'Prioritize' Privately Insured Patients, Mayo Exec Says

March 17, 2017

Mayo Clinic employees should "prioritize" privately insured patients over those in Medicare and Medicaid when they seek care for similar conditions to "have income at the end of the year," the health system's leader told employees in a speech last year.

The videotaped speech has come under fire in some quarters as conflicting with the famed institution's stated mission of "providing the best care to every patient." Dr Noseworthy's comments perturbed the Minnesota Department of Human Services so much that it is asking the Mayo Clinic a lot of questions about its patient-care policies.

The Star Tribune in Minneapolis, Minnesota, first reported on the speech on March 15, quoting portions taken from a transcript it had obtained.

Mayo Clinic President and CEO John Noseworthy, MD, was quoted as saying that, although the health system would accept all patients, it should "prioritize the commercially insured patients" over the publicly insured in situations when they are referred at the same time for the same problems.

"If we don't grow the commercially insured patients, we won't have income at the end of the year to pay our staff, pay the pensions, and so on," said Dr Noseworthy.

The speech came at the end of 2016, a year in which Mayo earned $475 million, down almost 10% from 2015, according to a financial report posted on its website. Expenses rose faster than revenue, 7.5% versus 6.6%, respectively.

Minnesota is one of 31 states that expanded Medicaid eligibility under the Affordable Care Act. That decision extended Medicaid coverage to an additional 223,000 Minnesotans as of March 2016, according to the Kaiser Family Foundation. Although Medicaid expansion turned self-pay and often charity-care patients into insured patients, the state Medicaid program pays providers such as the Mayo Clinic less than commercial health plans.

Mayo puts the estimated unreimbursed cost of treating Medicaid patients in 2016 at $546 million, up almost 55% since 2013, the year before Medicaid expansion took effect in Minnesota.

Dr Noseworthy said in the videotaped speech last year that a recent 3.7% increase in Medicaid patients represented a "tipping point" in terms of rebalancing Mayo's payer mix, according to the Star Tribune.

Noseworthy on Criticism: "We're Committed to Serving Those Patients"

Dr Noseworthy's directive to prioritize commercially insured patients drew some flak. Mathew Keller, RN, JD, a regulatory and policy nursing specialist at the Minnesota Nurses Association (MNA), blogged on the group's website that the speech "speaks volumes as to the true status of healthcare in America: those with the money get the care they need, those without get something else."

The MNA's Facebook page filled up with harsh remarks about the Mayo Clinic policy. "I think the CEO of Mayo should be ashamed," one person wrote. "I don't think it would pass a legal test. They accept public monies and they cannot discriminate based on income."

That rebuke was the upshot of a letter that Emily Piper, commissioner of the Minnesota Department of Human Services, sent Dr Noseworthy yesterday.

"I am writing to express my dismay" about the Star Tribune story, Piper wrote in a letter released to Medscape Medical News. "It is our expectation that Mayo Clinic will continue to serve public program enrollees in the same manner it serves patients with private insurance."

Her department, she said, will review its various agreements with the Mayo Clinic covering managed care, fee-for-service, and other forms of healthcare delivery and reimbursement. It also is asking the Mayo Clinic to answer detailed questions on how it "plans to continue to meet its obligations under the contracts as well as under state and federal law."

When Medscape Medical News sought a comment from Dr Noseworthy on all the criticism, the Mayo Clinic shared a statement that it attributed to him:

"Patient medical need will always be the primary factor in determining and setting an appointment," Dr Noseworthy said. "In an internal discussion I used the word 'prioritized' and I regret this has caused concerns that Mayo Clinic will not serve patients with government insurance. Nothing could be further from the truth. In fact, about half of the total services we provide are for patients who have government insurance, and we're committed to serving those patients.

"Changing demographics, aging of Americans, and budgetary pressures at state and federal government pose challenges to the fiscal sustainability in healthcare today. While these discussions are uncomfortable, they are critical for us to be able to meet the needs of all of our patients."

A Mayo Clinic spokesperson added that "Minnesota Medicaid patients are and will continue to be scheduled the same as patients with commercial insurance."

Follow Robert Lowes on Twitter @LowesRobert

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