AN ECONOMIC AND MEDICAL SPRINGBOARD: EASTERN VIRGINIA MEDICAL SCHOOL, 21 November 2007

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Executive Summary

Eastern Virginia Medical School (EVMS) is a growing economic powerhouse in Hampton Roads.  It ranks among the top 25 non-federal employers in the region and has an annual economic imprint of more than $711 million. A minimum estimate of the costs that the region would incur if EVMS did not exist is almost $287 million, or $179 per citizen in the region. 

Even so, the impact of EVMS on our regional quality of life in general, and our quality of medical care in particular, may even be more significant.  The presence of EVMS attracts highly qualified medical personnel who provide a menu of high quality medical care that otherwise would be beyond our grasp.  Multiple EVMS faculty are involved in cutting edge translational research that immediately is reflected in improved patient care.  Except for EVMS, approximately 90,000 patients would be forced to travel to other metropolitan areas to obtain appropriate medical care.  

EVMS annually provides almost 100,000 young people with unbilled medical services that include counseling, vaccinations, and prevention.  Approximately 7,500 key adults (parents, teachers) benefit from similar gratis services.

All things considered, the observation of a regional hospital executive that it would be “disastrous” for Hampton Roads if EVMS did not exist is very much on target.  EVMS is the centerpiece of the region’s health care system.


THE ECONOMIC IMPACT OF THE BON SECOURS  HAMPTON ROADS HEALTH SYSTEM, BASED ON DATA PROVIDED BY BON SECOURS HAMPTON ROADS HEALTH SYSTEM, 10 June 2007

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Executive Summary

The Bon Secours Hampton Roads Health System is a network of hospitals, primary care facilities, ambulatory care sites and continuing care facilities that provides high quality health care to the citizens of Hampton Roads.  Bon Secours Hampton Roads (BSHR) is noted for its holistic approach (body, mind and spirit) to the care of the individuals who take advantage of its services.  BSHR primarily serves the 1.6 million individual who reside in Hampton Roads, but also serves numbers of individuals from other regions and states, especially North Carolina.  Bon Secours Hampton Roads is a part of Bon Secours Health System, Inc., a not-for-profit organization that operates 17 acute care hospitals, six long-term care or nursing facilities, four assisted and independent care facilities, and a variety of other clinics, outpatient, and hospice facilities.

Bon Secours Hampton Roads employs more than 4,100 individuals, making it the fifth largest non-federal employer in the region.  The largest unit within BSHR in terms of its economic imprint is Bon Secours Maryview Medical Center in Portsmouth, which earned $223.4 million in revenues during its FY 2006 year.  Bon Secours DePaul Medical Center in Norfolk (whose roots date back to 1839 and has $123.1 million in annual revenues) and Mary Immaculate Hospital in Newport News ($99.0 million in annual revenues) also are very substantial units.  In addition, BSHR provided $23.7 million of health care to patients without health insurance, or without the ability to pay, and another $10.0 million of uncompensated care unreimbursed by Medicaid.  By any standard, Bon Secours Hampton Roads is a very substantial economic enterprise.       

During its FY 2006 year, BSHR paid $160.8 million in salaries and fringe benefits to its employees in the region.  The average salary of a full-time employee was $36,616, slightly above the Hampton Roads average.  However, each full-time employee received $10,253 in fringe benefits (28 percent of salary), and this was substantially higher than the regional average of about 20 percent.  Overall, Bon Secours provides its full-time employees compensation that is 6.9 percent above the regional average.

The economic impact of Bon Secours Hampton Roads can be divided into six categories: (1) direct expenditures on personnel in the form of salaries and fringe benefits; (2) equipment expenditures;  (3) other operating expenditures such as the purchase of drugs and supplies, utilities, and the like; (4) non-operating expenditures such as interest on obligations; (5) gifts made to public and charitable organizations, both financial and in-kind, plus the value of time volunteered by Bon Secours employees to civic and charitable organizations; and, (6) the ripple effect of these expenditures through the regional economy as these dollars are spent and re-spent.  


When the economic ripple effects of their expenditures are taken into account, Bon Secours Hampton Roads has an annual economic impact of $733.85 million, making it one of the dozen most substantial economic enterprises in the region.    This impact is split between the Peninsula and Southside, with approximately 21 percent ($154.27 million) of that impact on the Peninsula and 79 percent ($579.58 million) on the Southside.

Finally, even though some of the activities of BSHR are not directly taxable, the spin-off from the economic activities of Bon Secours  and its employees generates substantial sales, license and property tax revenues that benefit virtually every governmental unit in the region as well as state government.  For example, Bon Secours Hampton Roads’ purchases of supplies and services, for example, generate an estimated $6.0 million in sales taxes annually after economic ripple effects are taken into consideration.


