Mass. Health Industry Worries About Federal Cuts

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(CarbonNYC/Flickr)
(CarbonNYC/Flickr)

There is cautious reaction in Massachusetts to the debt deal finalized in Washington Tuesday.

In the short-term, the deal preserves much of the federal money the state relies on for entitlement programs. But it’s not clear what happens in the long-term — especially for the Boston-area’s key medical and scientific research industries.

Massachusetts receives more federal scientific research money per capita than any other state in the country — most of it from the National Institutes of Health, or NIH. Susan Windham-Bannister, president and CEO of the Massachusetts Life Sciences Center, says the state will likely be hit hard.

“When we look at dollars for major research programs and these dollars come from NIH, for example, it is likely that Massachusetts will experience a disproportionately negative share, because we have received a disproportionately positive benefit,” Windham-Bannister said.

Last year, the state received $2.4 billion from NIH for research. About half of that went to the teaching hospitals.

The five largest teaching hospital recipients of federal research dollars are in Boston, according to John Erwin, the executive director of the Conference of Boston Teaching hospitals. They include Massachusetts General Hospital, Brigham and Women’s, Children’s Hospital, the Dana Farber Cancer Institute and Beth Israel Deaconess Medical Center.

“That’s something we should be proud of,” Erwin said. “It shows that our researchers are putting forth proposals that, after peer review at NIH, are getting funding and it’s anchoring the entire life sciences industry here in Massachusetts.”

Massachusetts receives more federal scientific research money per capita than any other state in the country.

In fiscal year 2007, Erwin said, NIH-funded research created more than 20,000 new jobs in Massachusetts, with wages totaling more than $1 billion.

At Tufts Medical Center, research-related work alone employs about 400 people, according to Dick Karas, the hospital’s interim chief scientific officer.

“When you multiply that by all of the major academic centers in just the city of Boston alone, you can get a very clear picture that this is a very important part of the economy here,” Karas said.

Karas, Erwin and Windham-Bannister all say they’re talking with their colleagues and reaching out to state and federal lawmakers to lobby to preserve research funding. But state Administration and Finance Secretary Jay Gonzalez says the state is not in much of a position to help.

“Our capacity to put resources into places where the federal government is taking resources away is going to be very limited,” Gonzalez said. “What we’re going to be doing as we learn more about where those cuts will be hitting is to take a step back and a fresh look at whether there is any role for the state in terms of stepping in. But I think being realistic about our capacity is also important.”

Gonzalez says his office has not estimated the total amount Massachusetts stands to lose in federal cuts but some economists predict $400 million less next year and hundreds of millions less when the cuts are phased in over the next decade.

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