Little Rock-based Baptist Health is planning to end hospital operations at Baptist Health-Fort Smith with the campus providing emergency room and possibly limited surgery services. Some or all existing physician agreements may expire June 29, according to a Baptist Health official.

The move by Baptist officials, driven by what they say are significant financial losses and facilities too expensive to modernize, will result in Fort Smith moving from a two-hospital system to a one-hospital system. Baptist Health-Fort Smith, originally built as Sparks Hospital, is located on Towson Avenue near downtown Fort Smith. The hospital reports having 492 licensed hospital beds.

Doug Weeks, executive vice president, chief strategy and innovation officer, was in Fort Smith on Friday (March 20) and spoke to members of a civic club and several physicians about the issues facing Baptist in Fort Smith. The primary issue, according to Weeks is that the hospital faces a “poor payor mix,” meaning many patients are underinsured, are without insurance, or are later unable to pay their full cost of care.

According to a summary provided by Weeks during his Fort Smith visit, the hospital would eventually use only the newer “Renaissance” part of the building that includes emergency room and surgery center operations. Other than noting a two-year window on changes, Baptist has not said when major shifts in health care services will happen.

SYSTEM LOSSES
According to sources at Weeks’ presentation, the hospital system’s western division, which primarily is the Fort Smith operation, lost around $25 million in 2025 and lost around $7 million so far in 2026. In August 2022, the western division had two hospitals, more than 40 outpatient locations, and approximately 1,600 employees. Baptist also operates a hospital in Van Buren. Talk Business & Politics has requested information on employee and physician numbers at Baptist Health-Fort Smith.

Doug Weeks

Weeks said there were several decades of underinvestment in the hospital campus under previous owners and it is now too expensive to modernize the large east and west hospital towers. Needed fire suppression systems, elevators, and other basic infrastructure repairs and replacement are cost prohibitive.

Weeks told the Friday crowd that Baptist looked at other alternatives to maintaining a hospital operation in Fort Smith. Two reliable sources told Talk Business & Politics that Baptist Health officials were provided options to build a modern, smaller hospital campus on Chaffee Crossing property near Interstate 49 and the Arkansas Colleges of Health Education (ACHE). One of the options was to build a new hospital at Chaffee Crossing and retain some emergency care operations and other services at the existing facility.

Weeks reportedly said Friday during his remarks that even a new facility, which would cost around $3 million per hospital bed, was too costly.

PHYSICIAN CONTRACTS
Also, some physicians at Baptist Health-Fort Smith have been notified that their contracts are set to expire June 29.

“Please accept this letter as Notice required by your Employment Agreement that we are taking on a new regional approach and have concluded that we will not proceed with automatic renewals for existing physician employment agreements,” according to a note provided to physicians by Will Rusher, designated agent, Baptist Health Services. “Therefore, the term of your existing agreement will expire on 6/29/2026. We will plan to have some dedicated meetings and discussions with you prior to the end of your current contractual Term. You will hear from Jeff Carrier, your DPO, or myself when these meeting are to be scheduled.”

Weeks said the hospital system directly hires most physicians working in Fort Smith, which is different than with the other 11 hospitals in its system. As a result, more of the Fort Smith hospital revenue is directed toward physician contracts.

Baptist Health reports having more than 250 “points of access,” including 12 hospitals and urgent care centers, a senior living community, more than 100 primary and specialty care clinics, a college with studies in nursing and allied health, and a graduate residency program. The system reports having approximately 11,000 employees.

‘DIFFICULT’ CHANGES, ER CONCERNS
An internal memo from Troy Wells, president and CEO of the Baptist Health system, noted that Baptist has investigated options since 2024 to address financial and infrastructure needs in Fort Smith.

“We anticipate that more than $20 million dollars will be invested in the downtown campus over the next few years,” Wells noted. “We expect that some of the changes we make will be difficult. These changes often will overshadow the positive investments we are making at the same time.”

In a statement to the media, Wells cited nationwide health care issues for the planned changes.

