<PAGE>   1
                       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 Quarterly Period Ended June 30, 1998

                                       OR

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

            For the transition period from ___________ to __________

                           Commission File No. 0-27640


                             RENAL CARE GROUP, INC.
             (Exact name of registrant as specified in its charter)

         Delaware                                       62-1622383
(State or other jurisdiction of                      (I.R.S. Employer
incorporation or organization)                      Identification No.)


               2100 West End Ave., Suite 800, Nashville, Tennessee 37203
              (Address of principal executive offices) (Zip code)
       Registrant's telephone number, including area code: (615) 345-5500


         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
                                   ----      ----

         Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the latest practicable date.

          Class                                 Outstanding at August 5, 1998
          -----                                 -----------------------------
Common Stock, $.01 par value                              26,902,584


<PAGE>   2


                             RENAL CARE GROUP, INC.
                                      INDEX

<TABLE>
<CAPTION>
                                                                                                         PAGE NO.
                                                                                                         --------
<S>                                                                                                       <C>
PART I - FINANCIAL INFORMATION

Item 1.   Financial Statements

          Consolidated Balance Sheets
                 December 31, 1997 and June 30, 1998 (unaudited)                                             1

            Consolidated Income Statements - (unaudited)
                 For the three months and six months ended
                 June 30, 1997 and 1998                                                                      2

            Consolidated Statements of Cash Flows - (unaudited)
                 For the six months ended June 30, 1997 and 1998                                             3

             Notes to the Consolidated Financial Statements                                                  4

Item 2.    Management's Discussion and Analysis of Financial Condition
                 And Results of Operations                                                                   7


PART II - OTHER INFORMATION

Item 2.  Changes in Securities                                                                              16

Item 4.  Submission of Matters to a Vote of Security Holders                                                16

Item 5.  Other Information                                                                                  16

Item 6.  Exhibits and Reports on Form 8-K                                                                   16

Note:  Item 3 of Part I, and items 1 and 3 of Part II are omitted because they are not applicable
</TABLE>


<PAGE>   3
PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

                             RENAL CARE GROUP, INC.
                           CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)


<TABLE>
<CAPTION>
                                                                       DECEMBER 31,         JUNE 30,
                                                                          1997                1998
                                                                        --------            --------
                                                                                           (unaudited)
<S>                                                                     <C>                 <C>     
ASSETS
Current assets:
     Cash and cash equivalents                                          $  9,138            $ 16,026
     Investments                                                           3,625                  --
     Accounts receivable, net                                             45,199              68,869
     Inventories                                                           4,516               5,618
     Prepaid expenses and other current assets                             3,327               6,284
                                                                        --------            --------
Total current assets                                                      65,805              96,797

Property and equipment, net                                               60,974              71,716
Goodwill, net                                                            116,721             156,216
Intangible assets, net                                                     1,266               2,014
Other assets                                                               3,317               3,897
                                                                        --------            --------

Total assets                                                            $248,083            $330,640
                                                                        ========            ========

LIABILITIES AND STOCKHOLDERS' EQUITY 
Current liabilities:
     Accounts payable                                                   $  9,580            $ 13,487
     Income taxes payable                                                  1,653               6,643
     Other current liabilities                                            30,103              37,928
                                                                        --------            --------
Total current liabilities                                                 41,336              58,058

Long-term debt, net of current portion                                    15,470              50,855
Minority interest                                                         14,597              21,998
Deferred income taxes                                                      1,921               2,721
                                                                        --------            --------
Total liabilities                                                         73,324             133,632

Stockholders' equity:
     Preferred stock, $.01 par value, 10,000 shares
        authorized, none issued                                               --                  --
     Common stock, $.01 par value, 60,000 shares authorized,
        24,897 and 26,860 shares issued and outstanding at
        December 31, 1997 and June 30, 1998, respectively                    249                 269
     Additional paid-in capital                                          150,748             157,586
     Retained earnings                                                    23,762              39,153
                                                                        --------            --------
Total stockholders' equity                                               174,759             197,008
                                                                        --------            --------

Total liabilities and stockholders' equity                              $248,083            $330,640
                                                                        ========            ========
</TABLE>


          See accompanying notes to consolidated financial statements





                                       1
<PAGE>   4

                             RENAL CARE GROUP, INC.
                         CONSOLIDATED INCOME STATEMENTS
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                THREE MONTHS ENDED                       SIX MONTHS ENDED
                                                                      JUNE 30,                                JUNE 30,
                                                              1997                1998                1997                1998
                                                            -------            --------             -------            ---------
<S>                                                         <C>                <C>                  <C>                <C>      
Net revenue                                                 $51,666            $ 89,510             $97,775            $ 169,973
Operating costs and expenses:
    Patient care costs                                       35,635              59,183              67,569              112,723
    General and administrative expenses                       5,206               8,579              10,008               16,428
    Provision for doubtful accounts                           1,230               2,319               2,172                4,420
    Depreciation and amortization                             2,141               4,538               4,105                8,475
    Merger expenses                                             300                 300                 300                1,000
                                                            -------            --------             -------            ---------
Total operating costs and expenses                           44,512              74,919              84,154              143,046
                                                            -------            --------             -------            ---------
Income from operations                                        7,154              14,591              13,621               26,927
Interest income (expense), net                                   99                (780)                503               (1,342)
                                                            -------            --------             -------            ---------
Income before minority interest and income taxes              7,253              13,811              14,124               25,585
Minority interest                                               218                 608                 218                1,155
                                                            -------            --------             -------            ---------
Income before income taxes                                    7,035              13,203              13,906               24,430
Provision for income taxes                                    2,603               4,885               5,180                9,039
                                                            -------            --------             -------            ---------
Net income                                                  $ 4,432            $  8,318             $ 8,726            $  15,391
                                                            =======            ========             =======            =========
Net income per share:
    Basic                                                   $  0.20            $   0.31             $  0.40            $    0.58
                                                            =======            ========             =======            =========
    Diluted                                                 $  0.19            $   0.29             $  0.38            $    0.55
                                                            =======            ========             =======            =========
Weighted average shares outstanding:
    Basic                                                    22,022              26,810              21,817               26,560
                                                            =======            ========             =======            =========
    Diluted                                                  23,127              28,450              22,908               28,200
                                                            =======            ========             =======            =========
</TABLE>


