A regional hospital has implemented a coordinated care program for people with diabetes, heart disease, and obesity. The program has resulted in reduced re-admissions among patients enrolled in the program as compared to others not enrolled. The hospital has identified annual costs savings exceeding $5 million over the 5 year life of the program.
How would I use IMPLAN to model the annual impacts of these cost savings?
There are a few considerations here. Modeling this $5M savings over 5 years would actually be a negative in the economy as $5M less was actually spent.
You could consider a net analysis which looks at the effects resulting from a change in production or spending in the economy, both the positive and negative. Think through what type of hospital this is and what they might have done with the savings. Were those funds given out to shareholders, kept in the bank, or invested in another hospital program? Also, where the funding for the hospital comes from has implications as well. A county funded hospital could save the county money, but that money might be invested in other county programs like street repair, child care, etc.
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