The non-profit Mayo Clinic has reported that it built on its solid 2009 financial performance to end 2010 in a position of financial strength by holding expenses at a 2.5 percent increase while growing revenue by 4.7 percent.
The clinic’s net operating income for 2010 was $515 million – a 6.5 percent operating margin. Practice income grew by $64 million to $538 million, and the clinic’s investments had a return of 11.5 percent. Gifts from benefactors totaled $359 million. Research programs brought in $343 million in external funding.
[See related stories: Mayo Clinic has $22B economic impact; Mayo Clinic's debt rating improves]
“For the last two years, we have focused significantly on expense management, controlled growth in staffing and practice redesign by eliminating waste and overutilization,” said Jeff Bolton, the clinic’s chief financial officer, in a statement. “These efforts have significantly improved our operational effectiveness, and we continue to work to reduce the cost structure for delivering our services.”
Looking forward, the clinic plans on investing in capital projects, including multi-million dollar expansions and improvements to existing facilities. They include:
- A 10,400-square-foot expansion and renovation of the emergency department at Saint Marys Hospital in Rochester, at a cost of $25.8 million;
- A 118,000-square-foot expansion of Mary Brigh East, at a cost of $33 million;
- $28 million worth of improvements, including the addition of a 85,600-square-foot building, to Austin Medical Center; and
- An 18,000-square-foot expansion to the emergency services building at its Barron, Wis., campus, at a cost of $6.9 million.
“We know that we need to continue to manage expenses, even as we make necessary investment in capital projects and programs that are essential to providing the best care for our patients,” said John Noseworthy, MD, president and chief executive officer of the clinic, in a statement. “After two years of constrained capital spending. Mayo Clinic will begin to make necessary investments to ensure that we continue to deliver an unparalleled patient experience.”