           See accompanying notes to consolidated financial statements




                                       2
<PAGE>   5
                             RENAL CARE GROUP, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (unaudited)


<TABLE>
<CAPTION>
                                                                                          SIX MONTHS ENDED JUNE 30,
                                                                                          1997                 1998
                                                                                        --------             --------
<S>                                                                                     <C>                  <C>     
OPERATING ACTIVITIES
Net income                                                                              $  8,726             $ 15,391
Adjustments to reconcile net income to net cash
  provided by operating activities:
       Depreciation and amortization                                                       4,105                8,475
       Equity in earnings of subsidiaries                                                    218                1,155
       Change in assets and liabilities net of effects from acquisitions                 (12,319)             (15,917)
                                                                                        --------             --------
                     Net cash provided by operating activities                               730                9,104

INVESTING ACTIVITIES
Purchases of property and equipment                                                      (10,259)             (10,090)
Cash paid for acquisitions, net of cash acquired                                         (35,414)             (32,238)
Investments, net                                                                           3,035                3,625
                                                                                        --------             --------
                     Net cash used in investing activities                               (42,638)             (38,703)

FINANCING ACTIVITIES
Net borrowings under line of credit                                                           --               35,385
Payments on long-term debt                                                                (1,661)              (2,717)
Proceeds from exercise of stock options                                                      446                4,069
Distributions to minority shareholders                                                        --                 (250)
                                                                                        --------             --------
                     Net cash provided by (used in) financing activities                  (1,215)              36,487
                                                                                        --------             --------

Increase (decrease) in cash and cash equivalents                                         (43,123)               6,888

Cash and cash equivalents, at beginning of period                                         47,624                9,138
                                                                                        --------             --------

Cash and cash equivalents, at end of period                                             $  4,501             $ 16,026
                                                                                        ========             ========

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: 
Cash paid during the year for:
       Interest                                                                         $     --             $  1,478
                                                                                        ========             ========
       Income taxes                                                                     $  7,702             $  4,383
                                                                                        ========             ========
SUPPLEMENTAL DISCLOSURES OF NON-CASH TRANSACTIONS:
  Issuance of common stock in acquisition                                               $  6,008             $  1,846
                                                                                        ========             ========
</TABLE>



           See accompanying notes to consolidated financial statements




                                       3
<PAGE>   6

                             RENAL CARE GROUP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            FOR THE SIX MONTHS ENDED
                                  JUNE 30, 1998
                      (in thousands, except per share data)
                                   (unaudited)

NOTE 1 - BASIS OF PRESENTATION

Overview

         Renal Care Group, Inc. (the "Company") is a specialized provider of
nephrology services to patients with kidney disease, including patients
suffering from chronic kidney failure also known as end-stage renal disease
("ESRD"). As of June 30, 1998, the Company provided dialysis and ancillary
services to approximately 10,500 patients through 151 outpatient dialysis
centers in 18 states, and acute dialysis services in 87 hospitals.

         The Company's net revenue has been derived primarily from the following
sources: (i) outpatient hemodialysis services; (ii) ancillary services
associated with dialysis, primarily the administration of erythropoietin
("EPO"), a bio-engineered hormone used to treat anemia; (iii) home dialysis
services; (iv) inpatient hemodialysis services provided pursuant to contracts
with acute care hospitals and skilled nursing facilities; (v) management
contracts with hospital-based and medical university dialysis programs; and (vi)
laboratory services. ESRD patients typically receive 156 dialysis treatments per
year, with reimbursement for services provided primarily through the Medicare
ESRD program based on rates that are established by the Health Care Financing
Administration ("HCFA"). For the six months ended June 30, 1998, approximately
67% of the Company's net revenue was derived from reimbursement under the
Medicare and Medicaid programs. Medicare reimbursement is subject to rate and
other legislative changes by Congress and periodic changes in regulations,
including changes that may reduce payments under the ESRD program. For patients
with private health insurance, effective September 1, 1997, the health insurance
coordination period was extended to 30 months of treatment, after which time
Medicare becomes the primary payor. Reimbursement for dialysis services provided
pursuant to a hospital contract is negotiated with the individual hospital and
generally is greater on a per treatment equivalent basis than the Medicare rate.
Because dialysis is a life-sustaining therapy used to treat this chronic
disease, utilization is predictable and is not subject to seasonal fluctuations.

Interim Financial Statements

         In the opinion of management, the information contained herein reflects
all adjustments necessary to make the results of operations for the interim
periods a fair statement of such operations. All such adjustments are of a
normal recurring nature. Operating results for interim periods are not
necessarily indicative of results which may be expected for the year as a whole.
It is suggested that these financial statements be read in conjunction with the
consolidated financial statements and the related notes thereto included in the
Company's Form 10-K as filed with the Securities and Exchange Commission on
March 31, 1998.




