Nassau University Medical Center Files Suit Against State-Appointed Fiscal Watchdog Over Abuse of Power and Lack of Independence

Suit Filed in State Supreme Court Claims NIFA Made Material Omissions in Reports, Abused its Authority and Failed to Identify NYS's Massive Medicaid Scam That Cost the Safety-Net Hospital as Much as $1 Billion

EAST MEADOW, NY - - Following its discovery that New York State engaged in a decades-long Medicaid scam to deprive the largest safety-net hospital on Long Island of as much as $1 billion in aid, Nassau University Medical Center (NUMC) and its parent public benefit corporation, Nassau Health Care Corporation (NHCC), today filed suit against the Nassau County Interim Finance Authority (NIFA), accusing the Authority of gross negligence and abuses of power. In the Article 78 petition filed in State Supreme Court in Nassau County, NUMC details repeated decisions that were arbitrary, capricious, and abuses of the Authority's discretion. The petition alleges there were significant violations of the public's trust on the part of the State-appointed fiscal watchdog to advance either its own or the State's agenda to the reputational and financial detriment of the hospital.

"What my clients have uncovered eviscerates the credibility of NIFA as an independent financial oversight organization," said Steve Cohen, Partner at Pollock Cohen LLP, who is representing NUMC in the matter. "NIFA's repeated efforts to craft a misleading public narrative and manipulate data are clear attempts to justify its legally dubious oversight of NUMC's finances," said Cohen.

"NIFA's failure to uncover the state's Medicaid fraud scam has deprived the hospital and those it serves of substantial aid. Its unwillingness to provide basic fiscal supervision is truly shocking. If all this behavior wasn't intentional, it was certainly grossly negligent. The Court needs to act to protect the hospital and the patients it serves from this abuse. NIFA's negligence endangers the continued survival of this critical health care resource for the most vulnerable people of Nassau County," said Cohen.

The petition lays out how, in 2020, NIFA unilaterally decided it had financial oversight over the hospital due to its poor financial condition, despite never acknowledging that said financial condition was created by the state's Medicaid shell game, which violated federal law and the drastic reductions in direct State assistance to the hospital.

NHCC has filed a Notice of Claim against New York State as a prelude to a lawsuit alleging the state illegally forced NUMC to pay the non-federal share of Medicaid funds for nearly 20 years, thereby depriving the hospital of as much as $1 billion in aid for the at-risk communities it serves.

The petition lays out in detail NIFA's repeated failure or unwillingness to uncover the state's Medicaid shell game, and it accuses NIFA of using it's high-paid consulting firm, Alvarez and Marsal, to manipulate its reports to shield New York State from responsibility for destabilizing the hospital.

The suit asks the Court to nullify NIFA's financial oversight of NUMC, impose a monitor over NIFA to ensure it is fulfilling its statutory role competently, and independently, instruct NIFA to apologize publicly and correct two manipulated financial reports produced by its consultant, Alvarez & Marsal. Those reports which, due to material omissions in the analysis, misrepresented NUMC's financial condition to justify recommending a state take-over of the facility.

"They abused their authority to extend financial oversight to the hospital and then provided no oversight," stated NHCC Chairman Matthew Bruderman. "What was worse, they lied to the public by omitting key data about state aid cuts and the state's Medicaid scheme to justify recommending slashing our staff by 90 percent during the pandemic. They provided no solutions, despite paying their consultants millions."

"This wasn't incompetence or an accident. 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 team has now addressed. 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," stated Bruderman.

"NIFA has repeatedly misrepresented to the media, to the hospital's staff, and to the public that the hospital was in the midst of a financial crisis and should be shut down. That is simply untrue, insulting to the dedicated people who work here and unnecessarily scares the patients who depend on this hospital," stated interim President and CEO, Meg Ryan.

The current NUMC leadership team has undertaken a substantial fiscal and operational reform program to dramatically improve the hospital's financial position. NUMC recently received its Gold Star Certification from the Joint Commission and its first increase in its healthcare grades in six years. The hospital has also expanded services and modernized several of its facilities over the last year. "Our entire team has done an outstanding job putting this reform program into action to ensure that we continue to improve the range and quality of our services to everyone, regardless of their ability to pay," stated Ryan.

"We are an essential part of this community, and we won't let Albany politicians play games with people's healthcare," said Bruderman.

###

ABOUT NASSAU UNIVERSITY MEDICAL CENTER
Nassau University Medical Center (NUMC) is a leading healthcare provider dedicated to delivering comprehensive, high-quality medical services to the residents of Nassau County and beyond. As a Level I Trauma Center, NUMC is equipped with cutting-edge facilities and a highly skilled medical team, offering a broad spectrum of services including advanced emergency care, specialized surgeries, and expert outpatient treatments. As a key teaching hospital affiliated with prominent medical schools in the region, NUMC plays a critical role in training the next generation of healthcare professionals. With a strong focus on patient-centered care, innovation, and community outreach, NUMC is committed to improving the health and well-being of all its patients.

Public link

Please use the above public link if you want to share this noodl on another website.