The fight gets bloody: NUMC sues NIFA

Daily Point

NUMC’s Hail Mary passes keep coming

In its latest effort to push back against any attempt by Gov. Kathy Hochul to install a temporary operator at Nassau University Medical Center, the hospital and its public benefit corporation, Nassau Health Care Corp., have filed a lawsuit against the Nassau Interim Finance Authority — the county’s state-appointed fiscal watchdog, saying the authority "has repeatedly failed to exercise responsible oversight over the hospital."

NIFA and its chairman Richard Kessel have been negotiating with state and county officials regarding NUMC’s future and the potential for installing a temporary operator.

In the Article 78 action, NUMC accuses NIFA of erroneously deciding that the hospital falls under NIFA’s oversight umbrella. The 26-page complaint contends that NIFA was "grossly negligent" and "caused the Hospital, its staff, and its patients serious harm" by failing to adequately oversee the hospital.

The suit was filed Monday in Nassau County Supreme Court, by outside counsel recently hired by the hospital. However, the contract with Pollock Cohen has yet to be approved by NIFA.

The suit is a continuation of NUMC’s recent notice of claim against New York State, blaming it for failing to provide the hospital with matching funds for hospitals known as Disproportionate Share Hospitals, which have large numbers of poor, uninsured or Medicaid-eligible patients. NUMC has said it received the federal portion of the money, but was forced to first pony up the local match itself before those funds were later returned to the hospital. NUMC accused NIFA of failing to question the state about NUMC’s local share of the DSH funds.

In the Article 78 action, NUMC wants the court to remove NIFA’s oversight of the hospital, or appoint a monitor over NIFA. It also requests that the state, which is not a named party in the action, be required to distribute the matching DSH funds. And to give a sense of how raw this fight has become, it suggests the court compel NIFA to "issue a public apology" for failing to include the concern over the matching funds in recent consultant reports regarding the hospital’s finances.

In a statement, NUMC chairman Matthew Bruderman blamed NIFA for NUMC’s financial difficulties.

"NIFA’s lack of independence from Albany’s political machinery was in large part responsible for the hospital’s deplorable financial condition, that our leadership has now addressed," Bruderman said. "NIFA carried Albany’s water. It misled the public and now wants Albany to take over the hospital. We won’t allow that to happen."

NIFA comments to The Point, were sharp.

"We’re reviewing the litigation but again, I think the hospital is wasting money that could be better spent on patient care rather than enriching law firms and lawyers in a frivolous, ridiculous lawsuit," Kessel told The Point on Tuesday.

But NUMC didn’t stop with the lawsuit. The agenda for a board meeting scheduled for Thursday includes — for the second time — an attempt to make interim chief executive Megan Ryan’s role permanent. The resolution, in an agenda obtained by The Point, provides Ryan with a five-year term, at a $750,000 annual salary. On top of that, the resolution notes that there would be "additional compensation for duties performed" while Ryan was interim chief executive since she started in January.

Any contracts above $50,000 would require NIFA approval.

The moves come as discussions have intensified between state, county and NIFA officials regarding NUMC’s future, and the possibility that the state could install a temporary operator to lead NUMC — a move that likely would mean an overhaul, including the possible removal of Bruderman, Ryan and the hospital’s board of directors.

Sources with knowledge of the situation told The Point that the state is now exploring its options in advance of Thursday’s NUMC meeting.

— Randi F. Marshall randi.marshall@newsday.com

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