ACTION 8 UPDATE: Jackson Hospital says it will not move forward with July 1 closure process
MONTGOMERY, Ala. (WAKA) – Montgomery’s bankrupt Jackson Hospital says due to recent developments, it will not start a process to close on July 1.
The hospital had previously announced that unless more funding was found, it intended to start winding down operations.
In an email to employees obtained by Action 8 News late this afternoon, the hospital says that progress is still being made in talks with Blue Cross Blue Shield of Alabama. CEO John Quinlivan said that he hopes to wrap up the discussions very soon.
The hospital has hoped that BCBS will raise its insurance reimbursement rates so that more money comes in. The hospital failed earlier this month to get a bankruptcy judge to force BCBS to raise its reimbursement rates, which BCBS has said are more than fair as it says it’s trying to help Jackson Hospital stay open.
Earlier this week, the hospital said it was continuing to work in good faith with BCBS as well as city, county and state leaders to finalize the commitments it needs to emerge from bankruptcy.
“Nothing changes operationally today,” John Quinlivan, president and CEO of Jackson Hospital, said in a statement. “Jackson Hospital remains open, our emergency department remains open, and our teams continue to care for patients.”
Quinlivan said the hospital remains encouraged by the continued engagement from its partners. He says there are still important pieces that must be finalized.
“Our focus remains on protecting access to local healthcare for the River Region and ensuring any path forward is financially sustainable,” Quinlivan said. “We will share additional updates as soon as we are able.”
Last week, the hospital had scheduled an announcement about its future for the afternoon of Friday, June 26. The announcement was canceled due to the hospital saying there had been new developments the night before. The hospital had set a deadline of Thursday, June 25, to have its financing in order or to possibly begin a process to close the 80-year-old hospital.
The hospital has said it needs $293 million to fully recover from years of financial struggles. It has said it only has commitments of $61 million, including $35 million from Georgia billionaire Rick Jackson, who is also that state’s Republican nominee for governor.
As Action 8 News has reported, the hospital filed for Chapter 11 bankruptcy protection in February of 2025. That came after it missed a $60 million interest payment on bonds.
In filing for bankruptcy, Jackson Hospital said it experienced significant financial pressures in recent years due to increased labor costs, stagnant reimbursement rates, a challenging payor mix and fallout from COVID-19, among other factors. It said without Medicaid expansion in Alabama, it suffered significant financial losses due to its care for uninsured people. In 2023 alone, the hospital said gross charges related to the care of uninsured patients exceeded $45 million.
Jackson Hospital is licensed for 344 beds, serving Montgomery and the River Region as a community not-for-profit facility. It opened in 1946 with 37 beds and five doctors.
Stay with Action 8 News for updates.
