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Arkansas hospitals hurting financially, several face closure

Operating costs continue to climb for hospitals in the Natural State, causing financial stress amid recovering from the COVID-19 pandemic.

LITTLE ROCK, Ark. — Arkansas hospitals are still trying to recover from the impacts of the COVID-19 pandemic, and three years later, the financial stress is only getting worse.

"It's kind of like putting a drop of water in the big ocean," Ouachita County Medical Center President and CEO Peggy Abbott said. "It helps just a tiny bit, but it's not the cure end of the problem."

In September, the Ouachita County Medical Center was given a $6 million line life. Abbott said the relief money hadn't been much help.

"When you consider that half of that $34 million operating budget is salaries, labor cost," Abbott said. "That is exactly what the $6 million was designated to offset and be used for."

Abbott said they've had to make difficult decisions to try and save money.

"Ceased operating an urgent care clinic and a primary care clinic here in our community," Abbott said.

According to Abbott, the Ouachita County Medical Center reported an operating loss of over $1 million last year. Arkansas Business said Baptist Health of Little Rock is dealing with the same issue after reporting a $12.9 million loss.

"That's why we were putting those cost-cutting measures in place," Abbott said. "To try to be closer to a breakeven if not a slight profit."

The Ouachita County Medical Center is not the only healthcare system reporting significant losses. The Arkansas Hospital Association said it's a trend across the state as the cost of operating a hospital continues to climb.

"20% for supplies, 20% for pharmaceuticals, and then more than 30% for labor costs," President and CEO of the Arkansas Hospital Association Bo Ryall said.

Ryall explained that the financial stress is hitting some hospitals harder than others, as five are on the brink of shutting down.

"In almost every county, there's a hospital that is the largest or second largest employer," Ryall said. "That's a major impact on the community, its economic development, its economic engine for those communities."

Ryall said they're doing what they can to provide relief.

"We've been looking for other dollars," Ryall said. "Whether that's American Rescue Act funds or Medicaid funds, but we've been unsuccessful so far."

Currently, the future for many hospitals is uncertain, including in Ouachita County.

"I don't see any additional cuts that we can make and function as we currently do," Abbott said.

According to the Arkansas Hospital Association, there isn't an end to these financial hardships as revenue isn't keeping pace with the rising expenses. The association said it's unclear when things will get better.

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