                                       4
<PAGE>   7


                             RENAL CARE GROUP, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)


NOTE 2 - SUBSEQUENT EVENTS

         On July 23, 1998, the Board of Directors approved a three-for-two stock
split to be effected in the form of a 50% stock dividend. One additional share
of Common Stock will be issued for every two shares held by shareholders of
record at the close of business on August 7, 1998. The additional shares will be
distributed on August 24, 1998. Financial data included in this filing has
not been retroactively adjusted for this stock split.

NOTE 3 - EARNINGS PER SHARE

         The following table sets forth the computation of basic and diluted
income per share in accordance with SFAS 128.

<TABLE>
<CAPTION>
                                                        THREE MONTHS ENDED       SIX MONTHS ENDED
                                                              JUNE 30,                JUNE 30,
                                                         1997        1998        1997        1998
                                                        -------     -------     -------     -------
<S>                                                     <C>         <C>         <C>         <C>
Numerator:
   Numerator for basic and diluted income per share     $ 4,432     $ 8,318     $ 8,726     $15,391
Denominator:
   Denominator for basic net income per share -
      weighted-average shares                            22,022      26,810      21,817      26,560
   Effect of dilutive securities:
      Warrants                                              260         287         260         285
      Stock options                                         845       1,353         831       1,355
                                                        -------     -------     -------     -------
   Denominator for diluted net income per share -
      adjusted weighted-average shares and assumed
      conversions                                        23,127      28,450      22,908      28,200
                                                        =======     =======     =======     =======
Net income per share:
   Basic                                                $  0.20     $  0.31     $  0.40     $  0.58
                                                        =======     =======     =======     =======
   Diluted                                              $  0.19     $  0.29     $  0.38     $  0.55
                                                        =======     =======     =======     =======
</TABLE>






                                       5
<PAGE>   8


                             RENAL CARE GROUP, INC.
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)


NOTE 4 - RECENT ACCOUNTING PRONOUNCEMENTS

         In June 1997, the FASB issued Statement No. 131, "Disclosures about
Segments of an Enterprise and Related Information" ("Statement 131"). Statement
131 establishes standards for the way public business enterprises are to report
information about operating segments in annual financial statements and requires
those enterprises to report selected information about operating segments in
interim financial reports issued to shareholders. It also establishes standards
for related disclosures about products and services, geographic areas and major
customers. Statement 131 is effective for the fiscal years beginning after
December 15, 1997. Management of the Company is currently reviewing the impact
of Statement 131. The Company will adopt Statement 131 on December 31, 1998 and
will report interim information effective in the first quarter of 1999.






                                       6
<PAGE>   9


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


RESULTS OF OPERATIONS

THREE MONTHS ENDED JUNE 30, 1998 COMPARED TO THREE MONTHS ENDED JUNE 30, 1997

         Net revenue. Net revenue increased from $51,666,000 for the three
months ended June 30, 1997 to $89,510,000 for the three months ended June 30,
1998, an increase of $37,844,000, or 73.2%. This increase resulted primarily
from a 57.5% increase in the number of treatments from 249,139 in the 1997
period to 392,498 in the 1998 period. This growth in treatments is the result of
the acquisition and development of various dialysis facilities and a 10.1%
increase in same-center treatments for the 1998 period over the 1997 period. In
addition, average patient revenue per treatment increased 7.8% from $206 in the
1997 period to $222 in the 1998 period. The remaining revenue increase is a
result of wound care revenues from the December 1997 acquisition of STAT
Healthcare, higher management fees and earnings of 50% owned partnerships in the
1998 period compared to the 1997 period. The revenue per treatment increase is
due to an improvement in the Company's payor mix, increases in EPO and other
drug utilization, the implementation of the Company's in-house laboratory
services and the positive impact of commercial payments of the Medicare
secondary payor provisions of the Balanced Budget Act.

         Patient Care Costs. Patient care costs consist of costs directly
related to the care of patients, including direct labor, drugs and other medical
supplies and operational costs of facilities. Patient care costs increased from
$35,635,000 for the three months ended June 30, 1997 to $59,183,000 for the
three months ended June 30, 1998, an increase of $23,548,000, or 66.1%. This
increase resulted primarily from an increase in the number of treatments
performed during the period which caused a corresponding increase in the use of
labor, drugs and supplies. Patient care costs as a percent of net revenue
decreased from 69.0% in the 1997 period to 66.1% in the 1998 period primarily
due to an increase in net revenues. Patient care costs per treatment increased
from $143 in the 1997 period to $151 in the 1998 period, an increase of $8,
or 5.6%. This increase is due to EPO and other drug utilization costs, the cost
of providing in-house laboratory services and normal healthcare inflation.

         General and Administrative Expenses. General and administrative
expenses include corporate office costs and facility costs not directly related
to the care of patients, including facility administration, accounting, billing
and information systems. General and administrative expenses increased from
$5,206,000 for the three months ended June 30, 1997 to $8,579,000 for the three
months ended June 30, 1998, an increase of $3,373,000, or 64.8%. General and
administrative expenses as a percent of net revenue decreased from 10.1% in the
1997 period to 9.6% in the 1998 period, primarily due to an increase in net
revenue for the 1998 period.

         Provision for Doubtful Accounts. It is the Company's practice to
reserve for doubtful accounts in the period in which the revenue is recognized
based on management's estimate of the net collectibility of the accounts
receivable based upon an analysis of payor mix, billing practices and other
factors. The provision for doubtful accounts increased from $1,230,000 for the
three months ended June 30, 1997 to $2,319,000 for the three months ended June
30, 1998. The provision for doubtful accounts as a percent of net revenue
increased from 2.4% in the 1997 period to 2.6% in the 1998 period, or 0.2%. This
increase in provision for doubtful accounts was due to an increase in reserves
related to the amount of




                                       7
<PAGE>   10

                             RENAL CARE GROUP, INC.
            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                     AND RESULTS OF OPERATIONS - (CONTINUED)

net operating revenues generated from non-governmental payor sources, and the
temporary degradation of accounts receivable collections associated with the
conversion of patient billing systems.

