John Noseworthy on The Mayo Plan
We agree with Dale Kurschner’s perspective that Minnesota is home to outstanding health care (“Hold the Mayo,” Twin Cities Business, March 2013). Today, Minnesota is fortunate to be recognized as a national and global leader in health, healing, and the biosciences. Minnesota is a net importer of health spending and home to several first-class medical institutions, bioscience and medical device companies, and community health organizations. Mayo Clinic is proud to be part of this vibrant group. But we must look beyond today to a future that secures Minnesota’s place as a worldwide destination.
Sustaining Mayo Clinic and Minnesota as global medical destinations is far from a foregone conclusion. Cities around the nation and world are making significant investments to secure their positions as global destinations for medical care. Cities, states (Ohio, Maryland), and foreign countries are making significant public investments to attract and/or expand high-value medical and bioscience development to position themselves as world-class destinations.
For 148 years Mayo Clinic, the state’s largest private employer, has served as a national and global destination. Today, our 49,000 employees in Minnesota, including 34,000 in Rochester, serve patients from all 50 states, more than 135 countries, and all walks of life. Mayo Clinic currently serves 500,000 individual patients per year in Rochester, many of whom travel with two to three companions. Those numbers, when combined with the scientists and other providers who travel to Mayo, bring the number of visitors to Rochester to nearly 3 million per year. While other Minnesota health care organizations do a great job serving their patients, no other Minnesota health care provider can drive this kind of revenue and job growth by generating demand for its services from across the nation and around the world. As the largest national and international clinical practice in North America, Mayo Clinic is uniquely positioned to make Destination Medical Center (DMC) a success. The entire state will benefit through new jobs and tax revenues.
Mayo Clinic proposed DMC, a 20-year, multibillion-dollar economic development initiative, to expand Minnesota’s and Mayo Clinic’s position as one of the world’s truly global destinations for medical care for decades to come. DMC is one of the largest economic development initiatives in Minnesota, with the prospect of more than $5 billion in private investment, $3 billion in new tax revenues generated to state and local governments over 20 years, and 25,000 to 30,000 new jobs with expected incomes nearly twice the U.S. per capita average.
As Harvard Business School professor and former Medtronic CEO Bill George pointed out in the March 1 StarTribune, Minnesota has been a mecca for everything related to health care, and we need to adopt the “bold goal of becoming the standard-bearer for the nation’s health.”
DMC will strengthen Minnesota’s leadership position in health and biosciences for generations to come, and significantly elevate Minnesota’s profile on the global stage as a center for health, healing, and the biosciences.
Commercialization—the creation of new businesses and jobs developed through close collaborations—is central to DMC. Rochester (and Minnesota) currently lose almost all of the start-up biotech companies created here to other states. Mayo Clinic provides research for and has equity in a number of start-up biotech companies. Of approximately 91 businesses launched by Mayo Clinic in the last decade, only a handful located in Rochester or Minnesota. The rest located in other states. The DMC plan will help ensure that our state is the preferred location for start-up businesses, keeping the jobs they bring here in Minnesota.
Minnesota is fortunate to be home to an array of fine organizations in the health care and medical science fields. DMC will favorably impact these organizations as well. As Minnesota increasingly becomes known worldwide as the center for high-quality medical care and attracts increasing numbers of new patients from around the globe, these new patients and those who accompany them will visit not only Mayo Clinic, but also other high-quality medical providers and systems in our state.
The rising tide of Minnesota’s global reputation for health care excellence benefits the entire state. The influx of additional high-value medical spending to the state represents the opportunity for a significant win for Minnesota’s future.
The proposed DMC financing plan is unique—the public investment is contingent on new incremental tax revenue actually collected by the state. Unlike many standard economic development proposals, DMC is built on proof, rather than the promise of growth. Unlike almost all other front-loaded economic development projects, the public investment in DMC will follow private development and be based on growth that has actually occurred.
The availability of public funds to DMC will be realized only if private investment is made and economic growth occurs in the market. Some perceive that these funds will go to Mayo Clinic. None of the public money will go to Mayo Clinic. The funds will support the development of infrastructure that surrounds Mayo Clinic. This produces a low-risk, high-return finance plan for the State of Minnesota that we believe is sound public policy.
We are proud that a strong coalition of community organizations, local government, businesses, labor organizations, and others have already committed to DMC. Their energy and enthusiasm is palpable. We are confident it will lead to the successful passage of this finance plan. We encourage others to join us in working together to secure and expand Minnesota’s health and bioscience economic base and leadership position for generations to come.
Dr. John Noseworthy is president and CEO of Mayo Clinic.