Idaho Business Review
Guest Opinion
November 17, 2009
By Steve Millard

Health care. The economy. Health care. The economy. These two topics have dominated the airwaves, internet, and headlines for months.

As Congress grapples with “reforming” the health care system, and families and businesses struggle in this extremely difficult economic environment, it seems as logical time to examine how these two topics converge. To that end, the Idaho Hospital Association commissioned a University of Idaho economist to perform a detailed study of the economic impact that community hospitals have across Idaho and right here in the Treasure Valley.

Perhaps the most visible way in which hospitals contribute to the economy is y 4mploying people, lots of people actually. Across Idaho, community hospitals provided good-paying jobs to more than 23,000 people. In the Treasure Valley, community hospitals from Weiser to Mountain Home employ nearly 11,000 of our friends and neighbors. Collectively, that makes community hospitals one of the largest employers in the area. We’re not just talking about doctors, but nurses, technicians, administrators, maintenance staff and the many others who work tirelessly day in and day out contributing to the high quality medical care at your local community hospital.

The wages paid to those employees total over $1 billion across Idaho and $500 million in the valley – help them to purchase all kinds of goods – groceries, clothing and sports equipment – and services from lawn and car care to haircuts. These wages also help fund the support of churches, civic groups, and philanthropic giving.

Like echoes in a canyon, the dollars directly earned and spent in our community have a repeat effect that further strengthens our economy. Termed a multiplier effect, this residual impact is unique to each industry and within each county.

The economist who performed the study put it this way: “A medical center purchases goods and services in a community, which supports other area businesses. Those businesses in turn purchase even more goods and services as dollars ripple through the economy.

In the Treasure Valley, the multipliers for hospital expenditures and income ranged from 1.34 in the outlying areas to 2.03 in Ada County. When the impacts of the direct expenditures are fully calculated, over $3.1 billion of our local economy can be attributed to Treasure Valley community hospitals. When analyzing the jobs created directly and indirectly by those hospitals, the reports show that for every hospital job, another 1.4 jobs are created in our communities.

While these numbers are instructive and demonstrate the importance of community hospitals to our local economies, the most important thing to remember is that it takes dedicated people to meet our medical needs. They work hard to provide the high quality medical care that Idahoans expect and deserve.

And, as our nation, state and communities work to recover from the recession, we need to remember that our community hospitals are an extremely important, in fact vital, component of the overall economy.

There will undoubtedly be many more weeks, if not months of health care reform and the economy dominating not just the headlines but discussions at home, work, or on ball field sidelines. Hopefully the information about the economic impact of the valley’s community hospitals on out local community will allow for more informed and constructive dialogue.

Steven A. Millard is president of the Idaho Hospital Association