Economic Impact of Lehigh Valley Health Network

The economic and community benefit of Lehigh Valley Health Network on Pennsylvania and the Lehigh Valley Region (2003)

Lehigh Valley Health Network contracted with Tripp Umbach Healthcare Consulting, Inc. to perform a study to measure the economic impact of Lehigh Valley Health Network on the state, region and county level for 2003. Key measurement components included direct expenditures for goods and services by Lehigh Valley Health Network, its employees, patients and visitors and the recirculation of these revenues by the recipients. Also included were institutional expenditures for capital improvements and payment for services provided to out of state residents. The study concluded that the health network generates $752.5 million annually in net economic impact to Pennsylvania…$559.2 million of that directly impacts health network's nine-county service area.

Consultant Qualifications

Tripp Umbach Qualifications

• Industry leader in economic analysis for healthcare organizations completing more than 150 studies since 1990.
• National studies of every medical school and teaching hospital member of the Association of American Medical Colleges
• State level studies in Pennsylvania, South Carolina, Virginia, Ohio and Wisconsin.
• Individual projects for the Mayo Clinic, Cleveland Clinic and Ohio State University Medical Cente

Project Goals

• Quantify Lehigh Valley Health Network’s positive annual contribution to state, regional and local economies; specifically operations, employment, tax revenue, uncompensated care and charitable contributions by employees
• Compare Lehigh Valley Health Network with other industries.

Overview of Project

• Economic Impact of Lehigh Valley Health Network
• Industry Impact Comparisons
• Job Creation
• Tax Impacts
• Uncompensated Care and Medical and Nursing Education
• Employee Contribution

Total Economic Impact 2003

Direct + Indirect = Total
• Pennsylvania: $752.5 million
• 9-County Region: $559.2 million
• Lehigh County: $368.5 million

Direct includes: Lehigh Valley Health Network, Staff, Physician, Patient and Visitor Spending
Indirect includes: Re-spending throughout the economy (multiplier)

Direct Economic Impact
• Pennsylvania: $327.2 million
• 9-County Region: $279.6 million
• Lehigh County: $230.2 million

Direct includes: Lehigh Valley Health Network, Staff, Physician, Student, Patient and Visitor spending that remains in the state, region, and county.

Indirect Economic Impact

• Pennsylvania: $425.3 million
• 9-County Region: $279.6 million
• Lehigh County: $138.3 million

Indirect includes: Re-spending throughout the economy (multiplier) of direct dollars spent by  Lehigh Valley Health Network, staff, physicians, patients, students, and visitors.

Employment Impact

Employment Impact on PA

Employment Impact on Region

Employment Impact on Lehigh County

Total Government Revenue

Direct + Indirect = Total

• Pennsylvania: $34.9 million
• 9-County Region: $10.1 million
• Lehigh County: $10.0 million

Note: Includes direct tax payments by Lehigh Valley Health Network, payroll taxes, and all taxes indirectly generated by businesses in support of the health network.

Economic Impact Comparisons

• Lehigh Valley Assoc of Indep Colleges (6 Institutions): $1 billion
• Regional Tourism: $800 million
• Lehigh Valley Health Network: $752 million
• Philadelphia Eagles: $200 million

Uncompensated Care and Medical and Nursing Education

In 2004, the health network provided:

$48.6 million in uncompensated care to PA citizens
$16.2 million in medical and nursing education

$64.8 million
(Tripp Umbach economic impact report)
+
$6.1 million in other community programs & Services
(beyond what Tripp Umbach reported)
=
$70.9 million Total Contributions
(reported in Lehigh Valley Health Network’s 2004 report to the community)

Employee Contributions

Lehigh Valley Health Network’s employees annually contribute:
• $19.6 million to local charities
• $16.6 million in voluntary services
________________
• $36.2 million Total

Key Takeaways

• Lehigh Valley Health Network’s annual economic impact of $752 million makes it the Lehigh Valley’s largest single non-governmental contributor to the State’s economy.
• The health network directly and indirectly supports more than 15,000 jobs in the Lehigh Valley region – one in every 20 jobs in the region is attributable to Lehigh Valley Health Network.
• The health network along with its employees provide more than $100 million annually in free care, community services and charitable contributions.

This page last updated 12/11/08 02:09 PM