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Scott history at Columbia Hospital Corporation
In April 1987, Scott made his first attempt to buy the Hospital Corporation of America (HCA). While still a partner at Johnson & Swanson, Scott formed the HCA Acquisition Company with two former executives of Republic Health Corporation, Charles Miller and Richard Ragsdale.[9] With financing from Citicorp conditional on acquisition of HCA,[10] the proposed holding company offered $3.85 billion for 80 million shares at $47 each, intending to assume an additional $1.2 billion in debt, for a total $5 billion deal.[11] However, HCA declined the offer, and the bid was withdrawn.[12]
In 1988, Scott and Richard Rainwater, a multimillionaire financier from Fort Worth, each put up $125,000 in working capital in their new company, Columbia Hospital Corporation,[13] and borrowed the remaining money needed to purchase two struggling hospitals in El Paso for $60 million.[14] Then they acquired a neighboring hospital and shut it down. Within a year, the remaining two were doing much better.[8] By the end of 1989, Columbia Hospital Corporation owned four hospitals with a total of 833 beds.[14]
In 1992, Columbia made a stock purchase of Basic American Medical, which owned eight hospitals, primarily in southwestern Florida. In September 1993, Columbia did another stock purchase, worth $3.4 billion, of Galen Healthcare, which had been spun off by Humana Inc. a few months before.[15] At the time, Galen had approximately 90 hospitals. After the purchase, Galen stockholders had 82 percent of the stock in the combined company, with Scott still running the company.[14]
In 1994, Columbia purchased Scott's former acquisition target, HCA, which had approximately 100 hospitals. In 1995, Columbia purchased Healthtrust, which had approximately 80 hospitals, primarily in rural communities. By 1997, Columbia/HCA had become the world's largest health care provider with more than 340 hospitals, 130 surgery centers, and 550 home health locations in 38 states and two foreign countries. With annual revenues in excess of $23 billion, the company employed more than 285,000 people, making it the 7th largest U.S. employer and the 12th largest employer worldwide. Based on market capitalization, Columbia ranked in the top 50 companies in America and top 100 worldwide. That same year, the company was recognized by Business Week magazine as one of the 50 Best Performing Companies of the S&P 500.
Columbia/HCA fraud case details
In settlements reached in 2000 and 2002, Columbia/HCA rose to public attention when it pleaded guilty to 14 felonies and agreed to a $600+ million fine in what the Justice department then called the largest fraud case settled in the history of the Justice department.
A series of New York Times articles, beginning in 1996, began scrutinizing Columbia/HCA's business and Medicare billing practices. These culminated in the company being raided in July 1997 by Federal agents searching for documents.[16] Among the crimes uncovered were doctors being offered financial incentives to bring in patients, falsifying diagnostic codes to increase reimbursements from Medicare and other government programs, and billing the government for unnecessary lab tests.[17] Following the raids, the Columbia/HCA board of directors forced Scott to resign as Chairman and CEO. [18] He was paid $9.88 million in a settlement. He also left owning 10 million shares of stock worth over $350 million, mostly from his initial investment.[19][20][21] In 1999, Columbia/HCA changed its name back to HCA, Inc.
