AHA Reminds Bureaucrats That Healthcare is an Economic Engine

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Writing that healthcare dominates the national conversation isn’t exactly an original observation. Sometimes, healthcare seems to dominate this dialogue in ways that are unprecedented in U.S. history, and oftentimes, it seems like those who are engaged in this dialogue don’t fully understand what they’re discussing.

Take the occasionally flippant manner in which lawmakers will talk about cutting healthcare expenses as if they consider healthcare to be a financial drain on our economy.

However, John Commins from HealthLeaders Media reports that last week, the American Hospital Association “issued a none-too-subtle reminder that hospitals are economic engines for the communities they serve.”

AHA presented data showing that hospitals are $2 trillion-dollar generators of economic vitality and that 5.5 million people are employed by hospitals. In 2012, 28,000 jobs were added monthly to the healthcare sector, according to Caroline Steinberg, AHA’s vice president for trends analysis.

“Throughout the recession healthcare was a steady producer of jobs and you can’t really say that about any other industries,” she says. “It’s important that people understand that hospitals are not a drain on our economy. They are a driver. They not only provide medical care to support a healthy and productive workforce. They also act as an economic engine supporting trillions of dollars of economic activity nationwide.”

It worries Steinberg that “some in Congress continue to threaten access to hospital services,” especially when “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.”

She adds that healthcare has a “multiplier effect” as well, giving a $3.28 return on every $1 invested in it, most of which “stays in the local community.”

Stuart Altman, professor of national health policy at The Heller School at Brandeis University, agrees that all of this is true, but points out that healthcare “is draining funds from other industries and state governments and communities which can use that money to generate other kinds of jobs. 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.”

Richard (Buz) Cooper, MD, director of the Center for the Future of the Healthcare Workforce at New York Institute of Technology, counters Altman’s assertions with this idea: “The reality is healthcare is a major industry. Our problem is not that there’s too much. It’s that when there’s more, social justice demands that it be distributed across income groups, and this happens in a much more equitable manner than transportation, food, or housing and therefore entails greater transfers of wealth and taxes.”

He concludes, “This is what America does. And it creates jobs, well-paying jobs—jobs with upward mobility, jobs that pay taxes that support schools, and other important services. Healthcare accounts for about 10 percent of [all] jobs, but 20 percent of new jobs. This is the future. Don’t kill it.”

What are your thoughts on healthcare as an economic force? How has your organization impacted the economy of your community?

-by Pete Fernbaugh

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