Part I: How the CEO Behind the Largest Medicare Fraud in History Became Florida’s Governor & Senator

By Joe Marzo

The rise of Rick Scott and the largest Medicare fraud in U.S. history

In the mid-1990s, the federal government uncovered the largest Medicare fraud case in American history. At the center of the scandal was a healthcare behemoth known as Columbia/HCA. When the dust settled, the company had agreed to pay $1.7 billion in fines, making it the biggest health care fraud settlement ever at the time.

But what’s more shocking than the fraud itself is what happened next: the CEO of the company, Rick Scott, would go on to become Governor of Florida and then a U.S. Senator.

This is the story of how a man who oversaw a company accused of defrauding taxpayers out of hundreds of millions of dollars not only avoided prosecution — but used the scandal as a springboard into political power.

Columbia/HCA: A Profit Machine

Rick Scott, a former lawyer and venture capitalist, co-founded Columbia Hospital Corporation in 1987. Through aggressive acquisitions and cost-cutting, he built a rapidly expanding hospital chain. In 1994, Columbia merged with HCA Inc., creating the largest for-profit hospital network in the United States.

Scott’s strategy was simple: grow fast, cut expenses, and squeeze profits. But behind the scenes, the company’s practices were raising eyebrows.

Former employees would later testify that the company routinely inflated bills, billed for services never performed, and pushed unnecessary medical procedures to maximize reimbursements from Medicare and Medicaid.

The Federal Raid

In 1997, federal agents raided Columbia/HCA facilities across the country. What they uncovered was staggering: false cost reports, kickbacks to doctors, and upcoding of medical diagnoses to extract higher payments from government programs.

Facing mounting legal pressure, the board of directors forced Rick Scott to resign in July 1997. He walked away with $300 million in stock and a $5 million severance package.

The company eventually pleaded guilty to 14 corporate felonies and paid fines totaling $1.7 billion over the next several years.

No Charges, No Problem

Despite overseeing the company during the time the fraud took place, Rick Scott was never criminally charged. He claimed he had no knowledge of the wrongdoing and distanced himself from the scandal.

But public perception was mixed. To critics, he had either been complicit or grossly negligent. To his supporters, he was a successful businessman punished for others’ mistakes.

And in American politics, scandal doesn’t always end careers — sometimes it begins them.

Reinvention in Florida

In 2010, Rick Scott launched an improbable campaign for governor of Florida. Largely self-funded with more than $70 million of his own fortune, he ran as an outsider with a business background.

Despite the shadow of the Medicare scandal, Scott’s message of fiscal conservatism, job creation, and anti-establishment rhetoric resonated with voters — especially in the wake of the Great Recession.

He narrowly won the governorship in 2010, was re-elected in 2014, and in 2018, defeated incumbent Democrat Bill Nelson to become a U.S. Senator.

A Blueprint for the Powerful

Rick Scott’s rise illustrates something deeply unsettling about American politics: there is little accountability for corporate wrongdoing when paired with political ambition, money, and media savvy.

In a system where wealth can buy visibility and voter trust can be swayed by soundbites and slogans, a man once at the helm of the largest Medicare fraud case in history could not only reinvent himself — but thrive.

And as Florida's senior senator today, Rick Scott continues to influence national policy on healthcare, spending, and oversight — even as his own past reflects the very government waste and fraud he now claims to oppose.

Sources:

• U.S. Department of Justice. (2000). Largest Health Care Fraud Case in U.S. History Settled.

• The New York Times. (1997). Columbia/HCA Ousts CEO Amid Federal Probe.

• Politico. (2010). Rick Scott's Health-Care Past Hounds Him.

• Miami Herald. (2018). How Rick Scott Used His Fortune to Climb Florida's Political Ladder.

• Tampa Bay Times. (2014). Fact-checking Rick Scott’s Role in Columbia/HCA Medicare Fraud Case