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Governor acts to provide an extra $78 million in state, federal cash for Alabama hospitals

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Gov. Kay Ivey on Wednesday released an extra, conditional state appropriation that — when matched with federal dollars — will provide a total of $78 million in extra payments to state hospitals for treating Medicaid beneficiaries.

“I want to do everything I can to help our hospitals provide the services needed to keep Alabamians healthy,’’ Ivey said. She released a conditional appropriation of $22 million in state dollars for Alabama Medicaid to increase reimbursements to hospitals for treating Medicaid beneficiaries.

The $22 million in state money will allow Alabama Medicaid to receive an additional $56 million in matching federal dollars, said Alabama Medicaid Commissioner Stephanie Azar, “to help hospitals provide vital services.”

“The conditional appropriation not only supports Governor Ivey’s goal of ensuring access to quality health care in the state but also her goal of assisting rural health care,” she said.

The combined $78 million will be available in the 2020 fiscal year, which started Tuesday, and 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.

Don Williamson, president of the Alabama Hospital Association, said, “Alabama hospitals are very grateful to the Alabama Legislature and to Governor Ivey for the additional funds made available to Medicaid for hospital services. While these funds will help all hospitals in our state, they will especially provide needed support to the two children’s hospitals and the rural hospitals facing severe financial strains.”

The state operating budget for FY 2020, which legislators and the Governor approved in the spring, authorized Governor Ivey to release the conditional state funds to Medicaid if the state General Fund had the money, the state finance director recommended the release, and the Governor approved.

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State Rep. Steve Clouse, R-Ozark, who chairs the committee in the House of Representatives that oversees the state General Fund, said, “This appropriation is another successful example of coordination between the executive and legislative branches to be fiscally responsible while simultaneously meeting the needs of Alabamians.”

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