S E L E C TM E D I C A LH O L D I N G SC O R P O R A T I O N Partners in Post-Acute Care A N N U A LR E P O R T

QU ALITYCAREMADES TR ONGER THR OUGHJOINTVENTUREP AR TNERSHIPS Banner HealthUC San Diego HealthOchsner HealthDignity Health HonorHealthUF HealthSpectrum HealthCleveland Clinic UCLA Health & Cedars-Sinai Emory HealthSSM Health OhioHealth critical illness re c o ver yrehabilitation hospitals S E L E C T M E D I C A LI M P R O V I N G Q U A L I T Y O F L I F E OH MO GA CA OH MI FL AZ NV LA CA AZ

through the addition of U.S. HealthWorks. Much of the Penn State Health Riverside Health simultaneously focusing on executing strategic initiatives GR O WTH SP O TLIGHT : C ONCENTRASE GMENT TriHealth Baylor Scott & White In 2018, our Concentra segment grew significantly year was spent on this large-scale integration, while which resulted in: increased visits, decreased patient UPMC Pinnacleturnaround times and enhanced staffing efficiencies. >> Concentra is the nation’s largest provider of occupational health services. This segment’s expanded national footprint - coupled with its focus on quality care and patient/client satisfaction - gives us a distinct competitive advantage and will drive growth opportunities in 2019 and beyond. Patient Success Story While being treated for cancer, Melodee experienced numbness in her right arm, which her oncologist felt was due to chemotherapy-related neuropathy. As time went on, Melodee lost sensation in her right hand, was unable to tie her shoes and had to take a daily medication, which she feared would be long-term. When she fell at work and injured her left arm, Melodee’s employer sent her to Concentra. There, Alan, the physician assistant, asked about both her injured left arm and her numb right arm/hand. He felt her right arm had been misdiagnosed and was actually cubital tunnel syndrome. When Melodee started physical therapy for her left arm, her therapists, Evan and Justin, also provided home exercises for her right hand, which had an immediate effect. “Two weeks after going to Concentra, I was able to quit taking medication for my right hand and could tie my own shoes again,” Melodee said. “If I hadn’t fallen at work, I may never have regained the use of my right hand.” outpatient rehabilitation 2 0 1 8 A N N U A L R E P O R T 1 c oncentr a PA VA PA TX OH

 T OO U RS H A R E H O L D E R S As we look back on 2018, there are many accomplishments to celebrate. There is a dominant theme that emerges and that is one of partnership. Throughout the year, Select Medical positioned itself as the nation’s premier partner in post-acute care. During the past decade, we have successfully partnered with leading organizations to elevate and advance healthcare across the country. And 2018 was no exception, as we grew existing joint ventures, announced new partnerships and cultivated future opportunities. By joining together, the strength of two becomes the power of one … which creates innovative ways to further the delivery of post-acute care. Early in 2018, Select Medical and Dignity Health announced the completion of a transaction to combine Concentra and U.S. HealthWorks. Select Medical also entered into a joint venture with Banner Health to operate rehabilitation hospitals and outpatient rehabilitation clinics in Arizona. In May, we celebrated the opening of a new rehabilitation hospital through our partnership with Ochsner Health System in Louisiana. During the summer, we expanded our joint venture with Baylor Scott & White Health when the doors of a fourth rehabilitation hospital opened and we added outpatient rehabilitation clinics in Austin, Texas. In October, we announced plans for our first critical illness recovery hospital in California through a partner-ship with UC San Diego Health. In keeping with our values, we focused on delivering superior quality in all that we do across the organization. Within our rehabilitation hospital segment, Kessler Institute for Rehabilitation was honored for the 26th consecutive year by U.S. News & World Report as one of the nation’s best rehabilitation hospitals. Mean-while, our critical illness recovery hospital segment participated in the Mid-Atlantic Alliance for Performance Excellence Program, a Malcolm Baldrige-based program. We received the Mastery Award and embraced this opportunity to celebrate what we do well, while identifying ways to further innovate and excel. We were once again pleased that our commitment to growing our Company resulted in another year of strong financial performance. Net operating revenues grew 16.4% year-over-year to more than $5.0 billion and operating income grew 17.3% year-over-year to $417.3 million. In 2018, we generated more than $494 million in cash flows from operations during the year, which allowed us to pay down close to $200 million of Select’s outstanding debt balance during the year. Our operating segments continued to evolve and expand their focus in 2018, which include the following highlights: In 2018, we undertook a rebranding initiative for our long-term acute care (LTAC) hospital segment by revealing a new name: critical illness recovery hospitals. It better defines our purpose, is more easily under-stood by key stakeholders, and quickly conveys how we help high-acuity and medically complex patients heal and recover. In October, our rehabilitation hospitals and critical illness recovery hospitals partnered together to host the 2018 National Summit on Post-Acute Care Safety and Quality in Washington, D.C. This prestigious event is now in its sixth year. Within the outpatient rehabilitation segment, we continued to focus on concussion management and non-pharmaceutical pain management. Our clinics educated their respective communities on “direct access” and how individuals can seek physical rehabilitation care without a prescription. 2 S E L E C T M E D I C A LI M P R O V I N G Q U A L I T Y O F L I F E

