From the Arkansas Advocate\u2019s Tess Vrbin:
\nA year after Arkansas lawmakers rejected a bill that would have required minimum reimbursement rates for hospitals, three very different regions of the state have seen their local hospitals reduce services.<\/p>\n
Government-run insurance programs, like Medicare and Medicaid, and private insurers pay Arkansas health care providers among the lowest amounts nationwide. Meanwhile, the costs of labor, equipment and administration have increased, said Baptist Health CEO Troy Wells and Arkansas Hospital Administration Executive Vice President Jodiane Tritt.<\/p>\n
\u201cWe are doing the same work, often for a sicker population, with significantly fewer resources,\u201d Wells said. \u201c\u0085We will continue to have fewer resources to compete for physician manpower, and patients in Arkansas will have a more difficult time accessing the care they need.\u201d<\/p>\n
As the Arkansas Legislature is in the middle of legislative session focused on crafting the state\u2019s budget, health experts and legislators say more work needs to be done next year at the state level address the rising cost for hospitals and the relatively low amount they receive for providing that care.<\/p>\n
Without higher reimbursement rates in the near future, more hospitals might have to scale back or close permanently, Tritt said.<\/p>\n
\u201cWe hate to sound like we\u2019re crying wolf, because our hospitals do more with less as often as possible,\u201d she said. \u201cThe problem is, we\u2019ve been doing more with less for so long that we\u2019re at a fever pitch.\u201d<\/p>\n
Eight Arkansas hospitals have shuttered their labor and delivery units since 2020, most recently Baptist Health-Fort Smith, which will end these services April 28. Only 22 of Arkansas\u2019 75 counties have labor and delivery units, leaving women in some parts of the state to drive an hour or more to receive care.<\/p>\n
Women can still give birth at Fort Smith\u2019s Mercy Hospital after Baptist\u2019s maternity ward closes, but the city\u2019s Republican senator, Justin Boyd, said the situation highlights the need to make the hospital payment system more fair.<\/p>\n
\u201cWhen the market isn\u2019t working, the Legislature\u2019s job is to step in and have that debate on changing the rules in that market,\u201d Boyd said.<\/p>\n
Changing Medicare and Medicaid reimbursement rates would require an act of Congress. On the state level, lawmakers won\u2019t have an opportunity to introduce another bill addressing commercial payor reimbursements until next year\u2019s legislative session.<\/p>\n
Camden\u2019s Ouachita County Medical Center, which ended its labor and delivery services in January, was $8.5 million in debt when CEO Glenda Harper took over in August 2025. The hospital has filed for bankruptcy and applied for rural emergency hospital status, Harper said. If its application is approved, it will be Arkansas\u2019 sixth hospital to trade inpatient services for more federal funding.<\/p>\n
Jacksonville\u2019s only hospital, Unity Health, closed its emergency room and medical-surgical unit Wednesday, about three years after it opened. The hospital struggled with reimbursement rates and not being paid for uninsured patients seeking primary care from the emergency department, Jacksonville Mayor Jeff Elmore said.<\/p>\n
Elmore is grateful the facility still has psychiatric and radiology units, but said he\u2019s disappointed Jacksonville residents have to seek emergency care elsewhere.<\/p>\n
\u201cI would trade out the other two services for the emergency room service any day,\u201d he said.<\/p>\n
Rural areas such as south Arkansas tend to see the most financial struggles for health care providers, but the loss of services in Jacksonville and Fort Smith indicate urban and suburban areas aren\u2019t immune to the problem.<\/p>\n
Rural hospitals could receive federal funding through the new $50 billion Rural Health Transformation Program, but it isn\u2019t meant to alleviate the costs of hospital operations, Tritt said.<\/p>\n
Need for transparency<\/p>\n
Increasing reimbursements shouldn\u2019t create higher insurance premiums, because neighboring states have similar premiums but higher reimbursement rates, Tritt said.<\/p>\n
Last year\u2019s proposed legislation would have required commercial payors to gradually increase reimbursement rates to the average of their rates in Arkansas\u2019 six neighboring states. Several lawmakers opposed to the bill said they would not vote to increase their constituents\u2019 premiums. Others took issue with the bill\u2019s exemption for insurance provided by state government and higher education.<\/p>\n
Republican Rep. Brandon Achor of Maumelle said it\u2019s likely lawmakers will introduce similar legislation next year. Achor was among the bill\u2019s cosponsors and is running for a Senate seat that includes part of Jacksonville.<\/p>\n
Achor said legislation would need to be introduced earlier in the session to ensure there\u2019s \u201cearly engagement with the different players involved.\u201d He also said he believes \u201cthere needs to be significantly more transparency in the flow from the patient\u2019s dollar\u201d between medical care and insurance companies.<\/p>\n
, maternity wards and pharmacies are,\u201d said Achor, a practicing pharmacist.<\/p>\n
Wells called last year\u2019s bill \u201ca reasonable, fair approach\u201d and said the policy\u2019s financial impact on employers should be studied in advance of the next legislative session.<\/p>\n
Insurance premiums for Arkansans on private health care plans in the state marketplace increased by an average of more than 20% this year. Congress did not extend Affordable Care Act subsidies by the end of 2025, which would have prevented many Americans\u2019 insurance premiums from increasing.<\/p>\n
Meanwhile, the federal government is expected to decrease Medicaid spending in rural areas by about $15.5 billion per year thanks to a 2025 federal tax cut law, according to the nonpartisan health research organization KFF.<\/p>\n
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