Many houses and apartments were destroyed by the storm, which drove employees away. Those that have stayed or come back have demanded higher wages in order to pay for the increased cost of living in the area.
"Since Hurricane Katrina, providers in the Gulf Coast have experienced difficulty hiring and retaining staff," Secretary Leavitt said in a statement. "Changing wage rates have impacted health care providers' ability to attract potential workers. These grants will help hospitals and skilled nursing facilities respond to that pressure, and strengthen access to health care services in the Gulf Coast region."
However, health care facilities haven't been compensated for their increased costs by Medicare payments for services to patients, according to a statement released Friday.
The grants are available in locations that were declared eligible for both individual and public assistance by the Federal Emergency Management Agency. The funds will be divided among the three states, with $27.8 million going to Alabama, $60.5 million to Mississippi and $71.6 million to Louisiana, and an additional grant of $15 million will go to New Orleans to attract doctors and other health care providers. New Orleans is experiencing a shortage of doctors because it lost half its doctors following Katrina, according to the HHS statement.
