NEW: Medicare Sequester Could Cost RI 3,000 Healthcare Jobs
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NEW: Medicare Sequester Could Cost RI 3,000 Healthcare Jobs
The report, produced by Tripp Umbach, a firm specializing in conducting economic impact studies, measures the anticipated effect of these cuts in Medicare payments on health care providers and other industries. The Tripp Umbach model reflects how reductions in Medicare payment for health care services will lead to direct job losses in the health care sector, reduced purchases by health care entities of goods and services from other businesses which in turn will lay-off workers, and reduced household purchases by workers who lose their jobs. As the impact of these cuts ripples through the economy, jobs will be lost across many sectors beyond health care.
Hospitals and the RI economy
“Hospitals are major contributors to the Rhode Island economy,” said Edward J. Quinlan, president of the Hospital Association of Rhode Island. “Cuts to hospital services could create devastating job losses and threaten the access to quality health care that Rhode Islanders need.”
This model estimates that, during the first year of the sequester, nearly 2,000 jobs will be lost in Rhode Island. The report found that the job losses will affect many economic sectors beyond health care.
“Under the original Affordable Care Act health reform law, hospitals nationwide already have accepted shared sacrifice amounting to $155 billion in payment reductions - $574 million in Rhode Island alone," Quinlan said. “If sequestration goes into effect on March 1, Medicare payments to hospitals in our state will be reduced by $107 million over ten years. Recommendations to cut even more reimbursements to hospitals would decimate the health care delivery system by decreasing access to care, eliminating community services, and eliminating jobs.”
Rhode Island's healthcare sector
The health care sector has long been an economic mainstay providing stability and growth even during times of recession. The Bureau of Labor Statistics data shows that health care created 169,800 jobs in the first half of 2012 and accounted for one out of every 5 new jobs created this year. Hospitals in Rhode Island employ more than 21,000 health care professionals, which account for 6 percent of the state’s private sector employment.
Tripp Umbach designed a customized model based on the national economic impact models developed by MIG IMPLAN, as well as previous impact studies.
The Tripp Umbach report and other resources are available at www.aha.org/jobs.