A new study shows that healthcare is the largest private-sector employer in Michigan, boosting the state's economy by nearly $36.7 billion a year.
The study also revealed that the state spent $8.7 billion on Medicaid last year.
The study, "The Economic Impact of Health care in Michigan," is in its fourth edition, presents an analysis of data compiled by the Minnesota IMPLAN Group, Inc. and includes data from the U.S. Bureau of Economic Analysis, the U.S. Bureau of Labor and the U.S. Census Bureau.
The study found that healthcare employment exceeds the state's agriculture, education, automotive and manufacturing sectors.
Michigan State Medical Society President Michael A. Sandler, MD, said healthcare jobs are being created in private-sector life sciences and bio-tech businesses that turn research into products that improve quality of life.
"Healthcare jobs will always be about protecting wellness and health and saving lives," Sandler said. "But increasingly in Michigan, they are also about research that leads to the development of new products and technologies that can be produced."
Healthcare provides the state with 515,7000 direct jobs (the highest from hospitals) and about 278,500 related jobs. Michigan's healthcare workers earn about $26.3 billion a year in wages, salaries and benefits.
About 278,00 Michigan residents work in jobs indirectly related to healthcare or induced by the healthcare sector (the highest number coming from nursing and residential care), earning about $10.3 billion a year in wages, salaries and benefits, the report found.
The study also found that Michigan healthcare workers and their employers pay nearly $12 billion annually in taxes.
Experts say Michigan's economic recovery and prosperity is dependent on the state's workforce changing to fill the "knowledge jobs," like those related to healthcare, in order to continue to generate significant employment opportunities well into the future.
"Healthcare is Michigan's most vital employer," said Spencer Johnson, president of the Michigan Health & Hospital Association. "Healthcare jobs are good jobs that pay high wages and require people with higher skill sets. These are the exact types of jobs Michigan must keep and create to regain our state's economic prosperity."
The study found that even though Michigan employment sectors continue to pare workers, the healthcare sector will generate significant new job opportunities in the future.
"The healthcare sector continues to be a shining light in Michigan's transitioning economy," said Craig Magnatta, president of the Michigan Osteopathic Association. "Healthcare jobs are helping to put Michigan back on the path to prosperity - and unlike jobs in many other sectors, healthcare jobs tend to be stable and generally are not exported to other states or continents."
More than 1.5 million Michigan residents, or nearly one in seven, are enrolled in Medicaid.
In 2005 Michigan hospitals provided more than $500 million in unreimbursed medical care, including $110 million in charity care and $394 million in unreimbursed costs of health services to individuals insured by the government through Medicaid and other government-sponsored programs. In addition, the state furnished about $407 million in free or reduced-fee, community-based programs to hundreds of thousands of citizens.
Since 1996 Michigan has cut Medicaid funding by more than $774 million. Last year Medicaid healthcare spending in the state totaled about $8.7 billion.
The Partnership for Michigan's Health has proposed a 10-point plan to reform Medicaid to improve the way the system works. The complete listing of the 10 Concepts for Medicaid Reform is available at www.mha.org/mha_app/partnership.
How has a local healthcare organization impacted your community's economy? E-mail Associate Editor Molly Merrill at molly.merrill@medtechpublishing.com.