As coronavirus cases and hospitalization rates continue to climb, Americans are relying on their local hospitals now more than ever. But hospital closures continue to plague Alabama – especially in its most rural regions.
As of March 2020, 17 hospitals have closed in Alabama, six of which were rural hospitals. Three quarters of all Alabama hospitals operate in the red, and 38% of Alabama hospitals are vulnerable to shutting down. With daily coronavirus cases reaching new heights, another rural hospital closing in Alabama could have devastating consequences for rural Alabamians, who would have to drive hours to the nearest major city to receive medical treatment.
Rural hospitals across America are closing because they have difficulty retaining physicians, maintaining a high number of insured patients, and bringing in revenue. This is due in part to a heavy reliance on Medicaid, which has low reimbursement rates. In fact, Alabama has one of the lowest Medicaid reimbursement rates in the country, which explains why Alabama has the fifth-most rural hospital closings in the country.
What’s more devastating is that the closings could have been prevented if the Alabama State House voted to expand Medicaid under the Affordable Care Act. Of the states most vulnerable to having rural hospitals close (Texas, Tennessee, Oklahoma, Georgia and Missouri), none have expanded Medicaid. Expanding Medicaid will help rural hospitals stay open because it increases the number of insured patients in a community. That means that the hospital would have a larger revenue base to sustain itself on. If Alabama expanded Medicaid, 300,000 new people could be insured. And in the age of COVID-19, this number is likely to increase with more unemployed Alabamians to enroll in the program.
Some Alabama politicians are also interested in expanding Medicaid. Senator Doug Jones wants the state to expand Medicaid, but Governor Kay Ivey is hesitant, citing fiscal concerns. With the expansion of Medicaid, the state of Alabama would pay $168 million more and then $25 million more every year after that. But Medicaid funding is the largest source of federal funding that states receive. Under an expansion, Alabama would only be required to pay 10% of the total cost, while the federal government would pay the other 90%.
Alabamians want a Medicaid expansion. Currently, 64% of Alabamians support expanding Medicaid, and while some politicians are pushing for expansion, the Alabama legislature is unlikely to do so in the near future. In the meantime, Alabama’s legislature is relying on the $1.9 billion provided by the CARES Act to meet hospital demand. Whether those funds can keep Alabama hospitals afloat during a seemingly unending pandemic is yet to be determined. But without a robust healthcare plan for all Alabamians, it’s likely we’ll be playing catch-up for years to come.