<PAGE>
 
                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549

                                  FORM 10-K/A

[x]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
     EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED APRIL 30, 1997
                                       OR
[_]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

                        Commission File Number:  0-16235
                                        
                           PHP HEALTHCARE CORPORATION
             ------------------------------------------------------   
             (Exact name of registrant as specified in its charter)

           Delaware                                           54-1023168
-------------------------------                         ----------------------
(State or other jurisdiction of                         (I.R.S. Employer
incorporation or organization)                          Identification Number)

  11440 Commerce Park Drive
      Reston, Virginia                                           20191
-----------------------------                                  ---------- 
(Address of principal office)                                  (zip code)

      (Registrant's Telephone Number, Including Area  Code):  (703) 758-3600

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

<TABLE>
<S>                                          <C>    
          Title of each class:               Name of each exchange on which registered:
------------------------------------------   ------------------------------------------
   COMMON STOCK, $0.01 PAR VALUE, WITH                  NEW YORK STOCK EXCHANGE
ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS
</TABLE>
                                        
       Securities registered pursuant to Section 12(g) of the Act:  NONE

  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 by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  
            ---
    
  The aggregate market value of the voting stock held by nonaffiliates of the
registrant (based on the closing price of such stock as reported on June 30,
1997 through the New York Stock Exchange) was approximately $128 million.  There
were 11,474,139 shares of common stock, $0.01 par value per share, outstanding
as of June 30, 1997.
<PAGE>
 
     The undersigned registrant hereby amends the following items, financial
statements, exhibits or other portions of its annual report on Form 10-K by
restating such portions in their entirety as set forth in the pages attached
hereto:

     Part III, Items 10 through 13.


                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

  The information required by this Item for executive officers is set forth in
Part I of this report under the heading "Executive Officers" of the Company.

  The following sets forth certain information as of the date hereof with
respect to the Company's directors.  The Board of Directors is classified into
three classes whose terms are staggered to expire in different years.  The term
of office of one class of directors expires each year in rotation so that one
class is elected at each annual meeting of shareholders for a full three-year
term.  The Board was expanded from nine to twelve members in June 1997.  The
terms of four of the present directors expire at the 1997 annual meeting.  The
other eight directors will continue in office for the remainder of their terms
as indicated below.

<TABLE>
<CAPTION>
                                                             SERVED AS        TERM AS DIRECTOR
                               POSITIONS OR OFFICES           DIRECTOR         EXPIRES AT THE                       
           NAME                  WITH THE COMPANY        CONTINUOUSLY SINCE  ANNUAL MEETING IN          AGE         
--------------------------  ---------------------------  ------------------  ------------------  ------------------ 
<S>                         <C>                          <C>                 <C>                 <C>
Charles P. Reilly                      None                     1991                1997                 55       
                                                                                                                 
Jack M. Mazur               President                           1976                1998                 55       
                                                                                                                 
Michael D. Starr            Senior Executive Vice               1985                1998                 53       
                            President, Treasurer, and                                                            
                            Chief Executive Officer,                                                             
                            Government Managed Care                                                              
                            Division                                                                             
                                                                                                                 
Robert L. Bowles, Jr.       President, D.C. Chartered           1996                1999                 57       
                            Health Plan, Inc.                                                                    
                                                                                                                 
William J. Lubin            Executive Vice President            1997                1997                 45       
                            and Chief Executive                                                                  
                            Officer, Commercial                                                                  
                            Managed Care Division                                                                
                                                                                                                 
Frank L. Provato, M.D.      Executive Vice President            1997                1998                 49       
                            and Corporate Medical
                            Director
</TABLE>
                                       2

<PAGE>
 
<TABLE>
<CAPTION>
                                                             SERVED AS        TERM AS DIRECTOR
                               POSITIONS OR OFFICES           DIRECTOR         EXPIRES AT THE                       
           NAME                  WITH THE COMPANY        CONTINUOUSLY SINCE  ANNUAL MEETING IN          AGE         
--------------------------  ---------------------------  ------------------  ------------------  ------------------ 
<S>                         <C>                          <C>                 <C>                 <C>
George E. Schafer, M.D.     Senior Vice President for           1981                1997                 75
                            Medical Affairs                                                        
                                                                                                   
Paul T. Cuzmanes                       None                     1989                1997                 52
                                                                                                   
Donald J. Ruffing                      None                     1991                1999                 76
                                                                                                   
Joseph G. Mathews                      None                     1993                1999                 63
                                                                                                   
Jerry W. Carlton                       None                     1997                1999                 55
                                                                                                   
John J. McDonnell                      None                     1997                1998                 50
</TABLE>

     The following are brief summaries of the business experience during at
least the past five years of each of the directors of the Company.

