Summer COVID surge cost Alabama hospitals at least $200 million, legislature has offered some help

Coronavirus

HUNTSVILLE, Ala. – The Alabama Legislature took up political reapportionment and vaccine mandates during the second special session of 2021.

Legislators also offered some assistance to Alabama’s hospitals and nursing homes, which have been battered by the pandemic.

Alabama is due to get $2.1 billion in American Rescue Plan Act funds. The state plans to use about $400 million as part of its prison construction plan. The measure passed last week, sets aside $80 million to be disbursed through the Alabama Department of Finance through agreements with the Alabama Hospital Association and the Alabama Nursing Home Association.

The COVID-19 relief money follows a summer that saw Alabama’s hospitals inundated and nearly overrun with COVID-19 patients.

Danne Howard, associate director of the Alabama Hospital Association said details are still being worked out, but the association hopes the new money will help hospitals bridge the gap in funding caused by the patient surge.  

“That really started in July, the extraordinary expenses related to staffing up, related to delivering monoclonal antibodies, related to the additional and overwhelming needs and everywhere you look,” Howard said. “It was worse than it was in the last winter surge and it was worse because it happened so rapidly.

“We did a survey of our membership that only covered direct expenses from July the 1st through the surge. And it was more than $200 million just for that time period.”

Howard said member hospitals still report staffing is the greatest challenge. And they are looking at ways to try and address that through a task force study.

Smaller hospitals are also going through an assessment process to determine if they need more ICU bed capacity, and if so, how to pay for it.

The proposed funds contained in the new measure are for expenses already incurred. Howard said most rural hospitals were financially in the red before the pandemic.

The AHA hopes that the Alabama Legislature will revisit assistance to hospitals through the American Rescue Plan Act funds again when it reconvenes in 2022.

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