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                                                                   Exhibit 10.11
                              EMPLOYMENT AGREEMENT
                              --------------------


    AGREEMENT made, effective as of September 16, 1996, by  and  between
NORTHSTAR HEALTH SERVICES, INC., a Delaware Corporation, with a place of
business at 665 Philadelphia Street, Indiana, Pennsylvania, 15701, hereinafter
referred to as "Company", and JOHN LOMBARDI, of 1601 Market Street,
Philadelphia, Pennsylvania, 19103, hereinafter referred to as "Employee".

                                    RECITALS
The parties recite and declare:

    A.      Company desires to hire Employee because of Employee's vast business
experience.

    B.      Employee desires to be employed by the Company in the executive
capacity described below.


    For the reasons set forth above, and in consideration of the mutual
covenants and promises of the parties set forth in this Agreement, Company and
Employee agree as follows:

    1.    Position and Responsibilities.
          -----------------------------

          1.1.  Employee shall serve as Executive Vice President, Chief
Financial Officer and Treasurer of the Company, and in such position Employee
will exercise such executive authority, duties, powers and responsibilities as
customarily attend such position in the Company.  A job description is attached
hereto and made a part hereof.  This position will be termed "interim" until
such time, by mutual decision of the Board of Directors and Employee, the
position will be changed to "permanent" at which time a new agreement will be
negotiated.

          1.2.  Employee will, to the best of Employee's knowledge, skill and
ability, devote Employee's time and best efforts to the performance of
Employee's duties hereunder and the business and affairs of the Company.
Employee agrees to perform such executive duties as may be assigned to Employee
from time to time by the Company's Board of Directors or any committee of the
Board of Directors.

          1.3.  Employee will duly, punctually, competently and faithfully
perform and discharge Employee's duties in accordance with all applicable laws
and all policies, rules and regulations which the Company may now or shall
hereafter establish governing the conduct of its business.

     2.    Term of Employment.
           ------------------

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          2.1.  The initial term of this Agreement shall be for a period of one
(1) year commencing on September 16, 1996. Either party may elect to cancel
this Agreement within one hundred twenty (120) days prior written notice.
However, this Agreement may not be cancelled by either party within the first
ninety (90) days for any reason.  This Agreement will automatically renew for a
one (1) year period, unless terminated in writing with one hundred twenty (120)
days notice prior to September 12, 1997.

          2.2.  The Company may at any time terminate Employee's employment
hereunder for "Cause." In such event, the Company shall give Employee prompt
written notice specifying in reasonable detail the basis for such termination.
For purposes of this Agreement, "Cause" shall mean any of the following by
Employee: (i) material breach of any material provision of this Agreement,
which breach Employee shall have failed to cure within ten (10) days after
Employee's receipt from the Company specifying the specific nature of
Employee's breach; (ii) misconduct or neglect by Employee that is materially
inimical to the best interests, monetary or otherwise, of the Company; and
(iii) conviction of a felony or any crime involving moral turpitude or fraud.
In the event of Employee's termination for "Cause," the Company  shall pay
Employee any accrued salary and benefits due Employee as of such date, less
applicable taxes and other required withholdings and any amounts Employee may
owe to the Company.

    3.  Compensations.  Employee shall receive the compensation and benefits set
        -------------
forth on Exhibit "A", attached hereto and made a part hereof ("Compensation"),
for all services to be rendered by Employee hereunder.

    4. Other Activities During Employment.  Employee acknowledges and agrees
       -----------------------------------
that Employee may serve on boards of directors and hold other leadership
positions in non-profit organizations unless the objectives and requirements of
such positions are determined by the Board of Directors of Company to be
inconsistent with the performance of Employee's duties.  Employee also
acknowledges and agrees that the approval of the Board of Directors of Company
shall be required before Employee accepts or serves as a director, officer or
employee of any other for profit corporation during the term of this Agreement.

    5. Illness, Incapacity and Death.
       -----------------------------

          (a) If, during the term of this Agreement, Employee shall be
prevented from performing Employee's duties by reason of illness or physical or
mental disability (hereinafter referred to collectively as "incapacity") for a
continuous period greater than one hundred twenty (120) days in any twelve (12)
month period, the Company may terminate Employee's employment hereunder by
giving written notice thereof to Employee, effective on the date set forth in
the notice (which date shall be not less than fifteen (15) business days after
the notice is given), and the Company

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shall pay Employee any accrued salary and benefits due to Employee as of such
date, less applicable taxes and other required withholdings and any amounts
Employee owes the Company.

          (b) For purposes of this Agreement, a continuous period of incapacity
shall not be deemed interrupted until Employee returns to substantially full
time work for a period of at least thirty (30) consecutive business days.

          (c) In the event of Employee's death during the term of this
Agreement, employment hereunder shall terminate on the date of Employee's death,
and the Company shall pay Employee's estate any accrued salary and benefits due
to Employee as of such date, less applicable taxes and other required
withholdings and any amounts Employee owes the Company.