     Charles P. Reilly joined the Company as a Director in 1991 and became
Chairman of the Board in February 1997.  Mr. Reilly is the managing general
partner of Shamrock Investments, a financial advisory and investment firm that
specializes in the health care industry.  Mr. Reilly serves as Chairman of the
Board of Directors of Dynamic Health, Inc., an acute care hospital company, and
as a director of G & L Realty Corporation, a NYSE health care real estate
investment trust (REIT).  Mr. Reilly has served as a director, trustee and
governing council member of the Federation of American Healthcare Systems and
The National Committee for Quality Health Care and the American Hospital
Association.  From August 1994 to August 1995, Mr. Reilly was an officer of the
Company, serving as a member of the Executive Council.

     Jack M. Mazur has been a Director of the Company since 1976 and has served
as President since October 1995.  Prior to his election as President, Mr. Mazur
was Chief Executive Officer of the Company's Commercial Managed Care Division.
From August 1989 to October 1995, he served as Senior Executive Vice President
of the Company, and from June 1986 to October 1993 as Secretary of the Company.

     Michael D. Starr has been a Director since 1985.  Mr. Starr was Executive
Vice President from 1986 to September 1995 and has served as Senior Executive
Vice President since October 1995.  He has served as Chief Executive Officer,
Government Managed Care Division, since April 1995.

     Robert L. Bowles, Jr. was elected by the Board as a Director in September
1996.  Mr. Bowles joined the Company in connection with the Company's
acquisition of D.C. Chartered Health Plan, Inc.  Mr. Bowles is the founder of
D.C. Chartered and has more than 30 years of experience in administration and
management of health care services and operations for corporations and the
military.

                                       3

<PAGE>
 
     William J. Lubin was elected by the Board as a Director in June 1997.  Mr.
Lubin joined the Company in August 1994 as Senior Vice President for Managed
Care.  In late 1994 he assumed the position of Chief Operating Officer,
Commercial Managed Care Division.  In October 1995, he became Chief Executive
Officer, Commercial Managed Care Division.  In April 1996, he became Executive
Vice President.  Prior to joining the Company, Mr. Lubin held management
positions with Aetna Health Plans, Travelers Insurance Companies, Lincoln
National, and Blue Cross and Blue Shield of Connecticut.

     Frank L. Provato, M.D. was elected by the Board as a Director in June 1997.
Dr. Provato joined the Company in 1993 and currently serves as Executive Vice
President and Corporate Medical Director.  Prior to joining the Company, he
served as Vice President and Corporate Medical Director for GTE Corporation,
where he was responsible for the development of health care cost management
strategies and the implementation of a GTE-sponsored primary care health center
in Tampa, Florida.  Dr. Provato has 23 years of diverse background in clinical
medicine, health care administration, occupational health, and employee benefits
administration.

     George E. Schafer, M.D., joined the Company as a Director in 1981.  Dr.
Schafer serves as Senior Vice President for Medical Affairs and previously
served as Vice President/Medical Director.  Dr. Schafer retired from the Air
Force with the rank of Lieutenant General, having served as Surgeon General of
the United States Air Force.

     Paul T. Cuzmanes joined the Company as a Director in 1989.  Mr. Cuzmanes is
a partner with the law firm of Wilson, Elser, Moskowitz, Edelman & Dicker.  Mr.
Cuzmanes specializes in health care law, commercial law and the representation
of municipalities.  He is a fellow in the American Society of Pharmaceutical
Law.

     Donald J. Ruffing joined the Company as a Director in 1991.  Colonel
Ruffing retired as the Chief of the Air Force Medical Service Corps, Office of
the Surgeon General, where he was responsible for developing plans, policies and
procedures for the management of the Air Force Medical Service Corps.  In 1990,
Colonel Ruffing served as a team member of the Peer and Application Reviews,
Refugee Mental Health Programs for the National Institute of Mental Health.

     Joseph G. Mathews joined the Company as a Director in July 1993.  Mr.
Mathews owns and operates Joseph G. Mathews & Associates, an insurance brokerage
firm.  Mr. Mathews' professional designations include Chartered Financial
Consultant and Master of Science Financial Services.  In addition to serving on
the Company's board, Mr. Mathews is a member of the boards of directors of Lake
of the Ozarks General Hospital, Mark Twain Bank, Sanford Brown College,
Lindenwood College and Learfield Communication.

