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EXHIBIT 99.1
[HCA LOGO]
NEWS
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FOR IMMEDIATE RELEASE
INVESTOR CONTACT: MEDIA CONTACT:
Mark Kimbrough Jeff Prescott
(615) 344-2688 (615) 344-5708
HCA SIGNS AGREEMENTS IN COLUMBIA INVESTIGATION
Columbia Management Companies, Inc and Columbia Homecare Group, Inc.
Agree to Pleas
NASHVILLE, TENN., DEC. 14, 2000--HCA announced today that it has signed an
agreement with the criminal division of the Department of Justice and U.S.
attorneys' offices in Atlanta; El Paso, Texas; Miami; and Tampa, Fla. to resolve
all pending federal criminal issues in the Columbia investigation.
The company also signed today a civil settlement agreement with the
civil division of the Department of Justice, first announced by the company in
May 2000, to resolve civil false claims issues related to DRG coding, outpatient
laboratory and home health. Today's actions also included the signing of a
corporate integrity agreement with the Office of Inspector General of the
Department of Health and Human Services.
"Today's action represents one of the last steps needed to put the
Columbia investigation behind us and allows us to move forward, maintaining our
focus on providing quality patient care," said Thomas F. Frist, Jr., M.D.,
Chairman and Chief Executive Officer of HCA.
Frist was named Chairman and CEO of the company in July of 1997,
bringing with him Jack Bovender as President and COO. The two immediately began
making structural changes within the company, including the announcement of a
12-point plan to refocus operations. The plan placed new emphasis on
locally-managed hospitals and included elements such as:
- Halting the company's national branding campaign and returning
to a focus on local community relationships
- Reemphasizing a "patients first" philosophy with a new mission
and values statement
- Replacing most of senior management and further strengthening
the board of directors
- Developing a code of conduct as part of a model ethics and
compliance program
-more-
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In exchange for a full criminal release for the company and its
affiliates on all federal healthcare billing issues involved in the
investigation up to the date pleas are entered, Columbia Management Companies,
Inc. and Columbia Homecare Group, Inc. (non-operating subsidiaries) have agreed
to the following pleas:
Department of Justice - DRG Coding, one count of conspiracy.
U.S. Attorney's Office, Atlanta - Home health acquisitions, one count
of receiving unlawful remuneration.
U.S. Attorney's Office, El Paso - El Paso physician relationships, one
count of conspiracy.
U.S. Attorney's Office, Miami - Home Health acquisitions and community
educators cost allowability, one count of conspiracy.
U.S. Attorney's Office, Tampa - Home Health acquisitions and community
educators, two counts of conspiracy. Cost report claims in connection
with certain specific cost reports, multiple counts of false
statements.
Today's agreements resolve all federal criminal issues outstanding
against the company and civil issues related to outpatient lab billing, home
health issues and DRG coding. In addition, representatives of state attorneys
general have agreed to recommend to state officials that the company be released
from corresponding criminal liability in all states in which the company
conducts business. The company continues to discuss civil issues relating to
cost reporting and physician relations with the government.
The criminal agreement also will result in the company divesting
Deering Hospital in Miami, Fla. The company has been in discussions over the
past few years with buyers interested in acquiring Deering Hospital. The
divestiture was agreed to as part of the overall criminal resolution, and does
not reflect an admission or understanding that the facility was involved in the
specific situations discussed in the agreement. In addition, the company has
agreed to the exclusion from the Medicare program of Clearwater Community
Hospital in Clearwater, Fla., which the company closed in February 1999.
As part of today's announced criminal agreement the company will pay
the government approximately $95 million, which the company will record as a
special charge in the fourth quarter of 2000. The criminal agreement is
conditional upon entry of pleas in federal district court, and necessary court
approvals, which are expected in the first quarter of 2001. Payment of the
criminal settlement will be made by the company within five days after all
necessary court approvals are obtained.
As previously announced in May of 2000, the civil agreement completed
today included a provision for the company to pay the government $745 million
plus interest. Payment of the civil settlement will be made upon court approval
of the settlement, which is expected in the first quarter of 2001. The
accounting charge for the civil settlement was recorded in the second quarter of
2000.
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This press release contains forward-looking statements (all statements
other than those setting forth solely historic fact) based on management's
current expectations. Numerous risks, uncertainties and other factors including
(1) the ability to consummate the agreements relating to the civil and criminal
actions, (2) judicial approval of the settlement agreements in the civil and
criminal actions, (3) the review by the company's external auditors of the
accounting treatment of the settlement amounts and any related adjustments, (4)
any examination by the Internal Revenue Service of the tax treatment of the
settlement amounts and any related adjustments, (5) the impact of the remaining
civil issues relating to cost reporting and physician relations not resolved by
the settlements, (6) the impact of the settlements on pending and any future
actions by state government authorities and civil litigation by private
plaintiffs, (7) and other factors detailed from time to time in the company's
filings with the Securities and Exchange Commission may cause actual results to
differ materially from those anticipated in the forward-looking statements. Many
of the factors that will determine the impact of the announced settlements are
beyond the ability of the company to control or predict.
Readers should not place undue reliance on forward-looking statements, which
reflect management's views only as of the date hereof. The company undertakes no
obligation to revise or update any forward-looking statement, or to make and
other forward-looking statements, whether as a result of new information, future
events or otherwise.
All references to company and "HCA" as used throughout this news release refer
to HCA - The Healthcare Company and its affiliates.
