The Private Option has increased payments to Arkansas Hospitals and reduced the number of uninsured patients treated. Last week, the Arkansas Hospital Association and Arkansas Chapter of the Healthcare Financial Management Association released a study that took a look at the financial impact of Private Option after its first six months.

The major benefit of the Private Option is the reduction in uninsured patients seen in the hospitals. That means hospitals are getting paid for their services. When patients are uninsured, that doesn’t always happen. The Private Option is cutting those unpaid health costs significantly.

But that’s not all. Some of the reported gains for hospitals in a six month period are:

• Uncompensated care costs reduced by 54.6 percent resulting in a $69.2 million benefit.
• The number of people hospitalized without insurance fell by 46.5 percent.
• More than 4,900 admitted patients were uninsured this year compared with over 9,100 in 2013.
• Although ER visits increased overall, the volume of uninsured ER visits dropped by 35.5 percent.
• Hospitals expect a 261 percent increase in payment from low income patients.

In addition to helping Arkansas achieve the largest drop in the number of uninsured adults in the country, the Private Option is good for Arkansas hospitals too. It reduces the burden of financial losses because patients are unable to pay for treatment. This is especially true for hospitals in rural areas.