Mayo Clinic: Unaudited Condensed Consolidated Financial Reports March 31, 2024

Mayo Clinic
Unaudited Condensed Consolidated Financial Reports

March 31, 2024
Mayo Clinic
Contents
Unaudited Consolidated Financial Reports
Condensed consolidated statements of financial position 1
Condensed consolidated statements of activities 2
Condensed consolidated statements of cash flows 3
Notes to unaudited condensed consolidated financial statements 4-18

Condensed Consolidated Statements of Financial Position
Unaudited (In Millions)
March 31, 2024 December 31,

Unaudited 2023
Assets
Current assets:
Cash and cash equivalents $ 115 $ 80
Accounts receivable for medical services 2,097 1,976
Other receivables 756 787
Other current assets 425 391
Total current assets 3,393 3,234
Investments 19,700 18,834

Other long-term assets 3,304 3,428
Property, plant, and equipment, net 6,591 6,431
Total assets $ 32,988 $ 31,927
Liabilities and net assets
Current liabilities:
Accounts payable $ 759 $ 847
Accrued payroll 1,036 873
Accrued employee benefits 180 181
Deferred revenue 79 65
Long-term variable-rate debt 760 620
Other current liabilities 568 491
Total current liabilities 3,382 3,077
Long-term debt, net of current portion 3,957 4,098

Accrued pension and postretirement benefits, net of current portion 813 813
Other long-term liabilities 2,273 2,303
Total liabilities 10,425 10,291
Net assets:
Without donor restrictions 17,012 16,240
With donor restrictions 5,551 5,396
Total net assets 22,563 21,636
Total liabilities and net assets $ 32,988 $ 31,927
See notes to condensed consolidated financial statements.
1
Condensed Consolidated Statements of Activities
Unaudited (in Millions)
Three Months Ended March 31, 2024 Three Months Ended March 31, 2023
Without With Without With
Donor Donor Donor Donor
Restrictions Restrictions Total Restrictions Restrictions Total
Revenue, gains and other support:
Medical service revenue $ 3,957 $ — $ 3,957 $ 3,645 $ — $ 3,645
Grants and contracts 195 — 195 170 — 170
Investment return allocated to current activities 115 13 128 119 15 134
Contributions available for current activities 85 $ 64 149 25 24 49
Other 308 — 308 275 — 275
Net assets released from restrictions 55 (55) — 49 (49) —
Total revenue, gains and other support 4,715 22 4,737 4,283 (10) 4,273
Expenses:
Salaries and benefits 2,569 — 2,569 2,435 — 2,435
Supplies and services 1,515 — 1,515 1,396 — 1,396
Depreciation and amortization 161 — 161 158 — 158
Facilities 82 — 82 87 — 87
Finance and investment 47 — 47 48 — 48
Total expenses 4,374 — 4,374 4,124 — 4,124
Income (loss) from current activities 341 22 363 159 (10) 149
Noncurrent and other items:

Contributions not available for current activities, net (3) 12 9 (2) 17 15
Unallocated investment return, net 433 121 554 168 69 237
Income tax expense (12) — (12) (7) — (7)
Benefit credit 81 — 81 86 — 86
Other (67) — (67) (47) — (47)
Total noncurrent and other items 432 133 565 198 86 284
Increase (decrease) in net assets before other

changes in net assets 773 155 928 357 76 433
Pension and other postretirement benefit adjustments (1) (1) (13) — (13)
Increase (decrease) in net assets 772 155 927 344 76 420
Net assets at beginning of period 16,240 5063

5,396 21,636 14,808 5,063 19,871
Net assets at end of period $ 17,012 $ 5,551 $ 22,563 $ 15,152 $ 5,139 $ 20,291
2
Condensed Consolidated Statements of Cash Flows
Unaudited (In Millions)
Three Months Three Months

Ended Ended
March 31, 2024 March 31, 2023
Cash flows from operating activities:
Cash from medical services $ 3,607 $ 3,309
Cash from external lab services 229 227
Cash from grants and contracts 206 182
Cash from benefactors 113 31
Cash from other activities 320 272
Cash for salaries and benefits (2,314) (2,249)
Cash for supplies, services, and facilities (1,721) (1,567)
Interest and dividends received 59 62
Interest paid (11) (9)
Income tax refunds received 10 1
Net cash provided by operating activities 498 259
Cash flows from investing activities:

Purchase of property, plant, and equipment (310) (251)
Purchases of investments (4,499) (2,617)
Sales and maturities from investments 4,217 2,625
Proceeds from sale of (investment in) joint ventures 100 (2)
Net cash used in investing activities (492) (245)
Cash flows from financing activities:

Restricted gifts, bequests, and other 31 11
Payment on leases (2) (2)
Net cash provided by financing activities 29 9
Net increase in cash and cash equivalents 35 23
Cash and cash equivalents at beginning of period 80 64
Cash and cash equivalents at end of period $ 115 $ 87
3
Notes to Unaudited Condensed Consolidated Financial Statements
March 31, 2024 (in Millions)
Note 1. Basis of Presentation

