SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                    FORM 8-K

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

                                 CURRENT REPORT

                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) October 17, 1996
                                                 -------------------------------

                        INTEGRATED HEALTH SERVICES, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

           Delaware                    1-12306                23-2428312
----------------------------        ------------              ----------
(State or other jurisdiction        (Commission          (IRS Employer
        Of corporation)             File Number)         Identification No.)

10065 Red Run Boulevard, Owings Mills, Maryland               21117
------------------------------------------------            ---------
(Address of principal executive offices)                    (Zip Code)

Registrant's telephone number, including area code: (410) 998-8400
                                                    ----------------------------

                                 Not Applicable
-------------------------------------------------------------------------------
          (Former name or former address, if changed since last report)



<PAGE>
ITEM 2.        ACQUISITION OR DISPOSITION OF ASSETS

   On October  17,  1996,  Integrated  Health  Services,  Inc.  ("the  Company")
acquired  through merger First  American  Health Care of Georgia,  Inc.  ("First
American"),  a  provider  of home  health  services  in 21  states,  principally
Alabama, California, Florida, Georgia, Michigan, Pennsylvania and Tennessee. The
Company   believes   First   American  is  the  fourth   largest   (and  largest
privately-held) provider of home healthcare services in the United States.


   The  purchase  price for  First  American  was  $154.1  million  in cash plus
contingent payments of up to $155 million.  The contingent payments will be paid
as follows:  $10 million for 1999;  $40 million for 2000;  $51 million for 2001;
$39 million for 2002;  and $15 million  for 2003;  provided  that no  contingent
payment will be paid in respect of any year in which the percentage  increase in
the seasonally  unadjusted  Consumer Price Index for all Urban Consumers for the
Medical Care  expenditure  category (the "Medical CPI") exceeds 8% unless in any
subsequent year prior to 2004 the percentage increase in the Medical CPI is less
than 8%; and provided further that the foregoing  contingency  shall immediately
leave  if  legislation  is  enacted  that  changes  the  Medicare  reimbursement
methodology  for  home  health  services  to  a  prospectively  determined  rate
methodology,  in whole or in part. The Company  borrowed the cash purchase price
paid at the  closing  under its $700  million  revolving  credit  facility  with
Citibank, N.A., as Administrative Agent, and certain other lenders. $115 million
of the $154.1  million  paid at closing  was paid to the Health  Care  Financing
Administration  ("HCFA") in settlement of claims by HCFA seeking  repayment from
First American of certain disallowed reimbursements under Medicare, which claims
IHS believes relate to personal or corporate expenses,  rather than care-related
expenses (the "HCFA Claims").  The total  settlement with HCFA was $255 million;
the  remaining  $140  million will be paid from the  contingent  payments to the
extent such payments  become due.  During the first quarter of 1996, the Company
loaned  $18.1  million to First  American  to fund  certain of First  American's
pension and tax  liabilities.  The loan, which bore interest at a rate per annum
equal to the prime rate plus 4% and was due December 31, 1996,  was secured by a
pledge of  certain  shares of First  American  stock  owned by First  American's
principal stockholder.

   The  resolution  of the HCFA  Claims  will  require  a  restatement  of First
American's  financial  statements.  The HCFA  Claims  are  substantial,  and the
restatement  of  First  American's  financial  statements  is  likely  to have a
material adverse effect on First American's historical financial statements.  As
a result,  the  Company's pro forma  results of operation  reflecting  the First
American  acquisition will be adversely affected,  and such adverse effect could
be material.

   The  Company  believes  that the  acquisition  of First  American  will be an
important  component in the implementation of its post-acute  healthcare system.
First  American,  when  combined with the  Company's  existing  home  healthcare
operations,  will give the Company a significant home healthcare  presence in 24
states, many of which are the states the Company has targeted for its post-acute
healthcare  system.  The Company  believes  that its  expanded  home  healthcare
network will assist it in meeting the desire of payors for one stop shopping, as
well as offering  capitated rates to managed care providers.  Additionally,  the
Company  expects that Medicare will  implement a prospective  payment system for
home healthcare services in the next several years. Currently, Medicare provides
reimbursement  for home  healthcare  on a cost  basis  which  includes a rate of
return, subject to a cap. There is no reward for efficiency, provided that costs
are below the cap. Under  prospective  pay as currently  proposed,  a healthcare
provider would receive a predetermined rate for a given service.  Providers with
costs below the predetermined  rate will be entitled to keep some or all of this
difference.  Under  prospective  pay, the  efficient  operator will be rewarded.
Since  the  largest  component  of home  healthcare  costs  is  labor,  which is
basically   fixed,   the  Company   believes  the   differentiating   factor  in
profitability will be administrative costs. A large provider,  which the Company
is as a result of the First  American  acquisition,  should  be able to  achieve
administrative  efficiencies  compared with the small  providers which currently
dominate the home  healthcare  industry,  although  there can be no assurance it
will be able to do so. There can be no assurance  that Medicare will implement a
prospective  payment  system for home  healthcare  services in the next  several
years or at all.



