Outside the Mayo Clinic's Gonda building in Rochester, Minn.
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The Mayo Way
The Mayo Clinic attracts Kings and Presidents, injured athletes and ailing billionaires. When Mr. Burns visited Mayo on The Simpsons, Fidel Castro and the Pope were chatting in the waiting room. But Rochester's costs are well below the national average because Mayo also provides tremendous value for ordinary care; its flagship hospital spent just more than half as much per patient in the last two years of life as did the UCLA Medical Center.
What makes Mayo different? It's clearly avoided the oversupply trap — the UCLA center had about 50% more beds, and its chronically ill Medicare patients spent about 50% more time in the hospital. But that's just part of the "Mayo way."
On a visit to Rochester last month, I watched a hospice team of nurses, social workers, a chaplain and just one doctor talk about dying patients in ways that might have baffled the white coats on Emanuel's cancer ward: platelets were discussed, but so were spiritual needs, family tensions, hobbies and anything else relevant to quality of life. It sounds squishy, but Mayo patients who request palliative care have 84% lower hospital costs, 53% lower overall costs and higher satisfaction. Mayo has computerized medical records that provide instant access to patient histories, improving information-sharing, reducing pharmacy errors and eliminating the hassle of tracking down charts. The staff cafeteria even gives away fruit, illustrating Mayo's apple-a-day commitment to prevention and wellness. Like other low-cost, high-quality institutions — the Cleveland Clinic, Geisinger in Pennsylvania, Intermountain in Utah — Mayo is dedicated to offering integrated and coordinated care, with a broad network of providers working together to reduce redundant tests and office visits, improve disease management and generally avoid treating patients like pinballs. "It's a team sport here," says David Lewallen, a Mayo orthopedic surgeon. "A bunch of tennis players doing their own thing just doesn't work — it's too expensive, and it's bad medicine. We only do things to help the patient, and we're all looking over each other's shoulders."
Mayo also has an institutional obsession with evidence-based medicine, using electronic records for in-house effectiveness research, constantly monitoring its doctors on everything from infection rates to operating times to patient outcomes, minimizing the art of medicine and maximizing the science. "We try to drive out variation wherever we can," says Charles (Mike) Harper, a neurologist who oversees Mayo's clinical practice in Rochester. "Practicing medicine is not the same as building Toyotas, but you can still standardize. Uncertainty shouldn't be an excuse to ignore data." Mayo has teams working on evidence-based protocols to reduce the use of intensive care, lower valve-replacement costs and avoid unneeded transfusions. It's standardizing a handoff protocol that reduced errors after shift changes at its Arizona branch, as well as a program that boosted patient satisfaction by teaching doctors at its Florida branch to listen better. Mayo even has its own registry to track artificial joints, which are expected to increase fivefold by 2030 as baby boomers seek spare parts. Reducing the failure rate for artificial hips and knees 10% could save taxpayers $500 million a year.
Mayo doctors are also shielded from the incentives that discourage evidence-based medicine, because they all receive fixed salaries. They don't make more if they do more to patients, and they don't make less if they take more time to talk to them — even if they use the time to explain why a CT scan or a wonder drug advertised on TV might not be advisable. They don't have to worry about reimbursements that overvalue radiological tests and invasive prostate treatments, undervalue preventive care and watchful waiting and put zero value on returning a phone call or thinking about a case. "We've been able to buffer our staff from the harsh realities of the system, so they can concentrate on patient needs," says Dawn Milliner, a kidney doctor who oversees clinical practice throughout Mayo. "But it's not clear how long we can keep doing that."
That's the bad news about Mayo's success: it's not sustainable. The harsh reality is that smart, conservative, data-driven, patient-focused medicine is not necessarily profitable medicine. Last year, Mayo lost $840 million on $1.7 billion in Medicare work. It compensated by charging private insurers a premium for the Mayo name, but they're starting to balk. "The system pays more money for worse care," says Mayo CEO Denis Cortese. "If it doesn't start paying for value instead of volume, it will destroy the culture of the organizations with the best care. We might have to start doing more procedures just to stay in business."