Mayo Clinic (the Clinic) and its Arizona, Florida, Iowa, Minnesota, and Wisconsin affiliates provide
comprehensive medical care and education in clinical medicine and medical sciences and conduct
extensive programs in medical research. The Clinic and its affiliates also provide hospital and outpatient
services, and at each major location, the clinical practice is closely integrated with advanced education
and research programs. The Clinic has been determined to qualify as a tax-exempt organization under
Section 501(c) (3) of the Internal Revenue Code (Code) and as a public charity under Section 509(a) (2)
of the Code. Included in the Clinic’s condensed consolidated financial statements are all of its wholly
owned or wholly controlled subsidiaries, which include both tax-exempt and taxable entities. All significant
intercompany transactions have been eliminated in consolidation.
The accompanying unaudited condensed consolidated financial statements have been prepared in
accordance with accounting principles generally accepted in the United States (GAAP) for interim
financial information. Accordingly, they do not include all of the information and footnotes required by
GAAP for complete financial statements. In the opinion of management, all adjustments considered
necessary for a fair presentation have been included and are of a normal and recurring nature. Operating
results for the three months ended March 31, 2024 are not necessarily indicative of the results to be
expected for the year ending December 31, 2024. For further information, refer to the audited
consolidated financial statements and notes thereto for the year ended December 31, 2023.
The preparation of financial statements in conformity with GAAP requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at the date of the financial
statements. Estimates also affect the reported amounts of revenue and expenses during the reporting
period. Although estimates are considered to be fairly stated at the time the estimates are made, actual
results could differ from those estimates.
Note 2. New Accounting Standards
Effective January 1, 2024, the Clinic adopted Financial Accounting Standards Board Accounting Standard
Update (ASU) No. 2023-01, Leases - Common Control Arrangements. This ASU requires entities
determine whether a related party arrangement between entities under common control is a lease and
requires that leasehold improvements have an amortization period consistent with the shorter of the
remaining lease term and the useful life of the improvements for a lease between entities under common
control. The adoption of this ASU did not materially impact the condensed consolidated financial
statements.
4
Note 3. Liquidity and Availability
Financial assets available for general expenditure within one year of the balance sheet date, are
composed of the following:
March 31, 2024 December 31, 2023

Cash and cash equivalents $ 115 $ 80
Accounts receivable 2,097 1,976
Promises to give 290 325
Grants receivable 171 173
Other receivables 295 289
Investments 12,355 12,750
Total financial assets available within one year $ 15,323 $ 15,593
Note 4. Medical Service Revenue

Medical service revenue is reported at the amount that reflects the consideration to which the Clinic
expects to be entitled in exchange for providing patient care. These amounts, representing transaction
prices, are due from patients, third-party payors (including health insurers and government programs),
and others and includes variable consideration for retroactive revenue adjustments due to settlement of
audits, reviews, and investigations. Generally, the Clinic bills the patients and third-party payors several
days after the services are performed and/or the patient is discharged from the facility. Revenue is
recognized as performance obligations are satisfied.
Performance obligations are determined based on the nature of the services provided by the Clinic.
Revenue for performance obligations satisfied over time is recognized based on actual charges incurred
in relation to total expected (or actual) charges. The Clinic believes that this method provides a faithful
depiction of the transfer of services over the term of the performance obligation based on the inputs
needed to satisfy the obligation. Generally, performance obligations satisfied over time relate to patients
in the Clinic's hospital receiving inpatient acute care services. The Clinic measures the performance
obligation from admission into the hospital to the point when it is no longer required to provide services to
that patient, which is generally at the time of discharge. Revenue for performance obligations satisfied at
a point in time is recognized when goods or services are provided and the Clinic does not believe it is
required to provide additional goods or services to the patient.
Because all of its performance obligations relate to contracts with a duration of less than one year, the
Clinic has elected to apply the optional exemption provided in FASB ASC 606-10-50-14(a) and, therefore,
is not required to disclose the aggregate amount of the transaction price allocated to performance
obligations that are unsatisfied or partially unsatisfied at the end of the reporting period. The unsatisfied or
partially unsatisfied performance obligations referred to above are primarily related to inpatient acute care
services at the end of the reporting period. The performance obligations for these contracts are generally
completed when the patients are discharged, which generally occurs within days or weeks of the end of
the reporting period.
The Clinic determines the transaction price based on standard charges for goods and services provided
to patients, reduced by contractual adjustments provided to third-party payors, discounts provided to
uninsured patients in accordance with the Clinic’s policy, and/or implicit price concessions based on
historical collection experience.
5
Note 4. Medical Service Revenue (Continued)

Agreements with third-party payors typically provide for payments at amounts less than established
charges. A summary of the payment arrangements with major third-party payors follows:
• Medicare: Certain inpatient acute care services are paid at prospectively determined rates per
discharge based on clinical, diagnostic, and other factors. Certain services are paid based on
cost-reimbursement methodologies subject to certain limits. Physician services are paid based
upon established fee schedules. Outpatient services are paid using prospectively determined
rates.
• Medicaid: Reimbursements for Medicaid services are generally paid at prospectively determined
rates per discharge, per occasion of service, or per covered member.
• Other: Payment agreements with certain commercial insurance carriers, health maintenance
organizations, and preferred provider organizations provide for payment using prospectively
determined rates per discharge, discounts from established charges, and prospectively
determined daily rates.
Laws and regulations concerning government programs, including Medicare and Medicaid, are complex
and subject to varying interpretation. As a result of investigations by governmental agencies, various
health care organizations have received requests for information and notices regarding alleged
noncompliance with those laws and regulations, which, in some instances, have resulted in organizations
entering into significant settlement agreements. Compliance with such laws and regulations may also be
subject to future government review and interpretation as well as significant regulatory action, including
fines, penalties, and potential exclusion from the related programs. There can be no assurance that
regulatory authorities will not challenge the Clinic’s compliance with these laws and regulations, and it is
not possible to determine the impact (if any) such claims or penalties would have upon the Clinic. In
addition, the contracts that the Clinic has with commercial payors also provide for retroactive audit and
review of claims.
Generally, patients who are covered by third-party payors are responsible for related deductibles and
coinsurance, which vary in amount. The Clinic also provides services to uninsured patients and offers
those uninsured patients a discount, either by policy or law, from standard charges. The Clinic estimates
the transaction price for patients with deductibles and coinsurance and from those who are uninsured
based on historical experience and current market conditions. The initial estimate of the transaction price
is determined by reducing the standard charge by any contractual adjustments, discounts, and implicit
price concessions. Subsequent changes to the estimate of the transaction price are generally recorded as
adjustments to medical service revenue in the period of the change. For the three months ended
March 31, 2024 and 2023, revenue recognized due to changes in its estimates of transaction price
concessions for performance obligations satisfied in prior years was not significant. Subsequent changes
that are determined to be the result of an adverse change in the patients ability to pay are recorded as
bad debt expense. Bad debt expense for the three months ended March 31, 2024 and 2023 was not
significant.
Settlements with third-party payors for retroactive adjustments due to audits, reviews, or investigations
are considered variable consideration and are included in the determination of the estimated transaction
price for providing patient care. These settlements are estimated based on the terms of the payment
agreement with the payor, correspondence from the payor, and the Clinic’s historical settlement activity,
including an assessment to ensure it is probable a significant reversal in the amount of cumulative
revenue recognized will not occur when the uncertainty associated with the retroactive adjustment is
subsequently resolved. Estimated settlements are adjusted in future periods as adjustments become
known (that is, new information becomes available) or as years are settled or are no longer subject to
such audits, reviews, and investigations. Adjustments arising from a change in the transaction price were
not significant for the three months ended March 31, 2024 and 2023. Receivables from third-party
6
payors for final settlements were not significant for the three months ended March 31, 2024 and 2023.
Patients who meet the Clinic’s criteria for charity care are provided care without charge or at amounts less
than established rates. Such amounts which are determined to qualify as charity care are not reported as
revenue.
The composition of medical service revenue based on the regions of the country in which the Clinic
operates in, its lines of business, and timing of revenue recognition for the three months ended are as
follows:
March 31, 2024
Midwest Southeast Southwest Total
Hospital $ 1,425 $ 335 $ 430 $ 2,190
Clinic 982 250 266 1,498
Senior Care and Nursing Home 4 — — 4
Other 26 — — 26
Total patient care service revenue 2,437 585 696 3,718
External lab 239 — — 239