     Jerry W. Carlton was elected by the Board as a Director in June 1997.  Mr.
Carlton is the Managing Partner of the Newport Beach, California office of the
law firm of O'Melveny & Myers L.L.P. and his specialties are tax and general
business law.  He has handled hospital acquisitions and divestitures and has
been responsible for the legal aspects of provider relations for a large managed
care entity.  In addition to serving on the Company's board, Mr. Carlton is a
member of the boards of directors of Phoenix House, Prentice Day School,
Willametta K. Kay Foundation, Arlington Investment Company, Vicente Management
Company, and the Foley Timber Company.

     John J. McDonnell was elected by the Board as a Director in June 1997.  Mr.
McDonnell is the co-founder, Chairman and CEO of Coagulation Diagnostics, Inc.
of Bethesda, Maryland.  He also serves as the Secretary to the Board of
Directors and Counsel for Yurie Systems, Inc., a telecommunications 

                                       4

<PAGE>
 
firm. From 1990 to 1995, Mr. McDonnell was Counsel with Reed Smith Shaw &
McClay, a law firm. He has also held executive and legal positions with
Fairchild Space and Defense Corporation and Fairchild Industries, as well as
with the Department of the Navy. He is on the boards of directors of Sequoia
National Bank and several charitable and educational institutions.

                                       5

<PAGE>
 
ITEM 11.  EXECUTIVE COMPENSATION

Summary Compensation

     The following table sets forth certain information for each of the last
three fiscal years with respect to the compensation awarded to, earned by, or
paid to the Chief Executive Officers of the Company and the next five most
highly compensated executive officers for the fiscal year ended April 30, 1997.

<TABLE>
<CAPTION>
                                                                                LONG TERM
                                                                              COMPENSATION
                                         ANNUAL COMPENSATION                     AWARDS
                              ---------------------------------------------  ---------------     
       NAME AND                                               OTHER ANNUAL                         ALL OTHER
       PRINCIPAL                                              COMPENSATION    OPTIONS/SARS       COMPENSATION
       POSITION         YEAR      SALARY ($)       BONUS ($)       ($)          AWARD(S)              ($)
----------------------  ----  -------------------  ---------  -------------  ---------------  -------------------
<S>                     <C>   <C>                  <C>        <C>            <C>              <C>
Jack M. Mazur,          1997             583,000        -0-       /(1)/               -0-                 10,285/(2)/
  President and Chief   1996             550,000        -0-                           -0-                 17,636
  Executive Officer     1995             400,000      66,667                       720,000                21,688
                                                                           
Michael D. Starr,       1997             350,000        -0-       /(1)/               -0-                  2,286/(3)/
  Senior Executive      1996             330,000        -0-                           -0-                  9,362
  Vice President        1995             275,000        -0-                        290,000                 9,688
                                                                  
                                                                           
Robert L. Bowles, Jr.   1997             317,000        -0-       /(1)/             10,000                88,948/(4)/
  President, D.C.       1996             284,000        -0-                           -0-                 82,473
  Chartered Health      1995             200,000        -0-                         50,000                73,724
  Plan, Inc.                                                               
                                                                           
Frank L. Provato        1997             281,000        -0-       /(1)/             10,000                 1,079/(5)/
  Executive Vice        1996             250,000        -0-                         27,500                   581
  President             1995             250,000        -0-                         60,000                   899
                                                                           
William J. Lubin,       1997             274,000        -0-       /(1)/             10,000                   632/(6)/
  Executive Vice        1996             207,692        -0-                         15,000                   706
  President             1995             154,800        -0-                        100,000                   620
                                                                           
FORMER EXECUTIVE                                                           
 OFFICERS:                                                                 
----------------------                                                     
                                                                           
Charles H. Robbins,     1997             503,000        -0-       /(1)/               -0-              2,289,312/(8)/
  Former Chairman       1996             625,000        -0-                           -0-                 19,413
  and Chief Executive   1995             500,000      83,333                      790,000                 23,827
  Officer/(7)/                                                             
                                                                           
John P. Cole,           1997             313,000        -0-       /(1)/               -0-                  2,790/(12)/
  Former Executive      1996             330,000        -0-                           -0-                  1,636
  Vice President/(9)/   1995             176,346/(10)/  -0-                       30,000/(11)/             1,488
</TABLE>

--------------------------------------

                                       6

<PAGE>
 
/(1)/  Each of the named executive officers receives certain perquisites,
       including the use of Company automobiles; such perquisites, however, do
       not exceed the lesser of $50,000 or 10% of such officer's salary and
       bonus.

