------- 
                                                    (dollars in thousands,
                                                    except per share data)

<S>                                                  <C>        <C>
Net revenues                                         $250,538   $313,863
Costs and expenses:
   Cost of net revenues                                85,858    104,679
   Selling, distribution and administrative           141,946    147,312
   Provision for doubtful accounts                     13,795     15,764
   Amortization of intangible assets                    3,564      4,198
                                                     --------   --------
                                                      245,163    271,953
                                                     --------   --------
          OPERATING INCOME                              5,375     41,910
Interest expense                                       11,482     12,759
                                                     --------   --------
          (LOSS) INCOME BEFORE TAXES                   (6,107)    29,151
Income taxes                                              500      9,911
                                                     --------   --------
          NET (LOSS) INCOME                          $ (6,607)  $ 19,240
                                                     ========   ========



Net (loss) income per common share                     $(0.13)    $ 0.38
                                                       ======     ======

Net (loss) income per common share -
  assuming dilution                                    $(0.13)    $ 0.37
                                                       ======     ======

</TABLE>
             See notes to consolidated financial statements.
        
<PAGE>
<TABLE>
                   APRIA HEALTHCARE GROUP INC.
                                    
                  CONSOLIDATED STATEMENTS OF CASH FLOWS
                               (unaudited)

<CAPTION>
                                                      Three Months Ended
                                                            March 31,
                                                     --------------------
                                                       1998      1997
                                                     --------   --------
                                                    (dollars in thousands)

<S>                                                 <C>         <C>
OPERATING ACTIVITIES
Net (loss) income                                   $ (6,607)   $ 19,240
Items included in net income not 
  requiring (providing) cash:
  Provision for doubtful accounts                     13,795      15,764
  Provision for excess/obsolete equipment              3,947           -
  Depreciation                                        27,435      29,947
  Amortization of intangible assets                    3,564       4,198
  Amortization of deferred debt costs                    380         279
  Gain on disposition of assets                          (52)       (437)
  Deferred income taxes                                    -       1,437
Changes in operating assets and liabilities, 
  net of effects of acquisitions:
  Decrease (increase) in accounts receivable          13,564     (47,493)
  Increase in inventories                             (3,074)     (2,290)
  Decrease in prepaids and other assets                3,665      20,751
  Decrease in accounts payable                        (2,024)     (9,384)
  Decrease in accruals and other liabilities         (11,748)    (10,516)
Net purchases of patient service equipment, 
   net of effects of acquisitions                     (7,353)    (19,515)
                                                    --------    -------- 
          NET CASH PROVIDED BY 
          OPERATING ACTIVITIES                        35,492       1,981

INVESTING ACTIVITIES
  Purchases of property, equipment 
    and improvements, net of effects 
    of acquisitions                                   (3,445)     (6,800)
  Proceeds from disposition of assets                     68       5,249
  Acquisitions and payments of contingent 
    consideration                                       (745)       (732)
                                                    --------    -------- 
          NET CASH USED IN INVESTING ACTIVITIES       (4,122)     (2,283)

FINANCING ACTIVITIES
  Proceeds under revolving credit facility                 -      57,800
  Payments under revolving credit facility                 -     (65,250)
  Payments of senior and other long-term debt         (2,705)     (3,059)
  Capitalized debt costs, net                         (1,018)          -
  Issuances of Common Stock                            1,499       1,590
                                                    --------    --------
          NET CASH USED IN FINANCING ACTIVITIES       (2,224)     (8,919)
                                                    --------    --------

NET INCREASE (DECREASE) IN CASH                       29,146      (9,221)
Cash at beginning of period                           16,317      26,930
                                                    --------    --------
CASH AT END OF PERIOD                               $ 45,463    $ 17,709
                                                    ========    ========

</TABLE>
             See notes to consolidated financial statements.
<PAGE>                            
      

                      APRIA HEALTHCARE GROUP INC.
                                    
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE A - 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.

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, 1997, filed  with  the
Company's 1997 Form 10-K.

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  these
estimates.

NOTE C - INCOME TAXES

Current income tax expense reflects state tax amounts accrued and paid on
a basis other than or in addition to taxable income.