Total medical service revenue $ 2,676 $ 585 $ 696 $ 3,957
Timing of revenue and recognition:

At time services are rendered $ 1,247 $ 250 $ 266 $ 1,763
Services transferred over time 1,429 335 430 2,194
Total $ 2,676 $ 585 $ 696 $ 3,957
March 31, 2023

Midwest Southeast Southwest Total
Hospital $ 1,355 $ 301 $ 368 $ 2,024
Clinic 878 231 264 1,373
Senior Care and Nursing Home 4 — — 4
Other 17 — — 17
Total patient care service revenue 2,254 532 632 3,418
External lab 227 — — 227

Total medical service revenue $ 2,481 $ 532 $ 632 $ 3,645
Timing of revenue and recognition:

At time services are rendered $ 1,122 $ 231 $ 264 $ 1,617
Services transferred over time 1,359 301 368 2,028
Total $ 2,481 $ 532 $ 632 $ 3,645
7
Hospital revenue includes a variety of services mainly covering inpatient procedures requiring overnight
stays or outpatient operations that require anesthesia or use of complex diagnostic and surgical
equipment as well as emergency care for traumas and other critical conditions. Clinic revenue includes
services primarily focused on the care of outpatients covering primary and specialty health care needs.
The Clinic's practice is to record certain radiology, pathology, and other hospital related services in the
Midwest region as clinic revenue which amounted to $306 and $268, respectively, for the three months
ended March 31, 2024 and 2023. Examples of revenue at time services are rendered include clinical
services, lab and transport, and services transferred over time include hospital and senior care revenue.
The composition of medical service revenue by payor for the three months ended March 31, is as follows:
2024 2023
Medicare $ 1,060 $ 977
Medicaid 143 136
Contract 2,318 2,131
Other, including self-pay 436 401
Total $ 3,957 $ 3,645
The Clinic’s practice is to assign a patient to the primary payor and not reflect other uninsured balances
(for example, coinsurance and deductibles) as self-pay. Therefore the payors listed above contain patient
responsibility components, such as coinsurance and deductibles.
Financing component:
The Clinic has elected the practical expedient allowed under FASB ASU 2014-09, Revenue from
Contracts with Customers (Topic 606-10-32-18) and does not adjust the promised amount of
consideration from patients and third-party payors for the effects of a significant financing component due
to the Clinic’s expectation that the period between the time the service is provided to a patient and the
time that the patient or a third-party payor pays for that service will be one year or less. However, the
Clinic does, in certain instances, enter into payment agreements with patients that allow payments in
excess of one year. For those cases, the financing component is not deemed to be significant to the
contract.
Note 5. Investments
Investments in equity, debt securities, and alternative investments are recorded at fair value. Realized
gains and losses are calculated based on the average cost method. Investment income or loss (including
realized and unrealized gains and losses on investments, interest, and dividends) are included in the
condensed consolidated statements of activities.
Alternative investments (principally limited partnership interests in absolute return, hedge, private equity,
real estate and natural resources funds), represents the Clinic’s ownership interest in the net asset value
(NAV) of the respective partnership. The investments in alternative investments may individually expose
the Clinic to securities lending, short sales, and trading in futures and forward contract options and other
derivative products. The Clinic’s risk is limited to the investment’s carrying value.
From time to time, the Clinic invests directly in certain derivative contracts that do not qualify for hedge
accounting and are recorded at fair value in investments. Changes in fair value are reported as a
component of net unrealized gains or losses in the investment returns. These contracts are used in the
8
Note 5. Investments (Continued)

Clinic’s investment management program to minimize certain investment risks. For the three months
ended March 31, 2024 and 2023, the realized and unrealized gain/loss from derivative contracts was not
significant.
It is the Clinic’s intent to maintain a long-term investment portfolio to support research, education and
other activities. Accordingly, the total investment return is reported in the condensed consolidated
statements of activities in two categories. The investment return allocated to current activities is
determined by formula. Management believes this return is approximately equal to the real return that the
Clinic expects to earn on its investments over the long term. The unallocated investment return, included
in noncurrent and other items in the condensed consolidated statements of activities, represents the
difference between the total investment return and the amount allocated to current activities, net of
investment costs.
Note 6. Fair Value Measurements