         Depreciation and Amortization. Depreciation and amortization increased
from $2,141,000 for the three months ended June 30, 1997 to $4,538,000 for the
three months ended June 30, 1998, an increase of $2,397,000, or 111.9%. This net
increase was due to the start-up of dialysis facilities, the normal replacement
costs of dialysis facilities and equipment, the purchase of information systems
and the amortization of the goodwill associated with the acquisitions accounted
for under the purchase method of accounting.

         Merger Expenses. Merger expenses of $300,000 represented legal,
accounting, employee severance and related benefits and other assimilation and
transitional costs related to the Company's merger with four dialysis facilities
located in Missouri, Kansas and Oklahoma.

         Income from Operations. Income from operations increased from
$7,154,000 for the three months ended June 30, 1997 to $14,591,000 for the three
months ended June 30, 1998, an increase of $7,437,000, or 103.9%. Income from
operations as a percent of net revenue increased from 13.8% in the 1997 period
to 16.3% in the 1998 period. Income from operations increased due to the
increase in net revenue in excess of patient care costs, which was primarily due
to an increase in the number of treatments performed during the period.

         Interest, Net. Interest income was $99,000 for the three months ended
June 30, 1997 and interest expense was $780,000 for the three months ended June
30, 1998. Interest expense is a result of borrowings from the Company's credit
facility. The use of the credit facility increased due to the use of cash in
acquisitions and de novo facilities, the replacement of dialysis facilities and
equipment and the purchase of information systems.

         Minority Interest. Minority interest represents the proportionate
equity interest of other partners in the Company's consolidated entities which
are not wholly-owned. As of June 30, 1998, this was primarily comprised of three
joint venture partnerships.

RESULTS OF OPERATIONS

SIX MONTHS ENDED JUNE 30, 1998 COMPARED TO SIX MONTHS ENDED JUNE 30, 1997

         Net revenue. Net revenue increased from $97,775,000 for the six months
ended June 30, 1997 to $169,973,000 for the six months ended June 30, 1998, an
increase of $72,198,000, or 73.8%. This increase resulted primarily from a 59.6%
increase in the number of treatments from 473,307 in the 1997 period to 755,403
in the 1998 period. This growth in treatments is the result of the acquisition
and development of various dialysis facilities and a 10.1% increase in
same-center treatments for the 1998 period over the 1997 period. In addition,
average patient revenue per treatment increased 6.8% from $205 in the 1997
period to $219 in the 1998 period. The remaining revenue increase is a result of
hyperbaric and wound care revenues as a result of the STAT acquisition, higher
management fees and earnings of 50% owned partnerships in the 1998 period
compared to the 1997 period. The revenue per



                                       8
<PAGE>   11


                             RENAL CARE GROUP, INC.
            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                     AND RESULTS OF OPERATIONS - (CONTINUED)

treatment increase is due to an improvement in the Company's payor mix,
increases in EPO and other drug utilization, the implementation
of the Company's in-house laboratory services and the positive impact on
commercial payments of the Medicare Secondary Payor Provisions of the Balanced
Budget Act.

         Patient Care Costs. Patient care costs increased from $67,569,000 for
the six months ended June 30, 1997 to $112,723,000 for the six months ended June
30, 1998, an increase of $45,154,000, or 66.8%. This increase was due to the
increase in the number of associated treatments, which caused a corresponding
increase in the use of labor, drugs and supplies. Patient care costs as a
percent of net revenue decreased from 69.1% in the 1997 period to 66.3% in the
1998 period. Patient care costs per treatment increased from $143 in the 1997
period to $149 in the 1998 period, an increase of $6 or 4.2%. This increase is
due to greater EPO and other drug utilization costs, the cost of providing
in-house laboratory services and normal healthcare inflation.

         General and Administrative Expenses. General and administrative
expenses increased from $10,008,000 for the six months ended June 30, 1997 to
$16,428,000 for the six months ended June 30, 1998, an increase of $6,420,000,
or 64.1%. General and administrative expenses as a percent of net revenue
decreased from 10.2% for the 1997 period to 9.7% in the 1998 period, primarily
as a result of higher net revenues for the 1998 period.

         Provision for Doubtful Accounts. The provision for doubtful accounts
increased from $2,172,000 for the six months ended June 30, 1997 to $4,420,000
for the six months ended June 30, 1998, an increase of $2,248,000, or 103.5%.
The provision for doubtful accounts as a percent of net revenue increased from
2.2% for the six months ended June 30, 1997 to 2.6% for the six months ended
June 30, 1998, or 0.4%. The increase in the provision for doubtful accounts was
influenced by the amount of net operating revenues generated from
non-governmental payor sources and the temporary degradation of accounts
receivable collections due to the conversion of patient billing systems.

         Depreciation and Amortization. Depreciation and amortization increased
from $4,105,000 for the six months ended June 30, 1997 to $8,475,000 for the six
months ended June 30, 1998, an increase of $4,370,000, or 106.5%. This net
increase was due to the acquisition and start-up of dialysis facilities, the
normal replacement costs of dialysis facilities and equipment, the purchase of
information systems and the amortization of the goodwill associated with
the acquisitions accounted for under the purchase method of accounting.