NOTE D - BUSINESS COMBINATIONS AND DISPOSITIONS

The  Company periodically makes acquisitions of complementary  businesses
in  specific  geographic markets.  Acquisitions that  closed  during  the
three-month  period  ended March 31, 1998 resulted in  cash  payments  of
approximately $720,000.

NOTE E - PER SHARE AMOUNTS

     The following table sets forth the computation of basic and diluted
per share amounts:
<TABLE>
<CAPTION>

                                                      Three Months Ended
                                                           March 31,
                                                     -------------------
                                                       1998       1997
                                                     --------   -------- 
                                                    (in thousands, except
                                                       per share data)
(s)                                                  <C>        <C>
     Numerator:
        Net (loss) income                            $(6,607)   $19,240
        Numerator for basic per share 
          amounts - income available 
          to common stockholders                     $(6,607)   $19,240

        Numerator for diluted per share 
          amounts - income available to 
          common stockholders                        $(6,607)   $19,240

     Denominator:
        Denominator for basic per share
          amounts - weighted average shares           51,654     51,261

        Effect of dilutive securities:
          Employee stock options                           -        658
                                                     -------    -------
          Dilutive potential common shares                 -        658
                                                     -------    -------
        Denominator for diluted per share 
          amounts - adjusted weighted average 
          shares                                      51,654     51,919
                                                     =======    =======

     Basic (loss) earnings per share amounts          $(0.13)    $ 0.38
                                                      ======     ======  
     Diluted (loss) earnings per share amounts        $(0.13)    $ 0.37
                                                      ======     ====== 

     Employee stock options excluded from 
       the computation of diluted per share 
       amounts:

         Exercise price exceeds average 
           market price of Common Stock            2,154,265  1,338,387
         Other                                       155,395          -
                                                   ---------  ---------
                                                   2,309,660  1,338,387
                                                   =========  =========

     Average exercise price per share 
       that exceeds average market price 
       of Common Stock                                $19.15     $21.66
                                                      ======     ======
</TABLE>
      Due  to the net loss incurred for the three months ended March  31,
1998,  the  impact  of  employee stock options is antidilutive  for  that
period  and  there is no difference between basic and diluted  per  share
amounts.

NOTE F - EQUITY

The  change  in stockholders' equity, other than from net loss,  resulted
primarily from the exercise of stock options.  For the three months ended
March  31, 1998, proceeds from the exercise of stock options amounted  to
$1,499,000.

NOTE G - COMMITMENTS AND CONTINGENCIES

The Company is engaged in the defense of certain claims and lawsuits, 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 (see Item 1 of Part II).

<PAGE>

CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995:  The Company's business
is  subject to a number of risks, some of which are beyond the  Company's
control.   The Company has described certain of those risks in  its  Form
10-K  for  the  fiscal year ended December 31, 1997,  as  filed  with  the
Securities and Exchange Commission on April 15, 1998.  Such report may be
used for purposes of the Private Securities Litigation Reform Act of 1995
as   a   readily  available  document  containing  meaningful  cautionary
statements identifying important factors that could cause actual  results
to   differ  materially  from  those  projected  in  any  forward-looking
statements  the Company may make from time to time.  These risks  include
ongoing  issues  pertaining to management stability and  recruiting,  the
collectibility  of  its accounts receivable, healthcare  reform  and  the
effect  of  federal  and state healthcare regulations, pricing  pressures
(including   changes   in   governmental   reimbursement   levels),   the
effectiveness of its information systems, the highly competitive  market,
recent   losses,  the  concentration  of  large  payors,  dependence   on
relationships  with third parties and the availability  and  adequacy  of
insurance.


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

     Background:  In June 1997, the Company announced that it retained an
investment  banking  firm as its financial advisor to  explore  strategic
alternatives  to enhance shareholder value, including the possible  sale,
merger, or recapitalization of the Company.  During the first quarter  of
1998,  the  Company  entered  into an agreement  for  a  recapitalization
transaction,  however, the agreement was terminated by mutual  consent  of
the  parties  on  April  3, 1998.  At this time, the  Company's  ultimate
course  of action has not been determined (see Recent Developments).  The
process  has given rise to uncertainty, the impact of which is  difficult
to  determine,  but  which has probably affected the Company's  financial
results adversely.