/(2)/  Includes $1,785 term life insurance premiums, $500 in 401(k) Plan
       matching fees and $8,000 director's fees from D.C. Chartered Health Plan,
       Inc.

/(3)/  Includes $1,786 term life insurance premiums and $500 in 401(k) Plan
       matching fees.

/(4)/  Includes $3,954 term life insurance premiums, $500 in 401(k) Plan
       matching fees, $8,000 director's fees from D.C. Chartered Health Plan,
       Inc. and $76,494 forgiveness of debt related to the acquisition of D.C.
       Chartered Health Plan, Inc.

/(5)/  Includes $1,079 term life insurance premiums.

/(6)/  Includes $632 term life insurance premiums.

/(7)/  Mr. Robbins retired as Chairman and Chief Executive Officer as of January
       31, 1997.

/(8)/  Includes $7,812 term life insurance premiums, $500 in 401(k) Plan
       matching fees, $6,000 director's fees from D.C. Chartered Health Plan,
       Inc., $2,000,000 retirement payment and $275,000 related to a one-year
       noncompetition agreement.

/(9)/  Mr. Cole served as Executive Vice President until December 27, 1996.

/(10)/ Salary shown is that from Mr. Cole's date of employment, September 29,
       1994, through the end of the fiscal year.

/(11)/ Does not include options for 100,000 shares received by Mr. Cole upon the
       merger of JP Cole & Associates into the Company in October 1994.

/(12)/ Includes $2,790 term life insurance premiums.

                                       7

<PAGE>
 
OPTION GRANTS

     The following table sets forth certain information regarding options
granted during fiscal 1997 by the Company to the individuals named in the
Summary Compensation Table.

<TABLE>
<CAPTION>
                                                                                  
                                                                                     POTENTIAL REALIZABLE VALUE AT ASSUMED ANNUAL   
                                INDIVIDUAL GRANTS                                  RATES OF STOCK PRICE APPRECIATION FOR OPTION TERM
---------------------------------------------------------------------------------  -------------------------------------------------
                          NO. OF    % OF TOTAL
                        SECURITIES   OPTIONS
                        UNDERLYING  GRANTED TO               MARKET
                         OPTIONS    EMPLOYEES    EXERCISE    PRICE     EXPIRATION
NAME                     GRANTED     IN 1997      PRICE    GRANT DATE     DATE          0%                 5%              10%
----------------------  ----------  ----------   --------  ----------  ----------  -------------   ----------------   -------------
<S>                     <C>         <C>          <C>       <C>         <C>         <C>             <C>                <C>
 
Jack M. Mazur                  ---         ---        ---         ---         ---            ---                ---             ---
 
Michael D. Starr               ---         ---        ---         ---         ---            ---                ---             ---
 
Robert L. Bowles, Jr.       10,000        2.63%    $23.50      $23.50     8/21/06            -0-           $147,790        $374,529
 
Frank L. Provato            10,000        2.63%    $23.50      $23.50     8/21/06            -0-           $147,790        $374,529
 
William J. Lubin            10,000        2.63%    $23.50      $23.50     8/21/06            -0-           $147,790        $374.529
 
Charles H. Robbins             ---         ---        ---         ---         ---            ---                ---             ---
 
John P. Cole                   ---         ---        ---         ---         ---            ---                ---             ---
</TABLE>
                                        

OPTION EXERCISES

     The following table sets forth certain information relating to stock
options exercised by and the number and value of unexercised options previously
granted to, the individuals named in the Summary Compensation Table during
fiscal 1997.

              AGGREGATED OPTIONS/SAR EXERCISES IN FISCAL YEAR 1997
                     AND FISCAL YEAR-END OPTION/SAR VALUES


<TABLE>
<CAPTION>
                                                                                                      VALUE OF UNEXERCISED
                                                                          NUMBER OF UNEXERCISED           IN-THE-MONEY
                                                                               OPTIONS/SARS               OPTIONS/SARS
                                                                                AT 4/30/97                 AT 4/30/97
                                SHARES ACQUIRED             VALUE              EXERCISABLE/               EXERCISABLE/
          NAME                  ON EXERCISE (#)          REALIZED ($)         UNEXERCISABLE               UNEXERCISABLE
-------------------------  -------------------------  ------------------  ----------------------  -----------------------------
<S>                        <C>                        <C>                 <C>                     <C>
 