         Merger Expenses. Merger expenses of $1,000,000 represented legal,
accounting, employee severance and related benefits and other assimilation and
transitional costs related to the Company's merger of the operations of thirteen
dialysis facilities located in Arkansas, Missouri, Kansas and Oklahoma.

         Income from Operations. Income from operations increased from
$13,621,000 for the six months ended June 30, 1997 to $26,927,000 for the six
months ended June 30, 1998, an increase of $13,306,000, or 97.7%. Income from
operations as a percent of net revenue increased from 13.9% in the 1997 period
to 15.8% in the 1998 period. Income from operations increased due to the
increase in net




                                       9
<PAGE>   12

                             RENAL CARE GROUP, INC.
            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                     AND RESULTS OF OPERATIONS - (CONTINUED)

revenue in excess of patient care costs, which was primarily due to an increase
in the number of treatments performed during the period.

         Interest, Net. Interest income was $503,000 for the six months ended
June 30, 1997 and interest expense was $1,342,000 for the six months ended June
30, 1998. Interest expense is a result of borrowings from the Company's credit
facility. The use of the credit facility increased due to the use of cash in
acquisitions and de novo facilities, the replacement of dialysis facilities and
equipment and the purchase of information systems.

         Minority Interest. Minority interest represents the proportionate
equity interest of other partners in the Company's consolidated entities which
are not wholly-owned. As of June 30, 1998, this was primarily comprised of three
joint venture partnerships.

LIQUIDITY AND CAPITAL RESOURCES

         The Company requires capital primarily for the acquisition and the
development of dialysis facilities, the purchase of property and equipment for
existing facilities and to finance working capital requirements. At June 30,
1998, the Company's working capital was $38,739,000, cash and cash equivalents
were $16,026,000 and the Company's current ratio was 1.7 to 1.

         The Company's net cash provided by operating activities was $9,104,000
for the six months ended June 30, 1998. Cash provided by operating activities
consists of net income before depreciation and amortization expense, partially
offset by increases in accounts receivable and other current assets. The
Company's net cash used in investing activities was $38,703,000 for the six
months ended June 30, 1998. Cash used in investing activities resulted primarily
from $32,238,000 of cash paid for acquisitions, net of cash acquired, and
$10,090,000 of capital expenditures, partially offset by a $3,625,000 decrease
in investments.

         Cash provided by financing activities was $36,487,000 for the six
months ended June 30, 1998. Cash provided by financing activities resulted
primarily from $35,385,000 in net borrowings under the line of credit in
connection with certain acquisitions and $4,069,000 in proceeds from the
exercise of stock options, offset by $2,717,000 in debt paid in connection with
merger transactions.

         A significant component of the Company's growth strategy is the
acquisition and development of dialysis facilities. The Company believes that
existing cash and funds from operations, together with funds available under the
line of credit, will be sufficient to meet the Company's acquisition, expansion,
capital expenditure and working capital needs for the foreseeable future.
However, in order to finance certain large strategic acquisition opportunities,
the Company may incur from time to time additional short- and long-term bank
indebtedness and may issue equity or debt securities, the availability and terms
of which will depend on market and other conditions. There can be no assurance
that such additional financing, if required, will be available on terms
acceptable to the Company.



                                       10
<PAGE>   13

                             RENAL CARE GROUP, INC.
            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                     AND RESULTS OF OPERATIONS - (CONTINUED)

         Capital expenditures of approximately $28,000,000, primarily for
equipment replacement, expansion of existing dialysis facilities and
construction of de novo facilities are planned in 1998. The Company has made
capital expenditures to date of $10,090,000. The Company expects that such
capital expenditures will be funded with cash provided by operating activities
and available lines of credit. The Company believes that capital resources
available to it will be sufficient to meet the needs of its business, both on a
short- and long-term basis.

RISK FACTORS

         In evaluating the Company and its business, prospective investors
should carefully consider the following risk factors in addition to the other
information contained herein. This quarterly report contains statements that
constitute "forward-looking" statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements relate
to future events or the future financial performance of the Company and involve
known and unknown risks, uncertainties and other factors that may cause the
actual results, performance or achievements of the Company to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors include, among other
things, those discussed below, and such factors could cause actual results to
differ materially from those indicated by such forward-looking statements. The
Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise. In light of these risks and uncertainties, there can be no
assurance that the forward-looking information contained in this quarterly
report or the materials incorporated herein by reference will in fact transpire.

         Limited Combined Operating History. The Company has conducted
operations as a combined entity only since February 1996, upon the closing of
its initial public offering. Since the initial public offering, the Company has
made several additional acquisitions of entities that, in some cases, have been
part of the Company's combined operations for only a few weeks or months. There
can be no assurance that the Company will be able to integrate the dialysis
centers, information systems and related operations of the entities acquired by
it or to continue operating them profitably. Nor can there be any assurance that
the Company's management group will be able to implement effectively the
Company's operating and growth strategy while it is engaged in acquisition
activity. Failure to integrate successfully the centers and other operations
acquired by the Company or to implement effectively the Company's operating and
growth strategy could have a material adverse effect on the Company's results of
operations, financial condition or business.

