Mayo Clinic income dropped by 50%, to $595 million in 2022

ROCHESTER – While it fared better than most of its peers, Mayo Clinic reported its operating income plummeted by 50% from 2021 to 2022, going from $1.2 billion to $595 million.

That operating income level is 18% lower than the $727 million operating income that Mayo Clinic posted during the first pandemic year of 2020.

The consolidated financial report for 2022 was posted publicly by Mayo Clinic on Monday morning on the Municipal Securities Rulemaking Board website.

Mayo Clinic’s total revenue was up by 3.5%, to $16.3 billion from $15.7 billion in 2021 .

However, expenses increased by 8.1%, to $15.6 billion from $14.5 billion in 2021. Salaries and benefits for Mayo Clinic’s 76,000 employees, which made up 58.4% of total expenses, increased 5.9%, to $9.17 billion over 2021. Supplies and services, including contract labor costs, climbed by 37% compared to the previous year.

The financial report included a statement from Mayo Clinic:

“Performance results for 2022 reflect the challenges facing the health care industry and the U.S. economy. Workforce shortages and resulting capacity constraints as well as inflation in both labor and nonlabor costs have impacted operating results. Despite these challenges, Mayo Clinic continues to operate with a strong operating margin and is well positioned for continued progress in its vision to Cure, Connect and Transform health care.”

While the numbers were not as good as 2021 or the historic year of 2019, Mayo Clinic did have a better financial year than many other similar organizations.

Cleveland Clinic, which has not officially reported yet, has stated that it is expecting a more than $200 million operating loss for 2022. Indiana University Health reported a $715 million loss in 2022.

Mayo Clinic’s net medical service revenue climbed by 3.5%, to $13.78 billion. That represents 84.6% of Mayo Clinic’s total revenue.

Outpatient visits edged up by 1.8%, to 4.9 million visits in 2022. That's up from 4.8 million visits in 2021. Surgical patients saw a larger increase of 3.1%, to 141,452 from 137,186 in 2021.

Total hospital admissions dropped by 3.9%, to 118,014 from 122,830 in 2021. However, patient days in the hospital increased by 1.9%, to 712,174 from 698,258 days in 2021. The average patient stay was six days in 2022, up from 5.7 days in 2021.

Financial contributions to the nonprofit institution were down by 21% in 2022 to $343 million from $434 million in 2021.

Under "other revenue," Mayo Clinic did see some gains. Retail pharmacy sales grew to $475 million in 2022, up from $436 million the previous year.

Mayo Clinic’s longtime oil and gas producing activities climbed by 54%, to $156 million from $101 million in 2021. Revenue from Mayo Clinic’s retail stores went up $4 million to $71 million from $67 million in 2021.