Its annual sales are higher than Xerox's. It is the largest buyer of medical supplies in the world. The resignation on July 25 of Richard Scott, Columbia's visionary founder and chief executive officer, is part of an extraordinary series of events that have shaken the health care behemoth with a reputation for hyperaggressive business tactics. In an indictment unsealed last week, three Columbia executives were charged with overbilling Medicare at a Florida hospital. Just days before, federal agents served at least 35 search warrants on Columbia facilities in seven states.
More indictments appear likely.
He also challenged traditional concepts of medical ethics by encouraging doctors to invest in Columbia hospitals. Scott's boast that he has done more to reform the nation's health care system than Bill Clinton is partly true. Last week, Columbia attempted to repair its scarred image by replacing Scott with Thomas Frist Jr., a respected Nashville cardiologist and philanthropist who had been serving as the company's president. He appears to be his predecessor's temperamental opposite. While the actions announced by the courtly Frist may appease anxious stockholders and limit criminal penalties down the road, they do not resolve questions about the place of for-profits in a traditionally nonprofit field.