      In  June  1997, the Company decided to reemphasize its  traditional
referral-based  business and to focus more fully  on  the  core  business
lines   of  respiratory  therapy,  infusion  therapy  and  home   medical
equipment.   To  this end, the Company began efforts  to  renegotiate  or
terminate   certain   managed   care  contracts   not   meeting   minimum
profitability thresholds, as well as to exit certain lower-margin service
lines, including medical supplies, women's health and nursing management.
A  consequence of both of these initiatives was the loss of higher-margin
related business.

     Net  Revenues:  Net revenues were $250.5 million for the three-month
period  ended  March 31, 1998 compared with $313.9 million for  the  same
period  last  year.   A  number  of factors impacted  revenue,  the  most
significant  of which was the reduction in Medicare reimbursement  rates.
The  Balanced  Budget Act of 1997 contained several provisions  affecting
reimbursement  rates for products and services provided by  the  Company.
The  reimbursement  rates for home oxygen services were  reduced  by  25%
effective  January 1, 1998 with an additional 5% reduction scheduled  for
1999,  and the reimbursement rates for respiratory drugs were reduced  by
5%.   Also  included in the Balanced Budget Act of 1997 was a  freeze  on
Consumer Price Index-based reimbursement rate increases for 1998  through
2002.   The  estimated  impact of the rate reductions  on  first  quarter
revenues was approximately $15.4 million.
     
     The  strategic  decisions discussed above also  contributed  to  the
decline  in revenues from the first quarter of 1997 to the first  quarter
in  1998.   The  discontinued service lines of medical supplies,  women's
health  and  nursing management represented combined annual  revenues  of
approximately  $55.8  million.  Some portion of the  medical  supply  and
nursing  management  business is expected to  continue  due  to  customer
requirements.   The  Company  exited  contracted  business   representing
approximately $25 million and $8.5 million in annual revenues during 1997
and  during  the first quarter of 1998, respectively.  Also, the  Company
disposed  of  several  unprofitable branch locations  in  California  and
Arizona  in the latter part of 1997 with annual revenues of approximately
$3.3 million.
     
     Other  conditions and factors had an adverse impact on net revenues,
but  are  difficult to quantify.  First, the process discussed  above  to
identify a strategic alternative to enhance shareholder value has created
uncertainties  which  adversely  affected  revenues.   Next,   formidable
competition  at both the local and national levels has affected  revenues
and  margins,  especially in the infusion line.  Finally, a shortage in
trained sales personnel also contributed to the decrease in revenues.

      During  the  first quarter of 1998, the Company undertook  numerous
initiatives to restore quality, or higher-margin, revenue growth.   These
included  streamlining  and standardizing its  managed  care  contracting
procedures,  increasing  the  size and  strength  of  the  field  selling
organization,  introducing new sales commission programs based  on  gross
profit  contribution  and assembling an infusion therapy  task  force  to
evaluate  that  business  line  and implement  new  sales  and  marketing
programs.

     Gross  Profit:   Gross margins for the first quarter  of  1998  were
65.7%,  compared  to 66.6% for the first quarter of  1997.   The  primary
cause for the decrease is the Medicare reimbursement rate reduction.   If
the effect of this reduction is eliminated, the gross margin for the 1998
period actually improved.  In addition to the above-discussed strategy to
renegotiate  or  exit  unprofitable contracts  and  business  lines,  the
Company adopted other initiatives to reduce costs and  improve  its
gross  margins.   Controls  placed on the purchase  and  use  of  patient
service  equipment resulted in a $12.2 million reduction in net purchases
in  the first quarter of 1998 as compared to the same quarter last  year.
Also,  the  phasing  out of subrented patient service  equipment  reduced
expenditures  between the two quarters by $3.7 million.  In  addition  to
the  initiatives listed above that focus on quality revenue  growth  (see
Net  Revenues), the Company continues to seek opportunities to reduce its
costs to improve its gross margins.
     