 Our innovative ReVital Cancer Rehabilitation program more than doubled in size – growing from four regional markets (at the end of 2017) to 10 (by the end of 2018). Much of the year was spent integrating the Concentra and U.S. HealthWorks organizations. This combined footprint of 524 occupational medicine centers and 124 employer worksites in 43 states serves more than 44,000 patients each day. The ONE Select Commitment To maintain Select Medical’s leadership position in post-acute care, we invest time, effort and energy in our culture and employee engagement. Our ONE Select philosophy remains at the forefront of our organizational consciousness, as it unites our operating segments, geographies, brands and workforce. In 2018, our employees laced up their sneakers as nearly 200 walk teams participated at local Relay For Life events. Together, we raised more than a quarter million dollars for the American Cancer Society. In May, nearly 500 colleagues participated in the 2018 Select Medical Way Conference. Held in Cleveland, it was the largest to date and represented our seventh annual reaffirmation to the Select Medical Way, which guides our organization’s culture. When Mother Nature’s wrath struck, we rallied together to ensure our patients and employees were safe at the hospitals, clinics and centers in the devastating path of two back-to-back hurricanes. In closing, 2018 was a year in which the company continued to grow and innovate. This was powered by the collective clinical quality and operational excellence of Select Medical and its partners. As always, we thank you and appreciate your trust and belief in all that we do. Sincerely, 2 0 1 8 A N N U A L R E P O R T 3 Robert A. Ortenzio Rocco A. Ortenzio David S. Chernow Executive Chairman & Co-FounderVice Chairman & Co-FounderPresident & Chief Executive Officer

 FINANCIAL HIGHLIGHT S SELE CT MEDICAL HOLDINGS C ORP OR ATION (In thousands, except per share data)20182017201620152014 (1) For the years ended December 31, 2016, 2017, and 2018, net operating revenues reflect the adoption of Topic 606, Revenue from Contracts with Customers. Net operating revenues were not retrospectively conformed for the years ended December 31, 2014 and 2015. (2) The selected financial data for the company’s Concentra segment for the periods presented begins as of June 1, 2015, which is the date the Concentra acquisition was consummated. (3) Adjusted EBITDA is used by Select Medical to report its segment performance. Adjusted EBITDA is defined as earnings excluding interest, income taxes, depreciation and amortization, gain (loss) on early retirement of debt, stock compensation expense, acquisition costs associated with Concentra, Physiotherapy and U.S. HealthWorks, non-operating gain (loss) and equity in earnings (losses) of unconsolidated subsidiaries. Refer to Item 6 and Item 7 of Form 10-K for further consideration of Adjusted EBITDA as a Non-GAAP measure. 4 S E L E C T M E D I C A LI M P R O V I N G Q U A L I T Y O F L I F E FOR THE YEARS ENDED Net operating revenues(1) Income from operations Net income attributable to Select Medical Holdings Corporation Earnings per common share, fully diluted Dividends per share Cash flow from operations SEGMENT INFORMATION Net operating revenues(1) Critical illness recovery hospital Rehabilitation hospital Outpatient rehabilitation Concentra(2) Other $ 5,081,258 417,279 137,840 1.02 — 494,194 $ 1,753,584 707,514 1,062,487 1,557,673 — $ 4,365,245$ 4,217,460 $ 3,742,736 $ 3,065,017 355,878299,847274,790 284,476 177,184 115,411130,736120,627 1.330.87 0.99 0.91 — — 0.100.40 238,131 346,603 208,415170,642 $ 1,725,022$ 1,756,961$ 1,902,776$ 1,840,179 622,469498,100444,005 404,720 1,003,830979,363810,009 819,397 1,013,224982,495585,222 700 541724 721 Total Net Operating Revenues Adjusted EBITDA(3) Critical illness recovery hospital Rehabilitation hospital Outpatient rehabilitation Concentra(2) Other $ 5,081,258 $ 243,015 108,927 142,005 251,977 (100,769) $ 4,365,245$ 4,217,460 $ 3,742,736 $ 3,065,017 $ 252,679$ 224,609 $ 258,223$ 272,055 90,04156,902 69,400 69,732 132,533129,83098,220 97,584 157,561143,00948,301 (94,822) (88,543) (74,979) (75,499) Total Adjusted EBITDA BALANCE SHEET SNAPSHOT AT YEAR-END Cash and cash equivalents Working capital Total assets Total debt Stockholders’ equity $ 645,155 $ 175,178 287,338 5,964,265 3,293,381 803,042 $ 537,992$ 465,807 $ 399,165 $ 363,872 $ 122,549$ 99,029$ 14,435$ 3,354 315,423191,268 19,869133,220 5,127,166 4,920,626 4,388,6782,924,809 2,699,9022,698,9892,385,8961,552,976 823,368815,725859,253739,515

