SILOAM SPRINGS — Northwest Arkansas' health care sector is growing faster than the rest of the region's economy, but not fast enough to keep up with the needs of a growing population and the standards of quality of care in similar regions. Not so, said the Northwest Arkansas Council. Wednesday.
“It's like driving 60 mph while trying to catch up to a car going 160 mph,” said Paul Umbach, president of Tripp Umbach, a consulting firm in Kansas City, Missouri.
Umbach presented his company's research into the current state of health care in the region at the council's annual meeting on Wednesday. The council is comprised of community and business leaders who identify and address local needs and issues. The council and the Heartland Whole Health Institute commissioned Umbach's research.
Tripp Umbach proposed a way to accelerate progress.
Investments in health research in this region, in particular, have the potential to close the gap in health care with comparable regions further down the road, such as Des Moines, Iowa, and Evansville, Indiana. Mr. Umbach gave a presentation at a conference held over lunch at John Brown University.
Umbach's research found that residents in the region now meet their medical needs locally far more often than in the past. The “outflow” of patients seeking medical services in other countries has fallen from nearly $1 billion in total medical services in 2018 to $695 million in 2023.
As part of the economy, Northwest Arkansas' healthcare sector grew 80% from 2018 to 2023. According to the study, this equates to 37% of the region's overall economic growth rate.
Companies in Northwest Arkansas have invested $529.5 million in healthcare expansion since 2018, according to the study. These include expansions of Mercy Hospital Northwest in Rogers, Washington Regional Medical Center in Fayetteville, and Arkansas Children's Hospital Northwest in Springdale. Additional $1.3 billion expansions are underway, including the Alice L. Walton School of Medicine and Heartland Whole Health Institute in Bentonville.
With investments like this, the health care sector of the Northwest Arkansas economy is growing twice as fast as the regional economy as a whole, Umbach said. But like the rest of the state, Northwest Arkansas started far behind the rest of the nation in health care.
“Take away Northwest Arkansas from Arkansas. The health conditions here are worse than Mississippi,” Umbach said.
More than 2,700 health care jobs are unfilled in Northwest Arkansas, accounting for more than a quarter of the region's job openings, according to numbers released Wednesday.
Ambach said Medicare reimbursement rates in Arkansas are for severely disabled care.
His firm's research found that “Private insurers base their reimbursement rates on the amount they receive from Medicare, so Northwest Arkansas bears the burden of having the lowest government and private reimbursement rates. It turned out that there is.
Dr. Joe Thompson, director of the nonprofit Arkansas Center for Health Improvement, said the federal government began basing Medicare reimbursement rates on local wage levels in 1996.
“In some parts of the country, fees are six times the average in Arkansas,” he said in an interview after Umbach's presentation. He said private insurance companies base most of their reimbursement rates on fees paid by federal health care programs.
Trip Umbach's research quotes: “For example, a hospital near Oklahoma earns $5,725 more for treating the same patient with the same condition, compared to a hospital just a few miles away in northwest Arkansas. It shows how little money is available for reinvestment and growth.”
Pearl McElfish, director of the Institute for Regional Health Innovation at the University of Arkansas for Medical Sciences, also attended Wednesday's meeting. She agreed with Mr. Umbach's points about the need to research new ways of delivering health care and the need to move toward a “value-based” reimbursement system for health care. In such systems, reimbursement to providers is based on the improvements achieved.
“If treating high blood pressure lowers blood pressure, you'll get more reward,” she says.
In other business, Nick Hobbs of Rogers replaced Todd Simmons of Siloam Springs as council co-chair. The council's CEO Nelson Peacock also told members that local entrepreneurs need early investment to get their businesses off the ground. “Too often you have to go to one of the coasts or to Austin, Texas, to get funding,” he says.
on the web
Tripp Umbach Report on Healthcare in Northwest Arkansas: online.flippingbook.com/view/199987982/
