SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D Under the Securities Exchange Act of 1934 (Amendment No. 2) Kindred Healthcare, Inc. (Name of Issuer) Common Stock, par value $0.25 (Title of Class of Securities) 494580103 (CUSIP Number) David Winters Franklin Mutual Advisers, LLC 51 John F. Kennedy Parkway Short Hills, New Jersey 07078 973.912.2042 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) January 9, 2002 (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-l(e) 13d-1(f) or 13d-1(g) or (4), check the following box [ ]. *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page. The information required in the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 (the "Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). 1. NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Franklin Mutual Advisers, LLC 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)[ ] (b)[X] 3. SEC USE ONLY 4. SOURCE OF FUNDS See Item 3 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [ ] 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH 7. SOLE VOTING POWER 5,047,831(See Item 5) 8. SHARED VOTING POWER None (See Item 5) 9. SOLE DISPOSITIVE POWER 5,047,831(See Item 5) 10. SHARED DISPOSITIVE POWER None (See Item 5) 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 5,047,831 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES [ ] 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 28.7% 14. TYPE OF REPORTING PERSON IA This Amendment No. 2 relates to the Schedule 13D originally filed on behalf of Franklin Mutual Advisers, LLC (FMA) with the Securities and Exchange Commission on April 30, 2001 (as amended November 14, 2001, the Schedule 13D). Item 5 of the Schedule 13D is hereby amended as follows: Item 5. Interest in Securities of the Issuer (a-b) The securities reported on herein are beneficially owned by one or more open-end investment companies or other managed accounts of FMA. FMAs advisory contracts with its clients grant to FMA sole voting and investment discretion over the securities owned by its advisory clients. Therefore, FMA may be deemed to be, for purposes of Rule 13d-3 under the Act, the beneficial owner of 5,047,831 shares of Common Stock (consisting of 3,086,986 shares of Common Stock, 560,242 Series A warrants, and 1,400,603 Series B warrants), representing approximately 28.7% of the outstanding shares of Common Stock. FMA is an indirect wholly owned subsidiary of Franklin Resources, Inc. (FRI). Beneficial ownership by investment advisory subsidiaries and other affiliates of FRI is being reported in conformity with the guidelines articulated by the SEC staff in Release No. 34-39538 (January 12, 1998) relating to organizations, such as FRI, where related entities exercise voting and investment powers over the securities being reported independently from each other. The voting and investment powers held by FMA are exercised independently from FRI, and from all other investment advisor subsidiaries of FRI (FRI, its affiliates and investment advisor subsidiaries other than FMA are collectively referred to herein as FRI affiliates). Furthermore, FMA and FRI internal policies and procedures establish informational barriers that prevent the flow between FMA and the FRI affiliates of information that relates to the voting and investment powers over the securities owned by their respective advisory clients. Consequently, FMA and the FRI affiliates are each reporting the securities over which they hold investment and voting power separately from each other. Charles B. Johnson and Rupert H. Johnson, Jr. (the Principal Shareholders) each own in excess of 10% of the outstanding Common Stock of FRI and are the principal shareholders of FRI. However, FMA exercises voting and investment powers on behalf of its advisory clients independently of FRI, the Principal Shareholders, and their respective affiliates. Consequently, beneficial ownership of the securities being reported by FMA is not attributed to FRI, the Principal Shareholders, and their respective affiliates other than FMA. FMA disclaims any economic interest or beneficial ownership in any of the securities covered by this statement. Furthermore, FRI, the Principal Shareholders, and their respective affiliates including FMA, are of the view that they are not acting as a "group" for purposes of Section 13(d) under the Act and that they are not otherwise required to attribute to each other the "beneficial ownership" of securities held by any of them or by any persons or entities advised by FRI subsidiaries. (c) There was one transaction in the shares of the Common Stock within the past sixty days an acquisition of 24,650 common shares on January 9, 2002 in connection with a dividend distribution to holders of Ventas, Inc. common stock. (d) No person other than the respective advisory clients of FMA have the right to receive or the power to direct the receipt of dividends from, or the proceeds of the sale of the securities being reported herein. Mutual Shares Fund and Mutual Beacon Fund, each a series of Franklin Mutual Series Fund Inc., an investment company registered under the Investment Company Act of 1940, have an in interest in more than five percent of the class of securities being reported herein. (e) Not applicable. After reasonable inquiry, and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete, and correct. February 5, 2002 Franklin Mutual Advisers, LLC By: Franklin/Templeton Distributors, Inc. Its Managing Member /s/Leslie M. Kratter LESLIE M. KRATTER Secretary