What Health Care Means to Texas’ Fiscal Health

Health care is a vital component of the Texas economy, generating tens of billions of dollars in revenue each year and providing hundreds of thousands of jobs. For example, the 42 hospitals and other institutions that compose the Texas Medical Center (TMC) in Houston have a combined annual operating budget of $5.4 billion and employ more than 61,000 people. [16] Indirectly, TMC generates some $13.5 billion for the Houston economy, according to the medical center's 2003 statistics.

Meanwhile, health care is one of Texas' largest employers. And it is one of the fastest growing. Employment in health services represents 6.9 percent of the job market and 7.2 percent of total worker earnings in Texas. [17] In 2005, hospitals, physicians' offices, medical and dental laboratories, home health care providers, and other health facilities provided some 866,900 jobs in Texas. The Texas Workforce Commission (TWC) says employment in the ambulatory care sector, which includes physician offices and other outpatient services, is growing the fastest, at 3.7 percent per year. [18] Private sector health care services employed more than 862,000 Texans in 2001, with a combined annual payroll exceeding $32 billion. Texas state and local governments employed another 125,900 health and hospital workers, with an annual payroll of $3.8 billion. Allopathic and osteopathic physicians alone employed almost 133,000 people in 2000. That will grow by roughly one-third, to nearly 176,000 by 2010. TWC ranks offices and clinics of medical doctors, osteopathic physicians, and other health care practitioners as three of the 15 fastest-growing industries in the state. [19]

A healthy and viable medical system is vital for Texas' continued economic development. Without a healthy and educated workforce or ready access to high-quality medical care, the state cannot attract new industries and employers. Unfortunately, many areas of Texas suffer from a lack of health care professionals and health care infrastructure. And millions of our residents find accessing medical care a challenge because they are uninsured or underinsured.

Although health care collectively is big business, individual physician practices are small businesses - mostly very small and often struggling. About 40 percent of Texas physicians are solo practitioners; another 25 percent are in small groups of two to six physicians. These small practices each employ four to five additional workers per physician and have large overhead expenses. In recent surveys, two-thirds of Texas physicians report having trouble covering payroll and other practice expenses because of difficulties in collecting timely or adequate payment from insurers and government payers.

[16] 2006 City of Houston Budget Plan.
[17] Temple L, Hughes M. Texas Workforce Commission. Jobs in the 21st Century; December 2003.
[18] Texas Workforce Commission. Texas Labor Market Review; September 2005.
[19] Temple.