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Economic Impact of WellStar at $2.2B

The Cobb-based hospital system had direct expenditures of more than $957 million in 2010.

In 2010 ’s five hospitals -- WellStar Cobb, Douglas, , Paulding and Windy Hill -- generated more than $2.2 billion in revenue for the local and state economy, according to a recent report by the East Cobb-based Georgia Hospital Association, the state’s largest hospital trade association.

The report also found that, during the same time period, WellStar provided approximately $106,594,815 in uncompensated care. This is in addition to the unreimbursed cost of care provided by WellStar to Medicaid and Medicare beneficiaries of $31 million and $58 million, respectively.  

This has occurred while sustaining more than 10,000 full-time jobs throughout northwest metro-Atlanta. These jobs are non-WellStar employees, such as vendors and contractors, and are in addition to the more than 12,000 WellStar employees. 

The report revealed that WellStar hospitals had direct expenditures of more than $957,000,000 in 2010. When combined with the an economic multiplier developed by the United States Department of Commerce’s Bureau of Economic Analysis, the total economic impact of those expenditures was more than $2.2 billion.

This output multiplier considers the “ripple” effect of direct hospital expenditures on other sectors of the economy, such as medical supplies, durable medical equipment and pharmaceuticals. Economic multipliers are used to model the resulting impact of a change in one industry on the “circular flow” of spending within an economy as a whole. 

“This new report shows that, even in these difficult economic times, WellStar has an enormous positive impact on our local economy,” said Jim Budzinski, executive vice president and chief financial officer of WellStar Health System, in a press release.

“We thank our community’s unwavering support of WellStar and will continue to work hard to ensure that the citizens of this community have access to health care services that are second to none in quality and affordability.” 

While WellStar remains a major component of the area’s economic engine, the System’s leadership, like the rest of the Georgia hospital community, is concerned about a wide array of economic challenges that have made it increasingly difficult to meet the community’s health care needs including continued cuts in Medicare and Medicaid payments and a fast-growing uninsured population. Presently, more than a third of all hospitals in Georgia are operating with negative margins.  

“We’re extremely concerned with the current operating environment for hospitals,” said Budzinski in the release. “We’ve made a commitment to every citizen of this community to be on call for them 24 hours a day, 365 days a year. But our ability to do so is being compromised when, in many cases, we’re seeing an increasing number of uninsured patients while the state and federal governments are paying us far less than what it actually cost to treat Medicaid and Medicare patients.” 

According to Budzinski state lawmakers must work to protect the state’s health care system with the same fervor that they do other initiatives like education and public utilities.  

“Our local health care system is indispensable,” Budzinski said in the release. “It is the primary guardian of health in our community and is the key building block for everything else in our community including education and economic vitality. It is our hope that, even in these challenging economic times, that our elected lawmakers will do what is necessary to protect our local health care system and preserve access to health care for everyone in our community.” 

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