The Economic Impact of Children's Hospital Medical Center on Greater Cincinnati
Cincinnati Children’s Hospital Medical Center (Cincinnati Children’s) is one of the
largest and most respected pediatric hospitals and research centers in the United
States. While Cincinnati Children’s first responsibility is to improve the health of
children, the investments the organization makes in achieving that goal are also
investments in the health of the community in which its employees live and work.
This report estimates the economic impact of Cincinnati Children’s on Greater
As Cincinnati Children’s strengthens its ability to impact the health of children, it also
strengthens the economic impact it has on the community, as reflected in the
following highlights from this economic impact study:
Economic Impact 2
- The total annual economic impact of Cincinnati Children’s in fiscal year 20073 was
$2.72 billion, an increase of 78 percent from $1.53 billion in fiscal year 2002.
This is three times the overall growth rate of the local economy during the same
five year period.
- Included in the total economic impact is a household earnings impact of $1.16
billion in fiscal year 2007, a nearly 90 percent increase from $615.6 million in
fiscal year 2002.
- The total impact on employment in Greater Cincinnati is 24,381 jobs in fiscal year
2007, a 77 percent increase from 13,793 jobs in fiscal year 2002.
Expenditures and Employment
Over the last decade, Cincinnati Children’s has greatly expanded its staff and
facilities, with a particular focus on developing unique and cutting-edge programs
that place Cincinnati Children’s in the forefront of pediatric care and research. This
has allowed the medical center to achieve considerable growth in its patient care,
research, and education programs. The expansion of Cincinnati Children’s has
required substantial increases in the amount of expenditures and number of
employees as reflected in the following:
- Cincinnati Children’s expenditures were $1.21 billion in fiscal year 2007, an
increase of 71 percent from $706.1 million in fiscal year 2002. Personnel
expenditures represent more than half of total expenditures.
- Wages and Benefits (including pension benefits) are the largest component of
Personnel Expenditures and increased 81 percent from $299.7 million in fiscal
year 2002 to $541.8 million in fiscal year 2007. Real wages per job increased 30
percent over the period, from $42,564 to $55,515.
- Total employment increased 52 percent from 6,433 in fiscal year 2002 to 9,760
in fiscal year 2007. This growth can be attributed to the fact that Cincinnati
Children’s has added approximately 728 net jobs per year over the last decade.
- Other Operating Costs (for various supplies and services, personnel services, and
utilities) increased from $242.6 million in fiscal year 2002 to $367.3 million in
fiscal year 2007, which reflects a 51 percent increase in expenditures.
- Cincinnati Children’s invested $156.8 million in Capital Expenditures in 2007, a 51
percent increase from $104.1 million in 2002. Construction accounts for the
majority of Capital Expenditures and can be attributed primarily to a major new
research facility and an office building/parking garage at its main campus, as well
as a new campus in Liberty Township.
Cincinnati Children’s estimates it will spend an additional $707.4 million on Capital
Expenditures over the next five years which includes $232.9 million in Construction
activities and $198.4 million in Capital Expenditures.
Other Aspects of Impact and Growth
In May 2008 U.S. News & World Report ranked Cincinnati Children’s among the top
three children’s hospitals in General Pediatrics in its annual “America’s Best Children’s
Hospitals” ranking. The national prominence and reputation of Cincinnati Children’s
results from the magnitude and quality of its patient care, research, and education
efforts as highlighted below.
Over the last decade, Cincinnati Children’s has expanded clinical
services and made investments to provide state-of-the-art medical facilities to its
patients. Since 2002, patient encounters have increased from 660,124 to 917,204,
an increase of 39 percent. Many of these come from outside the Cincinnati area,
which increases the economic impact of the medical center. Within the last two
years, Cincinnati Children’s has served patients from all 50 states, Puerto Rico, and
48 foreign countries.
The research program at Cincinnati Children’s has grown dramatically. In
2002, awards for sponsored research totaled $84.4 million, and in fiscal year 2007, the
figure was over $123.4 million. In those same years, awards from the National
Institutes of Health (NIH) grew from $60.3 million to $92.1 million. Cincinnati Children’s
ranked second among all pediatric medical centers nationally in NIH funding in the
2006 federal fiscal year.
Cincinnati Children’s is home to the Department of Pediatrics of the
University of Cincinnati College of Medicine, ranked as third best in the nation in
2007 by U.S. News & World Report. Cincinnati Children’s also operates one of the
largest and most highly rated pediatric residency programs in the nation. In addition
it provides pediatric education to nursing students and a variety of other health
professionals and trainees.
During 2007, Cincinnati Children’s provided a total of $170.5
million in community benefit programs and activities that include charitable patient
care, internally subsidized research, graduate medical education, and community
Cincinnati Children’s clinicians and researchers are engaged in
pursuits that result in scientific discoveries and the creation of new technologies that
advance health care and have the potential to generate substantial new economic
activity. The portfolio of technology opportunities for commercialization has significantly
increased over the past several years.
1 Greater Cincinnati is the Cincinnati-Middletown Metropolitan Statistical Area (MSA) which includes the counties of Hamilton, Butler, Warren, Clermont, and Brown in Ohio; Boone, Kenton, Campbell, Gallatin, Grant, Pendleton, and Bracken in Kentucky; and Franklin, Dearborn, and Ohio in Indiana.
2 All monetary figures are represented in 2007 dollars for purposes of making comparisons.
3 Cincinnati Children’s fiscal year begins July 1 and ends June 30. Fiscal year 2007 began July 1, 2006 and ended June 30, 2007.