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February 7, 2020

CT hospitals report rising $28.9B economic impact

Photo | Contributed Middlesex Health's flagship facility, Middlesex Hospital in Middletown.

Connecticut hospitals say their direct spending rose 6.6% in 2018, while job counts were up 3%.

The Connecticut Hospital Association’s 2020 Economic Impact Report says the state’s nearly 30 acute care hospitals and their related entities directly spent $14.7 billion on payroll, goods, services and capital projects in 2018, up from $13.8 billion in 2017, according to CHA data.

Hospital and health systems employed 103,000 people in 2018, up from 100,000 the year prior, the report said.

When including the indirect impact, or ripple effect, of the direct spending, hospitals say their total economic impact here is $28.9 billion, up from $27 billion in 2017.

CHA has been releasing the report mostly annually since 2007, and it times the publication for the start of the annual legislative session. 

The 2020 session kicked off this week and comes fresh on the heels of a major deal CHA and Gov. Ned Lamont struck over the state’s healthcare provider tax.

As a result of that deal, Connecticut hospitals will receive $1.8 billion in state and federal funds between now and 2026 to resolve a lawsuit that could have cost the state as much as $4 billion, according to details released Thursday by Gov. Ned Lamont.

The agreement includes a one-time payment of $79 million to the industry, along with steadily declining taxes on hospitals — and increasing state payments to facilities — between now and 2026.

Medicaid rates for inpatient and outpatient services hospitals provide to the poor will rise annually by 2% or more over the next seven years.

Federal funds, provided to the state as Medicaid reimbursements, will cover 52% of settlement costs.
Lamont said the deal represents “a new chapter in the state’s relationship with its hospitals.”

This session, CHA said it will be lobbying lawmakers to increase behavioral health care and bed counts for children and teens, move to protect patient access to care if harmful federal changes emerge, and to avoid creating any additional regulatory burdens on its members.

Hospitals are not alone in looking to remind lawmakers of their value as the session begins. UConn, the Connecticut State Colleges & Universities system, as well as the quasi-public Connecticut Health & Educational Facilities Authority are among those that have released such reports in recent years.

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