Pennsylvanians See Billions in Economic, Community Benefits from Hospitals in their Communities

Hospitals are more important than ever to the health and economic competitiveness of Pennsylvania communities, an analysis released today by The Hospital and Healthsystem Association of Pennsylvania (HAP) indicates.

HAP’s analysis of fiscal year (FY) 2024 data found that the commonwealth’s hospitals invested nearly $10.8 billion in strengthening the health of their communities while—both directly and through the ripple effects of their economic activity—supporting 1 in 8 jobs statewide and almost a fifth of the commonwealth’s gross domestic product. That includes:

• Contributing $195.4 billion to the state and local economies
• Supporting 785,715 jobs throughout the entire commonwealth
• Generating $62.8 billion in wages, salaries, and benefits

The data underscores what’s at stake for communities beyond access to essential health care as recently enacted federal funding cuts are poised to exacerbate the financial instability many Pennsylvania hospitals already face. During FY 2024, fewer than half of the commonwealth’s acute care hospitals operated with margins necessary for long-term stability, 37 percent operated in the red, and 39 percent faced multi-year losses.

“We can’t have healthy, vibrant communities in Pennsylvania without strong, financially stable hospitals,” HAP President and CEO Nicole Stallings said. “HAP calls on our leaders in both Harrisburg and Washington to support policies that ensure hospitals can continue to provide high-quality care that Pennsylvanians depend on, and support communities where both people and businesses can thrive.”

Chronic underpayment by Medicaid—which provides insurance for nearly a quarter of Pennsylvanians and is one of hospitals’ largest payors—is among the top drivers of hospitals’ financial strain. Already, Medicaid reimburses Pennsylvania hospitals only 71 cents per dollar of care provided. That amount will drop to 64 cents when federal cuts are phased in.

Additional key findings of HAP’s analysis include:

• Hospitals’ $10.8 billion community benefit includes investments in areas such as enhancing community health, providing charity care to patients in need, training and educating the next generation of health care professionals, conducting lifesaving medical research, and absorbing costs associated with caring for millions of Pennsylvanians covered by Medicare and Medicaid.
• 56 of Pennsylvania’s 67 counties have at least one hospital among their top 10 employers and in 20 of them, a hospital is the largest employer.
• Hospitals’ economic impact has increased 70 percent over the past decade.
• Pennsylvania hospital jobs pay, on average, about 7.6 percent higher than the statewide average wage for all sectors.
• Hospitals invested $1.2 billion educating the next generation of health professionals.

HAP’s FY 2024 analysis is available online.