Mayo Clinic reports $9.5B revenue in first 9 months of 2018
- Mayo Clinic saw its operating income rise 32% in the first nine months of 2018 — to $601 million versus $455 million in the same period last year. That was after expenses of $8.8 billion, up from $8.4 billion a year ago.
- Revenue was $9.5 billion, compared with $8.8 billion in the January to October stretch of 2017, buoyed by a 7% increase in medical service revenue, according to consolidated financial statements released Friday.
- The Rochester, Minnesota-based health system has about $1.6 billion committed to various construction and expansion projects that are slated for completion over the next three to five years, as well as $217 million to complete an overhaul of an EHR system rolled out this year.
It's been a good nine months for Mayo Clinic. The system's capital investment efforts come as many nonprofit health systems are downgrading facilities and divesting assets to offset higher operating costs and a slowdown in revenue growth fueled by lower reimbursements and a shift to more care in outpatient settings.
During the third quarter of 2018, Fitch Ratings upgraded the security rating of 11 nonprofit hospitals and health systems and downgraded 11. Among the downgrades were Dignity Health and MedStar Health, each of which dropped from A to A-.
Mayo has about $908 million in construction projects underway related to patient care, research and education, with completion anticipated between 2021 and 2023. The health system is also bankrolling a $648 million expansion of its Phoenix campus. The five-year investment includes new clinical space, support services and infrastructure, with the expectation of 2,000 new jobs, including 200 physicians.
Mayo is also on track to complete the transition to a $1.5 billion Epic EHR system. The new system is replacing Mayo's three previous EHRs, enabling patients and providers to access a single system. Mayo began working with Epic to create a sole EHR system in 2015 and began transferring records to the new EHR in July.
The health system has other projects in the works as well. Last month, Mayo teamed up with medical devicemaker Baxter International to launch a renal care center at its Jacksonville, Florida, campus. The outpatient clinic will operate within the Mayo Clinic Dialysis Center and incorporate Baxter's clinical service model and chronic kidney disease management program.
- Becker’s Hospital CFO Report Mayo Clinic’s operating income climbs 32%