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Updated 10:00 AM February 19, 2007
 

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Michigan medical schools and teaching hospitals
make major economic impact

A new report from the Association of American Medical Colleges reveals that its member medical schools and teaching hospitals had a combined economic impact of $451 billion on their states and the nation in 2005. The U-M Medical School and other academic medical centers across the state had a combined economic impact of $18.7 billion, according to the report.
Neurology Drs. Jeffrey Kutcher and Gregory Thompson examine x-ray images. The Association of American Medical Colleges reports that its member medical schools and teaching hospitals, including U-M facilities, have an economic impact of $18.7 billion in Michigan. (Photo by Scott Galvin, U-M Photo Services)

Michigan medical schools and major teaching hospitals are directly and indirectly responsible for more than 121,956 full-time jobs. The U-M Health System directly employs nearly 19,000 people.

Nationally, the report found that the 125 accredited U.S. medical schools and more than 400 major teaching hospitals represented by the AAMC employ nearly 1.7 million individuals and are directly and indirectly responsible for more than 3 million full-time jobs—one out of every 48 wage earners in the United States.

The overall economic impact of institutions such as the U-M Health System on Michigan and the national economy takes into account the direct and indirect business volume generated by medical schools and teaching hospitals, including institutional and employee spending, and spending by patients, their families, and visitors (excluding spending for patient care and medical services).

According to the report, every dollar spent by a medical school or teaching hospital indirectly generates an additional $1.30 when it is re-spent on other businesses or individuals, resulting in a total impact of $2.30 per dollar.

Michigan's medical schools and teaching hospitals also generated more than $976 million in state tax revenue in 2005 through income and sales taxes, corporate income taxes, and capital stock/franchise taxes paid by businesses that collect revenue from state institutions.

In addition, UMHS and other academic medical centers in Michigan generated more than $661 million in out-of-state medical visitor-related revenue in 2005, including direct spending in local communities by out-of-state patients and their friends and families.

The report, "The Economic Impact of AAMC-Member Medical Schools and Teaching Hospitals," is available at www.aamc.org/economicimpact.

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