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Hospital drives economic growth
System CEO: $1 billion in regional economic impact
Dr. Daniel Winston, left, works on a heart bypass procedure at the Northeast Georgia Medical Center. - photo by Tom Reed
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Northeast Georgia Medical Center’s explosive growth in recent years has not just added jobs, it has made the hospital one of the central economic engines of the region, according to a recent independent report.

And in the midst of a deep recession, the medical center managed to avoid the layoffs that have had such a crushing effect on other sectors of the economy.

The Georgia Hospital Association report on economic impact stated that Northeast Georgia Medical Center in 2006 had direct expenditures of $326 million. Using a U.S. Department of Commerce economic multiplier that factors in the “ripple effect” of that spending, the hospital’s total economic impact was about $800 million in 2006, according to the report. Statewide, hospitals provide about $30 billion in economic impact to Georgia, according to the association.

Northeast Georgia Health System President and CEO Jim Gardner said that using today’s figures, the hospital’s regional economic impact likely now exceeds $1 billion.

In fiscal year 2009, the hospital had an employment base of 4,300 jobs and a payroll of $245 million, including benefits.

In three years, the hospital’s $326 million in annual direct expenditures has grown to $470 million, Gardner said.

“By any measure, the health system is an economic engine not just for Gainesville but for all of Northeast Georgia,” Gardner said.

Northeast Georgia Medical Center primarily serves a 13-county area. The hospital as an economic entity has more than doubled in size in just the last six to seven years, Gardner said. Northeast Georgia Medical Center is now among the top five largest hospitals in Georgia.

The GHA report estimates that for every person directly employed by the hospital, close to 1.7 ancillary jobs are created. Northeast Georgia Medical Center sustains at least 7,000 full-time jobs throughout the region that are not directly employed by the hospital, according to the report.

Gardner said the fact that the hospital has not laid off a single employee during one of the nation’s most profound economic crisis “speaks volumes to the hospital’s contribution to the community.”

“Of all the things I am proud of, that’s the single most important thing to me in the last 18 months,” Gardner said.

Gardner said the hospital was able to avoid layoffs by keeping operations lean and efficient, with charges and costs significantly below state and national averages.

“When a hospital is this well-run, you don’t find yourself backed into a corner in moments of crisis,” Gardner said.

Northeast Georgia Health System also provided more than $35 million in uncompensated care and $2.5 million in community outreach in 2006, according to the report.

Gardner noted that the hospital, a 501(c)(3) not-for-profit corporation, does not subsist on tax dollars.

“In this age of bailouts, we are very proud of the fact that we are self-sustaining, that we serve the community on our own, and it’s been that way for years,” he said.

“All this good work that’s happening from an economic perspective is a function of the medical center’s mission and leadership.”