Damage control: Mayo Clinic CEO backpedals on cherry-picking patients with commercial insurance

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The Mayo Clinic is under fire after media reports that CEO John Noseworthy told employees the organization would prioritize patients with commercial insurance over those with Medicaid or Medicare.

Mayo CEO John Noseworthy, M.D., apparently regrets his choice of words in a speech he made to employees in which he said the hospital would prioritize patients with commercial insurance over those with Medicaid or Medicare in cases where all other factors are equal.

Noseworthy issued a statement to STAT late Friday after media reports about his comments got the attention of Minnesota Department of Human Services, which is looking into possible violations of civil and human rights laws.

"In an internal discussion I used the word ‘prioritized’ and I regret this has caused concerns that Mayo Clinic will not serve patients with government insurance," Noseworthy told STAT in the news release. “Nothing could be further from the truth. In fact, about half of the total services we provide are for patients who have government insurance, and we’re committed to serving those patients.”

But in his speech, first reported by Minnesota’s Star Tribune, Noseworthy cited the recent 3.7% rise in Medicaid patients as a “tipping point” for the organization. Many government payer programs tend to pay lower reimbursement rates than commercial insurers for patients treated for similar conditions.

Medscape reported that the speech was delivered at the end of last year when Mayo’s profits were down nearly 10% compared to 2015. Last year the clinic reportedly earned $475 million, and expenses went up $7.5% compared to revenue, which grew 6.6%.

The publicized comments drew immediate criticism. Emily Piper, commissioner of the Minnesota Department of Human Services told Medscape Medical News she was dismayed by the story and said the agency expects Mayo Clinic to “continue to serve public program enrollees in the same manner it serves patients with private insurance.”