Jack M. Mazur                   
                                      -0-                 -0-                 480,000/240,000          $4,836,666/$2,418,334
 
Michael D. Starr                      -0-                 -0-                  193,333/96,667          $  1,906,747/$953,378
</TABLE>

                                       8

<PAGE>
 
<TABLE>
<CAPTION>
                                                                                                      VALUE OF UNEXERCISED
                                                                          NUMBER OF UNEXERCISED           IN-THE-MONEY
                                                                               OPTIONS/SARS               OPTIONS/SARS
                                                                                AT 4/30/97                 AT 4/30/97
                                SHARES ACQUIRED             VALUE              EXERCISABLE/               EXERCISABLE/
          NAME                  ON EXERCISE (#)          REALIZED ($)         UNEXERCISABLE               UNEXERCISABLE
-------------------------  -------------------------  ------------------  ----------------------  -----------------------------
<S>                        <C>                        <C>                 <C>                     <C>
 
Robert L. Bowles, Jr.               -0-                      -0-                   33,333/26,667          $    285,414/$142,711
                                                                        
Frank L. Provato                    -0-                      -0-                   69,167/48,333          $    585,835/$217,916
                                                                        
William J. Lubin                    -0-                      -0-                   71,667/53,333          $    599,129/$299,559
                                                                        
Charles H. Robbins                  -0-                      -0-                 526,667/263,333          $5,290,253/$2,645,122
 
John P. Cole                        -0-                      -0-                       130,000/0          $        1,235,000/$0
</TABLE>
                                        
-----------------


401(k) PLAN

     The Company established the PHP Healthcare Corporation 401(k) Plan (the
"401(k) Plan") effective January 1, 1991, pursuant to which employees may defer
compensation for income tax purposes under Section 401(k) of the Internal
Revenue Code of 1986, as amended (the "Code").  Participant contributions will
be invested at all times in any or all of six funds at the direction of the
participant.  Participant contributions will be matched up to $500 annually by
the Company.  The Company contributed $500 to the 401(k) Plan during fiscal year
1997 on behalf of each of the participating named executive officers.


DIRECTOR COMPENSATION

     Employee directors do not receive additional compensation for serving on
the Board.  The non-employee Chairman of the Board is paid $62,500 per quarter
for his service as Chairman.  Other non-employee directors are paid $4,500 per
quarter for their services as directors, plus $650 for each special meeting of
the Board.  In addition, each outside director serving on a particular committee
is paid $1,200 for attending up to three committee meetings annually and $500
for each additional committee meeting.  Each director is reimbursed for travel
expenses relating to attending meetings of the Board of Directors and its
committees.

     The Company has adopted a Directors' Retainer Plan.  For any fiscal
quarter, each director of the Company may elect to have the full amount of his
retainer paid in the form of Common Stock.  The number of shares issued is
calculated based on the then current market value of the stock.

     Under the 1996 Incentive Plan, on an annual basis each non-employee
director is granted 5,000 stock options at a purchase price equal to the fair
market value of a share of Common Stock on the grant 

                                       9

<PAGE>
 
date. Each such option vests after three years if the optionee remains a
Director on the third anniversary of the grant.


EMPLOYMENT AGREEMENTS

     The Company has entered into Employment Agreements with Jack M. Mazur and
Michael D. Starr.  Under these agreements, Mr. Mazur is employed as President
and Chief Executive Officer and Mr. Starr is employed as Senior Executive Vice
President and Chief Executive Officer, Government Managed Care Division.  The
agreements renew automatically on May 1 of each year unless terminated by either
the executive or the Company on ninety (90) days advance notice, or otherwise in
accordance with the agreements, except that no notice may be given by the
Company sooner than three years after a change in control (as defined in the
agreements).  The agreements are currently in effect through April 30, 1998.  In
the event of termination because of the executive's death or disability, the
Company will pay the executive or his estate a lump sum severance payment equal
to one year's salary and a pro rata bonus for the year in which the termination
occurs.  In the event the Company terminates the agreement other than for cause,
death or disability or the executive terminates the agreement because of certain
adverse changes following a change in control of the Company, then (a) the
Company must pay the executive a lump sum amount equal to three times the sum of
the executive's base salary and bonus; (b) the executive is entitled, for a
period of three years, to continuation of coverage at the Company's expense of
the executive's disability, medical and dental benefits; (c) all restrictions on
any outstanding awards granted to the executive will lapse and be immediately
vested, all stock options will become fully exercisable and the executive will
have the right to require the Company to purchase for cash any shares of
unrestricted stock and stock purchased upon the exercise of any options.

