setting the record straight


Richard M. Scrushy



A Biographical Sketch: Richard Scrushy and HealthSouth

The Man

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Born in 1952 in Selma, Alabama,—a town known as the birthplace of the civil-rights movement—Richard Scrushy is now fighting for his own rights and freedoms in the face of false allegations.

Richard grew up modestly with an older sister and a younger brother. His father worked for National Cash Register and his mother worked at the local hospital, first as a nurse and later as manager of the respiratory-therapy department. The Scrushys attended the Methodist church, where Richard sang in the youth choir and participated in the Methodist Youth Fellowship. He was active in Boy Scouts and little-league baseball, and at the age of eight, Richard taught himself to play piano and guitar. Throughout school, he played piano and organ at dances and parties.

By age 12, Richard was showing all the signs of a hard worker—even an entrepreneur. He worked at a local hamburger-and-milkshake stand and as a bellboy at a local hotel; during summers and on weekends, he cut grass for neighbors and the local country club. At 17, Richard pumped gas and washed cars at a filling station, apprenticed with a brick mason, and handled parts and shipping at a tractor implement company.

In 1971, Richard enrolled as a full-time student at Wallace State Community College in Selma while holding a full-time job. After one year, he transferred to Jefferson State Community College in Birmingham and worked in the evenings in a local hospital’s respiratory-therapy program. Richard married young, and before he finished college, he and his wife were parenting two children.

After passing the certification exam as a respiratory-therapy technician, Richard enrolled in the respiratory-therapy program at the University of Alabama at Birmingham. After graduating in 1974, he was hired immediately as an instructor in the program he had just completed. The young teacher was promoted quickly to director of the program, and spent two and a half years teaching at UAB. During these years, Richard supplemented his income and education by working in the evenings as a respiratory therapist at local hospitals.

Richard left Birmingham to become director of the respiratory-therapy program at Wallace State Community College in Dothan, Alabama. A year later, he joined Lifemark, a Houston-based NYSE company that owned and managed hospitals. Richard was hired to run Lifemark’s ancillary contracting division, which worked with the hospitals it owned and managed as well as others. The division included a pharmacy company, a physical-therapy company, and a respiratory-therapy company. Promotions came quickly, and at just 28 years old, Richard Scrushy was operating a $100-million-dollar company with thousands of employees and a national sales force.

Richard spent five years climbing steadily up the Lifemark corporate ladder. For his final assignment there, Richard was charged with purchasing and developing hospitals. It was during this time that Richard began planning a new business. He envisioned a rehabilitation company with outpatient centers, clinics, and hospitals. He developed the concept of moving patients quickly through rehab programs, allowing employees to return to their work, athletes to their game, and seniors to their independence sooner and healthier. His idea was the genesis for HealthSouth.

Richard presented his plans to the leadership at Lifemark; however, they could not implement them because they had recently agreed to merge with another company, American Medical International. Richard met with the management of AMI; however, they were not interested in his plans. So Richard set out to raise venture capital and form a management team that further developed his new business plan. This team established HealthSouth in January 1984. Most of the seed money was supplied by Richard; indeed, he paid payroll and business expenses out of his own pocket until the first influx of venture capital came in the spring of that year.

The Company

HealthSouth opened its doors and for almost 20 years, Richard Scrushy served as its chairman and CEO. With his guidance, the company grew from five employees sharing a one-room office to a workforce of more than 50,000 and billions of dollars in revenue.

At its height, the company had more than 2,000 locations. It became an industry leader in all product lines—rehabilitation, surgery, and diagnostics—with operations in all fifty states and several countries outside the U.S. HealthSouth developed a superior reputation for the quality of its clinical services. It became a national leader in the treatment of orthopedic, sports-related, closed-head, spinal, and other neurological and physical injuries. HealthSouth surgery and diagnostic centers also became reputed highly for their outstanding services and state-of-the-art technology.

Richard Scrushy was clearly the visionary who created HealthSouth from the ground up, listing the company on the New York Stock Exchange, consolidating the industry into an efficient operation, aligning the company with excellent physicians across the country, and overseeing approximately $6.5 billion in strategic acquisitions.

Richard believed that HealthSouth could perform more than just rehabilitative services, that it could perform surgeries as well. He set out to build a surgical and diagnostics division, and within two years, the company was a leader in these arenas. Richard believed that HealthSouth could be more than a regional company, and within two years of the inception of this ambitious part of his plan, HealthSouth was operating in all fifty states—only 12 years after its founding. Among other distinctions, the company was named to Standard and Poor’s and to the Fortune 500.

In March 2003, Richard Scrushy took administrative leave from HealthSouth, directly after Weston Smith, a former CFO, pleaded guilty to charges of accounting fraud. Richard informed the Board of Directors of the corporation he had built that he needed time to sort out and respond to the various allegations against him and to organize his legal defense. A few weeks later, HealthSouth announced that it would terminate Richard’s contract.


The financial success gained by Richard Scrushy has allowed him to practice undeniably generous philanthropic service. He has served on the boards of trustees for Troy State University, Birmingham-Southern College, and the University of Alabama. For six years, he served as chair of the Alabama Sports Hall of Fame. He has actively supported United Cerebral Palsy, the Arthritis Foundation, Jefferson State Community College, Lawson State Community College, the University of Alabama at Birmingham, Big Oak Ranch, the March of Dimes, and many others. His circle of giving has a vast diameter.

Today and Tomorrow

Currently, Richard is working diligently to clear his good name of the false accusations being made against him in connection with the alleged fraudulent activities of HealthSouth. He also focuses on the real-estate development business, Marin, Inc., and assists his wife Leslie with her company, uppseedaisees.

During these difficult days, Richard finds solace in the quality time he is able to spend with Leslie and his children. Together, they draw on their strong faith to weather this stormy part of their lives.