The Minnesota Attorney General's office reached a settlement with Mayo Clinic related to the nonprofit system's charity care practices.
Mayo Clinic must continue to provide charity care to "presumptively eligible" patients and streamline its application process, according to a Friday news release from the attorney general's office. The system is barred from suing to collect medical debt outside of extraordinary circumstances, such as when a patient keeps payment from an insurer that is intended to cover care costs.
Related: Hospital charity care falls short of nonprofit tax breaks
The state announced an investigation into Mayo Clinic's practices in December 2022, following media reports the system sued patients who may have qualified for charity care. The investigation found Mayo Clinic was using aggressive debt-collection tactics, asking employees to steer certain patients away from financial assistance, according to the settlement filed in Ramsey County District Court.
"In exchange for their tax exemption, nonprofit hospitals are supposed to give back to their communities by providing free or reduced-cost health care to folks with low incomes," Attorney General Keith Ellison said in the release.
The system's policy fully covers the cost of care for patients with income up to 200% of the federal poverty guideline and covers 40% to 50% of the costs for patients with income up to 400% of the federal poverty guideline.
Rochester, Minnesota-based Mayo Clinic provided $170.5 million in financial assistance in 2024, compared with $87.4 million in 2023 and $79.1 million in 2022, according to the settlement documents.
Mayo said in a statement that it contested many of the state’s findings, and the settlement did not require it to change any policies and practices.
The health system said the settlement showed its commitment to providing financial assistance. It also noted voluntary changes to its policies, including the 2023 expansion of presumptive eligibility, or when patients can receive financial assistance without completing an application.
"Mayo Clinic has offered assurances that it will continue the robust financial assistance policies Mayo Clinic has in place and the ongoing enhancements made in recent years to meet the evolving needs of patients," the system said in a statement.
The health system estimates its Minnesota locations have provided more than $600 million in financial assistance since 2019.
There was no financial penalty associated with the settlement.