     Selling, Distribution and Administrative:  Selling, distribution and
administrative  expenses as a percentage of net revenues were  56.7%  for
the first quarter in 1998 and 46.9% for the same period last year.  On  a
dollar basis, selling, distribution and administrative expenses decreased
by  $5.4 million, however, the rate of decrease was not commensurate with
the  rate  of the decrease in net revenues.  In response to the reduction
in  revenues,  Management  has taken steps  to  reduce  costs,  the  most
significant  of which is a reduction in the Company's labor force.   From
the  end of the first quarter in 1997 to the end of the first quarter  in
1998, full-time equivalents have been reduced by approximately 600.   The
labor  force  reduction  commenced in the  fourth  quarter  of  1997  and
continued into the first quarter of 1998, therefore the full cost savings
is   not   yet  reflected  in  the  first quarter  1998  expense  totals.
Management,  along  with  the  assistance of  consultants,  is  currently
evaluating its business model, operating strategies and cost structure to
identify appropriate changes that can be made to further reduce costs and
bring operating costs in line with the lower revenue base.

     Provision  for  Doubtful  Accounts:   The  provision  for   doubtful
accounts  as  a  percentage of net revenues was 5.5% for the  three-month
period  ended March 31, 1998 as compared to 5.0% for the same  period  in
the  prior  year.   The  increase can be partially  attributable  to  the
reduction in the revenue base due to Medicare reimbursement rate changes.
The  remainder  can  be  attributed to  a  refinement  in  the  allowance
estimation  procedures  made in conjunction with the  Company's  year-end
analysis  and  audit  of accounts receivable (see Accounts Receivable).
     
     Amortization  of  Intangible  Assets:   Amortization  of  intangible
assets  was $3.6 million for the first quarter of 1998 compared  to  $4.2
million  for  the same quarter last year.  The decrease  is  due  to  the
$133.5  million write-off of impaired goodwill in the fourth  quarter  of
1997.  The resulting decrease in amortization expense was offset somewhat
by  a  reduction in the amortization period for a certain  class  of  the
Company's goodwill from 40 years to 20 years.
     
     Interest Expense:  Interest expense was $11.5 million for the three-
month period ended March 31, 1998 compared to $12.8 million for the  same
period  last year.  The decrease is due to a reduction in long-term  debt
levels  between  the two periods, as  offset  by  higher effective interest 
rates in 1998.
     
     Income Taxes:  Income tax expense for the first quarter of 1998  was
$500,000  versus $9.9 million for the same period  last  year.   The
decrease  is attributable to the corresponding decrease in pretax  income
for  the  respective  periods.  The recorded tax expense  for  the  first
quarter  of 1998 relates to state taxes payable on a basis other than  or
in addition to taxable income.
     
     
LIQUIDITY AND CAPITAL RESOURCES

      Operating Cash Flow:  Cash provided by the Company's operations for
the  first quarter of 1998 was $35.5 million versus $2.0 million for  the
same   period  last  year.   This  increase  was  achieved  despite   the
significant decrease in net income between the two periods.  The  primary
reason for the improvement in operating cash flow was the decrease in the
first quarter of 1998 in accounts receivable as compared to a significant
increase  in  the first quarter of 1997 (see Accounts Receivable).   Also
contributing  to the increase in operating cash flow was a  reduction  in
net  purchases of patient service equipment.  A $12.0 million federal tax
refund  received  in  the  first  quarter  of  1997  contributed  to  the
difference between periods.

      Accounts  Receivable:   Accounts receivable  before  allowance  for
doubtful accounts decreased by $35.0 million during the first quarter  of
1998.  The decrease is attributable to the impact of bad debt write-offs,
net  of  recoveries, totaling $21.8 million and strong cash  collections,
which represented 105% of net revenues.  The level of accounts receivable
aged in excess of 180 days at March 31, 1998 remained relatively constant
with  the  level at December 31,1997 (30.5% and 30.2% as a percentage  of
total accounts receivable, respectively).  Days sales outstanding (DSO  -
calculated  as  of each period-end by dividing accounts  receivable  less
allowance  for  doubtful accounts by the 90-day rolling  average  of  net
revenues) decreased from 87 days at December 31, 1997 to 83 days at March
31, 1998.