The Clinic holds certain financial instruments that are required to be measured at fair value on a recurring
basis. The valuation techniques used to measure fair value under the Fair Value Measurement (Topic
820) of the FASB ASC 820 are based upon observable and unobservable inputs. The standard
establishes a three-level valuation hierarchy for disclosure of fair value measurements. The valuation
hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the
measurement date. The three levels are defined as follows:
Level 1: Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or
liabilities in active markets.
Level 2: Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active
markets, and inputs that are observable for the asset or liability, either directly or indirectly, for
substantially the same term of the financial instrument.
Level 3: Inputs to the valuation methodology are unobservable and significant to the fair value
measurement.
A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of
input that is significant to the fair value measurement. The Clinic’s policy is to recognize transfers in and
transfers out as of the actual date of the event or change in circumstances that caused the transfer.
There were no significant transfers within Levels for the three months ended March 31, 2023 and the year
ended December 31, 2023.
9
Note 6. Fair Value Measurements (Continued)

The following tables present the financial instruments carried at fair value as of March 31, 2024 and
December 31, 2023, by caption on the condensed consolidated statements of financial position
categorized by the valuation hierarchy and NAV:
March 31, 2024
Total
Level 1 Level 2 Level 3 NAV Fair Value
Assets:
Securities lending collateral $ 9 $ — $ — $ — $ 9
Investments:
Cash and cash equivalents 1,480 46 — — 1,526
Fixed income securities:
U.S. government — 2,077 — — 2,077
U.S. government agencies — 839 — — 839
U.S. corporate — 862 — — 862
Foreign — 34 — — 34
Common and preferred stocks:
U.S. 1,489 — — — 1,489
Foreign 926 — 20 — 946
Funds:
Fixed income 414 — — — 414
Equities 1,175 722 — — 1,897
Other investments — — — — —
Less securities under lending
agreement (138) — — — (138)
Investments at NAV — — — 9,616 9,616
Total investments 5,346 4,580 20 9,616 19,562
Investments under securities

lending agreement 138 — — — 138
Other long-term assets:

Trust receivables 71 29 126 — 226
Technology-based ventures — — 266 — 266
Total other long-term assets 71 29 392 — 492
Total assets at fair value $ 5,564 $ 4,609 $ 412 $ 9,616 $ 20,201
Liabilities:
Securities lending payable $ 9 $ — $ — $ — 9
Total liabilities at fair value $ 9 $ — $ — $ — $ 9
10

December 31, 2023
Total
Level 1 Level 2 Level 3 NAV Fair Value
Assets:
Securities lending collateral $ 10 $ — $ — $ — $ 10
Investments:
Cash and cash equivalents 1,137 66 — — 1,203
Fixed income securities:
U.S. government — 1,969 — — 1,969
U.S. government agencies — 840 — — 840
U.S. corporate — 918 — — 918
Foreign — 51 — — 51
Common and preferred stocks:
U.S. 1,391 — — — 1,391
Foreign 858 — 20 — 878
Funds:
Fixed income 398 — — — 398
Equities 1,107 716 — — 1,823
Other investments
Less securities under lending
agreement (86) — — — (86)
Investments at NAV — — — 9,363 9,363
Total investments 4,805 4,560 20 9,363 18,748
Investments under securities

lending agreement 86 — — — 86
Other long-term assets:

Trust receivables 69 29 120 — 218
Technology-based ventures — — 268 — 268
Total other long-term assets 69 29 388 — 486
Total assets at fair value $ 4,970 $ 4,589 $ 408 $ 9,363 $ 19,330
Liabilities:
Securities lending payable $ 10 $ — $ — $ — 10
Total liabilities at fair value $ 10 $ — $ — $ — $ 10
11
The following is a description of the Clinic’s valuation methodologies for assets and liabilities measured at
fair value. Fair value for Level 1 is based upon quoted market prices. Fair value for Level 2 is based on
quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in
markets that are not active, and model-based valuation techniques for which all significant assumptions
are observable in the market or can be corroborated by observable market data for substantially the full
term of the assets. Inputs are obtained from various sources, including market participants, dealers, and
brokers. Level 3 consists of trusts recorded at fair value based on the underlying value of the assets in the
trust or discounted cash flow of the expected payment streams.
The trusts reported as Level 3 are primarily perpetual trusts managed by third parties invested in stocks,
mutual funds, and fixed-income securities that are traded in active markets with observable inputs, and
since the Clinic will never receive the trust assets, these perpetual trusts are reported as Level 3. In
addition, technology-based ventures, composed primarily of shares in start-up companies, are recorded
at fair value based on inputs relying on factors such as the financial performance of the company, sales
performance, financial projections, sales projections, management representation, industry
developments, market analysis, and any other pertinent factors that would affect the fair value or based
on the quoted price of an otherwise identical unrestricted security of the same issuer, adjusted for the
effect of the restriction.
The methods described above and those recorded at NAV may produce a fair value calculation that may
not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Clinic
believes its valuation methods are appropriate and consistent with other market participants, the use of
different methodologies or assumptions to determine the fair value of certain financial instruments could
result in a different estimate of fair value at the reporting date.
The carrying values of cash and cash equivalents, short-term investments, accounts receivable, other
current assets, and accounts payable are reasonable estimates of their fair value due to the short-term
nature of these financial instruments.
The following information pertains to those alternative investments recorded at NAV in accordance with
the Fair Value Measurement (Topic 820) of the FASB ASC.
At March 31, 2024, alternative investments recorded at NAV consisted of the following:
Redemption Redemption
Fair Unfunded Frequency (If Notice
Value Commitment Currently Eligible) Period
Absolute return/hedge funds (a) $ 4,291 $ 281 Monthly to annually 30–90 days
Private partnerships (b) 5,325 2,107
Total alternative investments $ 9,616 $ 2,388
12
At December 31, 2023, alternative investments recorded at NAV consisted of the following:
Redemption Redemption
Fair Unfunded Frequency (If Notice
Value Commitment Currently Eligible) Period
Absolute return/hedge funds (a) $ 4,254 $ 388 Monthly to annually 30–90 days
Private partnerships (b) 5,109 2,043
Total alternative investments $ 9,363 $ 2,431
(a) This category includes investments in absolute return/hedge funds, which are actively managed
commingled investment vehicles that derive the majority of their returns from factors other than the
directional flow of the markets in which they invest. Representative strategies include high-yield credit,
distressed debt, merger arbitrage, relative value, and long-short equity strategies. The fair values of the
investments in this category have been estimated using the NAV per share of the investments.
Investments in this category generally carry “lockup” restrictions that do not allow investors to seek
redemption in the first year after acquisition. Following the initial lockup period, liquidity is generally
available monthly, quarterly, or annually following a redemption request. Over 90 percent of the
investments in this category have at least annual liquidity.
(b) This category includes limited partnership interests in closed-end funds that focus on venture
capital, private equity, real estate, and resource-related strategies. The fair values of the investments in
this category have been estimated using the NAV of the Clinic’s ownership interest in partners’ capital.
Distributions from each fund will be received as the underlying investments of the funds are liquidated. It
is estimated that the underlying assets of most funds will generally be liquidated over a seven- to ten-year
period.
Note 7. Securities Lending

