RESTATED EMPLOYMENT AGREEMENT
 
          THIS AGREEMENT, dated as of July 14, 1992, by and between UNIVERSAL
HEALTH SERVICES, INC., a Delaware corporation having its principal office at
367 South Gulph Road, King of Prussia, Pennsylvania 19406 (the "Company") and
ALAN B. MILLER, residing at 57 Crosby Brown Road, Gladwyne, Pennsylvania 19035
("Employee").
 
                                 W I T N E S S E T H:
 
          WHEREAS, employee has been and is employed by the Company as its
President and Chief Executive Officer pursuant to an Employment Agreement
dated as of January 1, 1981, as amended December 1984, July 15, 1987 and June
1, 1989 (the "Employment Agreement"), and Employee has served and is presently
serving as a Director of the Company;
 
          WHEREAS, the Company and Employee desire that such employment
continue pursuant to the terms and conditions hereof;
 
          WHEREAS,  because of the position Employee now holds with the
Company and will hold during the term of this Agreement, the Company's Board
of Directors considers it in the best interests of the Company, for an
extended period after the term of Employee's active employment, that the
Company have the benefit of Employee's services as a consultant and that
Employee refrain from competing with the Company; and 
 
          WHEREAS, after the term of his active employment by the Company,
Employee is willing to serve as a consultant to the Company and to refrain
from competing with the Company pursuant to the terms and conditions hereof
applicable thereto;
 
<PAGE>
          WHEREAS, the Employment Agreement is hereby amended and restated in
its entirety by this Agreement;
 
          NOW, THEREFORE, for and in consideration of the mutual premises,
representations and covenants herein contained, it is agreed as follows:
 
          1.   Term of Active Employment and Consulting Period.  
 
          The phrase "term of active employment", as used in this Agreement,
shall mean the period beginning July 14, 1992 and ending on December 31, 1997,
subject, however, to earlier termination as expressly provided herein, and
subject further to the right of Employee or the Company to extend the term of
active employment until December 31, 2002 by giving written notice thereof to
the other within 180 days prior to December 31, 1997.  The phrase "consulting
period", as used in this Agreement, shall mean, except as otherwise provided
herein, the period beginning immediately upon the expiration of the term of
active employment, as it may be extended, and continuing for five years after
such expiration.  The phrase "term of this Agreement", as used in this
Agreement, shall mean the term of active employment and the consulting period
together.
 
<PAGE>
 
          2.   Active Employment.
 
          The Company agrees to employ Employee, and Employee agrees to be
employed by the Company, as Chief Executive Officer and President of the
Company during the term of employment.
 
          3.   Duties.
 
               (a)  Employee agrees in the performance of his duties as Chief
Executive Officer and President of the Company during the term of active
employment to comply with the policies and reasonable directives of the Board
of Directors of the Company (and any subsidiary or subsidiaries of the Company
which shall, with the consent of Employee, at the time employ Employee).
 
               (b)  Employee agrees to devote his full time to the performance
of his duties during the term of active employment; and Employee shall not,
directly or indirectly, alone or as a member of a partnership, or as an
officer, director or employee of any other corporation, partnership or other
organization, be actively engaged in or concerned with any other duties or
pursuits which interfere with the performance of his duties hereunder. 
 
               (c)  The Company agrees that during the term of active
employment Employees' duties shall be such as to allow him to work and live in
the Philadelphia Metropolitan Area, and in no event shall Employee be required
to move his residence from, or operate (except in accordance with past
practice) outside of, the Philadelphia Metropolitan Area.
 
<PAGE>
 
          4.   Base Salary.
 
               (a)  As compensation for the services to be rendered by
Employee hereunder, the Company agrees to pay or cause to be paid to Employee
for the fiscal year ending December 31, 1992 and each fiscal year thereafter
during the term of this Agreement a base salary of six hundred seventy five
thousand ($675,000) dollars per annum which salary shall be increased by an
amount equal at least to the percentage increase in the Consumer Price Index
over the previous year as reported by the United States Department of Labor,
Bureau of Labor Statistics, for the Philadelphia Metropolitan Area, and may be
increased by such larger amount as the Board of Directors in its discretion
may determine, but in no event shall the salary be reduced from the salary
paid during the previous fiscal year. 
 
               (b)  The Company also agrees to pay or reimburse Employee
during the term of active employment for all reasonable travel and other
expenses incurred or paid by Employee in connection with the performance of
his services under this Agreement in accordance with past practice. 
 
          5.   Annual Bonus.
 
          It is acknowledged that it has been the practice of the Company to
award Employee an annual bonus (the "Annual Bonus").  It is agreed that the
Annual Bonus award shall be continued during the term of employment as
follows:  the Company shall pay to Employee during the term of active
employment, within ninety (90) days after the end of the fiscal year ending
December 31, 1992 and of each fiscal year of the Company thereafter during the
term of active employment, an amount determined by the Board of Directors, but
not less than $100,000.
 
