By: Nick Buglione
Money problems have the Nassau Health Care Corporation behind on its required 2003 pension contribution to the New York State Retirement System, county Comptroller Howard Weitzman revealed last week.
The county comptroller has been conducting monthly cash balance reviews of the beleaguered health care corporation, which runs the Nassau University Medical Center in East Meadow, and his most recent review showed that it had only paid 20 percent of its employee pension bill for the current year. That's $1.6 million of the $8 million it owes, Weitzman said.
"The failure to make full pension contributions on behalf of its employees is, unfortunately, further evidence of the NHCC's inability to meet its current obligations," Weitzman said.
The comptroller began conducting monthly reviews of the corporation after he discovered a precipitous decline in its cash-on-hand during the first eight months of the year.
So far, the corporation's made two payments to the New York State and Local Employees Retirement System this month. The first was a nearly $2.4 million check representing the first installment on its contribution to the 2002 local government retirement incentive program.
The second payment, of $1.6 million, represents only 20 percent of the Nassau Health Care Corporation's regular pension payment for the current year.
In a Dec. 12 letter to the retirement system, the corporation wrote that "cash flow problems at Nassau Health Care Corporation prohibit us from providing payment in full at this time."
The corporation released a statement partially blaming escalating pension costs, claiming they have quadrupled over the last year.
The corporation has requested the state retirement system allow it to make the rest of its payments in five installments.
"As the Nassau Health Care Corporation continues to restructure its operation and achieve break even operating results and long-term stability," the statement read, "it is seeking to put this cash requirement into a period where financial stability will be greater."
Weitzman, however, criticized the five-year payment plan idea.
"Paying the retirement incentive program contribution in installments, at 8 percent interest, may be allowed under the state's requirements," Weitzman said, "but it is not acceptable for NHCC to withhold regular pension payments on behalf of its employees.
"In addition to charging 8 percent interest, the state could ultimately intercept Medicaid funds due the corporation to make up the shortfall if the payment is not made."
The Nassau Health Care Corporation has also been the target of criticism from state Comptroller Alan Hevesi in recent months. Hevesi issued a state audit in September that concluded the corporation's plan for financial recovery was unrealistic and that it was likely to lose more money.
Around that same time the corporation announced a 7.5 percent staff cut--approximately 300 clinical and non-clinical jobs--to close its gaping financial deficit. So far, 35 doctors have been let go and more lay offs could be on the way.
It's the second time in as many years the Nassau Health Care Corporation cut staff.
In the beginning of 2002, 343 Nassau University Medical Center employees were laid off to trim down its deficit.
