Although the recent COVID-19 pandemic heightened public awareness of hospitals’ key role in community response to emerging health risks, the economic impacts that health systems and hospitals have on their communities are less understood. Recently, our team at RTI collaborated with the North Carolina Healthcare Association to estimate the economic impacts and social contributions of health systems and hospitals in North Carolina to show just how important these institutions are to the State’s economy.
By using an input output model, IMPLAN, and 2020 data for 137 facilities from the Healthcare Cost Report Information System, we determined that health systems and hospitals spent approximately $31 billion in 2020 on staff and operating expenses and an additional $3 billion on new healthcare facility construction. This spending makes health systems and hospitals a significant economic driver, sustaining jobs and secondary businesses across the state. In fact, more than 6% of North Carolina’s Gross Domestic Product (GDP), or the value of final goods and services, is produced by health systems and hospitals.