AHN Atc Healthcare,

ATC Healthcare, Inc., (AMEX:AHN) a leader in medical staffing, announced today that it was one of the two awardees of a large Blanket Purchase Agreement (BPA) with the Department of Health and Human Services. ATC teamed with one of the largest physician staffing firms in the country, to provide all the required staffing services. The contract requires nurse, allied health, and physician staffing in select DHHS facilities. The two-year contract, which has 3 one-year renewals for a total of five years, covers facilities in 11 states and the District of Columbia. The Department of Health and Human Services announcement "estimates, but does not guarantee, that the annual volume of purchases under the Blanket Purchase Agreement will be over $55 million (or $275 million over 5 years)." "I'm very pleased that ATC has been given the opportunity to work with DHHS on this long term contract", said David Savitsky, CEO of ATC Healthcare Services. "We estimate that ATC could see $10 million dollars in sales annually. If all options of the BPA are exercised, it could be worth as much as $18 million dollars per year to ATC over the life of the five-year contract. We are experiencing a significant increase in our government sales this year, having previously announced awards of up to $16 million dollars with facilities in Michigan, Massachusetts and New Jersey," Mr. Savitsky further said. About ATC Healthcare, Inc. ATC is a national leader in medical staffing personnel to hospitals, nursing homes, clinics, and other health care facilities with 51 locations and conducts business in 31 states. ATC provides supplemental staffing, outsourcing and human resources solutions to hospitals, nursing homes, medical and research facilities and industry. Drawing from a pool of over 15,000 healthcare professionals spanning more than 50 specialties, the Company supplies both clinical and non-clinical personnel for short-term, long-term, and "traveling" contract assignments. To learn more about the company's services, visit their web site at www.atchealthcare.com. This press release contains forward-looking statements. Actual results could differ materially from those projected in the forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained in ATC Healthcare, Inc. Annual Report on Form 10-K/A for the year ended February 28, 2005 as filed with the Securities and Exchange Commission on July 29, 2005.