Study Finds Montana Hospitals Leading Private Sector Employer

Jul 31, 2019

Nearly ten percent of private sector wages in Montana are paid by hospitals. That’s according to a new study released Tuesday.

The study that the Montana Hospital Association commissioned from economists at the University of Montana says hospitals large and small across the state account for nearly seven percent of total private sector employment.

“This study confirms that hospitals are the major contributors to the state’s growing economy,” says Rich Rasmussen, President and CEO of the Montana Hospital Association. “And in rural areas, they are often the backbone of that industry.”

“For every hospital job created or taken away, 1.2 jobs elsewhere are added or taken away,” says Gregg Davis, the study’s research consultant. “And for every dollar of personal income attributed to hospitals an additional 61 cents is generated economy wide.”

Hospitals get a lot of their revenue from Medicaid, the joint state and federal health program for people with low incomes.

For every $1 in state Medicaid funding, the federal match is $1.89. For every dollar reduced in Medicaid funding the state loses $2.89. The Medicaid funds alone account for about 1,200 jobs economy wide, the study’s authors say.

There are challenges for the state’s hospitals in regard to payments from both government and the private sector health insurers, says MHA’s chief Rich Rasmussen

“But any other payment recommendation, recommended changes on the federal level or any uncertainty regarding potential court challenges to the Affordable Care Act, does create within the health care community, not just hospitals, a heightened sensitivity of what may come next,” Rasmussen says.