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California physicians boost the state’s economy



January 07, 2018
Area(s) of Interest: Public Health Physician Leadership Quality of Care 

Physicians add opportunity, growth and prosperity to the California economy by creating 1.2 million jobs and generating $232 billion in economic activity, according to a new report, The Economic Impact of Physicians in California, released today by the California Medical Association (CMA) and the American Medical Association (AMA).

“California’s physicians do more than diagnose, cure or heal – they go beyond patient care by providing millions of good paying jobs and generate billions in tax revenues and economic activity,” said CMA President Theodore M. Mazer, M.D. “Today’s report illustrates why tackling our state’s physician shortage and supporting graduate medical education are so critical. The data is clear: more physicians will help keep our state’s health and economy strong.”

The study quantifies the economic boost that 89,933 active patient care physicians provide to the state’s economy, producing a ripple effect that is felt statewide. The study measures physicians’ impact using four key economic indicators:

  • Jobs: Physicians support 1.2 million jobs in California – an average of 13.3 jobs for each physician.
  • Economic activity: Physicians generate $232 billion in economic output, 9.3 percent of the state’s economy. Each physician generates an average of $2.6 million for the state economy.
  • Wages and benefits: Physicians contribute $135.3 billion in total wages and benefits paid to workers, empowering a high-quality, sustainable workforce. Each physician contributes, on average, $1.5 million to workers’ wages and benefits.
  • State and local tax revenue: Physicians’ contribution to the California economy generates $11.2 billion in state and local tax revenue for their communities – translating to $124,752 for each physician on average – enabling community investments.

“The positive impact of physicians extends beyond safeguarding the health and welfare of their patients,” said AMA President David O. Barbe, M.D., MHA. “The study illustrates that physicians are woven into their local communities and have a vital role in fueling state economies by creating jobs, purchasing goods and services, and supporting public services through the tax revenue they generate.”

The report found that every $1 applied to physician services in California supports an additional $2.16 in other business activity. An additional 7.13 jobs, above and beyond the clinical and administrative personnel that work inside physicians’ practices, are supported for each $1 million of revenue generated by physicians.

Across the country, physicians add $2.3 trillion to the U.S. economy, support more than 12.6 million jobs nationwide, contribute $1 trillion in total wages and benefits paid to U.S. workers, and generate $92.9 billion in state and local tax revenue. To view the full report and an interactive map, please visit www.PhysiciansEconomicImpact.org.

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The California Medical Association represents the state’s physicians with more than 43,000 members in all modes of practice and specialties. CMA is dedicated to the health of all patients in California. For more information, please visit cmadocs.org, and follow CMA on FacebookTwitterLinkedIn and Instagram.

The American Medical Association is the premier national organization providing timely, essential resources to empower physicians, residents and medical students to succeed at every phase of their medical lives. Physicians have entrusted the AMA to advance the art and science of medicine and the betterment of public health on behalf of patients for more than 170 years. For more information, visit ama-assn.org.

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