AHA: Hospitals a $2T Economic Driver

John Commins, for HealthLeaders Media , January 25, 2013

In addition, AHA says that hospitals are the second-largest sources of private sector jobs, support another 10 million jobs in the economy through "ripple effects," and spend more than $702 billion each year on goods and services from other businesses.

Stuart Altman, professor of national health policy at The Heller School at Brandeis University, calls the economic activity generated by hospitals and healthcare "a mixed blessing."

"There is no question it is a major economic force in many if not most communities. It is often the largest employer. It has transformed communities," Altman says.

"Even big cities like Pittsburgh and Boston. Pittsburgh in particular was reeling from the loss of steel and other industries and now it is a healthcare mecca. If we were to cut that spending it would reduce that component of the local economy."

"On the other hand it is draining funds from other industries and state governments and communities which can use that money to generate other kinds of jobs," Altman says. "It is a big mistake to use economic power as an excuse for not finding the right balance for what we should spend on healthcare. We should spend what we need to spend and no more."

Steinberg says hospitals have a tremendous "multiplier effect" in the communities they serve.

"For every $1 you put into healthcare you get $3.28 back," she says. "One thing that is different about healthcare and hospitals in particular is that most of the money stays in the local community."

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2 comments on "AHA: Hospitals a $2T Economic Driver"

Deborah Michael (1/27/2013 at 8:25 PM)
Thank you for this great article. I truly appreciate this perspective instead of all the negative comments recently regarding healthcare costs and clinicians' reimbursement. Currently hospitals are composed of a plethora of non clinician positions just to stay current with all the compliance and billing issues. Hospitals provide employment to so many non healthcare workers these days it would be very interesting to see how money is distributed salary wise between clinicians & non clinicians. Maybe the public should be educated where all the money is being spent in addition to their direct healthcare. I do my best to explain the reason some costs are inflated. For example, an aspirin maybe billed for $ 3.00 - $7.00 but this money is divided among the nurses, nurse assistants, additional healthcare ancillary staff, the maintenance and electronic crew who keep the hospitals sanitary & keep monitors functioning properly, the IT people who keep our pc's functioning and up to date with the latest HIPPA safety measures, for the quality insurance staff, for the billing staff, for programs to keep the hospital staff current not only with medical information, care protocols, etc.... Unlike many fields, healthcare providers need to be professionally trained and certified. This is obtained usually only with advanced degrees and training. We are constantly re certifying with board exams & CME. Certain healthcare workers must repay over & over licensing fees, DEA licenses and many additional other costs, unlike many/ most professions. Again Thank you for enlightening myself and hopefully the Congress regarding how hospitals make a difference in our communities, with healthcare as well as employment. If you do not have good healthcare your life can be miserable or considerably shorter. Sincerely, Deborah Michael

Prafull Shah (1/25/2013 at 1:40 PM)
"Hospitals a $2T Economic Driver"? One can immediately argue that showing economical muscle and competing to create more jobs may be one of the major reasons why US healthcare is THE MOST EXPENSIVE in the world, and that in spite of large healthcare workforce, we are not getting the quality, accessibility, and affordability compared to most developed countries of the world!




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