Dr. Roger Hall, center left, performs open-heart surgery. Open-heart surgery at the Rogue Valley Medical Center Feb. 2012. Photo by Julia Moore​

Jackson County health care has a strong pulse

Health care helps spur 20-25 percent of all Jackson County jobs

March 14, 2014
By Greg Stiles
Mail Tribune

Make no mistake about it, the economic role once held by the wood products industry in Jackson County now squarely rests on the shoulders of health care.

Depending on which set of government statistics you begin with, and how you evaluate those measurements, the local health care industry spurs somewhere between $1.2 billion to $1.5 billion in economic activity. It could be even more and is sure to mushroom in the years ahead.


  • Asante Rogue Regional $385.9 million
  • Providence Medford $161.6 million
  • Asante Three Rivers $129.5 million
  • Ashland Community $48.3 million
Source: Oregon Health Authority

Based on the federal Bureau of Economic Analysis statistics, the impact is north of $1.2 billion. And that's understated: BEA figures don't include insurance, retail pharmaceutical, construction of medical buildings, education-related or many other endeavors generated by health care activity.

"Nationally, health care accounts for 15 percent of the GDP; here, it's realistically 19 percent," said Guy Tauer, a regional economist for the Oregon Employment Department. "Relative to all other industries, there is a greater concentration here in terms of percentage of employment. If it means one in six jobs in the U.S., it's closer to one in five in Jackson County."

Health care's contribution to the local economy is expected to expand through the remainder of this decade.

A report authored by Oregon Health Sciences University economist Peter Graven projected Jackson County physician ranks will swell by 21 percent by 2020 based on demand created by the Affordable Care Act and demographic factors. In 2013 there were 572 local doctors in the county; the projection is that by 2020 there will be 695.

Boosted by increased Medicaid usage and retirement trends, the projected increase in health-care spending will be higher than for most other Oregon counties, Graven said.

"Jackson County is essentially exporting services, or importing people for care, because of the medical facilities there," Graven said.

Using the ripple effect of a 1.5 multiplier, commonly used in assessing economic impact, health care could contribute to about 25 percent of jobs in Jackson County— or about 18,000 positions. That number is higher than the one-in-five job figure given by Tauer because Graven's totals include a wider spectrum of related jobs.

"There are certainly industries that benefit from other industries," Tauer said, while cautioning that any multiplier is a very rough estimate. "In this case you have suppliers and vendors providing the things hospitals buy — medical devices, lab services, and such — linking to other industries."

For much of the 20th century, the timber industry held sway in the Rogue Valley. When logging and the mills were booming, so was the local economy. When they contracted, times got hard.

Bill Thorndike Jr., a former Asante board president, recalls an era when pear and timber harvests put people to work and food on the table for thousands of families.

"If either one of those faltered, it had a huge impact on our economy," said Thorndike, a member of the Northwest Health Foundation board. "The shift from wood products and agriculture has had a dramatic impact, particularly through the Great Recession. When you look at the figures, you didn't see the same impact on health care, it just continued to chug, chug, chug — growth, growth, growth."

According to the Oregon Health Authority's latest computation, using 2012 figures, Asante Rogue Regional Medical Center produced total operating revenue of just under $386 million, while Ashland Community Hospital — now under Asante's control — had total operating revenue of nearly $48.3 million. In neighboring Josephine County, Asante Three Rivers Medical Center had revenues of nearly $130 million.

Providence reported total operating revenue of more than $161.6 million in 2012.

Pat Hocking, Asante's chief financial officer, said Asante employs the full-time equivalent of 2,555 people in Jackson County alone, excluding its Josephine County operations. Using a statewide industry multiplier of 2.17 the organization directly and indirectly contributes to 7,000 local jobs.

"Asante is very important to the local economy and that's not lost to us in our daily behavior and long-term strategy," Hocking said. "In addition to our employees, we spend $30 million per year on services purchased from other companies. About half of that is spent on local companies, and that has that has a significant downstream economic flow."

Providence is part of an expansive, multi-state system that operates eight hospitals throughout Oregon. Locally, in addition to its Medford hospital campus, it has clinics in Ashland, Central Point, Phoenix and Eagle Point, with another scheduled to open in the county in 2014.

James Watson, the marketing chief at Providence Medford Medical Center, said it's difficult to give a precise local head count for his organization because many employees, including himself, report to a central office in Portland, while others work in multiple counties. He estimated there are approximately 1,000 employed here.

Medford's distance from major metropolitan medical centers factors into the industry's local impact, said Ron Fox, executive director for Southern Oregon Regional Economic Development Inc. Not only do many patients drive three or more hours for appointments, they often turn those ventures into shopping trips.

"Our medical service capacity is one and a half times what would be normal for a region with a population our size," Fox said. "We are importing a lot of health care dollars from outside the Jackson County area. It is an important traded sector industry for this region, doing what manufacturing would do in other communities. It's more like tourism where people spend their dollars that would've been spent elsewhere."

The economic impact of health care fans out in many directions beyond Rogue Regional Medical Center on East Barnett Road and the Providence complex on East McAndrews Road.

"When people retire and move here or are looking for a place to spend the sunset years, they want to be around the best health care facilities," said Ron Galbreath, an agent with Coldwell Banker Pro West Real Estate in Medford. "The first question people from California ask is about the medical facilities."

Executive and medical staff hires bring new home buyers as well.

"We know they are definitely buyers and enjoy larger square footage homes," Galbreath said. "A lot of times they're looking at homes with acreage."

Not everyone connected with health care has the resume — or income — of a physician, but the tentacles of the industry reach far beyond the walls of hospitals and doctors' offices.

Multi-millions of dollars have been spent in construction, adding or renovating buildings on hospital campuses and clinics in the past decade. In the public sector, Jackson County's mental health unit has a new office building going up downtown, while the Veterans Affairs Southern Oregon Rehabilitation Center and Clinics also has seen new construction.

There are dozens of agents selling health insurance in the county, plus scores more providing customer service at a Regence BlueCross/BlueShield clients call center.

Retirement centers offering one form or another of health care dot the local map, many clustered near hospitals.

Crystal balls are cloudy at best, but with more people than ever qualified for insurance, the demand is sure to rise, Providence spokesman Watson said.

"We have a larger health care network, because we're now responsible for everybody," he said. "At some point in time we're going to hit the maximum concentration of specialty clinics and providers. It will depend on the economy of Southern Oregon."

And that seems fair enough, as it seems likely the economy of the region will also continue to depend on health care.

Reach reporter Greg Stiles at 541-776-4463 or Follow him on Twitter @GregMTBusiness, friend him on Facebook and read his blog at Edge.

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