“Baptist Health-Fort Smith is announcing a transition of its Fort Smith campus,” Wells noted in the media statement. “For the past several years, the health care environment across the country has changed dramatically. Hospitals everywhere are facing rising costs, workforce shortages, and shifts in how care is delivered. These challenges require health systems to continually evaluate how best to provide care in ways that are sustainable for the long term.”

Kyle Parker, ACHE president and CEO, and a former member of the Sparks Hospital board, said the Fort Smith region needs two hospital systems.

“The thriving hospital (Mercy Fort Smith) will tell you that as well, and mean it,” Parker said. “My biggest concern is that the emergency room at Mercy could get overwhelmed if Baptist does not offer services other than one single overnight stay. The people will know that, and depending on their medical conditions, will go to an already-constrained emergency system at Mercy.”

BAPTIST, FORT SMITH HISTORY
Baptist Health acquired in July 2018 what was then Sparks Health System from Franklin, Tenn.-based Community Health Systems (CHS). The deal closed in the fourth quarter of 2018, and a transaction amount was not disclosed.

Prior to 2018, Naples, Fla.-based Health Management Associates acquired Sparks in a $138-million deal that closed Nov. 30, 2009. It was that transaction that resulted in funding for the ACHE, the parent organization of the Arkansas College of Osteopathic Medicine and the College of Health Sciences.

The Degen Foundation, a Fort Smith-based philanthropy, was created with some of the revenue from the sale of Sparks to HMA, providing initial ACHE funding to build a $32.4 million facility in east Fort Smith in the Chaffee Crossing area. The ACHE has since expanded to include other provider therapy programs and a research institute.

COMPLETE WELLS STATEMENT
Following is the complete, unedited internal memo from Baptist Health president and CEO Troy Wells to certain Fort Smith employees.

The following information is for directors at Baptist Health-Fort Smith to present to their staff in face-to-face meetings. Please do not forward this email to employees or print and distribute instead of having a direct conversation with your work team.

New Vision and Operating Strategy for Baptist Health-Fort Smith
March 23, 2026

Please see below an important message from Troy Wells, president and CEO, Baptist Health.

At Baptist Health, our mission has always been clear: to provide quality, patient-centered care while responding to the changing health needs of the communities we serve with Christian compassion and personal concern. When Baptist Health acquired Sparks Medical Center in November 2018, we knew there were changes that needed to be made in terms of facilities and the services we offered in the community.

When the COVID-19 pandemic occurred, it caused us to put a hold on making major changes to our facilities and clinical services. During that time we focused on caring for our community, improving quality and safety, and investing in clinical technology that would be available to better serve patients.

Over the past several years, the health care environment across the country has changed dramatically. Hospitals everywhere are facing rising costs, workforce shortages, and shifts in how care is delivered. These challenges require health systems to continually evaluate how best to provide care in ways that are sustainable for the long term.

In 2024, we launched a new strategic plan for Baptist Health. Part of that plan required us to do a full review of all of our system facilities and services. One of our major goals is to ensure that we are meeting community needs and that the services we provide are of high quality and sustainable. During the past year, we have worked with an external architecture and engineering firm to do a full assessment of all of our facilities on the downtown Fort Smith campus and to assist us in understanding what facility changes needed to be made for the future based on the current practice of medicine and community needs.

Likewise, we’ve undergone an extensive review of our clinical services to determine what we need to continue to provide versus services that are being adequately provided elsewhere in the community. Over the course of the next 12-18 months we will be making significant changes to our operations in Fort
Smith. These changes will include reinvesting in some services and transitioning out of others. We will also be consolidating where some services are provided on our downtown campus so that we can make the facilities investments needed for our future operations in downtown Fort Smith. We anticipate that
more than $20 million dollars will be invested in the downtown campus over the next few years.

We expect that some of the changes we make will be difficult. These changes often will overshadow the positive investments we are making at the same time. Please know that as we make these changes, specifically those that involve service reductions, we will be working closely with other community health care providers to ensure our patients will have access to the care they need.

We are committed to being transparent with our employees and the community as definitive plans are completed and being implemented.

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