How Do Hospitals Impact the Economy?
New Jersey Hospitals impact the economy within their community.
- If a hospital is doing well, so is the community around it; at least that appears to be the trend found by the New Jersey 2014 Economic Impact Report. The study indicates that New Jersey hospitals impact the economy in addition to providing an important public service.
In 2013, acute care hospitals in New Jersey delivered $20.9 billion in expenditures, $2.8 billion in purchased services, $8.3 billion in employee salaries, and approximately $460 million to the state in state income taxes from hospital employees.
It isn’t just New Jersey hospitals that are making an impact on their local communities. Resources published by Community Catalyst indicate that hospitals can be critical in strengthening communities.
“Often, hospitals are important allies in addressing some of the underlying issues that impact community health besides access to hospital care, such as healthy behaviors, environmental and socioeconomic factors,” the resources read.
According to the report, Healthcare is the only industry that has added jobs in New Jersey on an annual basis from 1990 through 2013. Additionally, the report indicates that the New Jersey Department of Labor projected that from 2010 through 2020, nearly 62,000 jobs will be added, accounting for more than 19 percent of net job growth in New Jersey.
The trend in the increase of jobs in New Jersey, lined up with the Bureau of Labor’s (BLS) hiring growth for the healthcare industry in November. The BLS reported that healthcare providers added 29,000 jobs over the month, and to date, hospitals added 33,000 jobs this year and nursing and residential care facilities added 19,000 jobs.
The New Jersey State Department of Labor projected that healthcare will continue to be the top rankedsector for employment growth in 16 out of 21 of New Jersey’s counties.
“Hospital contributions ripple across New Jersey providing economic stability to the state, its counties and to individual communities,” the impact report says. “In many towns, the local hospital is the largest employer, providing untold benefits in jobs and health insurance coverage, local spending and community health services.”
In addition to hospitals aiding their states financially, they can also help to create a healthcare safety net for the uninsured and most in need for free or at a reduced cost. New Jersey hospitals served as the primary source of medical services for the state’s 1.1 million uninsured, at a cost of close to $1.3 billion annually.
Funding for healthcare safety nets such as those in place in New Jersey will soon face cuts due to changed made by the Affordable Healthcare act. Disproportionate share hospitals, facilities that serve a large number of low-income patients, will likely see payments reduced by as much as $35.1 billion between 2017 and 2024.
