President's Perspective – Hospitals Keep Kansas Healthy and Economically Strong
(March 31, 2023) – A vigorous health care system is essential not only for the health and welfare of community residents but also to enhance economic opportunity. Health-related sectors are some of the fastest growing in the economy. Given demographic trends, this growth is likely to continue. Furthermore, evidence shows that quality health care improves business productivity, aids in the recruitment and retention of businesses, as well as attracts and retains retirees.
The Kansas Hospital Association’s new report on The Importance of the Health Care Sector to the Kansas Economy was performed by a team led by Donna Ginther, distinguished professor of economics and director of the Institute for Policy & Social Research at the University of Kansas. The research is modeled on previous studies completed by Professor John Leatherman, now retired from Kansas State University.
As our members understand, the health care sector in Kansas provides substantial contributions to the state’s economy. Not only does it generate direct jobs and employee income – it also supports additional businesses across many industries through supply chain linkages and employee spending on household goods and services. These secondary feedbacks are known as multiplier effects.
The Kansas health care sector contributes more than 300,000 jobs and almost $20 billion in labor income to the Kansas economy, including direct effects and multiplier effects. This labor income, when spent, generates over $600 million in sales tax revenue.
Hospitals alone employ more than 72,000 Kansans and direct labor income of more than $6 billion. The hospital sector has large multiplier effects. Every 100 hospital jobs support an additional 73 jobs in non-health care sectors. And, every $1000 in current hospital wages and salaries sustains an additional $483 in income for employees of grocery stores, restaurants, gas and electric utilities, along with other industries used by hospitals and their employees.
As we continue to look for opportunities to enhance our state's economy, a strong health care system, anchored by well-supported community hospitals, is essential. This report was highlighted for the KHA Board during last week's meeting and will be shared with our elected officials and the public in the coming weeks. We encourage our members to use this information as you discuss the economic impact of hospitals with your staff, boards and communities. County-specific reports will be available this summer.
Other items highlighted at the KHA board meeting included:
- Updating the KHA Strategic Plan to reflect the current priorities of the association;
- Approving associate membership applications for Advocate Health Services, LLC; Kompass Funding; and Nex-Tech;
- Recapping the latest discussions at the American Hospital Association’s Regional Policy Board and Rural Health Services meetings;
- Approving the KHA finance and investment report;
- Highlighting the latest advocacy developments on the state and federal levels;
- Adopting a two-year KHA-PAC campaign goal of $168,000; and
- Discussing several key KHA updates in the areas of quality and patient safety; communications; workforce strategies; education; rural health; and the KHA awards program.
As always, please feel free to reach out to your team at KHA if you should need any assistance. We look forward to seeing everyone at the upcoming KHA District Meetings that begin next week. See you there!
--Chad Austin