<PAGE>
 
          6.   Other Bonuses and Benefits.
 
               (a)  Employee may also be paid during the term of active
employment, in addition to the arrangements described above, such bonuses and
other compensation as may from time to time be determined by the Board of
Directors of the Company. 
 
               (b)  (1)  The Company agrees to pay Employee an annual amount
          of $13,674.00 during the term of this Agreement as payment for
          premiums under a life insurance policy, Policy No. 158034323 (the
          "Policy") issued by Manufacturers Life Insurance Company (the
          "Insurer"), on the life of Employee.  
 
                    (2)  Should Employee's employment with the Company cease
          because of Employee's resignation from employment with the Company
          or "discharge for cause" under the terms of this Agreement, the
          Company's obligations under clause (b)(1) hereof shall also cease. 
          At such time, the Company shall be entitled to receive from Employee
          a payment (based on the year of resignation or "discharge for
          cause") as follows:
 
                                     Year               Amount
                          ----              -------
                          1992              $29,090
                          1993              $38,716
                          1994              $48,815
                          1995              $59,410
                          1996              $70,534
                          1997              $90,843
                          1998             $103,774
                          1999             $117,338
                          2000             $131,443
                          2001             $146,119
                          2002             $151,334
 
<PAGE>
                    (3)  Employee's obligations under clause (b)(2) hereof are
          non-recourse to Employee and are secured solely by the cash
          surrender value of the Policy.  Should Employee not make the
          required payment to the Company of the amounts set forth in clause
          (b)(2) hereof, Employee agrees to surrender the Policy for
          termination by the Insurer in return for the payment by the Insurer
          to the Company of the cash surrender value of the Policy.
 
                    (4)  The Company's interest in the Policy shall be limited
          to the right to recover the cash surrender value of the Policy under
          the terms of this Agreement.
 
                    (5)  Except as specifically herein granted to the Company,
          Employee shall retain all incidents of ownership in the Policy,
          including, but not limited to, the right to change the beneficiary
          of the Policy, and the right to exercise all settlement options
          permitted by the terms of the Policy; provided, however, that all
          rights retained by Employee, transferee and beneficiary shall be
          subject to the terms and conditions of this Agreement. 
 
                    (6)  The Insurer is authorized by this Agreement to
          recognize the Company's claims to rights hereunder without
          investigating the reason for any action taken by the Company, the
          termination of Employees' employment, the giving of any notice
          required herein, or the application to be made by the Company of any
          amounts to be paid to the Company.  The signature of any officer of
          the Company shall be sufficient for the exercise of any rights under
          the Policy and the receipt of the Company for any sums received by
          it shall be a full discharge and release therefor to the Insurer. 
<PAGE>
 
                    (7)  If the Insurer is made or elects to become a party to
          any litigation concerning the proper apportionment under this
          agreement, Employee and the Company and their transferees agree to
          be jointly and severally liable for the Insurer's litigation
          expenses, including reasonable attorney fees. 
 
               (c)  Employee shall also be eligible to and shall participate
in, and receive the benefits of, any and all profit sharing, pension, bonus,
stock option or insurance plans, or other similar types of benefit plans which
may be initiated or adopted by the Company.
 
          7.   Fringe Benefits.
 
               Employee shall be entitled to and shall receive the following
benefits during the term of this Agreement:
 
               (a)  All prior benefits previously enjoyed in accordance with
past practice; and 
 
               (b)  Health, disability and accident insurance as presently in
force or as may be improved by the Board of Directors. 
 
          8.   Consulting Period Retention and Duties.
 
               (a)  Except as otherwise provided in Sections 9, 10 and 11
hereof, Employee agrees to be retained by the Company, and Company agrees to
retain Employee, as a consultant to the Company during the consulting period.
 
               (b)  During the consulting period Employee will provide such
reasonable consulting services concerning the business, affairs and management
of the Company as may be requested by the Company's Board of Directors, but
Employee shall not be required to devote more than five (5) business days each
<PAGE>
month to such services, which shall be performed at such place as is mutually
convenient to both parties or, in the event there is no agreement as to a
mutually convenient place, such services shall be performed at the principal
executive offices of the Company.  Employee may, subject to the restrictions
of Section 13, engage in other employment during the consulting period as is
not inconsistent with his consulting obligations hereunder. 
 
          9.   Consulting Period Compensation.
 
               (a)  As compensation for the services to be rendered by
Employee during the consulting period the Company agrees to pay or cause to be
paid to Employee a fee equal to one-half Employee's base salary paid under
Section 4 hereof at the date of the expiration of the term of active
employment, payable in equal monthly installments during the consulting
period.
 
