HEALTHSOUTH CORP
424B3, 1998-07-17
SPECIALTY OUTPATIENT FACILITIES, NEC
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                                Prospectus Supplement filed under Rule 424(b)(3)
                                                  S-3 Registration No. 333-52237

PROSPECTUS SUPPLEMENT
(to Prospectus dated June 3, 1998)

THIS DOCUMENTS  CONSTITUTES PART OF A PROSPECTUS  COVERING  SECURITIES THAT HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.  INFORMATION  CONTAINED HEREIN
IS SUBJECT TO AMENDMENT.

                             HEALTHSOUTH Corporation

                                  $567,750,000
                         3.25% Convertible Subordinated
                               Debentures due 2003

                                       and

                       15,501,707 SHARES OF COMMON STOCK,
                            PAR VALUE $.01 PER SHARE

     The  Prospectus,  dated June 3, 1998 (the  "Prospectus"),  relating  to the
offering  for  resale  of  $567,750,000  aggregate  principal  amount  of  3.25%
Convertible  Subordinated  Debentures due 2003 and  15,501,707  shares of Common
Stock, par value $.01 per share, of HEALTHSOUTH Corporation (the "Company"),  is
hereby supplemented as set forth below.

1.   CHARLES  SCHWAB TRUST COMPANY is added to the table of  Securityholders  on
     page 15 of the Prospectus,  together with the following information as of a
     recent date prior to the date of this Prospectus Supplement:

<TABLE>
<CAPTION>

     Principal Amount of Debentures Beneficially Owned That May be Sold         515,000
     Percentage of Debentures Outstanding                                             *
     Number of Conversion Shares That May Be Sold                                14,061
     Percentage of Common Stock Outstanding                                           *
<S>  

2.   The  information  set forth  opposite the name GOLDMAN,  SACHS & CO. in the
     table of Selling SEcurity holders on page 15 is amended as follows:

                                                                          <C>    
     Principal Amount of Debentures Beneficially Owned That May be Sold        4,650,000
     Percentage of Debentures Outstanding                                             *
     Number of Conversion Shares That May Be Sold                                126,962
     Percentage of Common Stock Outstanding                                           *
</TABLE>

3.   The information  set forth opposite the name HSBC  SECURITIES  INC., in the
     table of Selling Securityholders on page 15 is amended as follows:

<TABLE>
<CAPTION>
<S>                                                                             <C>      
     Principal Amount of Debentures Beneficially Owned That May be Sold         5,200,000
</TABLE>



<PAGE>


<TABLE>
<CAPTION>
<S>                                                                             <C>      
         Percentage of Debentures Outstanding                                           *
         Number of Conversion Shares                                              141,979
         Percentage of Common Stock Outstanding                                         *
</TABLE>

4.   LEHMAN BROTHERS is added to the table of  Securityholders on page 16 of the
     Prospe tus,  together  with the following  information  as of a recent date
     prior to the date of this Prospectus Supplement:

<TABLE>
<CAPTION>
<S>                                                                             <C>      
         Principal Amount of Debentures Beneficially Owned That May be Sold     1,125,000
         Percentage of Debentures Outstanding                                           *
         Number of Conversion Shares That May Be Sold                              30,716
         Percentage of Common Stock Outstanding                                         *
</TABLE>

5.   The  name  SBC  WARBURG   DILLON  READ  INC.,   in  the  table  of  Selling
     Securityholders on page 17 is hereby changed to WARBURG DILLON READ LLC and
     the  information  set forth opposite the name SBC WARBURG DILLON READ INC.,
     in the table of Selling Securityholders on page 17 is amended as follows:

<TABLE>
<CAPTION>
<S>                                                                             <C>       
         Principal Amount of Debentures Beneficially Owned That May be Sold     11,463,000
         Percentage of Debentures Outstanding                                        2.01%
         Number of Conversion Shares                                               312,982
         Percentage of Common Stock Outstanding                                          *
</TABLE>




            The date of this Prospectus Supplement is July 17, 1997.


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