Dothan hospital claims it is losing millions

Southeast Health will receive over two million additional taxpayer dollars annually after Houston County commissioners, without choice, approve a property tax increase for the Dothan hospital.
Published: Sep. 23, 2022 at 9:58 AM CDT
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DOTHAN, Ala. (WTVY) -Southeast Health will receive over two million additional taxpayer dollars annually after Houston County commissioners, without choice, approve a property tax increase for that Dothan hospital.

“We are right now projecting a $10 million operating loss for this fiscal year that ends at the end of this month, and the board just approved a budget for next year with a $15 million-dollar operating loss,” Southeast Health Chief Financial Officer Derek Miller told those commissioners on Thursday.

He blamed inflation and a labor shortage for the hospital’s tumble onto hard times.

Miller said from 2019 until the present contract labor costs—mostly traveling nurses-- soared from $7 million annually to $41 million.

He also pointed to declining federal reimbursements and inflation which he said are taking their toll.

Southeast Health has every legal right to demand an extra 1½ mils of property tax because Houston County voters designated 4 mills for the hospital in 1949.

But for most of the time since, the hospital voluntarily chose to receive less than its full allocation.

For many years it received only one mil, then jumped to the current 2½ mils when it constructed a medical college about a decade ago.

Commission approval to collect the full four mils for Southeast Health is a formality because of that vote 73 years ago.

Nevertheless, two commissioners have concerns.

Commissioner Brandon Shoupe questions why the hospital is financially frail, since a highly regarded credit reporting agency issued a glowing forecast.

“That Fitch rating that came out last year painted a very good picture about the health of the hospital and now the story is different,” Shoupe told News 4.

Commissioner Ricky Herring wonders why the hospital invested millions in unimproved property.

The 1½ mills commissioners will approve Monday equates to $15 in additional taxes per $100,000 in assessed property value.

Southeast Health is not the only hospital suffering.

East Alabama Health in Opelika is asking for $6 million in American Rescue Plan Act funds from Lee County.

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