Hospital association says new money helps hospitals hold on

MONTGOMERY, Ala. (WSFA) - Alabama hospitals will receive $78 million in extra reimbursements for treating Medicaid patients. However, some groups said this only puts a Band-Aid on the problem.

In the last eight years, 13 Alabama hospitals have closed, with seven of those closures in rural Alabama.

Gov. Kay Ivey stated on Wednesday that she’s released an extra, conditional state appropriation of $22 million for Alabama Medicaid. This will allow the program to receive an additional $56 million in matching federal dollars, according to Alabama Medicaid Commissioner Staphanie Azar.

Alabama Hospital Association Executive Vice President Danne Howard said this is a bump for hospitals, especially in rural areas. She said a large reason why they are losing money is because they treat many people without insurance and do not receive compensation for it.

Howard said that bump will not last long. She said most of Alabama hospitals are operating in the red.

“It doesn’t pull them out of the red, but it allows them to survive just a little bit longer," Howard said.

The association looks to Medicaid expansion as a long-term fix.

“That’s the one thing the state can do that will impact economic development, our prison reform system, access to care, the health of our citizens, the workforce. You name it," she said.

The group, Alabama Arise, also said this money helps, but they believe the long-term solution is Medicaid expansion.

“When a rural hospital closes the economy essentially hollows out. Just ring after ring of support services, then services like the cafes and other establishments that serve the workforce," said Jim Carnes, who is the Alabama Arise policy director.

Gov. Kay Ivey’s office provided WSFA this statement on whether Medicaid expansion is an option for the administration.

The reimbursements will be available in the 2020 fiscal year, which started Tuesday. The governor’s office said the funds will offer relief for hospitals facing financial strains, including rural hospitals and the two children’s hospitals in the state, Children’s of Alabama in Birmingham and USA Children’s & Women’s Hospital in Mobile.

Copyright 2019 WSFA 12 News. All rights reserved.