    6.  Former Employers.  Employee represents and warrants that Employee's
        ----------------
employment by the Company will not conflict with and will not be constrained by
any prior or current employment consulting agreement or relationship whether
oral or written.  Employee represents and warrants that Employee does not
possess confidential information arising out of any such employment, consulting
agreement or relationship which, in Employee's best judgment, would be utilized
in connection with Employee's employment by the Company.

    7.  Confidentiality.  Employee agrees to keep confidential, except as
        ---------------
the Company may otherwise consent in writing, and, except for the Company's
benefit, not to disclose or make any use of at any time, either during or
subsequent to Employee's employment, any trade secrets, confidential
information, knowledge, data, or other information of the Company relating to
services, treatment procedures, processes, know-how, designs, marketing data,
test data, customer lists, referral services, business plans, marketing plans
and strategies, pricing strategies, or other subject matter pertaining to any
business of the Company, or any of its affiliates, which Employee may produce,
obtain, or otherwise acquire during the term of this Agreement, except as herein
provided.  Employee further agrees not to deliver, reproduce or in any way allow
any such trade secrets, confidential information, knowledge, data or other
information, or any documentation relating thereto, to be delivered to or used
by any third parties without specific direction  or consent of a duly
authorized representative of the Company.  In the event Employee's employment
with the Company terminates for any reason whatsoever, Employee agrees to
promptly surrender and deliver to the Company all records, materials,
equipment, drawings, documents and data which Employee may obtain or produce
during the term of this Agreement, and Employee will not take with Employee any
summaries, outlines or descriptions of any confidential information, knowledge
or data of the Company which Employee may produce or obtain during the term of
this Agreement.

    8.   Non-Competition.
         ---------------

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          8.1.  During the term of Employee's employment hereunder, any period
under which Employee receives compensation from the Company under Exhibit "A"
hereto, absent the Company's prior written approval, Employee will not engage,
directly or indirectly, whether as principal or as agent, officer, director,
employee, consultant, shareholder, or otherwise, alone or in association with
any other person, corporation or other entity, in any Competing Business.  For
purposes of this Agreement, the term "Competing Business" shall mean: any
person, corporation or other entity which solicits, trades with, advises, calls
upon or otherwise does, or attempts to do, directly or indirectly, business
with any patients, referral sources, customers or accounts of the Company, its
successors, assigns or affiliates, that have done business with the Company at
any time or from time to time during the period of Employee's employment
hereunder.

          8.2.  Employee agrees that, except as expressly provided in Exhibit
"A" hereto, during Employee's employment with the Company, including without
limitation, termination by the Company for Cause or without Cause, Employee
shall not, directly or indirectly, solicit or induce, or attempt to solicit or
induce, any employee of the Company to leave the Company for any reason
whatsoever or hire any employee of the Company.

          8.3.  Employee represents that Employee's experience and capabilities
are such that the provisions of this Agreement will not prevent Employee from
earning a livelihood and Employee acknowledges that it would cause the Company
serious and irreparable injury and cost if Employee was to use Employee's
ability and knowledge in competition with the Company or to otherwise breach
the obligations contained in this Agreement.

    9.  Remedies.  In the event of a breach by Employee of the terms of this
        --------
Agreement, the Company shall be entitled, if it shall so elect, to institute
legal proceedings to obtain damages for any such breach, or to enforce the
specific performance of this Agreement by Employee and to enjoin Employee from
any further violation of this Agreement and to exercise such remedies
cumulatively or in conjunction with all other rights and remedies provided by
law.  Employee acknowledges, however, that the remedies at law for any breach
by Employee of the provisions of this Agreement may be inadequate and that the
Company shall be entitled to injunctive relief against Employee in the event of
any breach.

     10.  Assignment.  This Agreement shall be binding upon and inure to the
          ----------
benefit of the successors and assigns of the Company, and the Company shall be
obligated to require any successor to expressly acknowledge and assume its
obligations hereunder.  This Agreement shall inure to the extent provided
hereunder to the benefit of, and be enforceable by, Employee or Employee's
legal representatives, executors, administrators, successors and heirs.
Employee may not assign any of Employee's rights or delegate any

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of Employee's duties, responsibilities, obligations or positions hereunder to
any person, and any such purported delegation by Employee shall be void and of
no force and effect.

    11. Severability.  The Company and Employee acknowledge and agree that in
        ------------
the event any one or more of the provisions contained in this Agreement shall,
for any reason, be held to be invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect the other
provisions of this Agreement, and this Agreement shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein.

    12.  Notices.  Any notice given by the Company hereunder shall be by
         --------
personal delivery or registered or certified mail, return receipt requested,
addressed to Employee at Employee's address of record with the Company.  Any
notice which Employee is required or may desire to deliver to the Company may
be given by Employee by personal delivery or by registered or certified mail,
return receipt requested, addressed to the Company at its principal office.
The date of personal delivery or five (5) business days after the date of
mailing any notice shall be deemed to be the date of delivery thereof.

