Mayo Clinic Filing Details Coronavirus Impact and Response
Rochester, MN (KROC-AM News) - The Mayo Clinic estimates the pay reductions, employee furloughs, and other measures implemented in response to the financial impact of the coronavirus pandemic have reduced the organization’s 2020 expenses by about $1.2 billion.
A voluntary public disclosure that has been filed with the Electronic Municipal Market Access website provides a narrative of the COVID-19 impact on the Mayo Clinic's finances and its response to the crisis. The narrative indicates Mayo initially projected a $3 billion loss in revenue for 2020. The filing also indicates the Rochester-based health care giant entered the pandemic crisis in a strong financial position with over $10.5 billion in cash and investments. Of that, about $8.5 billion was either unrestricted or only temporarily restricted.
Mayo also states that it held about $1.5 million in cash and short-term investments as institutional liquidity reserves. Since the end of March, the Mayo Clinic has also received about $150 million in federal funding through the CARES Act and approximately $900 million dollars in advance Medicare payments. In addition, Mayo has secured a $100 million loan and is preparing to close on another $300 million in loans, while also increasing its lines of credit by $200 million.
The cost reduction steps previously announced by the Mayo Clinic included pay reductions ranging from 7 to 20 percent, extended furloughs, temporary benefit reductions, a hiring freeze, and elimination of most contracted services. The filing also says Mayo has canceled or delayed a significant portion of the building and other capital expenditures planned for this year.
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