Rising costs of health care leads to another rural Alabama hospital closure

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Georgiana Medical Center
[Photo via Georgiana Medical Center on Facebook]

Due to the rising costs of health care, the Georgiana Medical Center in Georgiana, Ala. will be closing on March 31. The hospital’s owner, Ivy Creek of Butler, made the announcement Monday afternoon that they would close the facility.

“The rising costs of healthcare coupled with the cuts in reimbursement have made it impractical to maintain financial viability with two hospitals operating in Butler County,” CEO of Ivy Creek, Mike Bruce, said in a statement.

Butler County’s other hospital, LV Stabler in Greenville, Ala. will join with Ivy Creek and combine their home health agencies to manage its rural health clinics.

“The partnering of the two organizations is the optimal way to continue to provide overall high-quality healthcare for the residents of Butler County, as well as the surrounding areas,” Bruce added.

“Small hospitals, in particular those in Alabama’s underserved, rural counties, are under tremendous financial pressure,” said LV Stabler Interim CEO Connie Nicholas. “We’ve seen other hospitals across the state forced to close their doors.”

The Andalusia Star-New reports the closing of the Georgiana Medical Center will be the state’s 13th hospital to close in eight years, and the seventh rural hospital among those to close.

According to Danne Howard, Policy Director at the Alabama Hospitals Association, about 88 percent of the state’s rural hospitals are operating “in the red” and aren’t currently receiving reimbursements that can cover the cost of delivering care.

Doug Jones reacts

Alabama U.S. Sen. Doug Jones says, this should be a wake-up call – actually, another wake up call.”

“For years, our rural hospitals have been warning public officials about the financial cliff they faced in large part as a result of unfair Medicare reimbursement rates and the refusal to expand Medicaid in Alabama. Thirteen hospitals have closed in our state since 2011. Seven of those have been in rural areas. How many more rural health care providers need to close for meaningful action to be taken? This should be a wake-up call – actually, another wake up call.  We all have a responsibility to take action – to expand Medicaid, to fight for wage index reform, to find opportunities to lower the cost of health care – and to find common ground to best serve our communities,” said Jones, who was recently honored by the National Rural Health Care Association for his commitment to rural health providers.