1. Beyond Health Care: The Economic Contribution of Hospitals July 2006

2. National Expenditures on Health Services and Supplies as a Percentage of Gross Domestic Product 2004 Source: Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group Other – 27% Prescription Drugs – 11% Nursing Home Care – 7% Physician Services – 23% Hospital Care – 33% $1.8 Trillion U.S. GDP 2004 Health Services and Supplies 14.9% Other Sectors 85.1% Health care is a major contributor to the U.S. economy.

3. Number of Full-time and Part-time Hospital Employees 1993 - 2004 Source: The Lewin Group analysis of American Hospital Association Annual Survey data, 1993 – 2004, for community hospitals Millions Nationwide hospitals employ nearly 5 million people...

4. Impact of Community Hospitals on U.S. Economy (in $ billions) 2004 Source: The Lewin Group, using BEA RIMS-II multipliers applied to 2004 American Hospital Association Annual Survey data Direct Effect Ripple EffectTotal Contribution … and support other businesses and jobs in communities across the United States.

5. Hospital Employment vs. Employment in Other Industries 2005 (1) Source: Department of Labor, Bureau of Labor Statistics, Current Employment Statistics Survey, custom data request (1) Data are as of September 2005 Thousands Hospitals are the second largest employer in the private sector...

6. Percent of Total Regional Employment (1) by Hospitals 2004 Source: The Lewin Group analysis of American Hospital Association 2004 Annual Survey data and 2004 total nonfarm employment data from the Bureau of Labor Statistics (1) Does not include farm employment. New England Mid-Atlantic East North Central West North Central West South Central Mountain Pacific East South Central South Atlantic 3.1% 2.9% 4.2% 3.6% 4.1% 4.2% 3.5% 4.4% 4.3% … accounting for as much as four percent of a region’s employment.

7. Hospital Employment by Occupation Type 2004 Installation, Maintenance, and Repair Business and Financial Operations Community and Social Services Food Preparation and Serving Management Building and Grounds Cleaning and Maintenance Other Occupations Healthcare Support Office and Administrative Support Healthcare Practitioner and Technical Source: Department of Labor, Bureau of Labor Statistics, 2004 National Industry-Specific Occupational Employment and Wage Estimates Number of Employees (Thousands) Hospitals support a range of positions for workers with varying skill levels…

8. Average Weekly Earnings of Workers, Hospitals (1) vs. All Service-providing Industries 1990 - 2004 All Service-providing Industries Hospitals Source: Department of Labor, Bureau of Labor Statistics, Current Employment Statistics Survey (1) Includes physicians employed by hospitals. … offering higher pay than other service- sector jobs.

9. Quarterly (3-Month) Percent Change Percent Change in Employment, Seasonally-Adjusted: Hospital vs. All Industries (Total Non-farm) 2002 – 2005 Source: Department of Labor, Bureau of Labor Statistics; Recession period defined by National Bureau of Economic Research Hospitals All Industries (Total nonfarm) Qtr 1 200220032004 Qtr 2Qtr 3Qtr 4Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1Qtr 2Qtr 3Qtr 4Qtr 1Qtr 2Qtr 3Qtr 4 2005 Hospitals provide a consistent source of jobs, even during recessions. Recession of 2001*

10. Percent of Hospital Costs (1) by Type of Expense 2Q05 Professional Fees - 5.7% Utilities – 1.7% All Other: Non-labor Intensive – 3.6% (2) All Other: Labor Intensive – 2.7% Professional Liability Insurance – 5.7% Other Products (e.g., Food, Medical Instruments) Other Services Prescription Drugs 19.3% 6.5% 19.5% Wages & Benefits 54.7% Source: Centers for Medicare and Medicaid Services, September 2005, using base year 2002 weights (1) Does not include capital (2) Includes postage and telephone expenses Hospitals purchase a variety of goods and services…

11. Source: The Lewin Group, using BEA RIMS-II multipliers applied to 2004 American Hospital Association Annual Survey data Impact of Community Hospitals on U.S. Jobs (in millions) 2004 … generating jobs throughout the economy...

12. Hospital Impact on Sectors of the U.S. Economy (in $ billions) 2004 Source: The Lewin Group analysis of American Hospital Association 2004 Annual Survey data using BEA industry multipliers for the hospital sector Health Care and Social Assistance$570.6 Manufacturing240.0 Real Estate and Rental & Leasing151.5 Finance and Insurance102.0 Professional, Scientific, and Technical Services66.8 Retail Trade65.0 Wholesale Trade52.3 Information52.2 Administrative and Waste Management Services49.9 Transportation and Warehousing49.9 Accommodation and Food Services40.9 Other Services40.0 Management of Companies and Enterprises32.3 Utilities28.4 Agriculture, Forestry, Fishing, and Hunting23.5 Educational Services12.8 Arts, Entertainment, and Recreation11.4 Mining10.1 Construction8.0 Total$1,607.6 Economic ImpactIndustry … and supporting other industries.

13. Percentage of Community Hospitals Offering Selected Community Outreach Services 2004 Source: Health Forum, Hospital Statistics, 2006 Hospitals offer an array of community services…

14. … provide charity care and other care for which no payment is received… Total Uncompensated Care Costs (in $ billions) 1998 - 2004 Source: AHA Annual Survey

15. Shortfall in Hospital Medicaid Payment Relative to Costs (in $ billions) 1998 - 2004 Source: AHA Annual Survey … and subsidize the care of Medicaid patients.

16. Table A: Impact of Community Hospitals on U.S. Economy, All States and Total U.S. 2004