Dayton concerned by Mayo Clinic favoring privately insured patients

The Mayo Clinic's Gonda Building
A new Mayo Clinic policy in some cases gives priority to privately insured patients over people on public programs.
Alex Kolyer for MPR News 2016

Updated: 4:57 p.m. | Posted: 3:50 p.m.

Gov. Mark Dayton and Lt. Gov. Tina Smith both expressed concern Friday about a Mayo Clinic policy that in some cases gives priority to privately insured patients over people on public programs.

Both officials expressed support for the Department of Human Services' review of the policy. DHS Commissioner Emily Piper has said she will investigate whether Mayo's plans violate civil- or human-rights laws.

"It really astonished me. It's so contrary to what I know about Mayo," said Dayton, who recently received treatment for prostate cancer at Mayo.

The Human Services Department is also reviewing contracts the state has with the clinic.

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The department sent Mayo leadership a letter on Friday with list of detailed questions to find out how widespread the practice is and whether the policy has had negative impacts on patients. It seeks a response from the clinic within two weeks.

Mayo said Friday that about half the clinic's service is to patients with government insurance, and they're committed to serving those patients.

The clinic said it needs more privately insured patients to keep subsidizing patients whose insurance doesn't cover their cost of care.

Smith chairs the board of the Destination Medical Center, a 20-year, multibillion dollar economic development effort to remake downtown Rochester and attract top talent and more patients to Mayo Clinic.

She would not say whether Mayo's policy would affect state support for the Destination Medical Center.

"We need to look into exactly what Mayo is doing," Smith said. "It is unacceptable that an organization that is benefiting so greatly from the strength of Minnesota, they also need to accept their responsibilities for treating everybody in Minnesota."

In a series of statements over the course of the week Mayo officials have emphasized they've provided health services worth over $2 billion to Medicaid, Medicare and uninsured patients that were unreimbursed.

On Friday, Mayo Clinic CEO Dr. John Noseworthy softened his language. He said he regrets using the word "prioritize" in the video, and that concerns that Mayo will not serve patients with government insurance couldn't be "further from the truth."

The statement also said that Minnesota Medicaid patients are and will continue to be scheduled the same as patients with commercial insurance.

Asked whether Mayo was rolling back the policy Noseworthy outlined, a spokeswoman emailed, "Minnesota Medicaid patients have always been, and will continue to, have the same access as patients with commercial insurance."

There's little dispute that government programs don't pay as well as private insurance. Dayton is asking the Legislature to boost the Medicaid reimbursement rate by 5 percent.

Still, it is unusual for a high ranking hospital official to speak widely about the issue, in this case, to Mayo's 30,000 plus employees.

The effect of reimbursement rates for government programs has gotten more complex since the adoption of the Affordable Care Act. Like many states, Minnesota expanded the number of people who are on Medicaid, and meanwhile, baby boomers are aging into Medicare.

That means lots of hospitals are seeing more publicly insured patients. On the other hand, research suggests hospitals in states with Medicaid expansions are getting stiffed less because more people have insurance.