News Release

Hospitals in Louisiana and Mississippi to Receive More Katrina Recovery Grants

Hospitals in Louisiana and Mississippi still working to recover from the Hurricane Katrina disaster will receive $19.1 million in additional assistance from the Department of Health and Human Services (HHS).

“HHS continues to work with those in need to resolve the health care problems created by Hurricane Katrina,” Secretary Mike Leavitt said. “This grant is another step we are taking to make sure the citizens of these states have continued access to medical services.”

Three years after Hurricanes Katrina and Rita devastated the Gulf coast, many state health care delivery systems are still attempting to rebuild. To date, HHS has provided the region with more than $2.5 billion to assist in funding for social services, health care, and efforts to rebuild the health care system in the states hardest hit by the storms.

Today’s grant is targeted specifically to Louisiana and Mississippi to support their hospitals and inpatient psychiatric facilities (IPFs) that are facing serious and ongoing financial pressure to compete for workers in highly competitive post-storm labor markets.

After the storm destroyed housing and other critical infrastructure in cities such as New Orleans, thousands of residents fled to other states and many have not returned. This has created stiff competition among employers to attract and retain workers. Rebuilding health care delivery systems in these communities is vital to the renewal of these devastated communities.

Today’s additional grant funds will help support provider operations until the Medicare prospective payment system can adjust for changes in local wage scales. Funding for hospitals and IPFs will be allocated to these two states with just over $10 million available to Louisiana and nearly $9 million to Mississippi.

States will have discretion to determine which hospitals and IPFs and/or regions are still experiencing the most post-Katrina difficulties and will receive grant funds. Facilities, however, must be located in counties or regions which continue to be designated by the Federal Emergency Management Agency as eligible to receive individual and public assistance.

Louisiana and Mississippi will need to apply to CMS to have the grant funds awarded. Additional information is available at http://www.hhs.gov/louisianahealth/speeches/index.html.

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Note: All HHS press releases, fact sheets and other press materials are available at http://www.hhs.gov/news.

Last revised: May 06, 2008