Medicare Compliance & Reimbursement

INDUSTRY NEWS:

Former HealthSouth Exec Must Do Time, Appeals Court Says

$41K a day to maintain Scrushy's yacht -- plus other tidbits from the compliance case that just won't die.

Former Chief Information Officer at HealthSouth, Kenneth Livesay should go to prison for his role in HealthSouth's now-legendary $2.7 billion accounting fraud that began brewing in the late 1990s, ruled U.S. Circuit Court of Appeals in Atlanta last week.

Livesay, who pleaded guilty in April 2003 to conspiracy to commit wire fraud and securities fraud and to falsifying financial information to inflate the company's stock price, was originally sentenced to to six months' housearrest, five years' probation plus a $10,000 fine and $750,000 restitution. According to press reports, he was a key witness for the prosecution in the sprawling HealthSouth case.

Despite his cooperation with prosecutors, probation and a few fines just ain't enough, contends the 11th Circuit Court. This is the third time the court has sent Livesay's case to a lower court for resentencing, and this time the court's demanding that Livesay go to prison, reports Bloomberg.com.

Meanwhile, here's the latest on former HealthSouth CEO Richard Scrushy...

The extravagant amateur rock-star is back in the news as lawyers sell off his property to pay off fines. Scrushy was acquitted of criminal charges for the HealthSouth accounting fraud, but he was found liable for his involvement. He is in prison for bribing former Alabama Governor Don Siegelman, according to press reports.

(Editor's note: For full history of the HealthSouth case, please visit: www.uow.edu.au/~bmartin/dissent/documents/health/access_healthsouth.html.)