Mayo Clinic's operating income down 51%, but records 3.6% operating margin through Q3

Although Mayo Clinic's net operating income through the first nine months of 2020 is down 51.4 percent compared to 2019, the Rochester, Minn.-based system's operating margin was 3.6 percent, according to recently released financial documents.

In the third quarter ended Sept. 30, Mayo Clinic saw its revenue reach $3.7 billion, which is a 7.4 percent increase from the same quarter last year.  

For the third quarter, Mayo Clinic recorded net medical service revenue of $3.1 billion, an increase of 6.1 percent from the third quarter last year. The recorded net medical service revenue represents 85 percent of its total revenue in the third quarter. 

Expenses also rose about 6.6 percent year over year to $3.4 billion in the third quarter. 

Net operating income hit $288 million in the third quarter, reflecting an 18 percent growth from the $244 million recorded in the third quarter of 2019. 

Mayo said that its third-quarter financial results included several non-recurring charges and payments, including $63 million received in federal relief aid and an expense accrual of $156 million in employee bonus payments or retroactive pay. 

Through the third quarter of 2020, Mayo Clinic recorded revenue of $10 billion, a decrease of 1.5 percent from the same period in 2019. Of the net revenue, $8.34 billion was attributed to medical service revenue, a decrease of 3.1 percent from the first nine months of 2019. 

Year to date, Mayo Clinic saw its net operating income drop 51.4 percent to $355 million.

"Mayo Clinic's third quarter and year-to-date 2020 financial performance reflects exemplary results during a remarkably challenging time," the health system said in the financial report. "They are the direct outcome of the efforts of our committed staff who have been on the front lines of caring for COVID-19 patients, developing lifesaving treatments, and conducting the testing and research that is essential to finding therapeutics, while advancing our mission to cure, connect and transform."

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