 BO ARDOFDIRE CT ORS Robert A. Ortenzio James S. Ely III Leopold Swergold Executive Chairman & Co-FounderFounder & Chief Executive Officer Managing Member Select Medical Holdings CorporationPriCap Advisors, LLCAnvers Management Company, LLC Rocco A. Ortenzio William H. FristMarilyn B. Tavenner Vice Chairman & Co-FounderFormer Majority Leader of Former Administrator of Select Medical Holdings Corporationthe United States SenateCenters for Medicare & Partner, Cressey & CompanyMedicaid Services Russell L. CarsonHarold L. Paz, M.D. FounderExecutive Vice President Welsh, Carson, Anderson & Stowe& Chief Medical Officer Aetna Inc. Bryan C. CresseyThomas A. Scully Founder & Partner General Partner Cressey & CompanyWelsh, Carson, Anderson & Stowe EXE CUTIVEOFFICERS Robert A. Ortenzio Martin F. JacksonScott A. Romberger Executive Chairman & Co-FounderExecutive Vice PresidentSenior Vice President, Controller & Chief Financial Officer & Chief Accounting Officer Rocco A. Ortenzio John A. SaichRobert G. Breighner, Jr. Vice Chairman & Co-FounderExecutive Vice PresidentVice President, Compliance and Audit Services & Chief Administrative Officer & Corporate Compliance Officer David S. Chernow Michael E. Tarvin President & Chief Executive Officer Executive Vice President, General Counsel & Secretary C ORP OR A TEINF ORM A TION Corporate Headquarters Stockholder Inquiries Register & Stock Transfer Agent Select Medical Holdings CorporationJoel T. Veit Stockholder correspondence 4714 Gettysburg RoadSenior Vice President & Treasurershould be mailed to: Mechanicsburg, PA 17055-50364714 Gettysburg RoadComputershare 717.972.1100Mechanicsburg, PA 17055-5036P.O. Box 505000 717.972.1100 | ir@selectmedical.comLouisville, KY 40233-5000 Independent Registered Public Stock ExchangeOvernight correspondence Accounting Firm NYSE should be mailed to: PricewaterhouseCoopers LLPSymbol: SEMComputershare Penn National Insurance Plaza462 South 4th Street, Suite 1600 2 N. 2nd Street, Suite 1100Internet Address Louisville, KY 40202 Harrisburg, PA 17101selectmedicalholdings.com 2 0 1 8 A N N U A L R E P O R T

 Our Mission SELE CT MEDICAL WILL PR O VIDE AN EX CEPTIONAL P A TIENT CARE EXPERIENCE THA T PR OMO TES HEALING AND RE C O VER Y IN A C OMP ASSIONA TE ENVIR ONMEN T . LEARN MORE A T >>SELE CT MEDICALHOLDINGS. C O M 47 14 GETTY SBUR G R O AD , ME CHANICSBUR G, P A 17 055