     The Company has entered into an agreement with William J. Lubin under
which, if Mr. Lubin's employment is involuntarily terminated, he will be
entitled to receive continued compensation as a consultant for 18 months or
until he secures full time employment.  Mr. Lubin serves as Executive Vice
President and Chief Executive Officer, Commercial Managed Care Division.  Under
the agreement, if the Company is sold or acquired by way of merger, stock swap
or cash transaction whereby there is a change in control of at least 20% of the
voting power of the Company's outstanding shares, and if Mr. Lubin's
responsibilities and compensation are reduced, then Mr. Lubin's employment will
be deemed to have been involuntarily terminated.

     The Company also has entered into an employment agreement with John P. Cole
as of December 27, 1996.  Under this agreement, Mr. Cole is employed as a
nonexecutive employee of the Company with an annual salary of $240,000.  The
agreement provides that if the Company is sold, merged or reorganized whereby
there is a change in control of more than 25% of the Company's outstanding
shares, a new Board of Directors is elected and existing management is replaced,
and if Mr. Cole's responsibilities and compensation are reduced, Mr. Cole's
employment will be deemed to have been involuntarily terminated "without cause"
and he will be entitled to receive continued compensation throughout the
remaining term of the agreement or any extension thereof.  The agreement is
currently in effect through December 31, 1997.


RETIREMENT OF FORMER CHAIRMAN

     Charles H. Robbins retired as Chairman and Chief Executive Officer of the
Company as of January 31, 1997.  The Company provided Mr. Robbins a retirement
agreement that included a one-time 

                                      10

<PAGE>
 
payment of $2 million and a payment of $275,000 related to a one-year
noncompetition agreement. In connection with the agreement, on May 2, 1997, Mr.
Robbins repaid all outstanding notes receivable and accrued interest due the
Company under the Senior Executive Loan Program and notes receivable related to
certain life insurance policies. The agreement contains additional clauses which
include, among other things, a "standstill" provision and restrictions on the
timing of any dispositions of Mr. Robbins' holdings in the Company.

                                      11

<PAGE>
 
ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT


  The following table sets forth certain information, as of August 25, 1997,
with respect to the beneficial ownership of Common Stock by (i) each person
known to the Company to be the beneficial owner of more than 5% of its
outstanding shares of Common Stock, (ii) each director of the Company, (iii)
each executive officer named in the Summary Compensation Table, and (iv) all
directors and executive officers of the Company as a group.
<TABLE>
<CAPTION>
 
Name and Address                                           No. of Shares   Percent of Class
---------------------------------------------------------  --------------  -----------------
<S>                                                        <C>             <C>
 
Charles H. Robbins.......................................  1,890,125/(1)/             15.41%
 7720 Carlton Place
 McLean, VA 22102
 
Shamrock Investments/(2)/................................  1,096,459/(3)/              9.10%
 Charles P. Reilly
 Michael E. Gallagher
 2049 Century Park East, Suite 3330
 Los Angeles, CA 90067
 
John W. Kluge............................................    816,500/(4)/              7.06%
 c/o Metromedia Company
 One Meadowlands Plaza
 East Rutherford, NJ 07073
 
Bosko Djordjevic and Elizabeth Keck Djordjevic, Trustee..    800,000/(5)/              6.92%
 505 S. Beverly Drive, Suite 215
 Beverly Hills, CA 90212
 
Jack M. Mazur............................................    654,009/(6)/              5.36%
 11440 Commerce Park Drive
 Reston, VA  20191
 
John P. Cole.............................................    400,000                   3.46%
 11440 Commerce Park Drive
 Reston, VA  20191
 
Michael D. Starr.........................................    389,185/(7)/              3.29%
 11440 Commerce Park Drive
 Reston, VA  20191
 
Robert L. Bowles, Jr.....................................    140,344/(8)/              1.21%
 820 First Street, N.E., Suite LL100
 Washington, D.C.  20002-4205
 
Frank L. Provato, M.D....................................     79,166/(9)/                 *
 11440 Commerce Park Drive
 Reston, VA 20191
 
William J. Lubin.........................................    77,333/(10)/                 *
 11440 Commerce Park Drive
 Reston, VA  20191
</TABLE> 
                                      12

