Nassau County Comptrollers Office

Despite a temporary upturn in NHCC's cash position in the last four weeks, the public corporation that runs Nassau County's only public hospital is still dangerously low on cash and the long term trend continues to be of grave concern, Comptroller Howard Weitzman said today, as he released his monthly analysis of the corporation's cash balances.

The report, which reviews cash-on-hand as of May 15, finds that the hospital corporation's cash and "cash equivalents" increased by $7 million to $10.6 million. Its working capital increased $12.8 million to $14.8 million. Nevertheless, the corporation projects that it will have "a negative cash position" by October.
"NHCC's cash position is dangerously low and remains a grave concern," Comptroller Weitzman said. "The slight improvement in NHCC's cash position is due to its normal revenue cycle and not to operational improvements. The bottom line is that NHCC is still running out of cash."

The healthcare corporation's available cash improved because the state of New York, after a delay, made intergovernmental transfer payments due NHCC of $2.3 million; the state made an additional payment of $6.5 million under a program that subsidizes hospitals serving a large proportion of Medicaid and low-income patients; and Nassau County made a second quarter advance payment to NHCC of $11.7 million. The various payments, which had been predicted in previous cash analyses by the Comptroller, have a minimal impact on the long-term downward trend of NHCC's cash position, the Comptroller said.

Although NHCC reported that during the month it made some payments to vendors that it had previously deferred, the corporation also increased its borrowings from an account reserved for malpractice claims during the period, from $8.6 million to $10 million.

NHCC's new Chief Operating Officer, former Deputy County Executive Arthur Gianelli, is currently updating the health care corporation's strategic plan, with the help of the county's consultant, Manatt, Phelps & Phillips. The plan is expected to project the amount of additional county subsidies required to stabilize the corporation. Each year, Nassau County purchases services from NHCC and pays subsidies to it with a combined value of approximately $60 million.

The county is currently considering an additional subsidy to NHCC of $98 million, to be paid out of funds borrowed against future payments from the court settlement with the major tobacco companies.
"I continue to believe that Nassau County should not provide additional subsidies to NHCC until we are convinced that a workable strategic plan is in place and that the management team is committed to carry it out," Comptroller Weitzman said.

"On a positive note, I am encouraged by County Executive Suozzi's appointment of Martin Payson to serve as Chairman of the NHCC Board. NHCC requires strong Board leadership to ensure that hospital management takes the actions necessary to prevent this vital healthcare system from failing. With his extensive background in helping troubled hospitals and his chairmanship of NIFA's committee on NHCC, Payson has shown that he has the experience, leadership and financial acumen needed to help put the hospital's turnaround back on track."

The Comptroller reinstated monthly reviews of NHCC's cash accounts in December 2005, following the corporation's failure to meet its 2005 budgetary goals. The report is distributed to the NHCC Board, the County Executive, the Nassau Interim Finance Authority, the County Legislature, and the Comptroller's Independent Audit Advisory Committee. The full report may be read or downloaded by clicking on the document title below.

COMPTROLLER: MONTHLY AUDIT SHOWS PUBLIC HOSPITAL'SCASH PROBLEMS CONTINUE

COMPTROLLER: MONTHLY AUDIT SHOWS PUBLIC HOSPITAL'S
CASH PROBLEMS CONTINUE