         Dependence On Government Reimbursement. The Company estimates that
approximately 68%, 63% and 61% of its net revenue for the years ended December
31, 1996 and 1997, and the six months ended June 30, 1998, respectively,
consisted of reimbursements from Medicare under the ESRD program, including
revenue for the reimbursement of the administration of EPO. Since 1983,
Congressional actions have resulted in occasional changes in the Medicare
composite reimbursement rate, and the Company is not able to predict whether
future rate changes will be made. Legislation or regulations may be enacted in
the future that may significantly modify the ESRD program or otherwise affect
the amount paid for the Company's services. Any such action could have a
material adverse effect on the Company's results of operations, financial
condition and business. Furthermore, increases in operating costs that are
subject to inflation, such as labor and supply costs, without a compensating




                                       11
<PAGE>   14

increase in prescribed rates, may have a material adverse effect on the
Company's earnings in the future. The Company is also unable to predict whether
certain ancillary services, for which the Company currently is reimbursed
separately, may in the future be included in the Medicare composite rate.

         Revenues from the administration of EPO (the substantial majority of
which are reimbursed through Medicare and Medicaid programs) were approximately
19%, 21% and 23% of the net revenue of the Company for the years ended December
31, 1996 and 1997, and the six months ended June 30, 1998, respectively. EPO
reimbursement significantly affects the Company's earnings. The President has
included in his 1999 budget a proposal to decrease Medicare reimbursement for
EPO. Any reduction in reimbursement rates for EPO could have a material adverse
effect on the Company's results of operations, financial condition or business.
EPO is produced by a single manufacturer, and any interruption of supply or
product cost increases could have a material adverse effect on the Company's
results of operations, financial condition or business.

         The Company estimates that approximately 6%, 7% and 6% of the Company's
net revenue for the years ended December 31, 1996 and 1997, and the six months
ended June 30, 1998, respectively, were funded by Medicaid or comparable state
programs. The Medicaid programs are subject to statutory and regulatory changes,
administrative rulings, interpretations of policy and governmental funding
restrictions, all of which may have the effect of decreasing program payments,
increasing costs or modifying the way the Company operates its dialysis
business.

         Dependence On Other Sources Of Reimbursement. The Company estimates
that approximately 26%, 30% and 33% of its net revenue for the years ended
December 31, 1996 and 1997, and the six months ended June 30, 1998,
respectively, were derived from sources other than Medicare and Medicaid.
Substantially all of this revenue comes from private insurance for chronic
dialysis treatments and payments from hospitals with which the Company has
contracts for the provision of acute dialysis services. In general, private
insurance reimbursement and payments for treatments performed at hospitals are
at rates significantly higher than Medicare and Medicaid rates. The Company
believes that if Medicare reimbursement for dialysis treatment is reduced in the
future, these private payors may be required to assume a greater percentage of
the costs of dialysis care and, as a result, may focus on reducing dialysis
payments as their overall costs increase. In addition, the Company believes that
health maintenance organizations ("HMOs") and other managed care providers may
have a strong incentive to reduce further the costs of specialty care and may
seek to reduce amounts paid for dialysis. The Company is unable to predict
whether and to what extent changes in these private reimbursement rates may be
made in the future. Any reduction in the rates paid by private insurers and
hospitals or a significant change in the Company's payor mix toward additional
Medicare or Medicaid reimbursement could have a material adverse effect on the
Company's results of operations, financial condition and business. Similarly,
increases in operating costs that are subject to inflation, such as labor and
supply costs, without a compensating increase in private reimbursement rates,
could have a material adverse effect on the Company's results of operations,
financial condition or business.

         Risks Associated With Growth Strategy. The Company's strategy includes
expanding its dialysis business through the acquisition and development of
dialysis centers and the management of nephrology practices. Competition for
acquisitions in the dialysis industry has increased significantly in recent
years and, as a result, the cost of acquiring dialysis centers has increased.
There can be no assurance that the Company will be able to identify, acquire or
profitably integrate acquired dialysis centers and nephrology practices.
Acquisitions involve a number of risks related to integration, including adverse
short-term effects on the Company's reported operating results, diversion of
management's attention, dependence on retention, hiring and training of key
personnel, including Medical Directors for each



                                       12
<PAGE>   15

dialysis center, some or all of which could have a material adverse effect on
the Company's results of operations, financial condition or business. In
addition, there can be no assurance that acquired or managed dialysis centers
will achieve net revenue and earnings that justify the Company's investment
therein or expenses related thereto. In order to implement its growth strategy,
the Company may require substantial capital resources and need to incur, from
time to time, short- and long-term bank indebtedness. The Company also may need
to issue in public or private transactions, equity or debt securities, the terms
of which will depend on market and other conditions. There can be no assurance
that any such additional financing will be available on terms acceptable to the
Company, if at all. To the extent that the Company is unable to acquire dialysis
centers or acquire or manage nephrology practices, to integrate such centers and
practices successfully, or to obtain financing on terms acceptable to the
Company, its ability to expand its business could be reduced significantly.

         Risks Associated With Liabilities Of Acquired Businesses. The Company
has acquired and will continue to acquire businesses with prior operating
histories. Acquired companies may have unknown or contingent liabilities,
including liabilities for failure to comply with health care laws and
regulations, such as billing and reimbursement, fraud and abuse and similar
anti-referral laws. The Company has from time to time identified certain past
practices of acquired companies that do not conform to its standards. Although
the Company institutes policies designed to conform such practices to its
standards following completion of acquisitions, there can be no assurance that
the Company will not become liable for past activities that may later be
asserted to be improper by private plaintiffs or government agencies. Although
the Company generally seeks to obtain indemnification from prospective sellers
covering such matters, there can be no assurance that any such matter will be
covered by indemnification or, if covered, that the liability sustained will not
exceed contractual limits or the financial capacity of the indemnifying party.

