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Planned hospital partnership to hold economic benefits, study shows

- March 16, 2009

An economic impact study issued by the Connecticut Center for Economic Analysis says the proposed partnership between the UConn Health Center and Hartford Hospital will result in a significant increase in new jobs, personal income, and tax revenue for the state.

The study found that the University Hospital, including construction of a replacement for the John Dempsey Hospital, and the regional education and research collaborative would have major benefits for the state including generating:

  • 8,229 jobs by 2020, and 18,200 jobs by 2040;
  • more than $3 billion annually in new personal income by 2040 (nominal dollars);
  • approaching $2 billion in aggregate new tax revenue for the state by 2035.

“These are compelling results,” says Fred Carstensen, professor of economics and director of the Connecticut Center for Economic Analysis.

“They clearly demonstrate that this project would create a long-term economic engine for the state and the region. Collectively, the components of the proposed partnership would be a clear win for Connecticut in terms of jobs, income, tax revenue, and return on investment if the state moves forward quickly and aggressively.”

The full report and an executive summary are available at http://news.uconn.edu/2009/March/Projecting_the_Economic_Benefits.doc (MS Word) and http://news.uconn.edu/2009/March/Projecting_the_Economic_Benefits.pdf (PDF)

The study analyzed four components of the proposed partnership: the benefits of replacing the outdated 224-bed John Dempsey Hospital, the second smallest academic hospital in the nation, with a new 250-bed hospital in Farmington and the expansion of the Schools of Medicine and Dental Medicine; a new research and educational collaboration between UConn and five regional hospitals; a partnership between Hartford Hospital and the Health Center resulting in a 1,100-bed University Hospital with campuses at the UConn Health Center in Farmington and at Hartford Hospital; and expanded clinical trials that would result from the partnership.

The report was discussed last week during a hearing of the General Assembly’s Committee on Higher Education and Employment Advancement about House Bill 6335: An Act Concerning the University of Connecticut Health Center Facilities Plan (the replacement hospital and proposed partnership with Hartford Hospital).

The study quantifies anticipated benefits of the proposed partnership not just to UConn or the region but also to the entire state, says University President Michael Hogan. “We must look beyond the current financial challenges so that our state is competitively positioned when the recession ends.”

Hogan says this is the right proposal for Connecticut.

“The findings more than validate UConn’s position that the proposal is not only the right choice for improving the quality of healthcare in the state but also the right choice for our ailing state economy,” he says.

“The partnership and the new hospital are the right long-term actions to ensure quality health care for Connecticut citizens and position our state for a strong economic recovery after the recession.”

The full analysis is based on the Connecticut REMI model, a dynamic, multi-sector, regional model developed and maintained for the Connecticut Center for Economic Analysis by Regional Economic Models Inc. of Amherst, Mass.

The model provides detail on Connecticut’s eight counties and is used to project economic benefits.

Built from the U.S. Department of Commerce’s national input-output matrix, it is nationally recognized for projecting economic impacts and is the basis on which the Connecticut Department of Economic and Community Development evaluates projects.

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