Kentucky’s hospitals are not only pillars of health care but also major economic engines, driving $34 billion in economic activity across the Commonwealth.
KHA’s new Statewide Economic Importance Report shows hospitals across Kentucky directly employ 95,000 people and invest $9 billion annually in wages and benefits. In addition, hospitals spend more than $2 billion on capital projects each year, creating further employment opportunities and boosting local economies.
After a Town Hall discussing the newest Economic Importance Reports, the KHA team made additional changes at the request of members to include more data and ensure the report shows the full impact hospitals have on their communities. Members will receive updated versions of personalized reports within the next seven days.
The economic impact findings are based on the IMPLAN model, a widely used economic analysis tool that measures how spending and employment in one industry affect other sectors of the economy. In this case, the model calculated how hospital expenditures — such as salaries, equipment, construction, and supply purchases — circulate through Kentucky’s economy. It also accounts for how hospital employees spend their wages in their local communities. This interconnected activity creates what economists call a “multiplier effect,” where every dollar spent by a hospital helps support other businesses, jobs, and tax revenues throughout the state.
The full economic footprint includes hospital-related spending, employee spending in local communities, and support for surrounding businesses and services. This multiplier effect reinforces the importance of strong, stable hospitals not only for public health but for economic prosperity.
