KINDRED HEALTHCARE INC
AMENDMENT #4 TO THE KINDRED 401(K) PLAN
<DOCUMENT>
<TYPE>EX-10.20
<SEQUENCE>6
<FILENAME>dex1020.txt
<DESCRIPTION>AMENDMENT #4 TO THE KINDRED 401(K) PLAN
<TEXT>
<PAGE>

                                                                   Exhibit 10.20

                                 AMENDMENT NO. 4
                                     TO THE
                               KINDRED 401(k) PLAN

     This is Amendment No. 4 to the Kindred 401(k) Plan (the "Plan") as last
amended and restated as of March 1, 2000, which amendment shall be effective
March 1, 2000, except as otherwise noted.

                                    RECITALS

A.   Kindred Healthcare, Inc. (the "Company") maintains the Plan and has
     reserved the right in Section 9.1 of the Plan to amend the Plan from time
     to time in its discretion.

B.   The Company wishes to amend the Plan as requested by the IRS in connection
     with an application for a favorable determination of the Plan's qualified
     status.

                                    AMENDMENT

     1.   Section 1.10 of the Plan is hereby amended to read in its entirety as
     follows:

          Compensation means, for any Plan Year or portion thereof during which
          an Employee is eligible to participate in this Plan (which shall not
          include compensation payable for periods after employment terminates,
          such as severance pay, but shall include vacation time earned but no
          yet paid as of that last date at work), total compensation paid to an
          Employee by the Employer that is includable in the Participant's gross
          income, including bonuses, commissions and overtime, but excluding (i)
          reimbursements or other expense allowance, (ii) fringe benefits (cash
          and noncash), (iii) moving expenses, (iv) deferred compensation, (v)
          welfare benefits, and (vi) amounts realized from the exercise of a
          nonqualified stock option (or the lifting of restrictions on
          restricted stock) or the sale or exchange of stock acquired under a
          qualified stock option. Despite the exclusions in the preceding
          sentence, Compensation shall include any amounts deducted pursuant to
          Code Sections 125 (flexible benefit plans), 402(a)(8) (salary
          redirection), 402(h)(1)(B) (simplified employee plans), 403(b), and
          132(f)(4) (effective January 1, 1998). Effective for Plan Years
          beginning on or after January 1, 1989, Compensation shall be limited
          to such amount as determined pursuant to Code Section 401(a)(17). For
          Plan Years beginning on or after January 1, 1994, Compensation shall
          be limited to $150,000, or such higher amount determined by the
          Commissioner of Internal Revenue pursuant to Section 401(a)(17) of the
          Code.

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     2.   Section 1.22 of the Plan is hereby amended to read in its entirety as
     follows:

          Highly Compensated Employee means any Employee of the Employer who (i)
          was a five percent owner of the Company during the current Plan Year
          or the preceding Plan Year, or (ii) during the preceding Plan Year,
          received Compensation from the Company in excess of $80,000 (as such
          amount may be adjusted from time to time by the Secretary of the
          Treasury) and was in the top-paid group of employees for such Plan
          Year.

     3.   Section 4.5(b) of the Plan is hereby amended to read as follows:

          25% of the Participant's compensation (as defined in Section 415(c)(3)
          of the Code), including compensation under Section 132(f) of the Code
          effective January 1, 1998.

     4.   Section 4.7 and 11.3 of the Plan are hereby amended effective March 1,
     2000 by the addition of the following language at the beginning of each
     section to reflect the repeal of Section 415(e):

          "This section shall no longer apply effective January 1, 2000."

     5.   Section 5.10(b) of the Plan is hereby amended which shall read in its
     entirety as follows:

          For purposes of this Section an eligible rollover distribution is
          described in IRC Section 402(c)(4), which the participant can elect to
          roll over to another plan pursuant to IRS Section 401(a)(31), excludes
          hardship withdrawals (effective January 1, 1999) as defined in IRC
          401(k)(2)(B)(i)(IV) which are attributable to the participant's
          elective contributions under Treasury Regulation Section
          1.401(k)-1(d)(2)(ii).

     IN WITNESS WHEREOF, the Employer has caused this Amendment No. 4 to be
executed this 18/th/ day of December, 2002.


                                              KINDRED HEALTHCARE, INC.


                                              By /s/ Richard E. Chapman
                                                 -------------------------------

                                              Title CIO, CAO & SVP
                                                    ----------------------------

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