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Cracking the Code: Understanding Contractual Allowances in Arkansas HospitalsLock Icon

2 min read

In the world of hospital accounting, the amount billed for patient care is called “total patient revenue,” even though nothing approaching that sum will be received. Instead, insurance discounts called “contractual allowances” are applied to the billed amount, and the result is called “net patient revenue.” That’s what this week’s list of 95 Arkansas hospitals is ranked by.

Contractual discounts vary widely, although they typically average more than 50% of the initial billed amount. Only 14 of 95 hospitals discounted by less than 50% in the most recent fiscal years reported to the federal Centers for Medicare & Medicaid Services, and they are mainly rehabilitation hospitals. Only the Arkansas State Hospital had no contractual allowances, while allowances ate up 90% of total patient revenue at National Park Medical Center in Hot Springs.

Here are Arkansas hospitals ranked by contractual allowances as a percentage of billed patient services:

Arkansas Hospitals Ranked by Contractual Allowances

Hospital

%

National Park Medical Center, Hot Springs

90.37%

Baptist Memorial Hospital-Crittenden, West Memphis

88.18%

Northwest Medical Center-Bentonville

88.14%

St. Mary’s Regional Medical Center, Russellvillle

88.05%

South Arkansas Regional Hospital, El Dorado

86.69%

Baptist Health Medical Center-Van Buren

86.30%

Baptist Health Medical Center-Fort Smith

85.48%

Select Specialty Hospital-Fort Smith

83.15%

CHI St. Vincent North, Sherwood

82.96%

Siloam Springs Regional Hospital

82.71%

Helena Regional Medical Center

81.55%

NEA Baptist Health System, Jonesboro

81.43%

Wadley Regional Medical Center of Hope

81.19%

Forrest City Medical Center

80.86%

Northwest Health Physicians’ Specialty Hospital, Fayetteville

79.76%

St. Vincent Infirmary Medical Center, Little Rock

78.86%

Washington Regional Medical System, Fayetteville

78.83%

Baptist Health Extended Care Hospital, Little Rock

77.48%

Conway Regional Medical Center

77.16%

Baptist Health Medical Center-Conway

76.71%

Source: Centers for Medicare & Medicaid Services cost reports
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