The Mayo Clinic in Rochester has held the top spot on the U.S. News and World Report hospital rankings for the past two
years, despite the closure of community hospitals that negatively impact rural Minnesota
towns.
Citing staff shortages, reduced inpatient censuses and ongoing financial challenges, Mayo decided to move all inpatient services from the hospital in Albert Lea, Minnesota, including labor and delivery, to a town more than 20 miles away. In response to pleas for reconsideration, Mayo Clinic Vice President Bobby Gastout callously remarked that 23 miles is not ideal — but “people are driving 23 miles to get their favorite ice cream.”
A grassroots group, Save Our Hospital, galvanized the community by answering “we like our ice cream and
inpatient care in Albert Lea.”
So how will our country, from the Midwest to here in
Kitsap County, ensure health care access doesn't continue to come second to
profits?
Price transparency must be mandatory at non-profit
hospitals if runaway healthcare costs are to be contained. Behemoth
institutions are decimating rural areas after a decade-long buying
spree. A study in Health Affairs magazine found nearly half of rural counties in the
United States are without hospital-based OB services, a change affecting more
than 2.4 million women. According to the University of North Carolina's Center
for Health Services Research, 83 rural hospitals have closed since 2010. Hospital systems complain they are crumbling under the
weight of lower reimbursements, rising bad debt from high-deductible plans, and
dwindling admissions.
However, communities are entitled to see the proof in the
pudding.
While touting $13 million in losses over two years as the central force behind the closure decision,
in reality, Mayo misrepresented their facts and figures according to tax
returns posted by ProPublica. Dr. Mark Ciota, CEO of MCHS-Albert Lea, reported the hospital lost $4.6
million in 2015, but the nonprofit's IRS 990 form showed a net income of $2.56
million. In 2016, the Albert Lea hospital projected a loss of $8 million,
though residents eagerly awaited release of Mayo's tax returns to separate fact
from fiction. Mayo conveniently overhauled its tax reporting process and
filed a group return, a format which obscured financial performance of
individual campuses, including Albert Lea. Allen Baumgarten, a Minneapolis-based
independent healthcare analyst, utilizes public records to calculate hospital
profits and losses — he estimates the Austin-Albert Lea campus generated a net income of $1.2 million in
2016.
Earlier this year, Dr. John Noseworthy, CEO of Mayo
Clinic, feigned financial woes, complaining Mayo had to “prioritize commercially insured patients” over
those on Medicaid and Medicare in the interest of long-term survival. Yet they
had no reservations investing in the Destination Medical Center Project, a 20-year, $5.6
billion economic development initiative which will position Rochester (actually
Mayo) as a global center to provide high-quality medical care to the wealthy
across the world. Astonishingly, third quarter earnings show Mayo
operating income more than doubled from $86 million to $182 million, with total revenue increasing 9 percent,
from $2.72 billion to $2.97 billion. In 2016, international investment
income was $2.7 billion, while close competitors, Cleveland Clinic and Johns
Hopkins, produced less than half that amount.
Mayo benefits handsomely from public tax revenue while
exempted from paying city, state, or federal taxes in exchange for “improving”
healthcare access for struggling communities. While no one is questioning
legality of these investments, ethically the loss of rural hospitals is
hard to reconcile when Mayo pours $1.34 billion into offshore tax
havens to reduce their tax liability.
Ice cream may melt on a 23-mile drive, but ill and
injured people may actually die traveling that same distance. Movements
like “Save Our Hospital” are garnering national attention with good reason, as
they are David bravely taking on Goliath.
To ensure access in rural communities, non-profit
hospital institutions should provide transparent pricing to patients and share
financial performance data with communities. Benjamin Disraeli said, “there are
three types of lies – lies, damn lies, and statistics.” Mayo has fractured
trust by misrepresenting operating losses in Albert Lea to justify hospital
closure, Dr. Noseworthy condoned prioritizing patients based on their
pocketbooks while third quarter earnings went through the roof, and hospital
leadership condescendingly compared driving 23 miles in labor as being
equivalent to buying ice cream.
Places like Mayo are systematically dismantling rural
care facilities without accountability for the generous tax exemptions they
receive. The loss of one more rural hospital this year will be a loss for
the entire nation. The battle for affordable,
accessible, and high-quality health care is one worth fighting. Rural
health care is far more important than ice cream.