Financially healthy hospitals add billions to their state economy, study finds
Healthcare institutions are often among the largest employers in their respective communities.
St. Francis Hospital in Hartford, CT. Photo Credit: Google Street View
Connecticut hospitals and health systems have a reputation for quality, but in addition to providing patient care they also contribute substantially to the state economy. In fact they're one of the biggest and most important sectors in the state.
In 2016, Connecticut hospitals and health systems contributed $27.7 billion to the state and local economies, according to the 2018 Economic Impact Report from the Connecticut Hospital Association.
For healthcare executives, the results of a single state study go beyond Connecticut and, in fact, demonstrate the potential hospitals have in making a broad economic impact. The revenue a hospital makes helps to pay for staff (among other things), and then that staff spends money in the community and everyone benefits.
Often, these institutions are the largest employers in their respective communities, employing about 104,000 people in the state overall. But those numbers only reflect direct employment. The CHA estimates that, including the residual jobs that are created, about 207,000 jobs total in the state are created by hospitals and health systems.
In terms of broader economic impact, Connecticut's hospitals and health systems generated $15.4 billion in annual local payroll, $10.6 billion in spending on goods and services, and $1.7 billion in capital spending in 2016 alone.
The report suggests that, to keep the economic impact viable, lawmakers should bring the state's low Medicaid reimbursements in line with the national average, improve mental healthcare by matching bed availability with patient need, and support a Certificate of Need process that treats hospitals fairly and on an equal basis with other providers and out-of-state specialty hospitals.
The takeaway: Ultimately,any hospital's financial health impacts a larger bubble outside the organization itself.
Twitter: @JELagasse
Email the writer: jeff.lagasse@himssmedia.com
