New York hospital argues it met requirements for $83M from state

East Meadow, N.Y.-based Nassau University Medical Center has responded to a letter from the state health commissioner that stated that NUMC must improve its financial picture to receive $83 million in emergency state funding to stay open.

Nassau Health Care Corp., which operates the 530-bed tertiary care teaching hospital, submitted the response to state Health Commissioner James McDonald, MD, on March 25.

In a letter to Dr. McDonald, which was shared with Becker's, NHCC says it "agrees that over the past two decades there have been many shortcomings particularly regarding the NHCC's financial management. However, as outlined below, the NEW NHCC leadership has been taking swift and immediate action to turn around the decades of financial mismanagement."

The letter comes after a March 1 letter from Dr. McDonald informed the hospital it would have to agree to state terms, such as conducting a professional and public search for its next CEO and submitting a detailed five-year plan for improving operations and reducing losses, to receive $83 million in emergency state funding to stay open. Dr. McDonald also pointed to "a distinct lack of transparency and clear communications" between NHCC and state officials. Following the letter, some Nassau County Democratic legislators and community stakeholders called for an overhaul and oversight to save NUMC.

In its response, NHHC pointed to the expertise of NHCC and NUMC Chair Matthew Bruderman as well as new C-suite management who took the helm in January. 

The term for Anthony Boutin, MD, as the hospital's president and CEO expired in October 2023. In January, the board voted not to renew his contract and to begin searching for a permanent CEO, along with a chief medical officer and chief nursing officer. Megan Ryan, NHCC's general counsel, was selected as interim president and CEO. 

"Our new management team is led by me, our interim CEO and president, which includes many dedicated leaders — all of whom conduct themselves as stewards of public funds and who take their fiduciary duties very seriously," Ms. Ryan told Dr. McDonald. "As outlined below, NHCC has already implemented most of your requests. That being said, NHCC asks DOH to reconsider certain items. For example, additional funding from the state to help close NHCC's funding gap does not need to be exclusively [Vital Access Provider Assurance Program] funding. Instead, some funding could be provided by a payment to cover NHCC's non-federal share for [Intergovernmental Transfer] programs."

Regarding a five-year plan for NUMC, Ms. Ryan said NHCC submitted its financial sustainability plan to state officials last fall and has since worked with NHCC CFO Perry Sham and Mr. Bruderman to update and further refine the plan. 

"As stated, implementation of performance enhancing initiatives has already begun, and our goal is to rely on less and less government subsidies year after year," Ms. Ryan said. "We have been in contact with [state officials] and continue to provide all requested documents and have been promoting continued transparency with" the state department of health and the Nassau County Interim Finance Authority.

The five-year plan is in a presentation that was given to legislators, the state and the local control board and points to more than $100 million in revenue-enhancing and cost-saving initiatives that are being executed, including the hiring of a highly qualified CFO — Mr. Sham, who was hired in December — and new timely monthly financial statements. 

Regarding the CEO search, NHCC retained executive search firm Korn Ferry late last year, and the NHCC board will select a new CEO subject to the approval of the Nassau County executive.

The state department of public health confirmed to Becker's that it received NUMC's letter and is reviewing it.



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