Mayo Clinic wrote off nearly $90 million in unpaid patient bills after changing how it determines eligibility for financial assistance, a step that consumer advocates are urging more hospitals to take as patients’ concerns grow over medical debt.
It’s part of an emerging trend where some medical centers, pushed at times by state laws, are adopting or expanding what’s called “presumptive eligibility” with charity care programs. It can be an alternative to waiting for patients to complete applications for financial aid that some find confusing and difficult to navigate.
Mayo disclosed the new approach, as well as the sizable write-off, in a tax filing released this week to the Minnesota Star Tribune.
The $90 million write-off includes multiple years of debt and goes beyond the $37.8 million in hospital charity care provided last year, according to the filing. That was an increase of about 5% compared with 2022. The debt forgiveness was applied in 2023.
The change comes as Mayo and other large medical centers have been facing increased questioning over whether they provide enough charity care and other community benefits to justify the large tax exemptions they receive as nonprofit groups. The clinic denies any connection, saying it “made this change in 2023 to further benefit patients in financial need.”
“Mayo provides hundreds of millions of dollars in community benefit every year through our investments in research and education, cash and in-kind contributions to the community ... and the cost of uncompensated care provided to Medicaid patients,” a statement from the clinic said. “We are pleased that we are able to increase the amount of charity care given to our patients, but even without this increase, the magnitude of our community benefit fully supports our tax-exempt status.”
Mayo’s financial-assistance program offers discounted or even free care to qualifying patients at certain income levels. To help make determinations, the clinic says it’s now using an independent third-party vendor to provide scoring based on publicly available data to assess where patients stand relative to federal poverty guidelines.
Mayo’s tax forms did not say how many patients benefited from the debt forgiveness, or where they live. The mention of the new system came in a public tax filing that covers Mayo operations not just in Minnesota, but also Arizona, Florida, Iowa and Wisconsin.