PRE-BUSINESS AT THE UNIVERSITY OF THE SOUTH: RESEARCH, ANALYSIS, OBSERVATIONS, RECOMMENDATIONS, 15 April 2007

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Executive Summary

The quality and rigor of the liberal arts education offered by Sewanee, the University of the South, are well-known.  Sewanee’s curriculum stresses critical thinking and the search for truth within a moral context informed by the institution’s historic relationship with the Episcopal Church.  Sewanee now is contemplating the possibility of expanding its offerings to better serve students who are interested in preparing themselves for careers in business, and/or who wish to pursue an MBA degree, and/or wish to fill leadership positions with a non-profit enterprise. 

Admissions data indicate that Sewanee forfeits about one-quarter of its potential applications because it does not offer an identifiable business or pre-business program.  This report is designed to assist the University in evaluating the options available to it in this regard.

Both students and alumni are enthusiastic supporters of a pre-business program, provided it serves as an addition to Sewanee’s traditional strength in the liberal arts rather than a substitute.  There is little support in these groups for a business major, but great support for a pre-business program that bears a resemblance to pre-medicine and pre-law programs.  Most students and alumni believe Sewanee should move quickly to establish a pre-business program that consists of academic courses leading to a concentration, supported by a variety of co-curricular activities including internships, guest executives on campus, alumni networks, and the like.      

Faculty generally support the idea of a pre-business program, but their support is more nuanced, for some faculty exhibit concerns about the size and course composition of a pre-business program, the salaries that business faculty might require, and the impact on Sewanee’s commitment to the liberal arts.  Most faculty prefer a multidisciplinary approach to pre-business that would draw on many of Sewanee’s traditional liberal arts strengths.

I conclude that Sewanee should move ahead vigorously to implement a full pre-business program and label it a concentration.  As it does so, it is essential that the Vice-Chancellor and Dean publicly support the pre-business program and devote resources to its support.  This will send an unmistakable signal to alumni, whose participation and support are crucial if the program is to prosper and students to reap maximum benefits.  The returns to Sewanee, however, bode to be very significant—among them a much larger admissions pool, happier students and larger alumni gifts.

THE ECONOMIC IMPACT OF UNIVERSITY HEALTH SYSTEMS OF EASTERN CAROLINA, REVISED 10 November 2006

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Executive Summary
 
University Health Systems of Eastern Carolina consists of a group of six hospitals that serve the medical and health needs of 1.2 million individuals in a 29-county region in northeastern North Carolina.  UHS is exceedingly diverse.  Its largest and most complex medical center, Pitt County Memorial Hospital (PCMH) in Greenville, offers almost 800 beds for patients, and is affiliated with the Brody School of Medicine at East Carolina University.  PCMH performs more than 25,000 surgeries annually. UHS’ smallest hospital, Bertie Memorial in Windsor, has only six beds and annual revenues of less than $25 million. This report also gauges the economic impact of three subsidiaries, Physician Practice Management (PPM), HealthAccess (wellness, home health and hospice care), and the Surgicenter.  

The centerpiece of the UHS system is Pitt County Memorial Hospital. PCMH offers a full range of medical services and has identified six distinct centers of excellence:  (1) cardiovascular medicine and research; (2) its children’s hospital; (3) cancer research and treatment; (4) patient rehabilitation; (5) trauma and critical care; and, (6) medical challenges relating to women.  The Cardiovascular Center is well regarded nationally.  UHS also offers a wide range of additional services that include the support of physicians’ practices, home health, a wide variety of community health and education programs, and the like.  

PCMH, with 5,238 FTE employees, is the largest single employer in Pitt County and, indeed, is the largest single employer in the region.  East Carolina University ranks second with 4,636 FTE employees. The UHS average salary per FTE employee ($45,389) ranks second in the region behind ECU ($65,544) and is 39.9 percent above the regional average. 

The economic impact of UHS can be divided into six categories: (1) direct expenditures on personnel in the form of salaries and fringe benefits; (2) equipment expenditures;  (3) other operating expenditures such as the purchase of drugs and supplies, utilities, and the like; (4) non-operating expenditures such as interest on obligations; (5) gifts made to public and charitable organizations, both financial and in-kind, plus the value of time volunteered by UHS employees to civic and charitable organizations; and, (6) the ripple effect of these expenditures through the regional economy as these dollars are spent and re-spent.  

When the economic ripple effects of its expenditures are taken into account, PCMH and its direct subsidiaries have an annual economic impact of $1.41 billion, which is 25.41 percent of the value of the annual gross product of Pitt County.  Along with East Carolina University, PCMH provides the economic spark for Pitt County and most of eastern North Carolina.  Together, they are responsible for more than one-half of the economic activity in Pitt County. 

The five regional hospitals that are members of UHS also have significant economic impacts on the counties in which they are located.   Roanoke-Chowan Hospital, for example, has an annual economic impact of $102 million and accounts for one of every six dollars of economic activity, directly and indirectly, within Hertford County.

