Cleveland Clinic Spent More Than $1 Billion On Community Benefit In 2018

The Cleveland Clinic Miller Family Pavilion
The nonprofit clinic spent 11.7 percent of its operating revenue on community benefits. [Cleveland Clinic]
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The Cleveland Clinic spent more than $1 billion on outreach, education and assisting low-income patients last year, according to the 2018 community benefits report released Wednesday.

The report details the clinic’s spending to improve community health, including education, subsidized health services and research. Spending was up 6 percent from the previous year, bringing increases across the board.

About $471 million was spent covering Medicaid shortfalls – when the benefit program doesn’t sufficiently cover patients’ full cost of prescriptions and care. That’s up 5 percent from 2017.

“We continue to see inflation on the cost of providing care to [Medicare] patients, with inflation on pharmaceuticals, on medical supplies, on our caregivers,” said Chief Financial Officer Steven Glass.

While spending on outreach programs went up by $3.1 million, it still dropped from 3.9 to 3.7 percent of total spending. The Clinic is working to expand outreach through its Population Health programming, Glass said.

“It’s a very different type of capability you need in treating patients that come in with an occurrence of a disease or a condition that needs to be treated, versus actually creating a delivery model where you can try and keep people healthy,” he said.

The nonprofit clinic spent 11.7 percent, or $1.04 billion of its operating revenue on benefits. That’s a slight increase from last year’s 10.7 percent. The Clinic is working within a tight margin to provide benefits and cover operating costs, Glass said.

“You can only manage that community benefit and the investment inside of that – along with education, research, community programs – inside of the context of what you can afford,” Glass said.

Education and training for residents and fellows was the second-highest expenditure, at $293.2 million. Another $77.7 million went to research, $130.7 million for financial assistance, and $26.3 million on subsidized health services.

The Cleveland Clinic is a nonprofit hospital system, and is required by the federal government to report its spending on community benefits each year to maintain its nonprofit status. The Clinic reported a total operating revenue of $8.9 billion in 2018.

In 2017, the Cleveland Clinic spent $906.5 million on community benefits.

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