Published April 21 2012
Diverson Discussion: Businesses describe economic impact of flooding
But a disaster that hurts the likes of Microsoft, Sanford Health or Blue Cross Blue Shield would also harm the rest of the metro, affecting thousands of local employees and small businesses and likely dampening the area’s vibrant economy.
Executives from the three companies testified about that prospect Thursday in front of the North Dakota Legislature’s Water-Related Topics Overview Committee.
The board had gathered in Fargo to learn more about the proposed Red River diversion and other flood protection efforts.
The testimony from those business leaders helped showcase how harmful a disaster – or even continuous flood fights – could be for Fargo-Moorhead’s economy.
While none of the three executives advocated for a specific solution, each stressed the need for permanent flood protection for the metro area.
Sanford, one of the valley’s primary health care providers, operates its main hospital in downtown Fargo, less than a half-mile from the Red River.
The medical center is one of two teaching hospitals Sanford runs in the Midwest. The site is also home to a major trauma center and the Roger Maris Cancer Center, facilities that draw tens of thousands of regional patients a year.
“Sanford Health has a huge responsibility for the health and welfare of the people in this region,” Sanford Health President and CEO Dennis Millirons told state lawmakers.
Under the threat of a historic flood, Sanford – then MeritCare hospital – was temporarily evacuated in 2009, which cost
But that’s far short of the cost Sanford Health would face if a flood overtakes downtown.
“It would destroy infrastructure at the facility and would require replacement of electrical, medical and other critical systems,” Millirons said, adding that Sanford’s operations would be down potentially for months.
Such a crippling disaster would force patients to seek treatment elsewhere, requiring them to travel long distances and diminishing access to quality local care, since other F-M medical facilities couldn’t accommodate all of Sanford’s patients, Millirons said.
For example, flood damage to the hospital’s radiation equipment would close the Roger Maris Cancer Center for at least a year, while the specially made equipment is replaced.
That alone would send cancer patients across the country to receive vital radiation therapy, Millirons said.
“While Sanford Health does not express a preference – we leave that to the experts and elected officials – we simply believe it’s vital to have flood control because some day a devastating flood could happen,” Millirons said.
Microsoft’s Fargo campus employs 1,650 people, but with new growth and investment in the region, the computer giant aims to eventually employ as many as 2,700 people.
Don Morton, Microsoft’s site leader here, told lawmakers that the Microsoft campus can handle itself against flood fights, but the ripple effects of such natural disasters still affect the company’s productivity in Fargo.
As one of Microsoft’s main stateside sites, Fargo’s campus handles a lot of high-priority tasks for the corporation, including biweekly payroll for Microsoft’s 52,000 employees in the Americas.
Microsoft’s Fargo site closed down for 10 days during the 2009 flood, so its employees could join the community in the fight, but Morton said “it’s just not something we need to go through year after year after year.”
Microsoft’s top executives want to continue investing in Fargo-Moorhead but perpetual flood fights could hinder that, Morton said.
Microsoft’s active presence here has a positive impact on dozens of other local businesses, including car rental companies, hotels and restaurants, Morton said.
“If you just take Microsoft employees that travel to Fargo – mostly from Seattle – each year, they will spend way north of $100,000 just on rental cars,” Morton said. “The direct economic impact in flooding can be seen in those numbers.”
BLUE CROSS BLUE SHIELD
Aside from being North Dakota’s largest health insurer, Fargo-based Blue Cross Blue Shield also has a major role in paying out Medicare and Medicaid claims nationwide.
Locally, BCBS pays out
$1 billion in health care claims each year just in North Dakota, President and CEO Paul Von Ebers told state lawmakers.
In order to accomplish that, the company has to process claims efficiently and on time, otherwise it can negatively affect health care facilities across the state and thousands of patients who need their services paid for, Von Ebers said.
BCBS – which employs 2,000 people – also manages Medicare in 18 states, as well as the Medicaid programs in Iowa and Louisiana.
“Our biggest customer is actually the federal government in Baltimore,” Von Ebers said. “Every time we have a flood event in Fargo, they’re on the phone calling us to make sure we’re going to be OK” and that the claims can still be taken care of.
BSBS currently has three bids out take on more administrative work for Medicare nationwide.
“Each bid is worth about $100 billion in revenue flowing into the state and could create literally hundreds of jobs in the state,” Von Ebers said. “It’s extremely important to us, able to say, ‘Yes, we have flood-protected facilities.' "
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