HEALTHCARE & BIOSCIENCE

(1)

San Antonio, Texas

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HEALTHCARE &

BIOSCIENCE

2014 SAN ANTONIO

ECONOMIC IMPACT STUDY

[based on 2013 data]

Conducted by

Richard V. Butler, Ph.D.

Mary E. Stefl, Ph.D.

Trinity University

(2)

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U

nlike most previous

versions, this current

study includes the impact

of The University of Texas

Health Science Center

at San Antonio, some

elements of the military

medical presence in the

region, and the multiplier

effects of the goods and

services local healthcare

and bioscience businesses

sell or deliver to customers

and patients outside the

region.

T

his study attempts, as

in the 2009 and 2011

studies, to include credible

approximations of the size of

these important contributors

to the San Antonio economy.

This expanded definition of

the industry is represented

in the “comprehensive”

estimates. To facilitate

comparisons with the past,

“traditional” estimates

using the previous industry

definition are also reported.

OVERVIEW

HIGHLIGHTS

• The Healthcare and Bioscience Industry continues

to be one of San Antonio’s largest industries. Its

economic impact in 2013 was

$23.9 billion

measured conservatively, and approximately

$30.6 billion

by a more comprehensive estimate.

• By the more comprehensive estimate, the industry

paid

$7.6 billion

in wages and salaries to

1

64,537

employee

s

in 2013.

• Nearly

one of every six San Antonio employees

works in the Healthcare and Bioscience Industry.

• The Healthcare and Bioscience Industry has added

41,567 net new jobs

over the past decade (a 40%

increase), fueling San Antonio’s growth.

• As one of San Antonio’s leading industries, the

Healthcare and Bioscience Industry has shown

steady growth and innovation

over the past

two decades.

(3)

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2014 Healthcare & Bioscience Economic Impact Study San Antonio, Texas

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OVERALL GROWTH & IMPACT

The economic impact of San Antonio’s

Healthcare and Bioscience Industry in

2013 totaled $30.6 billion.

T

he impact of San Antonio’s Healthcare and Bioscience Industry in 2013 is more than twice the size of the industry a decade ago, and more than four times its size in 1993.

M

easured by the dollar volume of final sales of its products and services, the economic impact in 2013 totaled $30.6 billion by the

comprehensive estimate, which is 6% above that for 2011, and 23% above the 2009 level.

B

y the traditional method, which is the measure most useful for comparison over time, the 2013 economic impact was $23.9 billion, a healthy 10.6% increase from the 2011 level.

The economic impact

of the Healthcare and

Bioscience Industry has

more than doubled in

the past decade.

(4)

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2014 Healthcare & Bioscience Economic Impact Study

The South Texas Veterans

Health Care System (STVHCS)

is one of only five Polytrauma

Rehabilitation Center sites

nationwide.

(5)

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IMPACT ON THE WORKFORCE

Nearly one in six San Antonio employees

works in healthcare and bioscience.

I

n 2013, a total of 146,190 San Antonians were employed

in the portion of the Healthcare and Bioscience Industry represented in the traditional data. This represents nearly one-sixth of the total San Antonio civilian workforce. The comprehensive total of 164,537 includes more than 18,000 uniformed military personnel and employees of the UT Health Science Center who are not counted in the Texas Workforce Commission (TWC) employment data, so the share of the total regional workforce employed in healthcare and bioscience is likely in excess of 18%.

U

sing the comprehensive estimates, 68% of these employees were involved in the direct provision of health and medical services; the remaining 32% were employed in related industries.

C

onsidering the traditional estimates for a comparison over time, the 146,190 employees in the narrower definition of the industry represent a 5.6% increase over the 2011 level, and a 15.4% increase since 2009. The industry generated 7,761 net new jobs since 2011.

L

ooking at the decade as a whole, the industry added 41,567 net new jobs, an increase of 40%. Employment in Related Industries and Services both grew at the same (40%) rate, demonstrating balanced growth over the period.

The Healthcare and Bioscience

Industry generated over 41,000

net new jobs in the last decade.

(6)

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San Antonio has been the “Home of

Army Medicine” since 1947 and is

now the “Home of Military Medicine”

with the Medical Education & Training

Campus (METC), which along with the

Army Medical Department Center &

School, annually train more healthcare

professionals than any organization in

the world.

