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Mayo Clinic reports revenue of $13.82 billion

Net operating income tops $1 billion for the first time in history.

Gonda Building.jpg
Mayo Clinic reported Tuesday, Feb. 25, that 2019 was "a year of remarkable growth," with revenue swelling to $13.82 billion, up 9.7% from the previous year. The Mayo Clinic’s Gonda Building in downtown Rochester. Forum News Service file photo
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ROCHESTER, Minn. -- Mayo Clinic reported Tuesday, Feb. 25, that 2019 was "a year of remarkable growth," with revenue swelling to $13.82 billion, up 9.7% from the previous year.

The clinic released the independently audited annual financial report Tuesday, along with a separate press release from Mayo Clinic leadership.

Net operating income topped $1 billion for the first time in the clinic's history. That's up from $617 million in 2018, according to this year's report.

"2019 was a year of remarkable growth and reinvestment in Mayo Clinic's mission," President and CEO Dr. Gianrico Farrugia said in the press release.

The introduction of a new accounting standard involving an $89 million "benefit credit" for pension-related expenses means some previously reported 2018 financials have been recalculated in this year's audited report. The $89 million was re-classified from operating income to non-operating, to allow comparability between years.

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Of the total revenue, medical services led the way with $11.6 billion, a 9.3% increase over the previous year.

Medical revenue from contract or traditional insurance payments hit $6.9 billion, up from $6.25 billion.

Payments from Medicare grew to $2.8 billion, up 11.9% from $2.51 billion in 2018. Revenue from "Other, including self-pay" slightly declined to $1.46 billion in 2019 from $1.51 billion from the previous year.

Medicaid payments were $379 million, up from $326 million in 2018. Mayo Clinic reported that the payments from the government for "Medicaid and indigent care programs" did not cover $494 million of the cost for services.

The amount that Mayo Clinic spent on "charity care" grew by 23% to $96 million in 2019, up from $78 million in 2018.

Mayo Clinic’s income from its “diversified sources of revenue,” or for-profit operations, such as Mayo Clinic Labs and Mayo Clinic Ventures, was $1.29 billion, up 8.1% from the re-calculated 2018 financials.

In 2019, Mayo Clinic reported treating more than 1.2 million patients. Overall, the number of patients was up at the three campuses in Rochester, Arizona and Florida.

"... At those destination sites, the number of transplant surgeries grew 12 percent, surgical cases increased 3.6 percent and hospital admissions grew 2.1 percent," Mayo Clinic Spokeswoman Ginger Plumbo said this morning. "Mayo Clinic Health System volumes are down overall. The installation of the Epic electronic medical record gives us a more accurate count for unique patients, eliminating some duplication of records. We're seeing more growth in the number of patients with complex medical needs and slower growth for those seeking less complex care."

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Some of the rural Mayo Clinic Health System sites, such as Waukon, Iowa, and La Crescent, closed in 2019, while others, such as Albert Lea, cut back services. Mayo Clinic did invest $11 million to increase services in Austin to cover patients in the Albert Lea area.

Benefactors donated $549 million to the nonprofit Mayo Clinic in 2019, up from the previous year.

While Mayo Clinic is a nonprofit hospital, the financial report shows it did pay $28 million in "real property/business property taxes" and $24 million in income taxes for the taxable portions of its operations. It also paid $11 million in sales and use taxes.

"Our strong performance in 2019, financially and in patient care, research, and educating the next generation of health care providers, positions us well for the important work that lies ahead," said Jeff Bolton, Mayo Clinic's chief administrative officer.

Related Topics: HEALTHNEWSMDMAYO CLINIC
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