Attorney General Ellison reaches settlement with Mayo Clinic over financial assistance

Minnesota Attorney General Keith Ellison announced Friday, March 14, that his office has reached a settlement with the Mayo Clinic that will require changes to the clinic’s charity care and debt collection practices. Now, as per the settlement, the clinic must provide charity care to certain presumptively eligible patients and streamline their charity care application process. It also prevents the clinic from suing to medical debt in all but “extraordinary” circumstances.

“Charity care, otherwise known as financial assistance, means free or discounted health services to people who are unable to pay for all or a portion of the services,” explained Press Secretary Brian Evans. “Under federal law, nonprofit hospitals like Mayo Clinic are required to provide charity care in exchange for their tax-exempt status.

The investigation was announced in 2022 after allegations that the clinic had sued patients who may have qualified for charity care to collect medical debt.

“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,” said Attorney General Ellison. “My office investigated Mayo Clinic and discovered that they were actively dissuading certain patients from seeking charity care. While this is disappointing, I am heartened by the substantial improvements Mayo Clinic has made to their charity care program, and I am grateful for their cooperation with our investigation. The settlement I have reached with Mayo Clinic ensures their improved charity care policies and procedures will remain in place. Our investigation also revealed shortcomings in the charity care system generally, and I hope lawmakers will consider my office’s recommendations to address those shortcomings and help more Minnesotans get the care they need to be well.”

According to the Attorney General’s Office, the settlement will require Mayo to maintain a charity care policy that provides free care to patients with incomes up to 200% of the federal poverty guidelines and between 40% to 50% discount for patients with incomes up to 400% of the federal poverty guidelines. It will also requires Mayo to screen certain patients to determine if they are presumptively eligible for charity care, and if so, provide the patients a discount in accordance with its charity care policies without requiring them to fill out an application.

The Mayo Clinic released the following the statement in response the settlement:

Mayo Clinic reached an agreement with the Minnesota Office of Attorney General (MN OAG) validating our longstanding commitment to ensuring all patients have access to the care they need, regardless of financial circumstances. After their review, the MN OAG’s factual findings demonstrate that Mayo Clinic adheres to and in many cases exceeds all regulatory guidelines for charity care. The settlement does not require Mayo Clinic to change any current policies or practices. As part of the settlement, Mayo Clinic agreed to continue policies and practices that it began long before the settlement was reached. The agreement also does not include any financial restitution or penalty by the MN OAG, which they have imposed in other cases. As noted by the MN AOG, its public report “does not constitute a legal opinion or reflect a formal determination by the Attorney General.” Mayo contests many of the findings reflected in the report, and Mayo did not agree to include them in the settlement agreement that is formally filed with the court, because those findings are inaccurate, speculative, or are irrelevant to applicable legal requirements.

Mayo Clinic offers financial assistance programs for patients who are unable to pay, and patients may apply for financial assistance at any point prior to services, during care, and after care has been provided. Mayo Clinic communicates the availability of financial assistance on its website, when patients first register for care, and in all billing statements and related letters and offers free financial counseling to uninsured or underinsured patients.

The agreement also reflects that Mayo Clinic has voluntarily adopted practices that support patients who are facing financial challenges. For example, since 2023 Mayo Clinic has expanded the practice of “presumptive eligibility,” in which qualifying patients receive financial assistance without needing to complete a financial assistance application. Since 2019, Mayo Clinic locations in Minnesota have provided over $600 million in financial assistance to patients.

Mayo Clinic continuously evaluates and updates its practices to best serve patients and the community.