(7)

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he total annual payroll in healthcare and bioscience (by the comprehensive estimate) was $7.6 billion in 2013, an 18% increase over 2009. Looking at the traditional definition of the industry, payroll grew by 73% over the decade.

A GROWING ANNUAL PAYROLL

Payroll in the Healthcare and

Bioscience Industry grew 73%

over the past decade.

(8)

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T

his margin of difference has persisted over at least two decades, though it is more pronounced when the highly-paid faculty at the UT Health Science Center and the military medical installations are added to derive the comprehensive estimates. Still, even by the traditional estimates, salaries in the industry have stayed well above the San Antonio average.

SALARIES ABOVE AVERAGE

T

hese figures include only direct wage payments. Total compensation, which includes benefits, would be considerably higher.

I

n interpreting these averages, it is important to note that employees in the healthcare and bioscience sector include not only well-paid healthcare providers and scientists but also support staff of various types. Also, since the employment figures include both full-time and part-time employees, the average salary reported here is no doubt lower than that received by a typical full-time employee.

U

sing the comprehensive estimates, individuals employed in the Healthcare and Bioscience Industry earned, on average, $46,333 in 2013. This is almost 7% above the 2013 average of $43,450 for all workers in San Antonio.

A

nnual incomes of workers in the Health Services sector averaged $48,467. The average salary for the Related Industries sector was $41,751.

Healthcare and bioscience

salaries were nearly 7%

above the average annual

salary for San Antonio.

(9)

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The Defense Medical

Readiness Training Institute

is a unique DoD command

conducting joint medical

readiness training in trauma,

burn care, disaster

preparedness, humanitarian

assistance, and CBRNE

preparation/response.

(10)

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IMPACT OF HEALTH SERVICES

& RELATED INDUSTRIES

T

he overall size or impact of the Health Services sector has always been larger than the Related Industries sector, and that difference remains when the comprehensive definition of the industry is used. Health Services represent about

56% of the total economic impact of the industry in San Antonio, but both sectors have experienced healthy growth in the past two decades, more than doubling since 2003 and more than quadrupling since 1993.

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2014 Healthcare & Bioscience Economic Impact Study San Antonio, Texas

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The Healthcare and Bioscience Industry

is both large and diverse. It includes a

wide variety of direct healthcare services,

as well as industries related to the provision

of health and medical care.

(11)

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HEALTH SERVICES

In 10 years, the economic

impact of hospitals has

increased by 130% and

that of physicians has

jumped by 95%.

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ithin this sector, there are five major groups: hospitals; physicians; ambulatory and other services, including laboratories; nursing and home health services providers; and other providers

of health services (dentists, therapists, optometrists, chiropractors and others). In San Antonio, this sector includes both civilian and military medicine, a Veterans Administration medical center

and a variety of governmental, for-profit and non-profit operations and facilities.

P

hysicians and hospitals, the two largest provider groups, have consistently made

a substantial contribution to the San Antonio economy. This remains the case when the comprehensive definition of the industry is used.

Includes a wide range of

healthcare professionals and

businesses providing direct

care to patients.

(12)

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RELATED INDUSTRIES

Incorporates a variety of entities that

support and complement the direct

provision of healthcare services.

T

hese industry sectors include health insurance carriers, pharmaceutical companies, medical equipment producers and manufacturers, civilian and military medical education, biomedical research organizations, residential care and social service providers, and a variety of related endeavors.

T

he Education and Research sector is buoyed considerably by the inclusion in the comprehensive estimate of more than 18,000 UT Health Science Center San Antonio and military medical training employees absent from the TWC data used for the traditional estimates.

O

ver time, both the Insurance and the Social Services/Residential Care sectors have shown steady growth. This reflects rising healthcare costs over the period as well as San Antonio’s population growth.

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1 of 6 BSL4 maximum

containment labs nationwide is

at the Texas Biomedical Research

Institute in San Antonio. Here,

scientists conduct many of the

nation’s vaccine and therapy

studies for deadly emerging viral

threats such as Ebola virus.

In 2013, San Antonio’s

major biomedical research

institutions were awarded

more than $325 million in

external research grants.

