Shreveport, La. (Mar. 31, 2021) – Ochsner LSU Health released a report today showing it is having a significant positive impact on the state and regional economies while expanding access to quality healthcare to residents across North Louisiana.
Ochsner LSU Health was formed in October 2018 when Ochsner Health and LSU Health Shreveport partnered to manage two former charity hospitals, a network of clinics and health centers and a physicians group, all in North Louisiana.
Ochsner LSU Health commissioned the study to assess the economic impact this partnership has had on the regional economy, specifically in Caddo and Ouachita Parishes, as well as the overall state economy.
The study was conducted by economist Dr. Loren Scott of Loren C. Scott and Associates.
State of Louisiana
On the state level, Ochsner LSU Health has added $151.4 million more in business sales and generated $57.4 million in additional household earnings for Louisiana residents. It has also created jobs across the state and generated an additional $9.1 million to the state treasury, the report said.
“Clearly, the formation of this partnership has been a big win for the state,” writes Scott in describing the impact.
In fiscal year 2018, $3.9 million in capital was spent on healthcare facilities. Since the partnership was formed in October of that year, this dramatically rose to by a factor of nearly 18 with Ochsner LSU Health spending $69.7 million fiscal year 2021.
In Caddo Parish, business sales impacts are up 54 percent, household earnings are up 52 percent and local taxes of more than 43 percent with a job multiplier factor of 2.6. The average wage of these jobs is $63,312 versus the Parish average of $47,944. In Shreveport, Ochsner LSU Health has increased its full-time employment by 32 percent.
“When a decision is made by a firm to create a new job, a chain reaction is started which works its way through the economy,” Scott said in the report. “This chain reaction causes even more jobs to be created. Think of the parish economy as a large economic pond. Into this pond is dropped a rock labeled ‘Ochsner LSU Health Shreveport.’ When that rock hits the pond, it sends ripples all the way to the edge of the pond. It is these ripples that are referred to as the ‘multiplier effect.’ ”
“Importantly, these gains came at a time when the state economy was being hammered by COVID-19 and a depressed energy sector,” Scott said in the report.
Capital spending in Caddo Parish is up 15 times, from $3.5 million in 2018 to $54.2 million less than three years later. Ochsner LSU Health also increased operational spending in Caddo Parish by 40 percent, or by $192 million, in that same time frame.
The partnership generated nearly $1 billion in sales at businesses in the Parish, just over $30 million for local government treasuries, boosting impacts by more than 54 percent.
Ochsner LSU Health has produced similar positive results in Monroe and Ouachita Parishes, the study reported. Full-time direct employment is up 10.5 percent, and capital spending increased from $410,000 in 2018 to $15.2 million in fiscal year 2021. Operational spending is up 12.4 percent, or $14.8 million.
“The small amount spent on the hospital prior to the takeover — $410,000 — had a negligible impact on the parish economy,” the report said. “Only about four jobs could be tied back to this spending. These impacts have grown since the partnership assumed responsibility for the hospital.”
Business sales impacts are up $48.5 million in Ouachita Parish. Earnings are up $18.1 million, and local taxes increased by one-half of a million dollars since the partnership was formed.
The partnership created more than 300 additional jobs, with a multiplier factor of 2.3 and an average annual wage 38 percent higher than the parish average.
“It should be pointed out that the Ochsner LSU Health Monroe Medical Center was one of the few entities in either parish that grew over 2018-2021,” the report states.
Continuing a Mission to Serve All Populations
“As a result of the extra effort to serve this underserved market, the partnership’s Medicaid patient count has increased significantly in just the first two years after the transition,” Scott said in the report. “[T]here has been a rather remarkable 21% increase in service to the Medicaid population since the transition to the partnership.”
“Importantly, expensive emergency room visits by Medicaid patients are down 25% since the transition. This is because more clinics are now available to this population, so they can take this less expensive way to receive care,” he continued.
In Shreveport and Caddo Parish, the partnership includes Ochsner LSU Health Shreveport’s academic medical center on Kings Highway, with 452 beds and north Louisiana’s only Level 1 trauma center. The partnership also includes St. Mary Medical Center, with 122 beds for women and children, a diagnostic and imaging center, a neurology and neurosurgery center and several other clinics.
In addition to its established clinics at its Kings Highways campus, Ochsner LSU Health also operates new clinics in Caddo Parish: Internal Medicine and Pediatrics providing primary care at Provenance, Primary Care at Fern Avenue, a Community Health Center on St. Vincent Avenue, Asthma Allergy and ENT and two Urgent Care facilities. It also opened Louisiana Behavioral Health in partnership with Oceans Healthcare in January 2021.
In Ouachita Parish, Ochsner LSU Health includes E.A. Conway Hospital, with 244 beds, and 13 clinics on the Monroe Medical Center campus and plans to add clinics in the community.