         Dependence On Physician Referrals. The Company's dialysis centers
depend upon local nephrologists for referrals of ESRD patients for treatment and
one or a few physicians typically account for all or a significant portion of
the patient referral base at a center. The loss of one or more referring
physicians at a particular center could have a material adverse effect on the
operations of such center, and the loss of a significant number of referring
physicians could have a material adverse effect on the Company's results of
operations, financial conditions and business. In many instances stockholders of
the Company are the primary referral sources for the dialysis centers operated
by the Company. If such ownership is deemed to violate applicable federal or
state law, such as the illegal remuneration provisions of the Social Security
Act and similar state laws which prohibit the payment of remuneration to induce
referrals, such physician owners may be forced to dispose of their stock in the
Company.

         Operations Subject To Extensive Government Regulation. The Company is
subject to extensive federal, state and local regulation regarding, among other
things, fraud and abuse, patient referral, false claims, health and safety,
environmental compliance and toxic waste disposal. Much of this regulation,
particularly in the areas of fraud and abuse and patient referral, is complex
and open to differing interpretations. First, the illegal remuneration
provisions of the Anti-Kickback Statute make it illegal for any person to, among
other things, solicit, offer, receive or pay any remuneration in exchange for
referring, or to induce the referral of, a patient for treatment which may be
paid for by Medicare, Medicaid or a similar state program. Second, the Stark Law
prohibits physician referrals for "designated health services" (including some
of the specific services offered by the Company) to entities with which a
physician or an immediate family member has a "financial relationship." These
laws contain certain statutory exemptions, and federal agencies have promulgated
regulations clarifying certain of these provisions and exceptions and creating
certain additional exceptions or "safe harbors" from such prohibitions. Many
states have enacted similar provisions of law, which may not have identical




                                       13
<PAGE>   16

prohibitions or exceptions, but which may apply regardless of whether Medicare
or Medicaid funds are involved. However, due to the breadth of the statutory
provisions and the absence in many instances of regulations or court decisions
addressing the specific arrangements by which the Company conducts its business,
it is possible that some of the Company's practices might be challenged under
these laws. Sanctions for violating these federal and state laws may include
civil monetary fines, disqualification from participation in the Medicare or
Medicaid programs and criminal sanctions. There can be no assurance that the
Company's practices will not be challenged by governmental authorities, or that
the Company will not be subject to sanctions under such laws or be required to
alter or discontinue certain of its practices. In addition, there can be no
assurance that if the Company is required to alter its practices, that it will
be able to do so successfully. The occurrence of any of these events could
result in a material adverse effect on the Company's results of operations,
financial condition or business.

         A number of proposals for health care reform have been made recently to
provide greater governmental control of health care spending and to provide
broader access to health care services. For example, HIPAA, among other things,
provides for insurance portability for individuals who lose or change jobs,
limits exclusions for pre-existing conditions and establishes a pilot program
for medical savings accounts. HIPAA also amends existing crimes and criminal
penalties for Medicare fraud and enacts new federal health care fraud crimes. It
is uncertain what additional health care reform legislation, if any, ultimately
will be implemented or whether other changes in the administration or
interpretation of governmental health care programs will occur. The Company
cannot predict what effect future health care legislation or other changes in
the administration or interpretation of governmental health care statutes,
regulations, or programs may have on the Company's operations.

         Substantial Competition. The dialysis industry is fragmented and is
consolidating rapidly. Accordingly, the industry is highly competitive,
particularly from the standpoint of competition for the acquisition of existing
dialysis centers and the development of relationships with referring physicians.
Many of the Company's competitors have substantially greater financial resources
and more established operations and infrastructure than the Company and may
compete with the Company for acquisitions of dialysis centers and nephrology
practices. In addition, the Company may also experience competition from
referring physicians who open their own dialysis centers. There can be no
assurance that the Company will be able to compete effectively with any such
competitors.

         Dependence On Key Personnel. The Company is dependent upon the services
of certain key executive officers. The Company's growth will depend in part upon
its ability to attract and retain skilled employees, for whom competition is
intense. The Company believes that its future success will also depend on its
ability to attract and retain qualified physicians to serve as Medical Directors
of its dialysis centers. The Company does not carry key-man life insurance on
any of its officers. The loss by the Company of any of its executive officers,
or the inability to attract and retain qualified management personnel and
Medical Directors, could have a material adverse effect on the Company's results
of operations, financial condition or business.

             CAUTIONARY NOTICE REGARDING FORWARD LOOKING STATEMENTS

THIS REPORT, PRESS RELEASES AND OTHER PUBLIC STATEMENTS BY THE COMPANY CONTAIN
"FORWARD-LOOKING STATEMENTS," WITHIN THE MEANING OF VARIOUS PROVISIONS OF THE
FEDERAL SECURITIES LAWS, THAT ADDRESS ACTIVITIES, EVENTS OR DEVELOPMENTS THAT
WILL OR MAY OCCUR IN THE FUTURE. THESE STATEMENTS ARE BASED ON ASSUMPTIONS AND
ANALYSES MADE BY THE COMPANY IN LIGHT OF ITS EXPERIENCE AND PERCEPTION OF
HISTORICAL



                                       14
<PAGE>   17

TRENDS, CURRENT CONDITIONS AND EXPECTED FUTURE DEVELOPMENTS, AND OTHER FACTORS
BELIEVED APPROPRIATE IN THE CIRCUMSTANCES. ACTUAL RESULTS AND DEVELOPMENTS ARE
SUBJECT TO A NUMBER OF RISKS AND UNCERTAINTIES, INCLUDING GENERAL ECONOMIC,
MARKET OR BUSINESS CONDITIONS; OPPORTUNITIES (OR LACK THEREOF) THAT MAY BE
PRESENTED TO AND PURSUED BY THE COMPANY; COMPETITIVE ACTIONS BY OTHER COMPANIES;
CHANGES IN LAWS OR REGULATIONS; AND OTHER FACTORS AS MAY BE DISCUSSED FROM TIME
TO TIME IN THE COMPANY'S SEC REPORTS AND OTHER FILINGS, MANY OF WHICH ARE BEYOND
THE CONTROL OF THE COMPANY. ACCORDINGLY, READERS ARE CAUTIONED NOT TO PLACE
UNDUE RELIANCE ON SUCH FORWARD LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE
DATE MADE AND WHICH THE COMPANY UNDERTAKES NO OBLIGATION TO REVISE TO REFLECT
EVENTS AFTER THE DATE MADE.




