Study: Catholic Health Partners has $9B economic impact in Ohio

CINCINNATI - From its unassuming headquarters at Reading Road and Elsinore Place in downtown Cincinnati, Catholic Health Partners is having a big impact in Ohio.

A new economic impact study commissioned by the health system shows just how big. The study found that CHP’s 22 hospitals in Ohio and its dozens of physician groups, nursing homes and outpatient centers across the state had a total economic impact of $8.95 billion in 2011.

That’s based on the system’s direct employment of 30,429 across Ohio, its $1.61 billion in payroll and the other jobs and services those jobs and paychecks help support, said Jeff Rexhausen, senior research associate at University of Cincinnati’s Economics Center. Rexhausen conducted the study for CHP, which is the state’s fourth-largest employer based on 2011 data.

“They’re bigger than any manufacturer in the state. They’re bigger than any banking system. They employ more people than Ohio State,” Rexhausen said. “I’ve been doing these studies for a long time. I don’t usually have surprises. But that was a surprise.”

Tax-exempt hospitals, such as those in CHP’s system, have come under increased scrutiny in recent years from critics who say they haven’t been held accountable for their special status. U.S. Sen. Chuck Grassley, R-Iowa, has led the federal charge to require hospitals to report in more detail how much free care they provide in exchange for that status.

Rexhausen’s study notes that CHP and its facilities paid a total of $235 million in income, sales and other taxes to the state and local governments in 2011. If it were a for-profit corporation, the healthcare system estimates it would have paid $138.5 million in property taxes that year, too. But that’s far less than the $327 million that CHP spent in 2011 on “community benefit,” which mostly consists of free care for needy patients, he said. CHP spent $385.4 million on community benefit in 2012, according to a new report released Thursday.

Having a federal tax-exempt status doesn’t automatically mean a nonprofit also is exempt from state real estate taxes, said Daniel Hoffheimer, a partner with downtown-based Taft Stettinius & Hollister LLP. The state has specific criteria that nonprofits must meet to get that exemption, he said.

The tax-exempt discussion is one that’s continuing at every level of government, said Jon Fishpaw, CHP’s vice president of advocacy and government relations.

And CHP hopes the study will help show legislators and other policy makers just how important the healthcare system is to the state, Fishpaw said.

“People think of the cost of health care to our economy,” he said. “But when you look at this study, it’s an excellent demonstration of a system that’s having such a big impact on the state’s economy.”

In recent years, CHP has worked to ensure more of that impact is felt by businesses owned by women and minorities. In 2012, the entire CHP system spent $92.6 million with women- and minority-owned businesses, said Mark Combs, vice president for supply chain operations for the system’s central division.

That figure includes $50 million in spending in Greater Cincinnati alone, he said.

“It just really helps us serve the communities better,” said Mike Boehmer, CHP’s media manager. “We really need to tap the power of these diverse suppliers.”

Ultimately, the impact study and the data in it should help show policy-makers throughout the state all the ways that CHP gives back, Fishpaw said.