Sunday, January 19, 2025
Among the top priorities of the Nassau County Interim Finance Authority is ensuring that Nassau University Medical Center remains open, returns to financial health and is available to serve the people who need it most. A recent op-ed in the Herald by NUMC leadership (“After reforms, NUMC is on the upswing,” Oct. 10-16) caught our eye, because it painted a rosy picture of the hospital’s financial situation, even though the facts say the opposite.
Despite the platitudes offered in the op-ed, the fundamental issue remains that the Nassau Health Care Corporation, the state public authority that manages NUMC and related facilities, continues to operate at a tremendous deficit while making no meaningful changes to work toward financial stability. NHCC’s operating losses (before certain actuarial adjustments) were approximately $77 million in 2023 and roughly $108 million in 2022. NIFA is projecting an operating loss for NHCC of around $120 million in 2024.
Earlier this year, NHCC made a unilateral demand for substantial additional funding from the state. In response, the State Department of Health requested that NHCC provide certain required information and take particular actions to achieve balanced operations in order to be considered for extraordinary relief. Amazingly, NHCC has resisted complying adequately with the Health Department’s reasonable conditions that it must impose to ensure that NHCC would manage the state’s scarce resources appropriately.
At the core of its financial instability is the fact that NHCC owes the New York State Health Insurance Program, or NYSHIP, $9 million per month in premiums. NHCC pays only $2 million each month, creating a monthly deficit of $7 million. Over the past four and a half years, the total that NHCC owes NYSHIP has ballooned to roughly $380 million.
That isn’t just some enormous number sitting in a filing cabinet in Albany: It’s a tremendous cost that is being passed on to other municipal organizations in Nassau County and throughout the state. This means that these costs are being subsidized by entities like local governments and school districts, and thus, taxpayers. The increased burden on Nassau County and other taxpayers will only get worse if the hospital’s ineffective leadership is not changed for the better.
NHCC executives are potentially placing an even greater financial strain on the shoulders of their over 3,500 employees (along with retirees), all of whom are at risk of losing their health insurance should these arrears on NYSHIP payments continue. The New York State Civil Service Commission has sent NHCC numerous letters over the past three years alerting leadership that the health care corporation is at risk of termination by NYSHIP due to these unpaid amounts. It is the negligence of NHCC’s executives that has led it to this point.
The hospital’s problems are the result of poor management and an ineffective board, whose members must be replaced in order for the situation to improve. NIFA knows for certain that, in order for NUMC to continue serving our community, its existing leadership must change, and soon. NHCC’s current board leadership and management have shown that they are ill-equipped to oversee such a delicate operation.
Their lack of ability shows, and it could ultimately result in the hospital shutting down entirely. Thousands of people would be out of jobs, and all of us would lose a crucial medical resource in our community.
The last thing we want is for NUMC is to close its doors. Along with Gov. Kathy Hochul and her top staff, NIFA is working hard with all stakeholders to keep them open.
Richard Kessel is chairman of the Nassau County Interim Finance Authority.