       Despite   indications   of  modest  improvement,   Management   is
aggressively  seeking to improve its overall revenue management  process.
The  major activities completed or in progress include the implementation
of  a  special  quality assurance function in each  branch,  designed  to
improve  workflow and billing accuracy, and the introduction of  software
enhancements  to  simplify the order-intake process  and  thereby  reduce
billing errors.

     Other  Balance  Sheet Changes: The decrease in accrued  payroll  and
related  taxes and benefits at March 31, 1998, compared to  December  31,
1997  is  due to the difference in the number of days' costs  accrued  at
each  period-end.   At  December 31, 1997,  other  assets  was  primarily
comprised  of payments for businesses acquired late in the year.   During
the  first  quarter of 1998, the payments were allocated to  the  various
underlying acquired assets.
     
     The   Company   periodically  makes  acquisitions  of  complementary
businesses  in  specific  geographic markets.  Acquisitions  that  closed
during  the three-month period ended March 31, 1998 totaled approximately
$720,000.
     
      Long-term Debt: The Company's credit agreement with a syndicate  of
banks was amended twice in 1997 and further amended in January, March and
April of 1998. Total availability under the facility was reduced from  an
original maximum of $800 million to $400 million.  Further reductions  to
$385  million, $350 million and $300 million are scheduled  for  December
31,  1998, 1999 and 2000, respectively.  As a result of these amendments,
borrowings  under  the credit agreement are secured by substantially  all
the   assets  of  the  Company.   Additionally,  amounts  available   for
acquisitions were reduced, tighter restrictions were imposed on dividends
and  other  distributions  and interest rates and  commitment  fees  were
increased.   At  March 31, 1998, availability under the credit  facility,
after  giving  consideration  to the subsequent  reduction  in  the  loan
commitment, was $51.7 million.

      Under the Indenture governing the Company's $200 million 9 1/2% Senior
Subordinated  Notes due 2002, the Company's ability to incur indebtedness
becomes  restricted  at times when the Company's "Fixed  Charge  Coverage
Ratio"  (as  defined in the Indenture) is less than 3.0 to 1.0.   Charges
taken against revenues in the second and fourth quarters of 1997 resulted
in  the  Fixed  Charge Coverage Ratio being less than 3.0 to  1.0.   This
condition is expected to continue for at least the balance of 1998.   The
Company  has  changed its cash management procedures so as to  avoid  the
need  to  incur indebtedness which would otherwise require a modification
of the terms of the Indenture and has accumulated a cash balance of $45.5
million as of March 31, 1998.  The Company believes that cash provided by
operations  will be sufficient to finance its current operations  for  at
least  the  next  12  months  or  until  the  borrowing  restriction   is
eliminated.   However,  the lack of borrowing ability  may  restrict  the
Company's ability to make major acquisitions during 1998, and the Company
may  attempt  to  obtain consent to an amendment to the  Indenture  which
would permit borrowings for acquisitions and other purposes.

     Year 2000 Issue:  As the year 2000 approaches, an issue ("Year 2000
Issue") impacting all companies has emerged regarding how existing
application software programs and operating systems can accommodate this
date value. In brief, many existing application programs in the
marketplace were designed to accommodate a two digit date position which
represents the year (e.g., "95" is stored on the system and represents
the year 1995). Consequently, the year 1999 could be the maximum date
value systems would be able to accurately process.

     Beginning in late 1997, the Company conducted a comprehensive review
of its existing computer systems, including an assessment of the nature
and potential extent of the impact of the Year 2000 Issue. As a result,
the Company has begun the modification process of its software in order
for its computer systems to function properly in the year 2000 and
thereafter. The Company is utilizing internal resources to reprogram and
test the software for the year 2000 modifications. The total cost of the
project is not expected to have a material effect on the Company's
results of operations. The project is currently on schedule and the
Company anticipates all phases of the project, including the testing and
implementation phases, to be completed by December 31, 1998. Further, the
Company's systems underwent two external assessments of the Year 2000
Issue and received a "low" risk rating.