<PAGE>


ITEM 7.  FINANCIAL  STATEMENTS,  PRO FORMA  FINANCIAL  INFORMATION  AND
         EXHIBITS

     a.   FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED.

   It  is  impractible  for  the  Company  to  provide  the  required  financial
information  on the date this report is being  filed.  As a result,  pursuant to
Instruction  (a)(4)  of Item 7 to Form  8-K,  the  Company  intends  to file the
required historical  financial statements of First American within 60 days after
the date this report was required to be filed.

     b.   PRO FORMA FINANCIAL INFORMATION.

   It  is  impractible  for  the  Company  to  provide  the  required  financial
information  on the date this report is being  filed.  As a result,  pursuant to
Instruction  (b)(2)  of Item 7 of Form  8-K,  the  Company  intends  to file the
required  pro forma  financial  information  within 60 days  after the date this
report was required to be filed.

   c. EXHIBITS.

     2.01  Merger  Agreement,  dated as of February  21,  1996 among  Integrated
Health Services, Inc., IHS Acquisition XIV, Inc., and First American Health Care
of Georgia, Inc. and its Principal Shareholders.


     2.02 Amendment to Merger  Agreement,  dated as of September 9, 1996, by and
among  Integrated  Health  Services,  Inc., IHS  Acquisition  XIV,  Inc.,  First
American Health Care of Georgia, Inc., Robert J. Mills and Margie B. Mills.
<PAGE>


                                   SIGNATURES
                                   ----------

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

                                       INTEGRATED HEALTH SERVICES, INC.


Date: October 24, 1996                   By /s/  W. Bradley Bennett
                                         --------------------------------------
                                         Name: W. Bradley Bennett
                                         Title: Executive Vice President and
                                                Chief Accounting Officer
[{"type": "8-K", "sequence": "1", "description": "FORM 8-K", "secsgml_size_bytes": 8845}]
{"company-data": {"conformed-name": "INTEGRATED HEALTH SERVICES INC", "cik": "0000785814", "assigned-sic": "8051", "irs-number": "232428312", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-12306", "film-number": "96647692"}, "business-address": {"street1": "10065 RED RUN BLVD", "city": "OWINGS MILLS", "state": "MD", "zip": "21117", "phone": "4109988400"}, "mail-address": {"street1": "100065 RED RUN BLVD", "city": "OWINGS MILLS", "state": "MD", "zip": "21117"}}
SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                    FORM 8-K

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

                                 CURRENT REPORT

                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) October 17, 1996
                                                 -------------------------------

                        INTEGRATED HEALTH SERVICES, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

           Delaware                    1-12306                23-2428312
----------------------------        ------------              ----------
(State or other jurisdiction        (Commission          (IRS Employer
        Of corporation)             File Number)         Identification No.)

10065 Red Run Boulevard, Owings Mills, Maryland               21117
------------------------------------------------            ---------
(Address of principal executive offices)                    (Zip Code)

Registrant's telephone number, including area code: (410) 998-8400
                                                    ----------------------------

                                 Not Applicable
-------------------------------------------------------------------------------
          (Former name or former address, if changed since last report)
ITEM 2.        ACQUISITION OR DISPOSITION OF ASSETS

   On October  17,  1996,  Integrated  Health  Services,  Inc.  ("the  Company")
acquired  through merger First  American  Health Care of Georgia,  Inc.  ("First
American"),  a  provider  of home  health  services  in 21  states,  principally
Alabama, California, Florida, Georgia, Michigan, Pennsylvania and Tennessee. The
Company   believes   First   American  is  the  fourth   largest   (and  largest
privately-held) provider of home healthcare services in the United States.

