Originally created 05/11/97

Ex-exec gets $476,000 in Healthmaster lawsuit



The former executive who said he was fired for helping federal investigators in the Healthmaster fraud case was awarded $476,000, plus attorney's fees, in a federal lawsuit Saturday against his former company.

A hearing will be set in federal court to determine the amount of the attorney's fees owed John B. O'Neal III. Mr. O'Neal claimed he was fired unjustly in 1995 from the presidency at Master Health Plan, a division of Jeanette Garrison's Healthmaster, the company that bilked federal Medicaid programs out of several million dollars.

The eight-member jury awarded $475,000 for Mr. O'Neal's claim he was fired unjustly and $1,592 for back vacation pay.

"I was vindicated, proven I did the right thing," Mr. O'Neal said, after the verdict. Senior U.S. District Judge Anthony A. Alaimo, who was the judge in the Healthmaster criminal case, presided over the civil trial.

Ms. Garrison pleaded guilty in the summer of 1995 to 10 felony charges related to the health care fraud case. She heads back to prison Monday to complete her 33-month sentence.

The jury ruled in favor of Ms. Garrison in the portion of the lawsuit that named her as a defendant, but ruled against her company.

"We feel it's a victory," her attorney David Hudson said.

Mr. Hudson said the defense would likely appeal the jury's decision that was a fraction of the several million dollars Mr. O'Neal was seeking.

At the time of Mr. O'Neal's dismissal in July 1995, Ms. Garrison was under indictment and had relinquished management of the company. The defense claimed no wrongdoing and argued that Mr. O'Neal was replaced with former Augusta Regional Hospital chief executive Wayne Peloquin because of erratic behavior and poor job performance.

The Medicare fraud investigation of Healthmaster began in 1994 when federal agents got wind of a story that the company was illegally funneling campaign contributions through their employees and then reimbursing the employees with the federal Medicare money the home health care corporation received.

Ms. Garrison rose to the highest ranks of Democratic Party fund-raisers in Georgia, and she was co-chairman of Clinton-Gore 92 in Georgia.

As a result of the Medicare fraud prosecution - which sent her and two other of her executives to prison - Healthmaster went into bankruptcy and was sold. It is now CareSouth.