     The Company has committed to a plan to replace its existing field
information systems with a large-scale fully integrated enterprise
resource planning system. The new system, which will be year 2000-
compliant from the outset, is not expected to be fully functional at all
locations by the beginning of the year 2000.

     Additionally, a formal process has been instituted to assess other
potential risks the Company may face in light of the Year 2000 Issue.
Examples of such issues include, but are not limited to, electronic
interfaces with external agents such as payors, banks and suppliers and
internal operational issues such as date-sensitive security systems and
elevators. Another area of potential risk is with certain patient service
equipment items that have microprocessors with date functionality which
could malfunction in the year 2000. Among other steps, the Company has
initiated formal communications with all its significant suppliers of its
patient service equipment to ensure those third parties are also working
to remediate their own year 2000 issues, if applicable. The Company
believes that it will be able to resolve these issues and any others it
may identify by the year 2000. The cost of such remediation has not yet
been quantified.

      Recent  Developments:  In April 1998, George L. Argyros, a director
and  chairman  of the board of the Company, stated in a filing  with  the
Securities  and  Exchange Commission his intentions to explore  strategic
alternatives,  including  transactions that might  involve  a  change  of
control  in the Company in which he would be a participant.  In light  of
this decision, Mr. Argyros resigned from his post as chairman, as well as
from  the  three-person  board committee formed recently  to  conduct  an
assessment  of  the Company's future course.  Mr. Argyros  remains  as  a
member of the board of directors.

     In  May  1998, the board of directors appointed Philip L. Carter  as
Chief  Executive  Officer and director of the Company.   The  board  also
appointed  Richard H. Koppes as director.  These appointments  bring  the
number of directors on the board to 11.


PART II. OTHER INFORMATION

Item 1.        Legal Proceedings

               The Company and certain of its present and former officers
          and/or   directors  are  defendants  in  three  "class  action"
          lawsuits  which allege, among other things, that the defendants
          made  false  and/or misleading public statements regarding  the
          Company  and  its financial condition in violation  of  federal
          securities laws.  Lasker v. Apria Healthcare, Inc., et al., was
          filed on or about March 5, 1998 in the U.S. District Court  for
          the Central District of California, Southern Division (Case No.
          SACV  98-217 GLT).  Miladin v. Apria Healthcare Group Inc.,  et
          al.,  was filed in the same court (Case No. SACV 98-318 AHS)  on
          or  about  April  2, 1998.  Schiller v. Apria Healthcare  Group
          Inc., et al., was filed in the same court (Case No. SACV  98-349
          GLT)  on or about April 9, 1998.  Two of the complaints purport
          to  establish a class of shareholders who purchased Apria stock
          between  March  2,  1995  and  January  20,  1998.   The  third
          complaint  purports  to establish a class of  shareholders  who
          purchased  Apria  stock between April 30, 1997  and  March  11,
          1998.   No  class  has  been  certified  at  this  time.    The
          complaints allege, among other things, that the defendants made
          false and/or misleading public statements regarding the Company
          and  its financial condition in violation of federal securities
          laws.   All three complaints seek compensatory as well as other
          relief.   Two  of the complaints include a claim  for  punitive
          damages.
          
               On or about May 4, 1998, a motion was filed by plaintiffs'
          counsel  seeking to have the Court appoint the "Miladin Group",
          a  group  of certain plaintiffs and other shareholders  in  the
          three  actions,  as lead plaintiffs, and the  firms  of  Stull,
          Stull  & Brody and Weiss & Yourman as co-lead counsel.  On  May
          4, 1998, plaintiffs' counsel also filed a motion to consolidate
          the  three actions.  Both motions are presently set for hearing
          on June 1, 1998.
          
Items 2-5.     Not applicable

Item 6.        Exhibits and Reports on Form 8-K

          (a)  Exhibits:

               Exhibit
               Number    Reference
               -------   ---------
               10.1      Resignation and General Release Agreement  dated
                         January 19, 1998, between Apria Healthcare Group
                         Inc.  and  Jeremy  M.  Jones.   Incorporated  by
                         reference to Apria Healthcare Group Inc.'s  Form
                         10-K for the year ended December 31, 1997.
               
