Health care remains state economic driver

By Bobby Harrison/NEMS Daily Journal

JACKSON – The health care industry is not only important to the overall physical wellness of Mississippians, but also is vital to their financial well-being.
That was one of the messages from the annual Mississippi Economic Outlook Conference conducted Wednesday by the Institutions of Higher Learning Policy and Research Planning division.
The overall theme was that the national economy had slowed and that some believe there is a 40 percent chance of another recession. And closer to home, the state economy continues to underperform the national economy.
Marcella McKay, chief operating officer for the Mississippi Hospital Association, said in many communities the local hospital is the area’s largest employer and primary economic engine.
“Often the economic importance of hospitals is overlooked in the communities they serve,” McKay told the about 50 policy experts and others who attended the conference at the IHL complex in Jackson.
She said 60,140 people are employed in hospitals across the state with an average annual salary of $42,193 – $9,000 above the overall state average.
While the health care industry is in some ways recession-proof, McKay said there are ongoing factors also affecting health care in Mississippi.
For instance, the amount of uncompensated care hospitals perform has risen during the current economic woes since more people are unemployed and without health insurance. Mississippi hospitals are not compensated for 9 percent of the care they provide.
Overall, 41 percent of all hospital services in the state are paid for through Medicare, a federal program for the elderly, while 16 percent are paid through Medicaid, a federal-state program primarily for poor pregnant women and their children, the disabled and the elderly. Insurance and self-pay account for the other 34 percent.
McKay said the downturn in the economy, leading to less state tax revenue, also is a concern for hospitals because of state budget cuts. She said cuts to universities and colleges have the potential of impacting the programs that train their employees.
“These programs are labor intensive and costly to run. We get concerned about budget cuts to universities and colleges,” she said.
National health care reform and other federal changes also will impact Mississippi hospitals. As part of the reform package, McKay said providers will move toward “bundled billing” where a person does not receive separate bills from the treating physicians and the hospital.
In other news from the conference, Mary Beth Wilkerson, the state tourism director, said Tupelo’s hotel/motel occupancy was up 23.1 percent during the first seven months of the year. She attributed the jump to business travel surrounding the opening of the $1.3 billion Toyota manufacturing plant later this year in nearby Blue Springs.
Several speakers said one of the biggest issues currently facing the economy is that consumers are not spending money.
“We really think there is a lot of pent-up demand,” said Marty Milstead, director of the Mississippi Homebuilders Association.
The number of people needing housing is growing, even though sales of new and existing homes remain sluggish.
“People are staying at home longer, staying with parents longer,” he said. “The divorce rate is actually going down. We don’t think people are loving each other more … The signs show people are staying together for business reasons.”
bobby.harrison@journalinc.com