The Clinic has an arrangement with its investment custodian to lend Clinic securities to approved brokers
in exchange for a fee. Among other provisions that limit the Clinic’s risk, the securities lending agreement
specifies that the custodian is responsible for lending securities and obtaining adequate collateral from
the borrower. Collateral is limited to cash, government securities, and irrevocable letters of credit.
Investments are loaned to various brokers and are returnable on demand. In exchange, the Clinic
receives collateral. The cash collateral is shown as both an asset and a liability on the condensed
consolidated statements of financial position.
At March 31, 2024 and December 31, 2023, the aggregate market value of securities on loan under
securities lending agreements totaled $138 and $86, respectively, and the total value of the collateral
supporting the securities was $144 and $90, respectively, which represents 104 percent of the value of
the securities on loan at March 31, 2024 and December 31, 2023. The cash portion of the collateral
supporting the securities as of March 31, 2024 and December 31, 2023, is $9 and $10, respectively.
Noncash collateral provided to the Clinic is not recorded in the condensed consolidated statements of
financial position, as the collateral may not be sold or repledged. The Clinic’s claim on such collateral is
limited to the market value of loaned securities. In the event of nonperformance by the other parties to the
securities lending agreements, the Clinic could be exposed to a loss.
13
Note 8. Board-Designated Funds
Board-designated funds are included in net assets without donor restrictions and are subject to
expenditure for the following purposes for the periods ended:

Research $ 1,578 $ 1,581
Education 326 327
Buildings and equipment 3 3
Charity care 13 13
Clinical 165 164
Other 1,109 1,093
Total designation for specified purpose $ 3,194 $ 3,181
Board designated funds were classified as follows for the periods ended:

Quasi endowments $ 2,947 $ 2,967
Professional liability reserve 198 185
Other reserves 49 29
Total $ 3,194 $ 3,181
14
Note 9. Net Assets with Donor Restrictions
The Clinic receives contributions in support of research, education, and clinical activities. Net assets with
donor restrictions were available for the following purposes:

Subject to expenditure for specified purposes:
Research $ 788 $ 686
Education 84 59
Buildings and equipment 192 180
Charity care 36 32
Clinical 103 89
Other 40 38
Total expenditure for specified purposes 1,243 1,084
Subject to passage of time:

Pledges and trusts 683 682
Endowments:
Perpetual in nature:
Research 1,278 1,263
Education 359 355
Charity care 14 14
Clinical 225 224
Other 50 50
Pledges and trusts 262 269
Total perpetual in nature 2,188 2,175
Subject to endowment spending policy:

Research 812 824
Education 368 370
Charity care 51 52
Clinical 164 166
Other 42 43
Total subject to endowment spending policy 1,437 1,455
Total endowments 3,625 3,630
Total net assets with donor restrictions $ 5,551 $ 5,396
15
Note 9. Net Assets with Donor Restrictions (Continued)
Net assets were released from donor restrictions as expenditures were made, which satisfied the
following restricted purposes for the three months ended March 31:
2024 2023
Research $ 33 $ 36
Education 10 7
Buildings and equipment 1 —
Other 11 6
Total net assets released from donor restrictions $ 55 $ 49
Note 10. Functional Expenses

The condensed consolidated financial statements present certain expenses that are attributed to more
than one program or supporting function. Therefore, expenses require allocation on a reasonable basis
that is consistently applied. Benefits and payroll taxes are allocated based on factors of either salary
expense or hours worked. Overhead costs that include professional services, office expenses, information
technology, interest, insurance, and other similar expenses are allocated based on on a variety of factors
including revenues, hours worked, and salary expense. Costs related to space including occupancy,
depreciation and amortization, and property taxes are allocated on a square footage basis.
The expenses reported in the condensed consolidated statements of activities for the three months ended
March 31, supported the following programs and functions:
2024
Lab and Graduate and

technology other General and Development Other Total
Patient care ventures Research education administrative expenses activities expenses
Salaries and benefits $ 2,130 $ 52 $ 200 $ 100 $ 62 $ 10 $ 15 $ 2,569
Supplies and services 1,071 307 76 24 16 3 18 1,515

Depreciation and
amortization 132 2 18 3 5 — 1 161
Facilities 61 1 5 3 11 — 1 82
Finance & investment 47 3 4 1 1 — (9) 47
Total $ 3,441 $ 365 $ 303 $ 131 $ 95 $ 13 $ 26 $ 4,374
2023
Lab and Graduate and

technology other General and Development Other Total
Patient care ventures Research education administrative expenses activities expenses
Salaries and benefits $ 2,015 $ 47 $ 187 $ 95 $ 72 $ 9 $ 10 $ 2,435
Supplies and services 983 291 72 22 3 3 22 1,396

Depreciation and
amortization 131 2 17 3 4 — 1 158
Facilities 68 1 5 4 9 — — 87
Finance & investment 44 2 5 — — — (3) 48
Total $ 3,241 $ 343 $ 286 $ 124 $ 88 $ 12 $ 30 $ 4,124
16
Note 11. Employee Benefit Programs

