Jackson Hospital reports a serious situation, alerting to possible closure if a deal with Blue Cross is not reached.

Jackson Hospital Faces Imminent Closure Amid Bankruptcy Proceedings

MONTGOMERY, Ala. – Jackson Hospital is indicating that its time is limited as it advances through bankruptcy processes, mentioning that closure could happen soon.

Hospital officials have expressed concerns that they might need to start shutting down by the end of this month, unless an agreement or a court order from Blue Cross and Blue Shield of Alabama comes through to increase reimbursement rates.

During a board meeting on Tuesday, a resolution was passed to set a definite deadline of June 25 for reaching an agreement on these rate hikes, as noted in court documents.

The hospital is contending that BCBS Alabama should provide reimbursement rates similar to what is given to Baptist Medical Center South, located nearby, stating that without these adjustments, the hospital’s survival is at risk.

The hospital previously filed a lawsuit against the insurance company in December, asserting that around $1.4 million in essential funding was being delayed, while it strives to remain operational. However, BCBS Alabama disagrees, claiming the allegations are “not accurate,” stating that the hospital influenced its stance by voluntarily providing cash advances.

WSFA 12 News has reached out to Blue Cross Alabama to get feedback regarding the hospital’s new resolution.

Jackson’s President and CEO, John Quinlivan, mentioned that the board has instructed the management to initiate the closure process if an agreement isn’t finalized by the June 25 deadline. He indicated that plans to begin shutting down operations will start on July 1, or sooner if required, outlining actions to “cease business operations and liquidate the hospital’s affairs.”

Quinlivan emphasized the seriousness of the situation, stating, “This is not a boy crying wolf. This is not a lawsuit pose. This is a true emergency. Jackson Hospital is in trouble,” as reflected in the bankruptcy court filing.

The petition submitted requests the bankruptcy court to “set a date for a preliminary injunction hearing by June 25, 2026, otherwise it will be too late to save Jackson Hospital.”

There were restructuring efforts started in April, but details about how many employees or departments would face changes remained unclear.

The hospital has recently seen a rise in admissions, coinciding with Governor Kay Ivey’s involvement with Montgomery County. Government agencies are pledging millions in financial support as part of ongoing efforts to maintain healthcare availability in the area.

WSFA 12 News has also reached out to the governor’s office to discuss how the state’s $40 million promise might be affected by these latest developments, along with similar inquiries made to the Montgomery County Commission, which has committed to provide $10 million.