Ris­ing costs con­trib­ute to lower sur­plus at Mayo

Modern Healthcare - - REGIONAL NEWS - —Beth Kutscher

The Mayo Clinic, which dili­gently cut ex­penses over the past year, started to see those costs creep up again in the first quar­ter of 2015.

The Rochester, Minn.-based sys­tem re­ported in­creases in salaries and benefits as well as sup­ply costs that off­set a 5.7% gain in rev­enue for the pe­riod ended March 31. Salaries and benefits rose 7%, while sup­ply costs jumped 16.2% at the 24-hos­pi­tal group.

Mayo did not break out op­er­at­ing statis­tics, such as pa­tient vol­ume, in its fi­nan­cial fil­ing.

Over the past year, Mayo has made a num­ber of moves to curb ex­penses. It elim­i­nated nearly 200 med­i­cal tran­scrip­tion­ist po­si­tions, in­stead opt­ing to out­source the depart­ment. It also be­gan of­fer­ing scaled-down health benefits with more cost-shar­ing for em­ploy­ees.

Still, the sys­tem re­ported a de­crease in its op­er­at­ing sur­plus in the first quar­ter, which fell to $88 mil­lion from $155 mil­lion in the same pe­riod last year. Rev­enue rose to $2.5 bil­lion from $2.4 bil­lion in the year-ago pe­riod.

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