The Clinic serves as plan sponsor for several defined-benefit pension funds and other postretirement
benefits.
Components of net periodic benefit cost for the three months ended March 31 are as follows for the
defined-benefit pension plans:
Qualified
2024 2023
Service cost $ 107 $ 96
v
Interest cost 117 109
Expected return on plan assets (208) (194)
Amortization of unrecognized:
Prior service benefit (2) (13)
Net actuarial loss — —
Net benefit (credit) cost $ 14 $ (2)
Components of net periodic benefit cost for the three months ended March 31 are as follows for the other
postretirement benefits:
Postretirement Benefits
2024 2023
Service cost $ 1 $ 1
Interest cost 11 12
Amortization of unrecognized:
Prior service benefit 1 —
Net actuarial loss — —
Net periodic cost $ 13 $ 13
17
Note 12. Commitments and Contingencies

The Clinic has various construction projects in progress related to patient care, research, and educational
facilities. The estimated costs committed to complete the various projects at March 31, 2024,
approximated $6,031, all of which is expected to be expended over the next three to five years.
While the Clinic is self-insured for a substantial portion of its general and workers’ compensation liabilities,
the Clinic maintains commercial insurance coverage against catastrophic loss. Additionally, the Clinic
maintains a self-insurance program for its long-term disability coverage. The provision for estimated self-
insured claims includes estimates of the ultimate costs for both reported claims and claims incurred but
not reported.
The Clinic is a defendant in various lawsuits arising in the ordinary course of business and records an
estimated liability for probable claims. Although the outcome of these lawsuits cannot be predicted with
certainty, management believes the ultimate disposition of such matters will not have a material effect on
the Clinic’s condensed consolidated statements of financial position or statements of activities.
Note 13. Subsequent Events

The Clinic evaluated events and transactions occurring subsequent to March 31, 2024, through May 21,
2024, the date of issuance of the condensed consolidated financial statements. During this period, there
were no subsequent events requiring recognition in the condensed consolidated financial statements.
Additionally, there were no nonrecognized subsequent events requiring disclosure.
18
First Quarter 2024 Financial Performance Overview
MANAGEMENT
DISCUSSION
AND ANALYSIS
FOR THE 3-MONTH PERIOD
ENDED
1
MARCH 31, 2024
May 2024
A POSITION OF STRENGTH, A SPIRIT OF PURPOSE

With the support of our dedicated staff and an unwavering focus on the needs of our patients,
Mayo Clinic leads the standard for high-quality healthcare.
A GLOBAL DESTINATION FOR HOPE AND HEALING

For 160 years, Mayo Clinic has shaped the future of healthcare through innovation in practice,
research and education. Mayo Clinic has grown to include destination campuses in Arizona,
Florida and Rochester. Mayo Clinic Health System has dozens of locations in Minnesota,
Wisconsin and Iowa. With a focus on serious or complex conditions, Mayo Clinic's nearly
81,000* highly trained, compassionate staff care for 1.3 million people from over 130 countries
each year. Mayo Clinic is committed to relentlessly pursuing cures, connecting people with data
to create new knowledge and care models, and transforming how healthcare is delivered.
DRIVING NEXT GENERATION CARE

Mayo Clinic is providing solutions and hope for patients with serious and/or complex medical
conditions through the discovery, translation and application of new diagnoses, treatments and
cures. This includes new medical therapies, surgeries, and procedures delivered through
physical, digital and virtual methods.
UNPARALLELED EXPERTISE
Mayo Clinic’s expertise gives patients confidence they’ve chosen the right place for their care.
Mayo Clinic has been named “World’s Best Hospital” by Newsweek and “World’s Best Smart
Hospital” by Newsweek and Statista. It is also top-ranked in more specialties than any other
hospital and has been recognized as an Honor Roll member on U.S. News & World Report’s
2023–2024 “Best Hospitals” ranking. Mayo Clinic’s destination medical centers in Arizona,
Florida and Rochester all rank No. 1 in their states.
ROOTED IN OUR VALUES, COMMITTED TO OUR FUTURE

The strength of Mayo Clinic’s legacy is matched by our commitment to innovation and solutions.
With nearly $18 billion in annual revenue, Mayo Clinic is investing in the future of healthcare,
upholding our founders’ vision of integrated patient care, research and education and
empowering our staff to advance superior outcomes and differentiated patient experiences.
*Number of Mayo Clinic staff as of Q1 2024
2
A COMMITMENT TO CONTINUED EXCELLENCE

FIRST QUARTER 2024 HIGHLIGHTS
Mayo Clinic named 'World's Best Hospital' by Newsweek for sixth straight year
Mayo Clinic in Rochester was again ranked No. 1 in the world by Newsweek in its list of the
"World's Best Hospitals." Mayo Clinic in Florida and Mayo Clinic in Arizona were also highly
ranked. Newsweek’s rankings, which include 2,300 hospitals in 28 countries, are based on
patient survey results, an international survey of more than 80,000 healthcare professionals,
hospital quality metrics, key performance metrics such as patient safety and quality of care
measures, and patient-reported outcomes.
Algorithm to predict heart failure gets Food and Drug Administration clearance
The Food and Drug Administration (FDA) cleared an algorithm co-developed by Mayo Clinic
cardiologists and Eko, a startup that creates digital stethoscopes and related software. The
algorithm can help Eko's AI stethoscopes accurately detect low ejection fraction. Detecting the
condition early can prevent more serious heart conditions, but it often goes undetected because
it has few symptoms.
Mayo Clinic engages Cerebras to deliver potent computing power, scale AI

transformation
Mayo Clinic is a global leader in advancing trusted generative AI healthcare applications and
has entered into a multiyear strategic collaboration with Cerebras Systems to develop
multimodal large language models (LLMs) to improve patient outcomes and diagnoses. The
collaboration combines Mayo Clinic's expansive repository of decades of de-identified clinical
data with generative AI capabilities developed by Cerebras to train models to complement
physicians' expertise. Early work is underway on a prototype combining genomic data with de-
identified data from patient records and medical evidence to explore the ability to predict a
patient's response to treatments for rheumatoid arthritis. The learnings from this prototype
should lead to similar solutions to support the diagnosis and treatment of other diseases.
Mayo Clinic Platform launches Solutions Studio

