Richard Scott is as conspicuous by his absence in hospital circles these days as he was by his presence in them half a decade ago. His name, however, has become synonymous with the rise and fall of Columbia/HCA Healthcare Corp., the nation's largest hospital chain. Scott declined to be interviewed for this article.
When Columbia was an aggressive acquirer of not-for-profit hospitals, with as many as 341 facilities at its peak in 1996, Scott was at the helm, the personification of the company's rapid growth, aggressive marketing tactics, and hard-nosed independent style.
In 1994, after years of hospital dealmaking, the company he founded, Columbia Healthcare Corp., Fort Worth, Texas, and Hospital Corporation of America, Nashville, completed a $10 billion merger, the culmination of years of strategizing by Scott.
Scott's career, and the future of Columbia, took a sharp turn in 1997. At the height of the hospital chain's acquisition frenzy, after what Scott proclaimed was its best year ever, Columbia was stopped in its tracks by the federal government's highly public probe into the company's business practices, including its controversial strategy of allowing doctors to buy stakes in its hospitals. In a symbolic gesture, federal agents targeted Columbia's El Paso hospitals and offices with their first raid on March 19, 1997. More raids followed in July of that year at Columbia facilities, as the probe widened to include alleged fraud related to the company's laboratory and home-care services and its Medicare cost-reporting practices. Scott resigned a week later, reportedly under pressure from the company's board and with a $9 million severance package. While Scott has not faced any charges in the government's suit, the company-since renamed HCA-has so far agreed to pay $840 million to settle the fraud allegations.