The Association of American Medical Colleges recently issued a report that underscores the financial contributions of medical schools and teaching hospitals to their local economies.

The association looked at 125 accredited medical schools and more than 400 major teaching hospitals in the United States, and calculated a total economic impact of $35.5 billion in California and $451 billion in the United States.

To accompany the report, the UC Davis Health System compiled some numbers of its own. For example, the medical center paid out $465 million in wages and benefits to its approximately 7,000 employees in 2006.

Other key financial figures:

• $262 million in purchased goods and services for the medical center, with 80 percent of those goods and services coming from local vendors or local branches of national companies.
• $74 million for medical center capital expenditures and construction.
• $121 million in research grants and contracts.

"We're proud to play such a major role in the local economy and community development," said Ann Madden Rice, the medical center's chief executive officer. "Our mission is to improve health, foster economic development and broaden educational opportunities. All of those goals play a major role in stimulating and adding to the economy."

To figure economic impact, the Association of American Medical Colleges looked at direct and indirect factors, including institutional spending, employee spending, and spending by patients, their families and visitors, but excluding expenditures for medical services. According to the study, every dollar spent by a medical school or teaching hospital generates an additional $1.30 when "respent."

The UC Davis Health System, with 10,000 employees at the medical center, medical group and School of Medicine, estimates its economic impact in the Sacramento region at about $1.5 billion annually, based on multipliers used in a 2004 UC Davis Economic Impact Study.

-- Charles Casey and David Ong, UC Davis Health System