Mayo Clinic Platform has launched Solutions Studio, a new program that accelerates the
development, validation and deployment of digital health solutions into healthcare workflows.
The Solutions Studio program will alleviate the high costs and complexities that digital health
companies face in the commercialization process and will streamline the adoption of solutions in
hospitals and clinics.
Mayo researchers invent a new class of AI to improve cancer research and treatments
Mayo Clinic researchers recently invented a new class of AI algorithms called hypothesis-driven
AI that is a significant departure from traditional AI models, which learn solely from data. In a
review published in Cancers, the researchers note that this emerging class of AI offers an
innovative way to use massive datasets to help discover the complex causes of diseases such
as cancer and improve treatment strategies. According to researchers, this heralds a new era of
3
designing targeted and informed AI algorithms to solve scientific questions, better understand
diseases and guide individualized medicine.
Mayo Clinic completes joint venture with Sheikh Shakhbout Medical City in Abu Dhabi
After four years of partnership, Mayo Clinic has completed its joint venture with Abu Dhabi
Health Services Company at Sheikh Shakhbout Medical City, a 743-bed hospital in Abu Dhabi.
Mayo Clinic entered a joint venture with Abu Dhabi Health Services Company in November
2019 to operate Sheikh Shakhbout Medical City. Through this partnership, Mayo Clinic brought
its expertise, standards of excellence and values to the facility with nearly 60 Mayo Clinic staff
members, including physicians, nurses, administrators and educators providing care and
support.
Over the course of the four-year collaboration, Sheikh Shakhbout Medical City opened its doors
with Mayo Clinic's integrated model of care and achieved a number of milestones, including
expanding complex care capabilities to 46 service lines, establishing the facility’s education and
research shields, launching the first comprehensive stroke center and first clinical trials in the
United Arab Emirates, and introducing AI tools into the clinical practice. The insights gained
from this experience will inform and guide Mayo's strategy as it continues to build a platform
approach to healthcare and extend its clinical knowledge and healthcare delivery expertise to
help meet the needs of patients around the world.
Mayo Clinic accommodating patient prescription needs amid Change Healthcare network
interruption
On February 21, a cyberattack on Change Healthcare, part of United Health Group, Inc. (UNH),
affected the claims and payment processing at healthcare organizations nationwide, including
the dispensing of medications for patients. Mayo Clinic was among the provider organizations
affected by the network interruption but was able to quickly adjust workflow and move
transactional volumes to other providers, avoiding significant disruptions to clinical care and
cash flow. For patients with serious health issues, teams created workarounds to ensure they
obtained their needed medications and continue to prioritize prescriptions due in the near future.
Mayo's commitment to patient care remains unwavering, and teams have actively responded to
the situation to minimize disruptions. This incident did not result in a material impact to first
quarter financial performance.
4
DISCUSSION OF 2024 RESULTS

For the three months ended March 31, 2024, Mayo Clinic generated net operating income of
$363 million on $4.7 billion in revenue, a 7.7% operating margin. For the same period, the
increase in net assets before other changes, including noncurrent and other items, was $928
million.
Three Months Ended

March 31,
($ In Millions): Change
2023 2024 From 2023
Revenue $4,273 $4,737 10.9%

Expenses 4,124 4,374 6.1%
Net operating income $149 $363 143.6%
Noncurrent & other items 284 565 98.9%
Increase (decrease) in net assets
$433 $928 114.3%
before other changes
Postretirement plan adjustment (13) (1) 92.3%
Increase (decrease) in net assets $420 $927 120.7%
REVENUE
Three Months Ended
March 31,
Change
($ in Millions):
2023 2024 From 2023
Revenue
Net medical service revenue $3,645 $3,957 8.6%
Grants and contracts 170 195 14.7%
Contributions 49 149 204.1%
Investments 134 128 -4.5%
Other 275 308 12.0%
Total operating revenue $4,273 $4,737 10.9%
As of March 31, 2024, net medical service revenue of $3.9 billion was 83.5% of total revenue
and represented an 8.6% increase from the prior year, reflecting strong outpatient, surgical and
hospital volumes. Mayo Clinic’s total operating revenue for the period was $4.7 billion, reflecting
a 10.9% increase over the same period in 2023. Revenue growth during Q1 2024 was driven by
strong volumes, reimbursement yield, and an increase in donor contributions.
5
VOLUME METRICS
Year-to-date clinical volumes are shown in the table below. All measures show an increase
compared to 2023 and 2022, reflecting strong, sustained demand for services.
3/31/2022 3/31/2023 3/31/2024

Outpatient visits 1,196,234 1,267,103 1,361,605
Surgical Cases 33,552 36,990 38,497
Admissions 29,117 29,926 31,994
Patient days 177,641 179,323 186,508
EXPENSES
Operating expenses were $4.37 billion for the three-month period ended March 31, 2024, which
represented year-over-year growth of 6.1%. At $2.57 billion, salaries and benefits increased
5.5% over the prior period and comprised 58.7% of total expenses, reflecting an increase in
staff. The increase in supplies and services is due to pharmaceutical pricing and utilization.
Three Months Ended

March 31,
Change
($ in Millions):
2023 2024 From 2023
Expenses
Salaries and benefits $2,435 $2,569 5.5%
Supplies and services 1,396 1,515 8.5%
Facilities 245 243 -0.8%
Finance and investment 48 47 -2.1%
Total expenses $4,124 $4,374 6.1%
Mayo Clinic continues to invest in its staff. In the first three months of 2024, 1,500 new
educational opportunities were available through the Career Investment Program, giving staff
additional tools to refine or learn new skills. The Mayo 403(b) Student Debt Match program
matches student loan payments to the Mayo 403(b) plan up to 4%, supporting those repaying
student loans by helping them save for retirement. Finally, a 4% annual salary increase was
provided to all allied health staff at the end of the quarter.
6
NONCURRENT & OTHER ITEMS