(14)

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1805

Hospital established at the

Alamo as a military hospital

for Mexican troops

1853

Bexar County Medical Society

chartered

1869

San Antonio’s first private hospital,

now known as CHRISTUS Santa

Rosa Health System, opens as

Santa Rosa Infirmary

1873

Dr. Josephine Kingsley

becomes the first woman

physician in San Antonio

1879

Temporary wooden 12-bed

hospital built at Ft. Sam Houston

1892

Mental health hospital, today

known as the San Antonio

State Hospital, opens

1903

Physicians’ and

Surgeons’ Hospital, now Baptist

Health System, established in

downtown San Antonio

1912

Bexar County Tuberculosis

Sanatorium founded

1916

City of San Antonio and Bexar

County sponsor the Robert B.

Green Memorial Hospital

1918

Santa Rosa becomes the first

hospital in Texas to devote a

separate unit for the care of

crippled children

1930

The first “medical mall” in the

U.S., now known as the Nix

Medical Center, opens

1931

Sisters of Charity of the Incarnate

Word establish a nursing

school, today known as the Ila

Faye Miller School of Nursing

and Health Professions

1938

Hospital opened on Ft. Sam

Houston, later named Brooke

General Hospital in 1942

1938

DPT Laboratories, then known

as Texas Pharmacal Company,

opens as the first dermatology

company in the U.S.

1941

Texas Biomedical Research

Institute, formerly known as

the Foundation of Applied

Research, and then Southwest

Foundation for Biomedical

Research created as a non-profit

institution

1946

U.S. Army Medical Field

Service School transfers to Ft.

Sam Houston

1946

Mission Pharmacal founded;

its first product, IROMIN,

increases hemoglobin content

in blood

1947

Community leaders create the

San Antonio Medical Foundation

1947

U.S. Army establishes the

Institute for Surgical Research

at Ft. Sam Houston

1947

Thomas Slick, Jr. establishes the

Southwest Research Institute,

providing contract research

and development services to

government and industrial clients

1959

Legislation passed to found

The University of Texas Health

Science Center at San Antonio

1959

CHRISTUS Santa Rosa Children’s

Hospital dedicated

1963

Methodist Hospital opens as

the first hospital in the South

Texas Medical Center

1966

Center for Health Care Services

is established

1969

The South Texas Medical

School is established. This was

a precursor to The University of

Texas Health Science Center at

San Antonio

1969

Bexar County Teaching

Hospital (now University

Hospital) dedicated

1969

School of Nursing begins

educating students at the UT

Health Science Center

1973

Audie L. Murphy Memorial VA

Hospital founded

HISTORY OF HEALTHCARE &

BIOSCIENCE IN SAN ANTONIO

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1974

Cancer Therapy and Research

Center created

1976

Kinetic Concepts (KCI) founded

with initial focus on products

like hospital beds

1979

Twenty community physicians

collaborate to build Southwest

General Hospital

1985

Stent patented by UT Health

Science Center physician Dr.

Julio Palmaz

1991

Institute of Drug Development

created for oncology clinical trials

1993

OsteoBiologics bone technology

spinoff started

1994

ILEX Oncology becomes San

Antonio’s first biopharmaceutical

company

1955

Bexar County voters

overwhelmingly approve

establishment of the Bexar

County Hospital District

1996

KCI introduces portable wound

vacuum technology

1996

San Antonio Chamber of

Commerce Health Care and

Bioscience Committee survey

implemented

1998

Methodist Healthcare opens the

Methodist Children’s Hospital,

the first hospital designed and

built in San Antonio specifically

for children.

2005

Base Realignment and Closure

Commission consolidates

medical training on Ft. Sam

2004

Feik School of Pharmacy

founded at the University of

the Incarnate Word

2004

ILEX acquired for $1 billion by

Genzyme Corp.

