Rise and Fall of Healthsouth

Richard M. Scrushy, described as a visionary risk taker and true American entrepreneur, empire-building ambition drove him to corruption. Scrushy founded three New York Stock Exchange (NYSE) companies, including healthcare giant, HealthSouth Corporation (HealthSouth). For over 20 years, Scrushy served as the mastermind, innovator, chairperson, and Chief Executive Officer (CEO) for HealthSouth (Scrushy, 2012). By 2001, HealthSouth had more than $4.3 billion in revenue and treated more than 100,000 patients a day globally (Bio. True Story, n.d). In November 2005, The United States (U.S.) Securities and Exchange Commission (SEC) filed a criminal suit against HealthSouth and Scrushy alleging massive accounting fraud including conspiracy, money laundering, and Violations of Sarbanes-Oxley Act (SOX) (Farrell, 2005). Scrushy was the first CEO charges with violating SOX. This research focuses on the rise and destruction of the HealthSouth Corporation focusing on the company’s growth, corporate scandals, impact on the stakeholders, and outcome of the punishment of the corporation’s visionary leader, Richard Scrushy.

Rise and Fall of HealthSouth: The Scrushy Way

Visionary American entrepreneur, founder, innovator, Chief Executive Officer (CEO) of HealthSouth Corporation (HealthSouth), Richard M. Scrushy, ambition turned a humble company into a corporate giant. In 1984, Scrushy created a comprehensive outpatient rehabilitation facility founding Amcare, which soon changed its name to HealthSouth. By 1986, HealthSouth became a highly successful publically traded company (Bio. True Story, n.d.) For over 20 years, Scrushy built an empire around rehabilitative services. By 2001, HealthSouth had more than $4.3 billion in revenue and treated more than 100,000 patients a day globally (Bio. True Story, n.d). In the 2000s, scrutiny of the company’s accounting caused a criminal and civil suit against HealthSouth and Scrushy alleging of massive accounting fraud, conspiracy, money...