    13.  Waivers.  If either party should waive any breach of any provision
         -------
of this Agreement, such waiver shall not operate or be construed as a waiver of
any subsequent breach of any provision of this Agreement.

    14.  Complete Agreement; Amendments.  This Agreement, including Exhibit
         ------------------------------
"A" hereto, is the entire agreement of the parties with respect to the subject
matter hereof, superseding all previous oral or written communications,
representations, understandings or agreements with the Company or any officer
or representative thereof.  Any amendment to this Agreement or waiver by the
Company of any right hereunder shall be effective only if evidenced by a
written instrument executed by the parties hereto, upon authorization of the
Company's Board of Directors.

    15.  Headings.  The headings of the sections hereof are inserted for
         --------
convenience only and shall not be deemed to constitute a part hereof nor to
affect the meaning of this Agreement.

    16.  Counterparts.  This Agreement may be signed in counterparts, each of
         ------------
which shall be deemed an original and both of which shall together constitute
one agreement.

    17.  Governing Law.  This Agreement shall be governed by and construed in
         -------------
accordance with the laws of the Commonwealth of Pennsylvania.

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     IN WITNESS WHEREOF, each party to this Agreement has caused it to be
executed at Indiana, Pennsylvania, on the date indicated below.

                                    COMPANY:

                                    NORTHSTAR HEALTH SERVICES, INC.

ATTEST:                             BY: /s/ David D. Watson
                                       -------------------------------
                                       David D. Watson, President


------------------------------
                   Secretary

    (  SEAL  )



WITNESS:                            EMPLOYEE:


 /s/ Emily B. Fister                 /s/ John Lombardi
------------------------------      -------------------------------(SEAL)
                                    JOHN LOMBARDI

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                                 EXHIBIT "A"
                                 -----------

                 EMPLOYMENT TERM.  COMPENSATION AND BENEFITS
                 -------------------------------------------
                               OF JOHN LOMBARDI
                               ----------------


1.  Compensation.
    ------------

    Employee's annual base salary will be One Hundred Twelve Thousand and
    No/100 ($112,000.00) Dollars paid bi-weekly, less appropriate deductions in
    accordance with the Company's salary payment policy.

2.  Stock Options.
    -------------

    Employee shall be eligible to participate in the Company's 1992 Stock
    Option Plan or any other stock bonus or stock Option plan authorized by the
    Company for its employees, officers and consultants.  On the Effective
    Date, Employee shall be granted, under the 1992 Stock option Plan, stock
    options for 25,000 shares of the Company's Common Stock in connection with
    the Employee's execution of this Agreement.  Such options shall have an
    exercise price equal to the fair market value (as defined in the 1992 Stock
    Option Plan) as of the Effective Date of this Employment Agreement.  Such
    options shall be in accordance with the 1992 Stock Option Plan.

    A grant of stock options to purchase fifty thousand (50,000) shares of the
    Company's Common Stock at $2.00. Such option shares are not exercisable
    until Company's Common Stock has traded in excess of $5.93 for at least ten
    (10) consecutive trading days.  Performance shares will enjoy all vesting
    and acceleration rights and privileges contained in option grants to other
    key employees.  In the event that this Agreement is terminated in less than
    six (6) months, Employee will be entitled to stock options on a pro rata
    basis over six (6) months (i.e. 8,333 options per month or any fraction
    thereof).  In any case, the stock options must be exercised within twelve
    (12) months of termination.  At the termination of this Agreement, this
    grant may be assigned to Employee's designee.

    In connection with the granting of the aforementioned options, Employee
    hereby acknowledges prior receipt of the Company's Form 10-KSB for the
    fiscal year ending December 31, 1994, Proxy Statement dated May 8, 1995,
    Form 10-QSB for the quarter ended June 30, 1995, 1992 Stock Option Plan and
    related stock option plan disclosure documents.  Employee also acknowledges
    that Employee has had ample opportunity to review each of the

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    aforementioned documents prior to the execution of this Agreement.

3.  Benefits.
    --------

    All standard benefits will be governed under Keystone Rehabilitation
    Systems existing Employee Benefit Plan.  The following benefits that are
    not standard will be valid for this Agreement and any renewal:

    A.   Vacation:     At least four (4) weeks, but not more
                       than six (6) weeks.

    B.   Ninety (90) day eligibility for benefits is waived.

    The remainder of benefits are attached and are the standard benefits of
    Northstar Health Services, Inc. and Keystone Rehabilitation Systems, Inc.

4.   Retirement Plan.
     ---------------

    Employee will be eligible to participate in the Company's 401(k) Plan in
    accordance with its terms.  The Company will provide a matching
    contribution in accordance with its matching contribution plan for all
    employees, with such matching contribution not to exceed fifteen (15%)
    percent of Employee's income as permitted by the Internal Revenue
    Service.

5.   Relocation Expenses.
     -------------------

     The Company will provide up to One Thousand Five Hundred and No/100
     ($1,500.00) Dollars, or greater with Board of Directors' approval, in
     moving expenses to move to Indiana, Pennsylvania.

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