Overall, the annual economic impact of UHS is $1.74 billion. With economic ripple effects taken into account, the health system generates 17.04 percent of the total economic activity within the counties in which the six hospitals are located. Within the past five years, the health system’s share of total economic activity within the six home counties has grown more than five percent, from 11.98 percent to 17.04 percent. As noted below, this dramatic growth largely reflects national trends in health care costs, the magnet nature of UHS, availability of higher quality health care services and the construction of new hospital facilities. 

Finally, even though some of the activities of UHS are not directly taxable, the spin-off from the economic activities of UHS and its employees generates substantial sales, license and property tax revenues that benefit virtually every governmental unit in the region.  Indeed, it appears that approximately one in every six dollars of local tax collections within the region eventually are generated by the economic activities of UHS and its employees.


ACSFA COLLEGE TEXTBOOK COST STUDY PLAN PROPOSAL, 7 September 2006

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Summary

“An Economic Analysis of Textbook Pricing and Textbook Markets”

For many years, textbook prices have been rising faster than the CPI.  Both demand side factors, which act to reduce students’ price elasticity of demand for textbooks, and supply side factors, which have increased textbook costs, are to blame.  

The textbook market resembles pharmaceutical markets in that the individuals who pay for these goods (textbooks and prescriptions) are not the people who select the goods and stipulate they should be purchased.  Further, faculty (who do make the latter decisions) are not well-informed about textbook policies and prices.  Faculty also tend to oppose textbook rental systems and other innovations that would moderate student expenditures on textbooks.

The bundling of various learning support materials in textbook packages and the early publication of new book editions also have tended to push up student expenditures on textbooks, as has the unwillingness of many campuses to provide students with Internet links that would allow them to comparison shop for textbooks.  Many institutions of higher education have a conflict of interest in this latter regard.  Either they run their won bookstores and profit directly from higher textbook prices, or they earn significant rental and lease fees from large national bookstores such as Barnes and Noble, or Follett when they are given an exclusive campus franchise. 

Electronic versions of textbooks have yet to make a major dent in collegiate textbook markets. 


THE ECONOMIC IMPACT OF AMERIGROUP CORPORATION ON HAMPTON ROADS, 30 May 2006
      
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Executive Summary

AMERIGROUP CORPORATION is ranked #732 in the 2005 Fortune 1000 listing of the largest firms in the United States.  It is headquartered in Virginia Beach.  Founded in 1994, AMERIGROUP’s 2005 sales exceeded $2.32 billion (a 27.8 percent increase over 2004) and it employed more than 2,700 individuals nationally.  With anticipated hiring, AMERIGROUP nationally will employ more than 3,100 individuals in 2006 and its sales will top $3.0 billion if it continues on its current growth trajectory.  In Hampton Roads, AMERIGROUP anticipates employing 1,900 individuals in 2006, making it the seventeenth largest employer, private or public, in the region.  AMERIGROUP created more new jobs than any private sector firm in Hampton Roads between 2003 and 2006 and based on available data, it appears that it created more new, permanent jobs than any other private firm in the region since 1994.

 The eighth largest health care firm in the country according to Fortune, AMERIGROUP is a managed health care company that focuses on providing health care services to individuals eligible to receive Medicaid, Children's Health Insurance Program and Family Care benefits. The Company does not offer Medicare or commercial products.

AMERIGROUP’s major customers (“members”) typically are much younger than Medicare recipients and the Company helps them access health care in a more efficient manner.  This requires a strong commitment to high levels of quality and cost containment.  This has been a winning formula; the Company now contracts with more than 50,000 health care providers and serves more than 1.0 million individuals in eight states plus the District of Columbia.  State governments find AMERIGROUP is capable of saving them hundreds of millions of dollars via its managed care operations and this is one of the reasons why the Company's sales and employment have expanded so rapidly.  

The economic impact of AMERIGROUP inside Hampton Roads can be divided into six categories: (1) direct expenditures on personnel, education and training, equipment, supplies food, materials, utilities, etc.; (2) capital expenditures on buildings and equipment that stretch beyond a single year; (3) taxes paid; (4) gifts made to public and charitable organizations; (5) time volunteered by AMERIGROUP employees to civic and charitable organizations; and, (6) the ripple effect of these expenditures through the regional economy as these dollars are spent and re-spent.  

AMERIGROUP’s estimated direct economic impact in Hampton Roads in 2006 will total $199.06 million.  These dollars have a ripple effect throughout the community as they are spent and re-spent within the region.  This ripple effect, or indirect economic impact, will total another $199.06 million.  The total annual economic impact of AMERIGROUP on the region in 2006 will be the sum of these two effects and is $398.12 million.  This places AMERIGROUP within the top five percent of all private employers in Hampton Roads and accounts for approximately .6 percent of the region’s gross regional product.

AMERIGROUP’s cumulative economic impact on the Hampton Roads region since its founding in 1994 is $1.98 billion.  Because of AMERIGROUP’s rapid growth, more than 80 percent of that economic impact has occurred since 2000.