Last year the US President, Barack Obama praised the Mayo Clinic as an exemplary health-care provider with better services and outcomes at low-cost.

Last week Mayo Clinic said that it won’t treat any Medicare patients at one of the primary care clinics in Arizona.

It said that the declaration comes as a result of the two-year pilot program to determine if it should also drop Medicare patients at other facilities in Arizona, Florida and Minnesota serving more than 500,000 seniors.

Mayo states that it suffered a loss of $840 million last year as a result of treating patients under the low reimbursement rates. A total loss of $120 was incurred on its hospital and four clinics in Arizona.

It further states that only governments can afford to loose such a huge sum and still resist making a change in the program.

The institution said, “Mayo Clinic loses a substantial amount of money every year due to the reimbursement schedule under Medicare. Decades of under-funding and paying for volume rather than value in Medicare have led us to this decision.”