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Mayo Clinic, legislature standoff could lead to economic hit on Minnesota

In an email last week, Mayo Clinic said it would pull back about $4 billion in investments if two specific nursing bills pass.

ROCHESTER, Minn. — The Minnesota Nurses Association union is back at the Capitol with an empty hospital bed. 

The display is the union's latest effort to pass the Keeping Nurses at the Bedside Act which addresses staffing shortages, retention and accountability over rising health care costs. 

But the state's largest private employer, Mayo Clinic, is pushing back. In an email last week, the clinic expressed frustration with two bills about nursing and said it will pull billions worth of investment out of the state if the bills pass.

Supporters argue the bills will prioritize patient care over profits, but Mayo argues it would create an inefficient bureaucracy - that would severely limit their flexibility to hire the staff they need and invest in new equipment and technology. 

But to understand the possible implications of this standoff is to know the history of Mayo Clinic. 

It was founded some 150 years ago after a deadly tornado. A father-son doctor duo teamed up with local nuns to help the injured and eventually created a permanent hospital. 

"Just about everything you see as you drive into Rochester is about Mayo Clinic," said Dave Senjem. He's a former state senator and current Olmsted County Commissioner. He also worked at Mayo for 44 years. 

It's a top-ranked hospital, that last year, raked in more than $16 billion. It has more than 2,000 beds and employs nearly 50,000 employees at its Rochester location, making it the state's largest private employer.

In an email to the governor last week, a Mayo lobbyist expressed frustration with the Bedside Act, and another piece of proposed legislation, that would require hospitals to form committees to mandate staffing levels and define the number of patients each nurse can care for. The bill would also establish an affordability board to tackle rising health care costs.   

"They exist to be the best health care center in the world — and by all accounts they are — and in terms of getting to that status, they have to manage their own organization," said Senjem. "The idea that a legislative body would begin to suggest to them how to run nursing staff or what their fee structure should be, is frankly out of reach in terms of acceptability."

The nurses union says the reforms are long overdue, but 62 leaders from every nonprofit hospital in Minnesota signed a letter telling lawmakers the proposed legislation is detrimental.  

"All of them are warning that we could be forced to shutter services at our hospitals if we don't get relief from the bureaucracy from some of these mandates and also some financial help," said the Minnesota Hospital Association (MHA) President Dr. Rahul Koranne.

Koranne says the MHA it's focusing on recruitment and millions in loan forgiveness to fill the 5,500 open nursing positions. He also says only 20% of the state's nurses are represented by the union. 

"We are part of the same team, this is about what the union is saying," said Koranne. "And why we are raising our voices in alarm."

Losing billions would be an economic hit to our state.

Senjem says Mayo may funnel the money instead to its Florida and Arizona campuses and Rochester could potentially lose its flagship status. 

That could also put a damper on a 20-year initiative to invest in infrastructure to secure Rochester's status as a destination medical center. The plan was put in place about eight years ago when the legislature approved contributing $585 million. Another $500 million in private funds and Mayo would invest about $934 million. 

Local businesses and economists worry the business from that — and beyond — could be at stake. 

"This is the biggest thing I think since, with respect to Mayo, since the tornado in 1883," said Senjem. "I hope the legislature and the governor think this thing through a little bit and find a solution."

Mayo hasn't offered specifics about its expansion plans, or where the money might go, but it does also have international projects in London and Abu Dhabi.

Mayo Clinic denied KARE 11's interview request. But wrote this statement: 

“Mayo remains committed to engaging with policymakers and other partners on legislation that will be in the best interests of patients, staff, the state and Mayo Clinic.

Mayo Clinic has worked with policymakers for several months on proposed changes to the Keeping Nurses at the Bedside Act legislation that would provide a more comprehensive approach to address nursing shortages while ensuring Mayo Clinic can continue to fulfill its mission. We value input from our nurses – it is core to our staffing model. We agree our nursing staff face many challenges; however, we believe this bill does little to address the real challenge – recruitment and retention of the health care workers and staff Minnesotans need.

At the heart of this is legislation we believe will negatively impact access to care and our ability to transform health care to support our staff and meet the evolving needs of our patients. Like any responsible organization, we must evaluate the legislative and regulatory environment in the places we operate. Mayo has been working to address these concerns for months and is committed to transparently sharing the impacts of these policy decisions. We will continue working with leaders on a bill that is in the best interests of patients, the State and Mayo Clinic.”

READ: Letter from Minnesota's nonprofit hospital leaders 


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