FORM 8-K/A 

                          SECURITIES AND EXCHANGE COMMISSION
                               WASHINGTON, D.C.  20549

                                                                  


                                   AMENDMENT NO. 1
                                TO THE CURRENT REPORT

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

                                                                           
               

                           Date of Report: January 28, 1994
                                                                           
               


                          CONTINENTAL MEDICAL SYSTEMS, INC.
                (Exact name of registrant as specified in its charter)


                 Delaware              0-15088             51-0287965

                (State of          (Commission File     (I.R.S. Employer
              incorporation)           Number)         Identification No.)



               600 Wilson Lane, P.O. Box 715, Mechanicsburg, PA  17055
                       (Address of Principal Executive Offices)

          Registrant's telephone number, including area code:  717-790-8300 


               The Registrant hereby amends its  Current Report on Form 8-K
          filed with the Commission on January 25, 1994 by adding Item 7 as
          follows:


          Item 7.  Financial Statements and Exhibits

               A letter from Price Waterhouse is filed herewith as  Exhibit
          16.1, pursuant to Item 304(a)(3) of Regulation S-K. 

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


                                        CONTINENTAL MEDICAL SYSTEMS, INC.



          Date:   January 28, 1994      By: /s/ Dennis L. Lehman        
                                            Dennis L.  Lehman, Senior  Vice-
                                            President  -  Finance  and Chief
                                            Financial Officer


                                        Signing on behalf of the registrant
                                        and as principal financial officer. 


                                    EXHIBIT INDEX

          Exhibit     Document                          Page
          Number

          16.1        Letter of Price Waterhouse dated  Exhibit 16.1
                      January 25, 1994 regarding        follows directly
                      concurrence with statements made  after this
                      by CMS.                           Exhibit Index 


                                     EXHIBIT 16.1

          January 25, 1994

          Securities and Exchange Commission
          450 Fifth Street, N.W.
          Washington, DC  20549

          Dear Sirs:

          We have read Item 4 of Continental Medical Systems, Inc. Form 8-K
          dated January 25, 1994 and  are in agreement with the  statements
          contained therein.

          Yours very truly,


          /S/ Price Waterhouse