<PAGE>
 
<TABLE> 
<CAPTION> 

Name and Address                                           No. of Shares   Percent of Class
---------------------------------------------------------  --------------  ----------------
<S>                                                        <C>             <C>      
George E. Schafer, M.D...................................    48,684/(11)/           *
 4 Imperial Oaks
 San Antonio, TX 78248
 
Joseph G. Mathews........................................     9,725                 *
 3510 Highway O
 Wright City, MO 63390
 
Donald J. Ruffing........................................     8,503                 *
 11104 Woodlawn Boulevard
 Upper Marlboro, MD 20772
 
Paul T. Cuzmanes.........................................     4,956                 *
 250 West Pratt Street
 Baltimore, MD 21201
 
Jerry W. Carlton.........................................         0                 *
 610 Newport Center Drive, Suite 1700
 Newport Beach, CA  92660
 
John J. McDonnell........................................         0                 *
 11440 Commerce Park Drive
 Reston, VA  20191
 
All directors and executive officers
 as a group (13 persons)................................. 2,033,469               15.65%
</TABLE> 
-----------------

/*/    Represents less than 1% of the shares of the Company's outstanding
       stock.

/(1)/  According to the Amendment No. 4 to Schedule 13D filed on May 2, 1997, of
       Charles H. Robbins, which includes 300,000 shares, or 2.6% of the class,
       owned by Mr. Robbins' spouse, Ellen E. Robbins, individually and as
       trustee for the benefit of their children. Also includes 706,667 shares
       which Mr. Robbins presently could acquire upon the exercise of options
       granted by the Company.

/(2)/  The persons listed constitute a group within the meaning of Section
       13(d)(3) of the Securities Exchange Act of 1934, as amended (the "1934
       Act"), and jointly filed a Schedule 13D with the Securities and Exchange
       Commission on October 11, 1994.

/(3)/  Includes 200,000 shares owned by Shamrock Investments, 237,770 shares
       owned by Mr. Reilly, 172,220 shares owned by Mr. Gallagher, 22,500 shares
       which Shamrock Investments could acquire upon the exercise of options
       granted by the Company, 231,596 shares which Mr. Reilly could acquire
       upon the exercise of options granted by the Company, 121,262 shares which
       Mr. Gallagher could acquire upon the exercise of options granted by the
       Company, 59,963 shares which Mr. Reilly could acquire upon conversion of
       a promissory note of the Company, 6,173 shares which Mr. Reilly could
       acquire upon conversion of a promissory note of the Company issued to
       Shamrock Investments, and 44,975 shares which Mr. Gallagher could acquire
       upon conversion of a promissory note of the Company.

                                      13

<PAGE>
 
/(4)/  According to Schedule 13D filed on May 8, 1997, John W. Kluge is the
       beneficial owner of these shares held by Chase Manhattan Bank, John W.
       Kluge and Stuart Subotnick, trustees of a grantor trust of which John W.
       Kluge is the beneficial owner.

/(5)/  According to the Amendment No. 1 to Schedule 13D of Bosko Djordjevic and
       Elizabeth Keck-Djordjevic, as trustee, filed on September 15, 1995.

/(6)/  Includes 646,667 shares which Mr. Mazur could acquire upon the exercise
       of options granted by the Company. Does not include either 512,014
       shares, or 4.43% of the class, owned by VACHR, Inc., a corporation owned
       by Mr. Mazur's spouse, Lynn Mazur, or 30,000 shares owned by J&J
       Investment Partnership, a partnership wholly owned by members of Mr.
       Mazur's family. Mr. Mazur disclaims beneficial ownership of the shares
       owned by Lynn Mazur (through VACHR, Inc.) and J&J Investment Partnership.

/(7)/  Includes 253,333 shares which Mr. Starr presently could acquire upon the
       exercise of options granted by the Company.

/(8)/  Includes 36,666 shares with Mr. Bowles presently could acquire upon the
       exercise of options granted by the Company.

/(9)/  Includes 79,166 shares which Dr. Provato presently could acquire upon the
       exercise of options granted by the Company.

/(10)/ Represents the shares which Mr. Lubin presently could acquire upon
       exercise of options granted by the Company.

/(11)/ Includes 1,000 shares which Dr. Schafer presently could acquire upon the
       exercise of options granted by the Company.