2005

OsteoBiologics acquired

for $72.3 million by

Smith&Nephew

2005

BioMed SA created as an

industry cluster organization

2009

Medtronic chooses

San Antonio as home of Diabetes

Therapy Management &

Education Center

2011

KCI purchased for $6.1 billion

by Apax Partners

2011

Vision Works/HVHC

announces national headquarters

move to San Antonio

2011

BRAC established

the San Antonio Military Medical

Center as the hospital component

of Brooke Army Medical Center

Command

2012

U.S. Navy Medical Education &

Training consolidated to San

Antonio

2012

CHRISTUS Santa Rosa Health

System opens the city’s first and

only free-standing children’s

hospital

2013

All U.S. Army and Air Force

healthcare delivery integrated

into one of the Department of

Defense’s six enhanced

multi-service health systems, one of

which is located in San Antonio

2014

1 million-square-foot

Sky Tower opens at University

Hospital, doubling the size of

the campus

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NAICS CODES & OTHER SOURCES

Health Services

Physicians

62111 Offices of physicians

Other Healthcare Providers

62121 Office of dentists 62131 Offices of chiropractors 62132 Offices of optometrists

62133 Offices of mental health practitioners 62134 Offices of specialty therapists

62139 Offices of all other health practitioners

Nursing Homes/Home Health

62311 Nursing care facilities 62161 Home healthcare services

Hospitals

62211 General medical and surgical hospitals 62221 Psychiatric and substance abuse hospitals 62231 Other hospitals

MTF U. S. Department of Defense inpatient Medical Treatment Facilities – uniformed military (civilian employees included in 62211)

Labs

62151 Medical and diagnostic laboratories

Other Direct Services

62191 Ambulance services

62199 All other ambulatory healthcare services MTF U. S. Department of Defense outpatient Medical

Treatment Facilities – uniformed military (civilian employees included in 62199)

Related Industries

Research & Education

54171 Physical, engineering and biological research UTHSCSA University of Texas Health Science Center at San Antonio

AMEDDC&S Military medical education and training facilities USA MEDCOM Military medical education and training facilities AFMOA Military medical education and training facilities NMETC Military medical education and training facilities MIL RSCH Military Medical Research

Social Services

62142 Outpatient mental health and substance abuse centers 62149 Other outpatient care centers

62321 Residential mental retardation facilities

62322 Residential mental health and substance abuse facilities 6233 Community care facilities for the elderly

62399 Other residential care facilities 62412 Services for the elderly and disabled 62431 Vocational rehabilitation services

Pharmaceuticals

32541 Pharmaceutical and medicine manufacturing 42421 Druggists’ goods merchant wholesalers

Equipment Manufacturing and Wholesaling

33911 Medical equipment and supplies manufacturing 42345 Medical equipment merchant wholesalers 42346 Ophthalmic goods merchant wholesalers

Insurance

524114 Direct health and medical insurance carriers

Miscellaneous

44611 Pharmacies and drug stores 44613 Optical goods stores

44619 Other health and personal care stores 92313 Administration of public health programs

INFORMATION SOURCES

The information for the “traditional” estimates presented here is derived from the Texas Workforce Commission’s Covered Employment and Wages database. The data is aggregated by the TWC into the lines of business defined by the North American Industrial Classification System (NAICS) coding framework. It represents essentially a 100% sample of all the businesses with employees in each NAICS subcode.

The specific subcodes included in this study are listed above. They cover both the healthcare and related industry segments in great detail. The information necessary for the inclusion of the UT Health Science

Center and the military presence in San Antonio’s medical industry was derived from data supplied by these two entities from their own financial reports. Since these data are compiled for a different purpose than that reported to the TWC, using different procedures, the additional contributions attributed to these activities must be understood as approximations. Still, their impact is so great that it would be a significant understatement to exclude them.

Details of the methodology used to create the estimates reported in this study may be found at www.sachamber.org.

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Special Thanks

BENEFACTOR

Methodist Healthcare System

PATRON

San Antonio Medical Foundation

UT Health Science Center

BioMed SA

CORPORATE

Baptist Health System

CHRISTUS Santa Rosa Health System

Mission Pharmacal

FRIEND

Provenir

Texas Biomedical Research Institute

HEALTH CARE & BIOSCIENCE COMMITTEE

Geoffrey Crabtree, Chairman

ECONOMIC IMPACT STUDY COMMITTEE

STAFF

Will Garrett

Trisha Lodde

Tina Luther

Mary Nava

Cory Ramsey

Phil Reidinger

Steve Soliz

Ann Stevens

Mary DeLay, Chairman

Andrew Boardman

Corbett Christie

Mary Garr

Col Michael Higgins

Leni Kirkman

Pam Leissner

San Antonio Chamber of Commerce

602 E. Commerce | San Antonio, TX 78205

(210) 229-2100 | www.sachamber.org