               10.2      Executive Employment Agreement dated January 26,
                         1998,  between Apria Healthcare Group  Inc.  and
                         Lawrence M. Higby.  Incorporated by reference to
                         Apria Healthcare Group Inc.'s Form 10-K for  the
                         year ended December 31, 1997.
               
               10.3      Third  Amendment to Credit Agreement and Waiver,
                         dated  January 30, 1998, among 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 Form 10-K for  the  year
                         ended December 31, 1997.
               
               10.4      Stock Purchase Agreement dated February 3, 1998,
                         by  and  among, JLL Argosy Apria, LLC,  CIBC  WG
                         Argosy  Merchant Fund 2, LLC, Joseph  Littlejohn
                         & Levy Fund III, LP and Apria Healthcare Group
                         Inc.   Incorporated by reference to Registrant's
                         Current Report on Form 8-K, as filed on February
                         6, 1998.
               
               10.5      Stockholder Agreement dated February 3, 1998, by
                         and among, JLL Argosy Apria, LLC, CIBC WG Argosy
                         Merchant Fund 2, LLC, Joseph Littlejohn & Levy
                         Fund  III,  LP, Relational Investors,  LLC,  HBI
                         Financial, Inc. and Apria Healthcare Group  Inc.
                         Incorporated   by   reference  to   Registrant's
                         Current Report on Form 8-K, as filed on February
                         6, 1998.
               
               10.6      Resignation and General Release Agreement  dated
                         February 4, 1998, between Apria Healthcare Group
                         Inc.  and  Jerome  J.  Lyden.   Incorporated  by
                         reference to Apria Healthcare Group Inc.'s  Form
                         10-K for the year ended December 31, 1997.
               
               10.7      Fourth Amendment to Credit Agreement and Waiver,
                         dated  March  13,  1998, among 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 Form 10-K for  the  year
                         ended December 31, 1997.
               
               10.8      Security   Agreement,  dated  March  13,   1998,
                         between  Apria  Healthcare  Group  Inc.,   Apria
                         Healthcare,   Inc.,   and   certain    of    its
                         subsidiaries and Bank of America National  Trust
                         and   Savings   Association.   Incorporated   by
                         reference to Apria Healthcare Group Inc.'s  Form
                         10-K for the year ended December 31, 1997.
               
               10.9      Fifth  Amendment to Credit Agreement and Waiver,
                         dated  April  15,  1998 among  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 Form 10-K for  the  year
                         ended December 31, 1997.

               10.10     First  Amendment  to  Security  Agreement  dated
                         April 15, 1998 among 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  Form  10-K  for  the  year  ended
                         December 31, 1997.
               
               27.1      Financial Data Schedule.


          (b)  Reports on Form 8-K:

               The  Company  filed a Current Report on  Form  8-K,  dated
               February   6,  1998,  with  the  Securities  and  Exchange
               Commission reporting that the Registrant had entered  into
               a  Stock Purchase Agreement ("the JLL Agreement") with JLL
               Argosy  Apria, LLC, Joseph Littlejohn & Levy Fund III,  LP
               and  CIBC  WG  Argosy Merchant Fund 2, LLC (together,  the
               "JLL Group").  Pursuant to the terms of the JLL Agreement,
               among  other things, the Company had agreed to  issue  and
               sell  12,300,000  shares of Common Stock and  warrants  to
               purchase  5,000,000  additional  shares,  exercisable   at
               $20.00  per  share, in consideration for a cash investment
               of  $172.2 million by the JLL Group.  The Company  was  to
               have used the proceeds, together with $70.0 million in new
               borrowings   under  the  Company's  credit  facility,   to
               purchase  17,300,000 shares of Common Stock.  On April  3,
               1998,  the  parties agreed to terminate the JLL  Agreement
               without any further obligation to any party.
     
     
<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



May 15, 1998                   /s/ Lawrence H. Smallen
                               -------------------------------
                               Lawrence H. Smallen
                               Chief Financial Officer,
                               Senior Vice President, Finance and
                               Treasurer
                               (Principal Financial Officer)