Congressional leaders should consider the overall economic value that physician-owned hospitals generate in states, according to a new study that projects these hospitals will generate about $3.9 billion in eight states in 2009. Conducted by Morristown, N.J.-based Health Economics Consulting Group, the study used economic data from 2007 and physician-owned hospital data from 2008 for eight statesArkansas, Indiana, Louisiana, Nebraska, Ohio, Pennsylvania, South Dakota and Texasand it also considered projects that are currently under development.
Co-authors John Schneider and Christopher Decker found that physician-owned hospitals add considerable value to state economies, ranging from $117.8 million in Nebraska to $2.9 billion in Texas. The study evaluated the direct effects of these facilities, such as the added payroll and capital expenditures, and it also considered the indirect and induced effects, which describe the re-spending that filters through other industries in an economy as a result of the direct effect. In addition, physician-owned hospitals also pay a substantial amount of property, payroll and income taxes, according to the study.
The vast majority of these taxes accrue to states general tax funds and is in turn used to support a variety of state programs, according to the study. Across all eight states, POHs will pay an estimated $207.4 billion in taxes in 2009.