Noncurrent and other items include the portions of philanthropic contributions and investment
income not available to support operating activities as well as certain deferred compensation
and other charges. The increase from 2023 is largely driven by increased non-operating
investment returns during 2024. For the three-month period ending March 31, 2024 noncurrent
investment returns totaled $554 million compared to a $237 million investment return for the
same period in 2023.
CASH, INVESTMENTS AND BALANCE SHEET STRENGTH

Cash and investments totaled $19.81 billion as of March 31, 2024, an increase of $901 million
since the end of 2023, largely driven by investment gains. Of the $19.81 billion total, $3.82
billion or 19.3% is held for short-term liquidity in working capital and short-term funds.
Long Term Fund

As of March 31, 2024, Mayo's cash and investment position included $14.57 billion in long- term
investments that are held in its primary investment vehicle, the Long Term Fund (LTF). The LTF
is composed of $6.31 billion of endowed funds (both donor and board-restricted) and $8.26
billion of unrestricted reserves. Investment earnings on Mayo's endowed funds are a key source
of support for its research and education programs.
The LTF generated a 4.1% gain for the quarter ended March 31, 2024. On a three-year, five-
year and 10-year basis, the LTF's investment returns continue to meet investment objectives
and exceed benchmark performance, with 6.0%, 10.2% and 8.8% returns, respectively, over
those time periods.
Capital Expenditures
Capital expenditures totaled $332 million as of March 31, 2024. The total is comprised of $159
million in major projects, $105 million in equipment and $68 million in other projects. Major
project spending included bed tower modernization and expansions in Mankato, Minnesota, and
La Crosse, Wisconsin; the Arizona Bold. Forward. campus expansion and Arizona Integrated
Education and Research Building; the Florida Bold. Forward. Unbound. Integrated Oncology
facility, hospital expansion and central utility plant; the Bold. Forward. Unbound. in Rochester
initiative and related expansion projects, including the Anna-Maria and Stephen Kellen Building;
and the proton beam expansion.
Core balance sheet metrics are strong and within "AA" rating parameters as shown in the table
below.
12/31/2022 12/31/2023 3/31/2024

Days Revenue Outstanding 46.9 45.2 47.3
Days Cash on Hand 352 358 370
Max Debt Service Coverage Ratio 5.9x 7.2x 8.3x
Cash to Debt 307% 336% 354%
Debt to Capitalization 24% 23% 22%
7
SUMMARY
Inspired by our values and driven by innovation, Mayo Clinic's strong first-quarter results
support investments in our staff, physical and digital infrastructure, and our strategy to Cure,
Connect and Transform healthcare. Our financial performance is due to our committed staff
members, who are dedicated to ensuring the needs of Mayo's growing number of patients come
first.

Mayo Clinic: Unaudited Condensed Consolidated Financial Reports March 31, 2024

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Mayo Clinic: Unaudited Condensed Consolidated Financial Reports March 31, 2024

Uploaded by

Copyright:

Available Formats

Mayo Clinic

Unaudited Condensed Consolidated Financial Reports

Condensed consolidated statements of financial position 1

Condensed consolidated statements of activities 2

Condensed consolidated statements of cash flows 3

Notes to unaudited condensed consolidated financial statements 4-18

March 31, 2024 December 31,

Investments 19,700 18,834

Total assets $ 32,988 $ 31,927

Liabilities and net assets

Long-term debt, net of current portion 3,957 4,098

Total liabilities and net assets $ 32,988 $ 31,927

See notes to condensed consolidated financial statements.

Noncurrent and other items:

Increase (decrease) in net assets before other

Net assets at beginning of period 16,240 5063

See notes to condensed consolidated financial statements.

Three Months Three Months

Cash flows from investing activities:

Cash flows from financing activities:

Net increase in cash and cash equivalents 35 23

Cash and cash equivalents at beginning of period 80 64

Cash and cash equivalents at end of period $ 115 $ 87

See notes to condensed consolidated financial statements.

Note 1. Basis of Presentation

Note 2. New Accounting Standards

Note 3. Liquidity and Availability

March 31, 2024 December 31, 2023

Note 4. Medical Service Revenue

Note 4. Medical Service Revenue (Continued)

Note 4. Medical Service Revenue (Continued)

External lab 239 — — 239

Timing of revenue and recognition:

March 31, 2023

External lab 227 — — 227

Timing of revenue and recognition:

Note 4. Medical Service Revenue (Continued)

Note 5. Investments (Continued)

Note 6. Fair Value Measurements

Note 6. Fair Value Measurements (Continued)

Investments under securities

Other long-term assets:

Note 6. Fair Value Measurements (Continued)

Investments under securities

Other long-term assets:

Note 6. Fair Value Measurements (Continued)

Note 6. Fair Value Measurements (Continued)

Note 7. Securities Lending

Note 8. Board-Designated Funds

March 31, 2024 December 31, 2023

March 31, 2024 December 31, 2023

Note 9. Net Assets with Donor Restrictions

March 31, 2024 December 31, 2023

Subject to passage of time:

Subject to endowment spending policy:

Total net assets with donor restrictions $ 5,551 $ 5,396

Note 9. Net Assets with Donor Restrictions (Continued)

Note 10. Functional Expenses

Lab and Graduate and

Salaries and benefits $ 2,130 $ 52 $ 200 $ 100 $ 62 $ 10 $ 15 $ 2,569

Supplies and services 1,071 307 76 24 16 3 18 1,515

Finance & investment 47 3 4 1 1 — (9) 47

Total $ 3,441 $ 365 $ 303 $ 131 $ 95 $ 13 $ 26 $ 4,374