                                      14

<PAGE>
 
ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

  In September 1995, the Company retained Shamrock Investments ("Shamrock") as a
financial advisor.  Charles P. Reilly, the managing general partner of Shamrock,
was a Director of the Company and became Chairman of the Board in February 1997.
Michael E. Gallagher is a general partner of Shamrock.  During fiscal 1997,
total billings approximated $233,000.

  The Company has a Senior Executive Loan Program (the "Program"), pursuant to
which loans to senior executive officers may be made up to three and one-half
times the officer's annual salary.  Each loan must be repaid within one year and
bears interest at two percent above the Company's short-term borrowing rate.
All loans are collateralized by the shares of the Company's Common Stock owned
by the senior executive officer.  The due dates on amounts outstanding were
extended in 1997 for twelve months.  During fiscal year 1997, loans were
outstanding under the Program to Charles H. Robbins, Jack M. Mazur, Michael D.
Starr and William J. Lubin.  The largest amount outstanding during fiscal 1997
to Mr. Robbins was $1,596,000, to Mr. Mazur was $2,128,000, to Mr. Starr was
$800,000 and to Mr. Lubin was $48,000.  The interest rate on these loans as of
July 1997 was 10.5%.  The loan to Mr. Robbins was repaid on May 2, 1997.

    The Company advanced amounts to Robert L. Bowles, Jr. in the form of
promissory notes bearing interest at 8.5% collateralized by Mr. Bowles stock in
the Company.  The largest amount outstanding during fiscal 1997 was $767,000.

    In accordance with the Board of Directors' approval, the Company makes
premium payments relating to certain insurance policies on behalf of certain
officers of the Company.  These advances are owed to the Company and are
collateralized by assignment of the underlying cash surrender value and related
death benefit.  During 1997, the officers signed promissory notes bearing
interest at 7% and due in April 2002 for the amounts advanced.  The amount
outstanding as of April 30, 1997, to Mr. Robbins was $745,000, to Mr. Mazur was
$231,000, to Mr. Starr was $207,000 and to Mr. Lubin was $20,000.  The note from
Mr. Robbins was repaid May 2, 1997.

    Paul Cuzmanes is a partner with the law firm of Wilson, Elser, Moskowitz,
Edelman & Dicker, which firm the Company retained in fiscal 1997.  During the
year ended April 30, 1997, total billings approximated $321,000.

    The Company also provided Charles H. Robbins, Ellen Robbins (individually
and as trustee under trusts for the benefit of two of their children, Caroline
H. Robbins and Lee S. Robbins) and Charles B. Robbins, with certain registration
rights for the Common Stock they beneficially owned as of February 24, 1997,
subject to certain restrictions on the timing of dispositions contained in Mr.
Robbins' Employment Agreement, and the Common Stock under Company options held
by Charles H. Robbins.

     Joseph G. Mathews is the owner of an insurance brokerage firm through which
the Company purchased keyman life insurance policies covering certain executive 
officers from various insurance companies. During fiscal 1997, premiums paid to 
those insurance companies for keyman life insurance approximated $443,000.

     For further information with respect to related party transactions, see
Note 12 of Notes to Consolidated Financial Statements.

                                      15

<PAGE>
 
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

     Section 16(a) of the 1934 Act requires the Company's executive officers and
directors, and persons who own more than ten percent of a registered class of
the Company's equity securities, to file reports of ownership and changes in
ownership on Forms 3, 4 and 5 with the Securities and Exchange Commission
("SEC") and the New York Stock Exchange.  Executive officers, directors and
greater than ten percent shareholders are required by the SEC regulation to
furnish the Company with copies of all Forms 3, 4 and 5 they file.

     Based on the Company's review of the copies of such forms it has received
and based on written representations from certain reporting persons that they
were not required to file Forms 5 for the fiscal year, except as noted below,
the Company believes that all its executive officers, directors and greater than
ten percent shareholders complied with all filing requirements applicable to
them with respect to transactions during fiscal 1997. Certain of the Company's 
directors failed to report on a timely basis certain option grants under the 
Company's 1996 Incentive Plan, as follows: Charles P. Reilly, Paul T. Cuzmanes, 
Donald J. Ruffing and Joseph G. Mathews (each one late report with respect to 
one transaction). These transactions will be reported on Forms 5 to be filed in 
September 1997.

     Pursuant to the requirements of Section 13 or 15(d) 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.

                                    PHP HEALTHCARE CORPORATION


Date:  August 28, 1997              By:  /s/ Anthony M. Picini
                                         ----------------------------
                                         Anthony M. Picini
                                         Executive Vice President and
                                         Chief Financial Officer

                                      16