HCA Chairman Frist Stepping Down
HCA Chairman Frist Stepping Down
Jul. 30, 2001
NASHVILLE, Tenn. (AP) _ Thomas F. Frist Jr., co-founder of HCA, said Monday he is stepping down as chairman of the nation's largest for-profit hospital chain.
Frist, who returned as a top executive four years ago amid a management shakeup and a federal fraud investigation, said he and Jack O. Bovender Jr., president and chief executive, had successfully restructured the company and it was time for him step aside.
Bovender, who came out of retirement in 1997 at Frist's request, will succeed Frist as chairman, effective Jan. 1.
``Initial goals have all been achieved, and the executive management team that we have put together over the past four years has led HCA to new levels of success,'' Frist said in a statement. ``It is now time to begin an orderly transition of HCA's leadership team that will guide this company to even higher levels of achievement in the coming years.''
Richard M. Bracken, president of HCA's Western Group, was promoted to chief operating officer, effective Monday. He will add president to his title once Bovender becomes chairman.
Samuel N. Hazen, chief financial officer for HCA's Western Group, will replace Bracken as the division president.
Bovender said the immediate appointments of Bracken and Hazen would allow them to assume their new positions before the company begins its annual planning and budgeting process for 2002.
Frist, the brother of U.S. Sen. Bill Frist, R-Tenn., said he would continue to work with management as a member of the HCA board and as one of the company's largest shareholders.
Frist and Bovender began a major restructuring after a federal fraud investigation caused profits and stock prices to tumble four years ago.
Richard L. Scott was ousted as chief executive in July 1997 and HCA got out of the home health care business. The company also sold or consolidated more than 100 hospitals.
Two executives were convicted in Florida in 1999 of helping cheat federal health care programs out of $3 million in a complex billing scheme.
HCA agreed last year to plead guilty to defrauding government health care programs and pay more than $840 million in criminal fines, civil penalties and damages.
The company has paid $95.3 million in criminal fines but has not yet paid the $745 million in civil penalties,
Last week, HCA posted second-quarter net income of $263 million, beating Wall Street's expectations.
Shares of HCA were trading Monday at $45.50, up 57 cents on the New York Stock Exchange.
Bovender, 55, has worked in the healthcare industry for 31 years _ more than 20 years with HCA. He worked with hospitals in Florida before advancing to several senior level positions. In 1992, he was named executive vice president and chief operating officer of HCA. Following HCA's merger with Columbia in 1994, he left the company to serve on various public and private company boards. He returned in 1997 as president and COO. He was named to HCA's board in 1999 and promoted to president and CEO in January.
Bracken, 48, started his career with HCA in 1981 and has held various executive positions at hospitals in San Diego and Nashville. In 1995, he was appointed president of HCA's Pacific Division and two years later was named president of Western Group Operations, responsible for 80 hospitals west of the Mississippi.
Frist, 62, founded Hospital Corp. of America, or HCA, in Nashville in 1968 along with his father, the late Dr. Thomas F. Frist, Sr., and the late Jack C. Massey. He was named president in 1977, and a decade later became chairman, president and CEO.
Upon the 1994 merger with Columbia, Frist served as board chairman. In early 1995, he became vice chairman following the company's merger with HealthTrust. He returned to the company in 1997 as chairman and CEO.
HCA operates 194 hospitals and 78 ambulatory surgery centers.
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