Restoring Rural Healthcare: Hospital Recovery After Hurricane Michael

Project Overview

Calhoun Liberty Hospital (CLH) is a critical access hospital serving Calhoun and Liberty Counties in rural North Florida. For more than 90,000 residents, it is the only hospital within a 35-mile drive, making it an essential lifeline for emergency care, diagnostics, and routine medical services.

That lifeline was severely threatened on October 10, 2018, when Hurricane Michael made landfall as a Category (Cat) 5 storm just 40 miles south of the facility. More than 60 percent of the hospital was destroyed, and much of the remaining structure sustained significant damage. Despite operating out of a compromised building maintained through temporary repairs, the hospital never closed its doors. Continuity of care for the community remained non-negotiable, even as recovery needs mounted.

Understanding the Mission

In the months following the storm, CLH leadership faced an unprecedented challenge: sustaining continuous healthcare operations while navigating a complex recovery process. Hospital reconstruction is fundamentally different from other recovery efforts. The facility had to remain fully operational while coordinating inspections, documentation, regulatory approvals, and disaster funding requirements that quickly became overwhelming.

By early 2019, it became clear that repairing the existing facility was not feasible. Built in 1961, the hospital no longer met modern healthcare and accessibility standards. Bringing it into compliance would have required expansions to hallways, patient rooms, and restrooms throughout the building—something the small five-acre site simply could not accommodate. Ultimately, the only viable long-term solution was to build a new hospital.

By mid-2020, the Federal Emergency Management Agency (FEMA) had agreed to fund a replacement facility, CLH purchased a 14-acre site nearby, and design work was nearing completion. Then COVID-19 hit.

As the hospital responded to a global pandemic, government agencies shifted to emergency operations. Offices closed, reviews slowed, and approval timelines stretched dramatically. At the same time, construction costs escalated rapidly. What FEMA estimated in late 2019 as a $16 million project approached $60 million by 2022 due to labor shortages, supply chain disruptions, and inflation.

The Hagerty Approach

Beginning in December 2018, Hagerty partnered with CLH to lead disaster recovery and grant management efforts—allowing hospital leadership to remain focused on patient care. The mission was simple in concept, but complex in execution: help the hospital rebuild, remain operational, and protect every dollar of public funding throughout the process.

When COVID-19 disruptions and escalating construction costs threatened to stall progress, Hagerty helped CLH adapt. We coordinated across multiple funding sources, including FEMA, Department of Housing and Urban Development (HUD) disaster recovery funds, Florida Department of Health (FL DOH) grants, state funding, and New Market Tax Credits (NMTC). Each funding stream carried distinct eligibility rules and requirements. Ultimately, our team helped manage these programs as a single coordinated recovery strategy—keeping the project compliant, aligned, and moving forward.

As circumstances evolved and a full build-out became temporarily unattainable, Hagerty worked with hospital leadership and design teams to develop a phased solution. The team helped design a modern hospital that could open sooner while allowing for future expansion without triggering new approvals or delays. This approach preserved project momentum while positioning the hospital for long-term growth.

Achieving Results

By late 2023, funding was secured, and construction finally began. In August 2025, CLH proudly opened a new 50,000-square-foot facility built to restore and strengthen rural healthcare access for generations to come.

In total, Hagerty helped CLH secure and manage more than $47 million in combined funding, including FEMA Public Assistance (PA) and Hazard Mitigation grants, HUD Community Development Block Grant Disaster Recovery (CDBG-DR) funds, FL DOH Rural Hospital program grants, three state appropriations, and NMTC benefits. Acting as the integrator across all funding partners, Hagerty aligned scopes and schedules, enforced strict cost separation, and documented eligibility to ensure the project advanced without duplication-of-benefits risks that can reduce or eliminate funding.

Hagerty also helped CLH obtain an uncommon reimbursement of more than $715,000 for construction loan fees and interest associated with a $14.5 million construction loan. This highly technical reimbursement required precise documentation and close coordination with agency requirements. Hagerty’s deep expertise in federal funding programs positioned CLH among only a handful of applicants nationwide to receive this reimbursement.

Today, Hagerty continues to support CLH through final grant closeouts and compliance, applying the same discipline, coordination, and commitment that have guided the project from day one.