Alabama hospital operators and the state hospital affiliation referred to as for extra federal funding to mitigate ongoing working losses throughout a information convention Thursday.
Alabama wants a “significant infusion” of American Rescue Plan Act {dollars} to stop service cuts and closures, Dr. Donald Williamson, president of the Alabama Hospital Association, stated throughout a phone briefing with reporters.
The median working margin throughout Alabama hospitals declined 79% from 2019 to 2022, in response to an evaluation from consultancy Kaufman Hall that elements in state and federal COVID-19 aid funds. Half of Alabama hospitals completed final yr with unfavorable working margins.
“What we desperately need is a significant infusion of ARPA funds, enough to serve as a bridge so we can address some of the other fundamental challenges in the reimbursement system and keep our hospital infrastructure in place,” Williamson stated. “This data shows that Alabama hospitals face an existential crisis.”
The hospital affiliation didn’t specify how a lot extra ARPA funding would suffice. About $8.5 billion of the 2021 legislation’s $1.9 trillion is earmarked for rural providers, which about half of Alabama’s hospitals are. Alabama has obtained greater than $2.1 billion from ARPA, in response to Treasury Department knowledge.
“We will all continue to explore any and all opportunities to support our systems, but there is no other immediate access to cash like the ARPA funds,” stated Joseph Marchant, CEO of Bibb Medical Center in Centreville, Alabama, and chairman of the Alabama Hospital Association.
Alabama hospitals’ median working margin relative to 2019 steadily decreased from 2020 to 2022 as labor and provide value inflation outpaced income will increase. Labor bills jumped 30% final yr in contrast with 2019, whereas discharges declined 3% and size of keep elevated 6%.
Alabama has the bottom Medicare reimbursement charges within the nation, which influences industrial insurers to additionally pay much less, stated Erik Swanson, senior vp of Kaufman Hall’s knowledge analytics follow.
Most of the state’s hospitals are within the bottom quartile of Medicare wage index reimbursement, which makes use of labor knowledge from Medicare value reviews to set funds. While the bottom earners within the Medicare wage index pay framework received a boost in 2020, Alabama hospitals are nonetheless on the “backside of the barrel,” Williamson stated.
Nationally, hospitals in states that expanded Medicaid eligibility below the Affordable Care Act have fared higher financially than these in states that did not, together with Alabama. Alabama Republicans oppose broadening Medicaid eligibility. Hospitals in non-expansion states have a tendency to hold extra dangerous debt and supply extra charity care, analysis has proven.
Just over 15% of Alabamians aged 19-64 have been uninsured in 2021, in contrast with 12.2% nationwide, in response to census knowledge compiled by the Kaiser Family Foundation. Alabama has the eighth-highest uninsured charge for this inhabitants among the many states.
“In addition to the ARPA funds, we have to look at long-term solutions,” Williamson stated. “We have to try to address how do we close coverage gaps.”