As rescuers combed the smoke-charred building in search of more bodies, Prime Minister Mustafa al-Kadhimi held urgent meetings with senior ministers and ordered the suspension and arrest of health and civil defence managers in Nassiriya, his office said in a statement.
The manager of the hospital was also suspended and ordered to be arrested, the statement added.
Already decimated by war and sanctions, Iraq's healthcare system has struggled to cope with the coronavirus crisis, which has killed 17,592 people and infected more than 1.4 million.
"Health crews carried charred bodies out of the burning hospital while many patients were coughing from the rising smoke," a Reuters reporter at the site of the fire said.
Health officials at Nassiriya said search operations at the al-Hussain coronavirus hospital were continuing after the fire was brought under control, but thick smoke was making it difficult to enter some of the burnt wards.
"Raging fires have trapped many patients inside the coronavirus ward and rescue teams are struggling to reach them," a health worker told Reuters before entering the burning building.
Initial police reports suggested that an oxygen tank explosion inside the hospital's COVID-19 wards was the likely cause of the fire, a policeman at the scene of the fire said.
"I heard a big explosion inside the coronavirus wards and then fire had erupted very quickly," said Ali Muhsin, a hospital guard who was helping carrying wounded patients away from fires.
In April, a fire caused by an oxygen tank explosion at a COVID-19 hospital in Baghdad killed at least 82 people and injured 110 others.
Health sources said earlier the death toll from Monday's fire could rise as many patients were still missing. Two health workers were among the dead, they said.
Angry relatives gathered in front of the hospital and clashed with police, setting fire to two police vehicles, a Reuters witness said.
Weary of political violence, Iraqis also suffer frequent accidents due to under-investment, corruption and wrecked infrastructure. During the coronavirus crisis, hospitals have struggled with an influx of patients and short supplies.
"Corrupt officials must be held accountable for the fire and killing innocent patients. Where is my father's body," said one young man as he searched among charred bodies wrapped in blankets in the hospital's yard.
