NUMC debt could imperil health coverage for its workers

Daily Point

$310M owed to NYS insurance program

The public benefit corporation that manages the Nassau University Medical Center owed a stunning $296,612,502.76 in back payments to the New York State Health Insurance Program as of Nov. 17, 2023, according to a letter from the state Department of Civil Service, which oversees NYSHIP. The amount due has since grown.

According to the Nov. 28 letter obtained by The Point, the debt could put NUMC employees’ health insurance coverage at risk.

In response to inquiries from The Point, a Department of Civil Service spokesman said Thursday that the current arrears now approximate $310 million. The failure to pay in full for the health insurance of NUMC's workers has been going on for at least five years.

The spokesman noted that the Nassau Health Care Corp. already had a payment plan in place since 2019 to deal with prior debt. Under that plan, the corporation is required to pay $2 million a month to address the past arrears, while also paying its current monthly premium of $8.6 million a month. Sources told The Point that Nassau Health Care Corp. has been paying the $2 million a month, but not the current premiums, plunging it further into debt.

“The Department of Civil Service is continuing the conversation with NuHealth regarding the balance of its arrears,” the spokesman said in a statement.

The letter to then-chief executive Anthony Boutin from Department of Civil Service Deputy Commissioner for Administration Jian Paolucci requested full payment or an agreement for a proposed payment plan by Dec. 27, 2023.

“In addition, please be advised that this matter has been referred to the Department’s attorneys for further review and action,” the letter said.

Paolucci also noted that under state regulations, “an agency in default risks termination of NYSHIP coverage retroactive to the last date coverage was paid and retroactive expulsion from NYSHIP to such date.”

“The Department may also pursue other debt collection remedies allowed under the law, including referral to the NYS Office of Attorney General for collection,” the letter said.

Nassau Health Care Corp. is addressing the issue, interim president and chief executive Megan Ryan told The Point.

“NHCC has obtained an extension for this and we are in ongoing discussion with [the Department of] Civil Service,” said Ryan, who also serves as NHCC’s general counsel. “We will be commenting further on this matter next week.”

The arrears, however, represent a concern for more than just NUMC, a spokesman for Gov. Kathy Hochul told The Point.

“Their failure to pay drives up costs for other ratepayers, for other local governments, for state employees and for the state government in general,” the spokesman said. “All of those entities pay into NYSHIP and we have an obligation to all of those entities to have a fair playing field.”

“We’re very much open to reaching a workable solution for everyone involved,” the spokesman added.

The letter comes as NUMC has had years of financial turmoil. The 2023 budget for Nassau Health Care Corp. projected an operating deficit of $179.3 million, higher than the 2022 deficit of $154.3 million. NHCC’s budget documents say that increase was due to “factors beyond the control of NHCC management,” including inflation and staffing shortages that required employment retention incentives.

Hochul told the editorial board last month that the future of NUMC is a priority for her administration. Whether the Civil Service letter jump-starts an even bigger push to deal with the ailing hospital remains to be seen.

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

Pencil Point

Bordering on insanity

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Reference Point

A taxing issue through the decades

It’s budget time. In New York, that means it’s time to negotiate state school aid. Year in, year out, it’s a primary bone of contention.

By now, we all know the contours of the debate. Quality education is not cheap, costs only go up, but how much can taxpayers bear?

It’s a debate that has riveted Newsday’s editorial board pretty much since the newspaper’s inception.

Back in 1949, the board contemplated state school aid in a Feb. 1 piece called “Whopper in the Hopper” that analyzed that titular “whopper” — Gov. Thomas Dewey’s $936.2 million budget proposal that contained “greatly expanded” assistance to K-12 schools.

“Republicans, Democrats and taxpayers are all sour on the idea of taxes going up,” the board wrote. “People who in the past few years joined the chorus of demands that the state spend more and more on education are cooling off and wonder if we must neglect other worthies and overtax everybody for teacher’s benefit, and to send the kids to good schools.”

The board said that Dewey, responding to “public pressure,” proposed a $40 million increase in school aid beyond the $194 million required by “existing laws.”

“So there it is,” the board wrote, “and virtually all your increased income tax money next year may go to improving teacher’s pay and the educational [system]. It should end that demand. But will it?”

We all know the answer. Both school aid and the overall budget are massively larger now, with Gov. Kathy Hochul’s 2024-25 spending plan coming in at $233 billion and proposed school aid at $35 billion, the starting point for negotiations.

Since 1949, Newsday’s board has revisited the topic frequently, including in 1969 in another Feb. 1 piece called “Paying for Schools.” This time, its lament — regarding predicted school spending increases of 300% in Nassau County and 500% in Suffolk by 1985 — was accompanied by a full-throated defense of the value of education.

“It is important to note that education will remain a bargain,” the board wrote. “Even in the most narrow terms the schools pay for themselves many times over. Nevertheless, there are limits to what Long Islanders are willing or can afford to pay.”

The board said “judicious cost-cutting” would be needed to avoid a “taxpayer revolt,” but warned that “cost-paring will not solve the school financing problem,” and dipped its editorial toe into the fraught waters of finding a school funding stream other than property taxes.

“The fundamental need is for tax sources which are broader than the real estate levy, which now carries most of the load. The obvious source of increased school money is the federal government, whose income tax remains the broadest-based and fairest tax in the country,” the board proposed, before acknowledging that there was “little early prospect” that would happen.

That 1969 board concluded that the state should assume more of the cost but wrapped that advice in a warning: “The important thing is that children, our most precious resource, should not be caught in the middle …”

Words that frame every school funding debate, then as now.

— Michael Dobie michael.dobie@newsday.com, Amanda Fiscina-Wells amanda.fiscina-wells@newsday.com

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