8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant To Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (date of earliest event reported): March 31, 2008

HealthSouth Corporation

(Exact name of Registrant as specified in its Charter)

Delaware

(State or Other Jurisdiction of Incorporation)

001-10315	63-0860407
(Commission File Number)	(IRS Employer Identification No.)

3660 Grandview Parkway, Suite 200, Birmingham, Alabama 35243

(Address of Principal Executive Offices, Including Zip Code)

(205)967-7116

(Registrant’s Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

Item 8.01 Other Events

Item 9.01 Financial Statements and Exhibits

Item 8.01 Other Events

On March 31, 2008, HealthSouth Corporation (the “Company”) finalized the transaction contemplated by the previously reported agreement (the “Agreement”) with Daniel Corporation (the “Buyer”), a Birmingham, Alabama-based full-service real estate organization, pursuant to which the Buyer acquired the Company’s corporate campus for $43.5 million in cash and a 40% residual interest in the “Digital Hospital.” In addition, HealthSouth entered into a long-term lease arrangement with the Buyer to maintain its corporate headquarters on the property. Proceeds from this transaction will be used to pay down a portion of the Company’s debt.

A press release issued by the Company announcing the consummation of the transaction is attached hereto as Exhibit 99 and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

See Exhibit Index

SIGNATURE

Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	HEALTHSOUTH CORPORATION
By:	/S/   JOHN P. WHITTINGTON
	Name:    John P. Whittington
	Title:     Executive Vice President, General Counsel and Corporate Secretary

Dated: April 1, 2008

EXHIBIT INDEX

Exhibit No.	Description
99	Press release of HealthSouth Corporation dated March 31, 2008.

EX-99

Exhibit 99

Media Contact March 31, 2008

HealthSouth: Andy Brimmer, 205-410-2777

HEALTHSOUTH FINALIZES SALE OF CORPORATE CAMPUS TO

DANIEL CORPORATION

BIRMINGHAM, Ala. – HealthSouth Corporation (NYSE: HLS) today announced it has finalized the sale of its corporate campus, located in Birmingham, Ala., to Daniel Corporation, a Birmingham-based, full-service real estate organization, for $43.5 million in cash and a 40% residual interest in the “Digital Hospital.” In addition, HealthSouth has entered into a long-term lease arrangement with Daniel Corporation to maintain its corporate headquarters on the property. On January 23, 2008, HealthSouth announced that it had reached a definitive agreement for this sale.

The sale includes the 103-acre corporate campus and all related buildings including a 200,000 square-foot corporate headquarters building, the Cahaba Grand Conference Center, and an incomplete 13-story building formerly called the “Digital Hospital.”

The sale of the corporate campus is part of the strategic repositioning of HealthSouth, first announced in August 2006, as a post-acute healthcare provider, focusing on inpatient rehabilitative and other complementary services. Proceeds from this transaction will be used to pay down a portion of the company’s long-term debt.

“We are very pleased to finalize this transaction with Daniel Corporation,” said HealthSouth President and CEO Jay Grinney, “This is another step in our plan to reposition HealthSouth as the preeminent provider of inpatient rehabilitative services in the U.S. The sale of this property will help us reduce corporate operating expenses, while the proceeds from the sale will be used to pay down additional debt.”

Additional details of the agreement were not disclosed.

About HealthSouth

HealthSouth is the nation’s largest provider of inpatient rehabilitation services. Operating in 26 states across the country and in Puerto Rico, HealthSouth serves more than 250,000 patients annually through its network of inpatient rehabilitation hospitals, long-term acute care hospitals, outpatient rehabilitation satellites, and home health agencies. HealthSouth strives to be the health care company of choice for its patients, employees, physicians and shareholders and can be found on the Web at www.healthsouth.com.

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