Little Rock Hospitals and Physician Continue to Vie for Profitable Services

More Children Gain Coverage as Access-to-Care Problems Mount for Uninsured Adults

News Release
July 21, 2005

FURTHER INFORMATION, CONTACT:
Alwyn Cassil (202) 264-3484 or acassil@hschange.org

WASHINGTON, DC—Financial pressures continue to spur competition between Little Rock hospitals and physicians for profitable health care services, especially cardiac and orthopedic care, according to a new Community Report released today by the Center for Studying Health System Change (HSC).

Little Rock remains a market where health care costs are extremely high relative to workers’ incomes, leaving many low-income adults with inadequate access to health care. In contrast, low-income children have relatively good access, thanks largely to the Arkansas Medicaid program.

"Little Rock’s health care market is a study in contrasts—hospitals and physicians are competing fiercely for high-cost, high-tech services, in part to offset the need for more uncompensated care for uninsured, low-income people," said Paul B. Ginsburg, Ph.D., president of HSC, a nonpartisan policy research organization funded principally by The Robert Wood Johnson Foundation.

Both hospitals and physicians reported continuing financial pressures because of payment rates they say don’t keep up with operating cost increases. Hospitals also reported that financial pressures increased in the last two years because of the growing burden of uncompensated care. In response, hospitals continued to compete for physicians and patients, particularly around profitable service lines, such as cardiology and orthopedics, to help offset financial pressures.

Other key findings of the report, Little Rock Providers Vie for Revenues, as High Health Care Costs Continue, include:

• Ongoing shifting of treatment and diagnostic services from full-service hospitals to physician offices and specialty facilities.
• Rising numbers of uninsured adults, including undocumented immigrants, that are challenging the capacity and responsiveness of the area’s safety net.
• A new any-willing provider law—supported by a few hospitals and many physicians and consumer groups but opposed by employers and health plans—that may affect health care costs and access.

Little Rock is one of 12 communities across the country tracked intensively by HSC researchers through site visits. The new report is based on a February 2005 site visit and interviews with more than 65 Little Rock health care leaders, representing health plans, employers, hospitals, physicians and policy makers.

The Center for Studying Health System Change is a nonpartisan policy research organization committed to providing objective and timely research on the nation’s changing health system to help inform policy makers and contribute to better health care policy. HSC, based in Washington, D.C., is funded principally by The Robert Wood Johnson Foundation and is affiliated with Mathematica Policy Research, Inc.