In the settlements with the Justice department, Columbia/HCA plead guilty to 14 felonies and agreed to a $600+ million fine in what the Justice department then called the largest fraud case settled in the history of the Justice department. Columbia/HCA admitted systematically overcharging the government by claiming marketing costs as reimbursable, by striking illegal deals with home care agencies, and by filing false data about use of hospital space. They also admitted fraudulently billing Medicare and other health programs by inflating the seriousness of diagnoses and to giving doctors partnerships in company hospitals as a kickback for the doctors referring patients to HCA. They filed false cost reports, fraudulently billing Medicare for home health care workers, and paid kickbacks in the sale of home health agencies and to doctors to refer patients. In addition, they gave doctors "loans" never intending to be repaid, free rent, free office furniture, and free drugs from hospital pharmacies.[22][23] [24][25][26]
In late 2002, HCA agreed to pay the U.S. government $631 million, plus interest, and pay $17.5 million to state Medicaid agencies, in addition to $250 million paid up to that point to resolve outstanding Medicare expense claims.[27] In all, civil law suits cost HCA more than $2 billion to settle, by far the largest fraud settlement in US history at the time.[28]
http://en.wikipedia.org/wiki/Rick_scott#cite_note-27
http://en.wikipedia.org/wiki/Rick_scott
In April 1987, Scott made his first attempt to buy the Hospital Corporation of America (HCA). While still a partner at Johnson & Swanson, Scott formed the HCA Acquisition Company with two former executives of Republic Health Corporation, Charles Miller and Richard Ragsdale.[9] With financing from Citicorp conditional on acquisition of HCA,[10] the proposed holding company offered $3.85 billion for 80 million shares at $47 each, intending to assume an additional $1.2 billion in debt, for a total $5 billion deal.[11] However, HCA declined the offer, and the bid was withdrawn.[12]
In 1988, Scott and Richard Rainwater, a multimillionaire financier from Fort Worth, each put up $125,000 in working capital in their new company, Columbia Hospital Corporation,[13] and borrowed the remaining money needed to purchase two struggling hospitals in El Paso for $60 million.[14] Then they acquired a neighboring hospital and shut it down. Within a year, the remaining two were doing much better.[8] By the end of 1989, Columbia Hospital Corporation owned four hospitals with a total of 833 beds.[14]
In 1992, Columbia made a stock purchase of Basic American Medical, which owned eight hospitals, primarily in southwestern Florida. In September 1993, Columbia did another stock purchase, worth $3.4 billion, of Galen Healthcare, which had been spun off by Humana Inc. a few months before.[15] At the time, Galen had approximately 90 hospitals. After the purchase, Galen stockholders had 82 percent of the stock in the combined company, with Scott still running the company.[14]
In 1994, Columbia purchased Scott's former acquisition target, HCA, which had approximately 100 hospitals. In 1995, Columbia purchased Healthtrust, which had approximately 80 hospitals, primarily in rural communities. By 1997, Columbia/HCA had become the world's largest health care provider with more than 340 hospitals, 130 surgery centers, and 550 home health locations in 38 states and two foreign countries. With annual revenues in excess of $23 billion, the company employed more than 285,000 people, making it the 7th largest U.S. employer and the 12th largest employer worldwide. Based on market capitalization, Columbia ranked in the top 50 companies in America and top 100 worldwide. That same year, the company was recognized by Business Week magazine as one of the 50 Best Performing Companies of the S&P 500.
Columbia/HCA fraud case details
In settlements reached in 2000 and 2002, Columbia/HCA rose to public attention when it pleaded guilty to 14 felonies and agreed to a $600+ million fine in what the Justice department then called the largest fraud case settled in the history of the Justice department.
A series of New York Times articles, beginning in 1996, began scrutinizing Columbia/HCA's business and Medicare billing practices. These culminated in the company being raided in July 1997 by Federal agents searching for documents.[16] Among the crimes uncovered were doctors being offered financial incentives to bring in patients, falsifying diagnostic codes to increase reimbursements from Medicare and other government programs, and billing the government for unnecessary lab tests.[17] Following the raids, the Columbia/HCA board of directors forced Scott to resign as Chairman and CEO. [18] He was paid $9.88 million in a settlement. He also left owning 10 million shares of stock worth over $350 million, mostly from his initial investment.[19][20][21] In 1999, Columbia/HCA changed its name back to HCA, Inc.
In the settlements with the Justice department, Columbia/HCA plead guilty to 14 felonies and agreed to a $600+ million fine in what the Justice department then called the largest fraud case settled in the history of the Justice department. Columbia/HCA admitted systematically overcharging the government by claiming marketing costs as reimbursable, by striking illegal deals with home care agencies, and by filing false data about use of hospital space. They also admitted fraudulently billing Medicare and other health programs by inflating the seriousness of diagnoses and to giving doctors partnerships in company hospitals as a kickback for the doctors referring patients to HCA. They filed false cost reports, fraudulently billing Medicare for home health care workers, and paid kickbacks in the sale of home health agencies and to doctors to refer patients. In addition, they gave doctors "loans" never intending to be repaid, free rent, free office furniture, and free drugs from hospital pharmacies.[22][23] [24][25][26]
In late 2002, HCA agreed to pay the U.S. government $631 million, plus interest, and pay $17.5 million to state Medicaid agencies, in addition to $250 million paid up to that point to resolve outstanding Medicare expense claims.[27] In all, civil law suits cost HCA more than $2 billion to settle, by far the largest fraud settlement in US history at the time.[28]
http://en.wikipedia.org/wiki/Rick_scott#cite_note-27
http://en.wikipedia.org/wiki/Rick_scott