   The  purchase  price for  First  American  was  $154.1  million  in cash plus
contingent payments of up to $155 million.  The contingent payments will be paid
as follows:  $10 million for 1999;  $40 million for 2000;  $51 million for 2001;
$39 million for 2002;  and $15 million  for 2003;  provided  that no  contingent
payment will be paid in respect of any year in which the percentage  increase in
the seasonally  unadjusted  Consumer Price Index for all Urban Consumers for the
Medical Care  expenditure  category (the "Medical CPI") exceeds 8% unless in any
subsequent year prior to 2004 the percentage increase in the Medical CPI is less
than 8%; and provided further that the foregoing  contingency  shall immediately
leave  if  legislation  is  enacted  that  changes  the  Medicare  reimbursement
methodology  for  home  health  services  to  a  prospectively  determined  rate
methodology,  in whole or in part. The Company  borrowed the cash purchase price
paid at the  closing  under its $700  million  revolving  credit  facility  with
Citibank, N.A., as Administrative Agent, and certain other lenders. $115 million
of the $154.1  million  paid at closing  was paid to the Health  Care  Financing
Administration  ("HCFA") in settlement of claims by HCFA seeking  repayment from
First American of certain disallowed reimbursements under Medicare, which claims
IHS believes relate to personal or corporate expenses,  rather than care-related
expenses (the "HCFA Claims").  The total  settlement with HCFA was $255 million;
the  remaining  $140  million will be paid from the  contingent  payments to the
extent such payments  become due.  During the first quarter of 1996, the Company
loaned  $18.1  million to First  American  to fund  certain of First  American's
pension and tax  liabilities.  The loan, which bore interest at a rate per annum
equal to the prime rate plus 4% and was due December 31, 1996,  was secured by a
pledge of  certain  shares of First  American  stock  owned by First  American's
principal stockholder.

   The  resolution  of the HCFA  Claims  will  require  a  restatement  of First
American's  financial  statements.  The HCFA  Claims  are  substantial,  and the
restatement  of  First  American's  financial  statements  is  likely  to have a
material adverse effect on First American's historical financial statements.  As
a result,  the  Company's pro forma  results of operation  reflecting  the First
American  acquisition will be adversely affected,  and such adverse effect could
be material.

   The  Company  believes  that the  acquisition  of First  American  will be an
important  component in the implementation of its post-acute  healthcare system.
First  American,  when  combined with the  Company's  existing  home  healthcare
operations,  will give the Company a significant home healthcare  presence in 24
states, many of which are the states the Company has targeted for its post-acute
healthcare  system.  The Company  believes  that its  expanded  home  healthcare
network will assist it in meeting the desire of payors for one stop shopping, as
well as offering  capitated rates to managed care providers.  Additionally,  the
Company  expects that Medicare will  implement a prospective  payment system for
home healthcare services in the next several years. Currently, Medicare provides
reimbursement  for home  healthcare  on a cost  basis  which  includes a rate of
return, subject to a cap. There is no reward for efficiency, provided that costs
are below the cap. Under  prospective  pay as currently  proposed,  a healthcare
provider would receive a predetermined rate for a given service.  Providers with
costs below the predetermined  rate will be entitled to keep some or all of this
difference.  Under  prospective  pay, the  efficient  operator will be rewarded.
Since  the  largest  component  of home  healthcare  costs  is  labor,  which is
basically   fixed,   the  Company   believes  the   differentiating   factor  in
profitability will be administrative costs. A large provider,  which the Company
is as a result of the First  American  acquisition,  should  be able to  achieve
administrative  efficiencies  compared with the small  providers which currently
dominate the home  healthcare  industry,  although  there can be no assurance it
will be able to do so. There can be no assurance  that Medicare will implement a
prospective  payment  system for home  healthcare  services in the next  several
years or at all.
ITEM 7.  FINANCIAL  STATEMENTS,  PRO FORMA  FINANCIAL  INFORMATION  AND
         EXHIBITS

     a.   FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED.

   It  is  impractible  for  the  Company  to  provide  the  required  financial
information  on the date this report is being  filed.  As a result,  pursuant to
Instruction  (a)(4)  of Item 7 to Form  8-K,  the  Company  intends  to file the
required historical  financial statements of First American within 60 days after
the date this report was required to be filed.

     b.   PRO FORMA FINANCIAL INFORMATION.

   It  is  impractible  for  the  Company  to  provide  the  required  financial
information  on the date this report is being  filed.  As a result,  pursuant to
Instruction  (b)(2)  of Item 7 of Form  8-K,  the  Company  intends  to file the
required  pro forma  financial  information  within 60 days  after the date this
report was required to be filed.

   c. EXHIBITS.

     2.01  Merger  Agreement,  dated as of February  21,  1996 among  Integrated
Health Services, Inc., IHS Acquisition XIV, Inc., and First American Health Care
of Georgia, Inc. and its Principal Shareholders.

     2.02 Amendment to Merger  Agreement,  dated as of September 9, 1996, by and
among  Integrated  Health  Services,  Inc., IHS  Acquisition  XIV,  Inc.,  First
American Health Care of Georgia, Inc., Robert J. Mills and Margie B. Mills.
SIGNATURES
                                   ----------

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

                                       INTEGRATED HEALTH SERVICES, INC.

Date: October 24, 1996                   By /s/  W. Bradley Bennett
                                         --------------------------------------
                                         Name: W. Bradley Bennett
                                         Title: Executive Vice President and
                                                Chief Accounting Officer