               (b)  The Company also agrees to pay or reimburse Employee for
all reasonable travel and other expenses incurred or paid by Employee in
connection with the performance of his services under this Agreement during
the consulting period in accordance with the payment or reimbursement
practices in effect during the term of active employment.
 
          10.  Disability.
 
               If during the term of active employment Employee shall become
physically or mentally disabled, whether totally or partially, so that he is
prevented from performing his usual duties for a period of six consecutive
months, or for shorter periods aggregating six months in any twelve-month
period, the Company shall, nevertheless, continue to pay Employee his full
compensation, when otherwise due, as provided in this Agreement through the
last day of the sixth consecutive month of disability or the date on which the
<PAGE>
shorter periods of disability shall have equalled a total of six months in any
twelve-month period.  The Company may, by action of all but one of the members
of the Company's Board of Directors, at any time on or after such day, by
written notice to Employee (the "Disability Notice"), provided Employee has
not resumed his usual duties prior to the date of the Disability Notice,
terminate (as of the first day of the month following the date of the
Disability Notice, provided that Employee shall also be paid a pro rata
portion of the Annual Bonus which would otherwise have been payable for such
fiscal year in which the Disability Notice is given) the compensation
otherwise payable to Employee during the term of active employment and pay to
Employee the Disability Payment.  The Disability Payment shall mean the
payment by the Company to Employee of a sum equal to one-half of Employee's
base salary paid under Section 4 hereof at the date of the Disability Notice,
payable in twelve equal monthly installments.
 
          11.  Death.
 
               (a)  If Employee shall die during the term of this Agreement,
this Agreement shall terminate as of the last day of the month of Employee's
death except as set forth in subsection (b) of this Section 11.
 
               (b)  Anything to the contrary notwithstanding, the Company
shall pay to Employee's wife on the date of his death or, in the event
Employee is unmarried on the date of his death, to his estate, a pro rata
portion of the Annual Bonus which would otherwise have been payable to
Employee for the fiscal year in which he died, which pro rata portion shall be
determined as of the last day of the month of Employee's death, together with
<PAGE>
any items of reimbursement or salary owed to Employee as of the date of his
death.  In addition, the Company shall file claims and take other appropriate
action with respect to any life insurance policies maintained on Employee's
life by the Company for which Employee had the right to designate the
beneficiary. 
 
          12.  Termination.
 
               (a)  Discharge for cause.  The Company recognizes that during
the many ears of Employee's employment by the Company, the Company has become
familiar with Employee's ability, competence and judgment.  The Company
acknowledges, on the basis of such familiarity, that Employee's ability,
competence and judgment are satisfactory to the Company.  Employee is
continuing his employment with the Company hereunder in reliance upon the
foregoing expression of satisfaction by the Company.  It is therefore agreed
that "discharge for cause" shall include discharge by the Company on the
following grounds only:
 
                    (i)  Employee's conviction (which, through lapse of time
     or otherwise, is not subject to appeal) of any crime or offense involving
     money or other property of the Company or its subsidiaries; or
 
                    (ii) Employee's conviction (which, through lapse of time
     or otherwise, is not subject to appeal) of any other crime (whether or
     not involving the Company or its subsidiaries) which constitutes a felony
     in the jurisdiction involved; or
 
                    (iii) Employee's continuing repeated wilful failure or
     refusal to perform his duties as required by this Agreement, provided
     that discharge pursuant to this subparagraph (iii) shall not constitute
     discharge for cause unless Employee shall have first received written
     notice from the Board of Directors of such failure and refusal and
<PAGE>
     affording Employee an opportunity, as soon as practicable, to correct the
     acts or omissions complained of.
 
In the event that Employee shall be discharged for cause, all salary and other
benefits payable by the Company under this Agreement in respect of periods
after such discharge shall terminate upon such discharge, but any benefits
payable to or earned by Employee with respect to any period of his employment
prior to such discharge shall not be terminated by reason of such discharge. 
Anything in the foregoing to the contrary notwithstanding, if Employee is
convicted of any crime set forth in either Section 12(a)(i) or 12(a)(ii)
above, the Company may forthwith suspend Employee without any compensation and
choose a new person or persons to perform his duties hereunder during the
period between conviction and the time when such conviction, through lapse of
time or otherwise, is no longer subject to appeal; provided, however, that if
Employee's conviction is subsequently reversed (i) he shall promptly be paid
all compensation to which he would otherwise have been entitled during the
period of suspension, together with interest thereon (which interest shall be
calculated at a rate per annum equal to the rate of interest payable on the
date of such reversal on money judgments after entry thereof under the laws of
the Commonwealth of Pennsylvania), and (ii) the Company shall have the right
(exercisable within sixty (60) days after such reversal) but not the
obligation to restore Employee to active service hereunder at full
compensation.  If the Company elects not to restore Employee to active service
after reversal of a conviction, Employee shall thereafter be paid the full
compensation which would otherwise have been payable during the balance of the
term of active employment and during the consulting period and Employee shall
<PAGE>
be entitled to obtain other employment, subject however to (i) an obligation
to perform consulting services so long as he is receiving compensation
pursuant to the terms of this Agreement, (ii) the continued application of the
covenants provided in Section 13 and (iii) the condition that, if Employee
does obtain other employment during the period ending on December 31, 1997, or
December 31, 2002 if this Agreement is extended by Employee or the Company,
his total compensation therefrom (whether paid to him or deferred for his
benefit) shall reduce, pro tanto, any amount which the Company would otherwise
have been required to pay him during the period ending on December 31, 1997,
or December 31, 2002 if this Agreement is extended by Employee or the Company.
 
