Hospitals rank as major drivers of local economy

There is no doubt that the health-care industry in Colorado has a huge impact on Colorado’s economy. As one of the largest employers in the state, Colorado community hospitals employed 75,586 people in 2015, creating more than $11 billion in payroll and benefits that were then spent energizing the local economy, according to data compiled by the American Hospital Association. The hospitals themselves spent $12.6 billion in 2015, which contributed $28.9 billion to Colorado’s total state economic output. Nationwide, hospitals contributed $2.8 trillion to the economy.

Health-care systems such as Boulder Community Health, UCHealth and Banner Health have continued to grow their presence along the Front Range, with new hospitals in Greeley and Longmont and a major expansion of BCH in Boulder.

“I think in most communities, the health-care system including the hospital, are important employers in any community, if they are fortunate enough to have one,” said Robert Vissers, CEO of Boulder Community Health. “And if you look at it nationally, there’s something like one in nine jobs are health-care related. Health care is 17 percent of the gross domestic product, and that continues to rise.”

In Boulder, BCH employs more than 2,200 people, but they aren’t just any workers but highly skilled, highly paid jobs that come with good benefits, Vissers said.

“In general, health-care jobs are high-quality jobs. When you look at our employees, they are not just highly paid surgeons, but incredibly talented and skilled nursing staff, nurse practitioners, physician assistants and lab technicians. The amount of skill and knowledge that comes into this industry is really impressive,” he said.

He calls the staff at BCH the “best and brightest” across the board.

“Employees here are just so wonderful, bright and engaged. … They are here because they feel passionate about their job and what they are doing. It is a great job, and it pays well, but they are in it because it makes a difference. They are coming to our community because they believe in what they are doing, not just for the patient’s sake, but they feel a strong sense of community in the hospital and a strong commitment to the community they serve,” Vissers added.

BCH is different from other Northern Colorado health-care systems in that it is an independent, nonprofit organization that solely serves Boulder County.

“One of the advantages of being independent is we don’t outsource our service or care. We do everything to keep things local, particularly care and providers and those we partner with,” he said.

With larger health-care systems, “part of the scale is sending patients to larger centers; centralizing the care,” he said. Much of that care shifts to hospitals in the Denver metro area.

Health care is expensive, but more than half of the hospital’s investments go toward supporting the salaries of BCH’s employees.

Everyone talks about the impact of hospitals on a community, but “60 percent of what we do in our business, and probably more than that in numbers of employees, is outpatient settings. We have 30 clinics and surgical centers throughout the county. That area will continue to grow,” he said.

UCHealth is another large health system with a major presence in Northern Colorado. The company plans to spend $186 million building a 22-acre health campus — a 53-bed UCHealth Greeley Hospital and UC Health Health Center — south of U.S. Highway 34 Bypass. Once completed in late 2018, the campus will provide more than 300 new health-care positions.

Construction is set to begin on the campus this spring, creating about 500 construction jobs.

The UCHealth Longs Peak Hospital in Longmont, which is expected to open in mid-2017, cost between $185 million and $190 million for a hospital and surgery center on the northwest corner of Colorado Highway 119 and County Line Road. The project is supporting about 500 construction jobs and will create about 200 new health-care employment opportunities once the hospital is completed.

The hospital will be 190,000 square feet with 50-plus beds.

The UCHealth Broomfield Hospital, which opened in September 2016 at 11820 Destination Drive, supported 300 construction jobs and created more than 100 new health-care jobs in the area. The hospital is 80,000 square feet and has 22 beds.

According to the American Hospital Association, health care added more than 35,000 jobs per month in 2016. Nationwide, hospitals employ more than 5.7 million people and are one of the top sources for private-sector jobs. Those employees then turn around and buy more than $850 million in goods and services from other businesses.

The ACA’s research shows that for every health-care job created, two other jobs are created elsewhere in the economy.

“Overall, hospitals support 16 million total jobs, or one of nine jobs in the U.S.,” the ACA found.

Banner Health operates McKee Medical Center in Loveland, North Colorado Medical Center in Greeley and the Banner Fort Collins Medical Center.

Banner Fort Collins Medical Center is Banner Health’s newest hospital. It opened on April 6, 2015, creating 397 new jobs at the time. Total labor income topped $15 million a year, according to economic multipliers provided by the U.S. Bureau of Economic Analysis.

Banner Health employs 4,895 people in Weld and Larimer counties, with a $266 million payroll, according to Paul Matthews, public relations director, patient care services for Banner Health, Western Division. That just includes salary, not other benefits.

“When you consider the economic benefits, that’s $266 million that is spent in grocery stores, invested in the community, that are applied to restaurants and to a whole host of activities and expenses in the area that feeds the economy overall,” Matthews said.

The $86 million construction cost of Banner Fort Collins Medical Center had an impact of $171 million on the surrounding economy.

The Fort Collins center opened with 22 licensed patient beds and three operating rooms but was designed to eventually accommodate up to 144 patient beds, two additional patient towers, a parking structure and medical office building as part of its 40-year plan.

Clif Harald, executive director of the Boulder Economic Council, said that the health-care industry has seen a lot of consolidation in the past few years, which has created large systems of hospitals.

“In some ways, that’s beneficial: You get economies of scale, but it is also potentially problematic when you have a system, with a corporate headquarters outside of Colorado, making decisions about care that will directly affect local residents,” Harald said.

As an example, he said that Colorado voters approved in November a measure that makes assisted death legal among terminally ill patients who are given less than six months to live. Two large hospital systems in the state said they won’t provide that service because it doesn’t fit with their philosophy of care.

“But that’s going to impact people in Colorado. The people in Boulder County voted for that standard of care, that level of care. Right now, BCH is one of the last remaining independent hospitals in Colorado. There are only a couple left. So there is, you talk about an economic impact, there is also a care impact of these trends.”

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