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Mayo to spend $3.5B on projects

This news story was published on February 24, 2012.
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Jackie Crosby, Star Tribune, Minneapolis –

The Mayo Clinic said Thursday it will invest $3.5 billion in capital projects over the next five years, putting a focus on research and cutting edge technology that leaders of the Rochester-based health system say will “redefine the future of health care.”

The network of hospitals and clinics, with major hospital centers in Florida and Arizona, expects to direct about 40 percent of the funds toward new projects. Mayo expects to maintain a spending level of about $700 million a year beginning in 2012.

The outlay may not go toward traditional brick-and-mortar projects as in the past, said Dr. John Noseworthy, Mayo Clinic CEO. Instead, some spending will go toward education and research.

Mayo has refocused its strategy on three new centers, specializing in health care delivery, individualized medicine and regenerative medicine.

The centers are focused on finding ways to get promising treatments into the hands of doctors more quickly.

The commitment comes as Mayo reported a stronger-than-average operating margin of just over 7 percent in 2011. The strong financial results were driven by increases in the number of patients coming to Mayo for complex treatments, and by record fundraising levels. Margins at the non-profit typically are in the 4 to 6 percent, according to officials.

Mayo reported income of $610 million, up 18 percent from a year ago. Revenues were $8.5 billion, up 6.7 percent. The organization said it treated 1 million patients from more than 135 countries at its network of hospitals and clinics, including 70 communities in Minnesota, Iowa and Wisconsin

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