JRMC Readies For Rural Health Funding; Hospital CEO Updates Board On Application Process
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by Janice Penix
Johnson Regional Medical Center (JRMC) administrators are working to be fully prepared for a state rural health funding program, CEO Tommy Hobbs told members of the Board of Directors on Thursday, April 23.
The Arkansas Rural Health Transformation Program (ARHT) allocates funding to rural health systems to soften the impact of federal funding reductions on rural communities.
Spending cuts to Medicare, Medicaid and other health coverage programs that were part of the “One Big, Beautiful Bill,” disproportionately affected rural health systems that rely heavily on public insurance programs. In response, Congress included a Rural Health Transformation Program in the final bill that allotted $50 billion to states to address the funding reductions.
Hobbs said the first round of funding is expected to be released before the next Board meeting, and he and his staff are diligently preparing to be ready to submit JRMC’s application as soon as possible.
“We assume there will be a short turnaround time for submissions, but we will not know until we receive notice what they expect to be funding and how we will submit our application,” Hobbs said.
The Arkansas THRIVE Program is expected to be the first phase of the ARHT funding, Hobbs told the Board.
THRIVE stands for Telehealth, Health-monitoring, and Response Innovation for Vital Expansion and is the technology-focused pillar of the ARHT. It is designed to move rural care from reactive, facility-centered delivery to proactive, connected, technology-enabled care that expands access, improves chronic disease management and strengthens emergency response.
Over $208 million was awarded to Arkansas for THRIVE for the 2026 fiscal year, according to information Hobbs provided to the Board.
The technology-focused program is designed to reduce unnecessary transfers and emergency department use through telehealth and remote monitoring. It will also improve chronic care follow-up and earlier intervention through better data sharing and predictive tools, and strengthen rural emergency response and stabilization capacity through modernized emergency medical services (EMS) systems.
THRIVE is also designed to build digital infrastructure that supports broader care coordination across hospitals, clinics, nursing and pharmacy services.
Following the THRIVE phase of funding, Hobbs said it is anticipated the PACT Program will be funded next.
PACT, which stands for Promoting Access, Coordination and Transformation, is the access and delivery arm of the ARHT, according to information provided by Hobbs.
It is the primary access-and-delivery investment within THRIVE and directly addresses rural provider shortages, fragmented care, transportation barriers and service instability. The initiative is designed to expand services closer to home while strengthening the long-term viability of rural hospitals, clinics and regional partnerships.
Arkansas has allocated $393 million to PACT, making it the largest of the state’s four major rural health transformation initiatives.
Hobbs said JRMC staff has collaborated to anticipate what might be required for funding applications, although much of the information remains unknown.
“There is a lot of ambiguity,” he said. “There has been since day one. It’s challenging. What we are hearing does not provide anything succinct, but we have developed several concepts we think will match the requirements. But we know we will need to react in a short amount of time. Much of the focus has been on what we can submit for, and how to frame that.”
Financials
Hobbs presented the financial report in the absence of Whitney Stepp, chief finance officer.
Total operating revenue for March was $3,709,196, with expenses totaling $4,113,337, for a monthly net income of -$483,201.
Operating revenue year-to-date is $10,740,185, with expenses totaling $11,603,020, for a year-to-date net income of -$1,344,044.
Hobbs said there has been a heavy focus on increasing revenue and ensuring JRMC receives its commercial payments.
The Arkansas Hospital Association reported in 2024, the average reimbursement per patient from commercial insurance payers in the state was $8,842.50. That average was significantly lower than all six of Arkansas’ neighboring states, which ranged from $17,356.60 in Texas to $14,567.20 in Oklahoma and $11,767.40 in Missouri.
“This affects every hospital in the state, and it will require legislative action to change,” Hobbs said. “In two years, at best it hasn’t improved, and I’d guess that it’s gotten worse.”
Because JRMC is self-insured, increases in employee benefits, particularly in prescription drug costs, is another area driving up overall expenses, according to Hobbs.
However, Hobbs said the hospital administration has identified numerous cost-saving measures that can be implemented to reduce the deficit.
“The silver lining is, there are costs we can reduce, and we will reduce those,” Hobbs said. “It won’t happen overnight, but we do have some actions we can take. We do know of two or three areas we can focus on to have a substantial impact on costs. The financials are not where I expected them to be, or where I want them to be.”
Budget and Capital Committee Chair Darrel Wheeler reported the committee met prior to the Board meeting and recommended the approval of the monthly financials. The Board approved the report unanimously.
Other Matters
–Hobbs reported Dr. Kate Gazenko, general surgeon, will be leaving the area in May, but Dr. Allison Tanck will begin general surgery practice on May 18. In addition, Dr. Ryan Banning will join the surgery team in August.
–Volumes in admissions increased to 354 in March, up from 275 last month. Hobbs said inpatient volume for the entire first quarter was up, and remained busy in April. A total of 34 births were reported in March, bringing the year-to-date total to 87. The birth rate is on track to be the highest at JRMC in several years, Hobbs said.
–Board Chair Heather Patton reported the personnel committee assisted with interviews for the new human resources director, Laura Akkub.
–The medical staff appointments and reappointments were approved as presented by Dr. Shannon Case, Board member.
Board members present included Clayton Caldwell, Matt McCormick, Josh Nelson, Case, Patton and Wheeler, while Ethan Rogers was absent.
Read this story and others in the April 29 issue of The Graphic, available online and at businesses throughout Franklin and Johnson counties. Subscribe or donate here to support more hometown journalism.
