The Mazzoni Center’s recent financial hardships first entered public discourse after an audit for fiscal year 2022 included a “going concern” notice. This note is inserted into a financial audit when auditors predict that an organization will have difficulty meeting financial obligations for the foreseeable future. It’s often a “red flag” that signals an organization might not be financially stable or could even close.
An audit for fiscal year 2023 was recently issued — and auditors included a similar note. But the report also highlights the steps the center has taken to carve a better path forward to address concerns.
“The audit is a snapshot in time,” said Sultan Shakir, Mazzoni Center’s president and executive director, who underlined that this specific report offers a view of the center’s financial position “around two years ago” with just a few comments about current standings and future plans. An annual report — which Shakir expects to publish in the next few months — will offer more information about today.
The audit shows that revenue from operations was up by almost $600,000 from 2022 to 2023 — but Mazzoni Center still landed in the red. Cash and cash-equivalent assets decreased by over $1 million and overall assets dropped by over $2 million. Expenses also increased. Approximately $3 million in operating losses is noted for 2022 and $3.5 million for 2023.
“What you’ll see [in the report] is that it shows Mazzoni Center made an investment in the community and what you’ll see today is how that investment really paid off,” Shakir continued, explaining that the organization was recently able to eliminate excess wait times, increase behavioral health offerings, establish a more integrated approach to care, and increase accessibility — accomplishments that don’t get reflected in these short-term financial outcomes.
“Where do we need to spend money in order to improve access and care for our community?” Shakir said Mazzoni’s leaders were asking at the time, seeking ways to spend with intentionality. “In 2022, we spent almost $15 million — and in 2023, we spent almost $16 million.”
Some of the budget losses visible in the report can be attributed to the center’s pursuit of becoming a Federally-Qualified Health Center (FQHC) Look-Alike — a designation that allows the organization to be reimbursed for care provided to Medicare and Medicaid beneficiaries, purchase medications at a reduced cost, offer free vaccines and access other benefits.
In 2023, Mazzoni provided behavioral health care to 777 individuals and the organization’s Intensive Outpatient Program (IOP) serviced 30 patients. More than 6,000 HIV tests and take-home HIV tests were distributed — and more than 1,676 people living with HIV and their families received food, case management, gender-affirming services, and housing subsidy services through the center. Direct legal services were provided for 298 people. The center also provided training and education to more than 6,400 service providers on LGBTQ+ specific health, mental health and legal topics.
The designation may help offset costs the center has historically eaten in the past — as Mazzoni has never turned away patients or clients who could not pay for services. Although it took time for Mazzoni to see the full benefit of becoming an FQHC Look-Alike, Shakir said the organization is now fully benefiting from the designation in 2025.
Shakir explained that the organization spent the most money on increasing staff — which cost Mazzoni over $850,000 more in 2023 than 2022 — and ensuring equipment could meet the need of increased patient volume associated with the designation.
“If you look at it from a profit lens, you sort of look at it incorrectly,” Shakir noted about the audit report — underlining that he believes a “going concern” notice is standard for any nonprofit that invests more money in its community than it receives in return.
Various nonprofit health systems across Philadelphia — including major players like Jefferson and Temple health systems — have individually reported tens of millions of dollars in losses over the past few years and in 2025. Many cite troubles climbing out of the pandemic, systemic failures of the health care system as a whole, and challenges related to providing care to low-income and high-needs patients as contributing financial stressors (all problems Mazzoni has also faced which have caused setbacks).
Mazzoni’s 2023 audit also highlights financial turmoil that struck after the audit’s window — in fall 2024. Just months after the 2022 “going concern” notice was issued to the organization, the center’s former executive financial officer signed contracts with two “merchant cash advance” funders — companies that provided Mazzoni with quick cash to cover payroll expenses in exchange for high-interest returns of the center’s future earnings.
Mazzoni claimed the former employee did not have permission to enter into these agreements and tried to return the money it was given — but the funders filed lawsuits for breach of contract. The funders issued UCC liens to business partners who owed money to Mazzoni — including the city of Philadelphia, Walgreens, Stripe Inc. and Cigna — blocking the center’s access to reimbursements and revenue. Mazzoni claimed in court documents that immediate repayment of these debts could lead to bankruptcy.
Shakir didn’t comment on the matter — as it is still pending litigation — but he did note that Mazzoni hopes for a quick resolution.
Although increasing staff was an important investment for the center in the year reflected in the audit, Mazzoni’s financial struggles in 2024 resulted in layoffs. Shakir said the center is now in the early stages of planning to increase their workforce again.
That began with an important new hire — Mazzoni’s new executive financial officer, Dan Clemons, who was previously the CFO at Philadelphia FIGHT.
“They come with decades of experience working with FQHC Lookalikes,” said Shakir, noting that some of the processes associated with realizing those benefits can be difficult to navigate. “And so it’s really great to have somebody who can help us chart the future to ensure that we really are using the community’s resources and our resources as strategically as possible to meet the many and changing needs of our community.”
A note in the report highlights that Mazzoni Center received 90% of its support and revenues and 96% of its accounts receivable from government agencies and third-party billing sources in 2023 — noting that a change in government priorities, for example, could adversely affect the center’s programs and activities. But Mazzoni has secured new funding options.
A five-year $1.8 million grant from the Pew Charitable Trust is helping the organization create a strategic business plan. Shakir explained that part of those efforts will include an internal analysis of the services Mazzoni currently provides and how they’re implemented. It will also include consideration of necessary services the community needs that the center doesn’t currently provide, whether or not other organizations are bridging those gaps, and — if not — how to create opportunities that are as accessible as possible for a diverse population.
“That’s work we’re really excited to be doing,” Shakir said, underlining that it will help the organization better serve those who are traditionally “left out of these conversations” — including Black and brown individuals, those with low incomes, and people whose backgrounds haven’t allowed them to access health literacy.
Philanthropic revenue is also on the rise, Shakir explained. The report claims that over the past two years, the center has received its first congressional appropriation, doubled its annual supporters, connected with the largest individual donor to date, and developed a high-profile fundraising event — a tribute event called Mazzoni Center Honors.
The report underlines that the center’s leaders have “continually implemented changes to improve Mazzoni’s liquidity, financial condition, and operating results” — citing many of the programs, initiatives and accomplishments Mazzoni has also outlined as reason for optimism. It emphasizes that it will be Mazzoni’s ability to successfully complete its plan that will dictate whether or not it can become financially stable.
Shakir said he’d rather Mazzoni endure a temporary hardship as they made major changes to address the needs of the community than for those needs to persist when the organization could have done something about it. He underlined that caring for the community has always been the top priority and that he believes these new initiatives will place Mazzoni Center on a path to become more financially stable.
“Every nonprofit consistently needs to balance meeting a huge community need with looking at the available resources that we currently have and the resources that are potentially available in the future,” Shakir said. “And what we see is, given that we made a strong investment in the organization’s ability to see more patients and clients and create a more integrated model of care, we’re really confident about the organization’s position.”