               (b)  Breach by Company.  If Employee shall terminate his
employment with the Company because of a material change in the duties of his
office or any other breach by the Company of its obligations hereunder, or in
the event of the termination of Employee's employment by the Company in breach
of this Agreement, Employee shall, except as otherwise provided herein,
continue to receive all of the compensation provided hereunder and shall be
entitled to all of the benefits otherwise provided herein, during the term of
this Agreement notwithstanding such termination and Employee shall have no
further obligations or duties under this Agreement.
 
               (c)  Mitigation.   In the event of the termination by Employee
of his employment with the Company as a result of a material breach by the
Company of any of its obligations hereunder, or in the event of the
termination of Employee's employment by the Company in breach of this
Agreement, Employee shall not be required to seek other employment in order to
<PAGE>
mitigate his damages hereunder; provided, however, that if Employee does
obtain other employment, his total compensation therefrom, whether paid to him
or deferred for his benefit, shall reduce, pro tanto, any amount which the
Company would otherwise be required to pay to him as a result of such breach.
 
          13.  Non-Competition.
 
          Employee agrees that he will not during the term of this Agreement,
directly or indirectly, own, manage, operate, join, control, be controlled by,
or be connected in any manner with any business of the type conducted by the
Company or render any service or assistance of any kind to any competitor of
the Company or any of its subsidiaries; provided, however, that (i) in the
event Employee terminates his employment with the Company as result of a
material breach by the Company of any of its obligations hereunder or in the
event the Company discharges Employee without cause, Employee shall continue
to be bound by the restrictions of this Section 13 only if Employee is
receiving the compensation payable to him in accordance with Section 12(b)
hereof and (ii) in the event the Company discharges Employee for cause,
Employee shall be bound by the restrictions of this Section for a period of
one year following such discharge.
 
          14.  Binding Effect.
 
          Except as otherwise provided for herein, this Agreement shall inure
to the benefit of and be binding upon the heirs, executors, administrators,
successors in interest and assigns of the parties hereto.
 
          15.  Effective Date.
 
          This Agreement shall become effective on July 14, 1992.
<PAGE>
 
          16.  Notices.
 
          All notices provided for herein to be given to any party shall be in
writing and signed by the party giving the notice and shall be deemed to have
been duly given if mailed, registered or certified mail, return receipt
requested, as follows:
 
               (i)  If to Employee:
 
                    57 Crosby Brown Road
                    Gladwyne, Pennsylvania 19035
 
               (ii) If to Company:
 
                    367 South Gulph Road
                    King of Prussia, Pennsylvania 19406
                    Attention: Secretary
 
Either party may change the address to which notices, requests, demands and
other communications hereunder shall be sent by sending written notice of such
change of address to the other party.
 
          17.  Amendment, Modification and Waiver.
 
          The terms, covenants, representations, warranties or conditions of
this Agreement may be amended, modified or waived only by a written instrument
executed by the parties hereto, except that a waiver need only be executed by
the party waiving compliance.  No waiver by any party of any condition, or of
the breach of any term, covenant, representation or warranty contained in this
Agreement, whether by conduct or otherwise, in any one or more instances shall
be deemed to be or construed as a waiver of any other condition or breach of
any other term, covenant, representation or warranty of this Agreement.
 
<PAGE>
 
          18.  Governing Law.
 
          This Agreement shall be construed in accordance with the laws of the
Commonwealth of Pennsylvania applicable to agreements made and to be performed
therein.
 
          19.  Entire Agreement.
 
          This Agreement contains the entire agreement of the parties relating
to the subject matter herein contained and supersedes all prior contracts,
agreements or understandings between and among the parties, except as set
forth herein. 
 
          IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first above written.
 
                                   UNIVERSAL HEALTH SERVICES, INC.
 
 
                                   By:__________________________________
                                        Executive Vice President
 
 
                                   ______________________________________
                                        Alan B. Miller