Sonoma Valley Hospital Makes Strong Contributions To Regional Economy, New Economic Impact Study Reports

March 17, 2015

Sonoma Valley Hospital has a strong positive economic impact on the Sonoma Valley and Sonoma County, according to a new study. It found that the hospital generates $104 million in total economic activity and supports 658 jobs within the hospital and in other business sectors.

The study, which was commissioned by the hospital, also reports that SVH benefits the community by providing $1.5 million in unreimbursed and charity care over the past three years, much of this going to disadvantaged populations.

“Hospitals in general are an important part of the economic engine for a region, and Sonoma Valley Hospital is a strong contributor both in the Sonoma Valley and throughout Sonoma County,” said Philip King, Ph.D., the author of the report. He is an economics professor at San Francisco State University and has conducted many economic impact studies, including several for the Hospital Council of Northern and Central California.

Hospital spending benefits a region in a number of ways, according to Dr. King. He notes, for example, that SVH’s recent facility upgrades and expansion created close to 100 construction jobs with a related $16 million in economic activity annually over the last three years. Hospital spending also created nearly 80 jobs in real estate, restaurants and employment services, which was responsible for more than $9 million in economic activity last year. All data reported are in 2014 dollars.

The $104 million total includes both the direct and indirect economic impacts of SVH spending, while the 658 jobs generated include both hospital employees and jobs created in the region through that spending.

“The report illustrates how Sonoma Valley Hospital contributes to the economic health of our region, in addition to supporting its physical health,” said Kelly Mather SVH CEO. “I’m confident that the hospital will make even bigger contributions over time because it is in a stronger financial position today that it has been in more than a decade.”

“Sonoma Valley Hospital has made significant progress toward financial stability over the past five years by increasing revenue, reducing costs, paying down debt, upgrading the physical plant, and improving technology,” Mather said. “We’re well-positioned to continue contributing to our community for many years to come.”

SVH reported total payroll of $26 million in fiscal 2014, and operating revenues of $50.5 million, a 10 percent increase from 2011. It also spent $46 million in construction, upgrades and maintenance over the past three years, funded by the General Obligation Bond and philanthropic donations.

The report also notes that health care employment is especially valuable from an economic standpoint because these jobs contribute twice the country average for wages and salaries, and are more stable during economic downturns.

While the study reflects hospital and hospital-related jobs and economic activity, it does not include all medical services in the region, such as health centers or independent physician and medical specialty groups

View 2015 Economic Impact Report