                                       15
<PAGE>   18


PART II - OTHER INFORMATION

ITEM 2.  CHANGES IN SECURITIES.

(a)      None.

(b)      See Note 2 to Financial Statements concerning the three-for-two
         stock split in the form of a dividend.

(c)      On April 1, 1998, the Company issued 258,656 shares of Common Stock to
         the former owners of Four State Regional Dialysis Center, Inc., Fort
         Scott Regional Dialysis Center, Inc. and Miami Regional Dialysis
         Center, Inc. in a private placement pursuant to the exemption from
         registration set forth in Section 4(2) of the Securities Act.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

On June 4, 1998, the Annual Meeting of Stockholders of Renal Care Group, Inc.
was held in Nashville, Tennessee for the following purposes:

1.       To elect Joseph C. Hutts and Thomas A. Lowery, M.D. as Class II
         Directors to serve for a term of three (3) years and until their
         successors are elected;

<TABLE>
<CAPTION>
                                                                     FOR           AGAINST           ABSTAIN
                                                                     ---           -------           -------
<S>                                                                <C>             <C>               <C>
         Election of Joseph C. Hutts
         as Class II Director                                      20,412,462         --             227,196

         Election of Thomas A. Lowery, M.D.
         as Class II Director                                      20,536,902         --             102,756
</TABLE>

         The terms of Mr. Brooks, Dr. McMurray, Dr. Jacobson, Dr. Bower, Dr.
         Johnson and Dr. Meredith have not expired and therefore were not up for
         reelection.

2.       To consider and vote upon a proposal to approve an amendment to the
         Renal Care Group, Inc. 1996 Third Amended and Restated Stock Incentive
         Plan (the "Plan") to increase the number of shares available for
         issuance thereunder;

                FOR                    AGAINST                        ABSTAIN

             15,612,129                4,901,478                       14,822

ITEM 5.  OTHER INFORMATION

STOCKHOLDER PROPOSALS

The proxy statement solicited by management of the Company with respect to the
1999 Annual Meeting of Stockholders will confer discretionary authority to vote
on proposals of stockholders of the Company intended to be presented for
consideration at such Annual Meeting that are submitted to the Company after
April 29, 1999.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

(a)      Exhibits

<TABLE>

<S>      <C>
10.16    Fourth Amended and Restated 1996 Stock Incentive Plan
         (incorporated herein by reference to Appendix A to the Company's
         Proxy Statement relating to the 1998 Annual Meeting of Stockholders,
         filed on April 27, 1998)
10.38    Stock Option Agreement between the Company and Sam A. Brooks
10.39    Stock Option Agreement between the Company and Gary A. Brukardt
10.40    Stock Option Agreement between the Company and Raymond Hakim, M.D.
10.41    Stock Option Agreement between the Company and Ronald Hinds
10.42    Stock Option Agreement between the Company and Joseph C. Hutts
10.43    Stock Option Agreement between the Company and Harry R. Jacobson, M.D.
27.1     Financial Data Schedule for the six months ended June 30, 1998 (filed
         via Edgar on August 14, 1998)
27.2     Financial Data Schedule for the six months ended June 30, 1997 (filed
         via Edgar on August 14, 1998)
</TABLE>

(b)   Reports on Form 8-K

         None



                                       16
<PAGE>   19


                                    SIGNATURE

         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.


                                  RENAL CARE GROUP, INC.
                                  ---------------------
                                       (Registrant)




August 14, 1998                 BY: /s/ Ronald Hinds
                                   ---------------------------------------------
                                   Ronald Hinds
                                   Executive Vice President,
                                   Chief Financial Officer, Secretary/Treasurer
                                   and Principal Financial Officer and Principal
                                   Accounting Officer




                                       17
<PAGE>   20


                                  EXHIBIT INDEX


<TABLE>
Exhibit
Number                    Description of Exhibits                                 Page No.
------                    -----------------------                                 --------
<S>      <C>                                                                      <C>
10.16    Fourth Amended and Restated 1996 Stock Incentive Plan
         (incorporated herein by reference to Appendix A to the Company's
         Proxy Statement relating to the 1998 Annual Meeting of Stockholders,
         filed on April 27, 1998)
10.38    Stock Option Agreement between the Company and Sam A. Brooks
10.39    Stock Option Agreement between the Company and Gary A. Brukardt
10.40    Stock Option Agreement between the Company and Raymond Hakim, M.D.
10.41    Stock Option Agreement between the Company and Ronald Hinds
10.42    Stock Option Agreement between the Company and Joseph C. Hutts
10.43    Stock Option Agreement between the Company and Harry R. Jacobson, M.D.
27.1     Financial Data Schedule for the six months ended June 30, 1998 (filed
         via Edgar on August 14, 1998)
27.2     Financial Data Schedule for the six months ended June 30, 1997 (filed
         via Edgar on August 14, 1998)
</TABLE>




                                       18