Report shows Greater Boston teaching hospitals as largest driver of economy, job growth
Economic impact beyond traditional leaders like high-tech, financial services
March 6, 2007
(Boston, MA) -- A report, released today by the Conference of Boston Teaching Hospitals (COBTH), shows Greater Boston's teaching hospitals and affiliated medical schools as having a major economic impact on the region by generating $24 billion in economic activity and creating and supporting over 200,000 jobs.
The report, titled Driving Greater Boston and New England: The Impact of Greater Boston's Teaching Hospitals, details how combined, these fourteen teaching hospitals and three affiliated medical schools have become the largest, most important driver of the regional economy, outpacing traditional industry leaders like high technology and financial services.
"The Greater Boston teaching hospitals are national leaders in providing quality care and expert medical training," said James Mandell, COBTH chair and president and CEO of Children's Hospital Boston. "These hospitals not only sustain and contribute to the region's economic viability through local spending, job creation and research, they also have a huge community and social impact by partnering with local agencies to address unmet social and health care needs and providing care to those in need regardless of their coverage or means."
The report found that annually, the Greater Boston teaching hospitals:
- generate $24.3 billion in economic activity in Massachusetts and $29.7 billion in economic activity for New England~
- employ more than 110,000 people directly and support nearly an additional 100,000 jobs dependant on the hospitals~
- generate $839 million in income, sales and other tax revenue for the state.
The Greater Boston teaching hospitals fuel the local biotechnical and biomedical industries by attracting more than $1.38 billion in total research funds each year, two-thirds of which comes from the federal government. The federal research funds received in 2005 by these hospitals have an impact on the region's economy of over $2.5 billion and directly account for 8,000 high paying research jobs. Overall, federal research funding invested in the Greater Boston's teaching hospitals supports more than 25,000 full-time jobs in the Greater Boston region. The report also emphasizes the considerable social and community impact the Greater Boston teaching hospitals have as well. The fourteen teaching hospitals provide nearly $150 million each year in community benefit programs for people in need by teaming up with over 300 local agencies. These hospitals also provide more than two thirds of all the uncompensated care delivered in Massachusetts, incurring nearly $200 million in non-reimbursed care.
The report makes clear the risks to the regional economy should the Greater Boston teaching hospitals lose ground to other emerging national and international centers of advanced medical research and innovation. Because of the declining population numbers and a shrinking workforce, any slowdown in research efforts in the region will weaken the teaching hospitals ability to generate additional employment, which will hurt the local biomedical and biotechnology industries.
"Greater Boston's Teaching Hospitals are the driving force in the regional economy because we are the leader in patient care, research and innovation. But, that could quickly slip away to other states eager to replace us as the leader," said COBTH Executive Director John Erwin. "The Greater Boston region must address the issues that could slow the growth of the healthcare and life science industries if we want to sustain the beneficial economic impact and its benefits to the city and the state."
COBTH suggests in the report that the Greater Boston region must address and solve the growing issues of affordable housing~ sustaining a skilled and trained workforce~ maintaining the steady flow of federal research funds~ the regulatory procedures for patient care and research~ and the reimbursement policies that support patient care.
The economic and employment impact was measured by calculating the direct impact the teaching hospitals had when purchasing goods and services within defined geographies and the indirect impact caused when local businesses had to spend more to meet the increased demand. The complete report, Driving Greater Boston and New England: The Impact of Greater Boston's Teaching Hospitals, is available on the COBTH Web site at: www.cobth.org.
The Conference of Boston Teaching Hospitals exists to maximize the Boston area teaching hospitals' visibility on the issues that are fundamental to their unique missions of teaching and research. COBTH educates opinion leaders at all levels about the contributions of its members to the area's health and economy.
COBTH is made up of Beth Israel Deaconess Medical Center, Boston Medical Center, Brigham and Women's Hospital, Cambridge Health Alliance, Caritas Carney Hospital, Caritas St. Elizabeth Medical Center, Children's Hospital Boston, Dana-Farber Cancer Institute, Faulkner Hospital, Lahey Clinic Medical Center, Massachusetts Eye and Ear Infirmary, Massachusetts General Hospital, Tufts-New England Medical Center Floating Hospital for Children, VA Boston Healthcare System. COBTH member hospitals' affiliated medical schools are Boston University School of Medicine, Harvard Medical School and Tufts University School of Medicine.