Former HealthSouth Corp. chief Richard Scrushy allegedly paid $500,000 to the former governor of Alabama, Don Siegelman, in return for being appointed to the state's certificate-of-need board in 1999, according to an indictment in U.S. District Court, Montgomery, Ala. The 30-count indictment filed by a federal grand jury in Montgomery also named Siegelman, his former chief of staff Paul Hamrick and former state Transportation Director Gary Roberts. Siegelman, a Democrat, was Alabama's governor from 1999 to 2003. In a statement, Scrushy's legal team said Scrushy was innocent and that the government indicted him because he refused to testify against Siegelman. The HealthSouth founder and former chief executive officer allegedly made two payments to Siegelman in 1999 and 2000 through the Alabama Education Lottery Foundation. Scrushy served on the state CON board until 2001, when he was replaced by another HealthSouth employee.
In June, a jury acquitted Scrushy of orchestrating a scheme to inflate HealthSouth's income by some $2.6 billion. The U.S. attorney in Birmingham, Ala., HealthSouth's home base, prosecuted that case. In a separate case, the Birmingham office charged Siegelman with rigging Medicaid contracts, but the charges were dismissed about a year ago. The latest indictment was issued in May but kept under seal so as not to disrupt the trial in Birmingham. The indictment came out of a joint federal-state investigation begun in 2001 into alleged improprieties in Siegelman's administration. -- by Joseph Mantone