In 2019, hospitals spent more than $23.4 billion to serve communities, according to the latest Georgia Hospital Association report. These expenditures generated an estimated $54.7 billion in state and local economic activity, which translates to $2.34 for every $1 of hospital expenditures. The single largest expenditures are wages and salaries for hospital employees. In fact, hospitals are a major source of jobs in their communities. In 2017, hospitals directly provided more than 150,000 full-time jobs. When an employment multiplier is applied to this number, it indicates that hospitals supported an additional 370,000 full-time jobs in the state. The employment multiplier considers the “ripple effect” of direct hospital expenditures on the economy, such as medical supplies; durable medical equipment and pharmaceuticals; and retail establishments that depend on the hospital and its employees for business. When the direct and indirectly supported jobs are combined, over 520,000 jobs can be attributed to the presence of hospitals. This reflects 11.98 percent of all jobs in Georgia.
The GHA Economic Impact Report also measures hospitals’ direct economic contributions to Georgia’s working families. Using a household earnings multiplier, the report determined that hospitals generate more than $22.2 billion in household earnings in the state. The household earnings multiplier measures the increased economic contributions from individuals employed directly or indirectly by hospitals through daily living expenditures.
Georgia residents who are uninsured or underinsured and unable to pay hospital bills continue to add to the uncompensated care challenges that hospitals, both rural and non-rural, face. In 2017, Georgia hospitals absorbed more than $2.1 billion in costs for care that was provided but not paid for. In the same year, Georgia’s uninsured rate was 15.4 percent, the fifth-highest in the nation behind Texas, Oklahoma, Florida and Alaska. The national average is 10.2 percent. Additionally, Medicaid pays Georgia hospitals only about 87 percent of actual costs, meaning hospitals lose 13 cents on every dollar spent treating a Medicaid recipient.
Unfortunately, many hospitals have been forced to close due to dire fiscal strain. Thirteen Georgia hospitals have closed since 2013 and others, especially those in rural areas, are fighting to keep their doors open.
For more information, contact Erin Stewart or Jeff Sunderland.