NUMC forecasts $167M in financial losses next year without state aid

The health system that operates Nassau University Medical Center is projecting a $167.1 million deficit in its 2026 budget, according to documents posted online, in what new leadership has called a "conservative approach" to the new year. 

The budget, adopted unanimously by the institution's board of directors Tuesday night, does not factor in funding from the state since it's unclear how much it would be. The projections follow years of financial decline and a vicious dispute between the county and state over the management of what is the only safety-net medical care center for the poor and uninsured in Nassau.

The losses are on par with an analysis by the global accounting firm Deloitte that forecast growing annual operating deficits of more than $213 million by 2029 without a turnaround strategy in place. 

Gov. Kathy Hochul, a Democrat, is expected to provide significant support to the 530-bed hospital in East Meadow, its nursing home and community health centers after having reconfigured the system's governance structure to shift the board control from the county to the state, according to her state appointees. Last week, the new board of directors announced the hire of Thomas Stokes as its new chief executive. Stokes, 54, of Brookhaven, is chief financial officer of Weill Cornell Medicine in Manhattan until he begins at NUMC in mid-January.

The projected 2026 operating loss is $29 million more than in 2025 "due primarily to certain nonrecurring items totaling $42.5 million." Without the impact of those nonrecurring expenses, the projected deficit for 2026 would be $124.5 million, or an improvement of $13.4 million over last year, officials said. 

To offset the losses, patient service revenue in 2026 is projected to reach $461.4 million, an increase of $27.1 million over projected 2025, budget documents show.   

Hospital officials say the increased revenue comes from "management reforms to revenue cycle, managed care contract renegotiations, increases in payment rate and implemented mitigations to stabilize emergency department visits decrease." Revenue sources to the hospital are from federal plans such as Medicaid and Medicare as well as private insurance, state and local funding.   

Officials also expect non-salary-related expenses to fall by $7.7 million due to the reduction in outside services including consulting services and staffing agencies. The consulting services were hired on an interim basis when former CEO Megan C. Ryan and about a dozen hospital executives resigned in May, objecting to the state's increased authority in day-to-day operations, officials have said. Hochul tapped Stuart Rabinowitz, former president of Hofstra University, to be the chairman of the health system in June. 

Budget documents noted the lack of data after the departures of former top executives: "It is important to emphasize the conservative approach taken in composing this budget as well as the lack of performance and statistical data that, typically, would allow management to build a budget with more operational insight and precision," officials wrote in their budget presentation.

 Rabinowitz replaced former chairman Matthew Bruderman, a Centre Island businessman and major GOP donor. Nassau County Executive Bruce Blakeman, who appointed Bruderman to the NUMC board, removed Bruderman from the board after a bizarre report of a break-in at Bruderman's home in which the only item stolen was a binder of hospital financial documents. Blakeman and Legis. Howard Kopel, Republican majority leader and presiding officer of the county legislature, declined to name appointees to the new board. 

"In a short period of time, NUMC has made meaningful improvements in care, operations, and financial stability. This budget reflects that early progress — and the even greater strides we can make as we continue working to address the financial mismanagement left by prior leadership," Rabinowitz said in a statement to Newsday.  "This budget takes steps toward putting NUMC on a path that strengthens our operations and positions us to work with state partners to secure long-term stability. It reaffirms our commitment to building a stronger future for NUMC and delivering the high-quality care this community deserves." 

NUMC treats more than 80,000 emergency patients annually, many of whom are uninsured or are covered by federal, public insurance plans like Medicaid or Medicare. Budget documents show through October year-to-date, patient service volume has declined by 8% for inpatient discharges and approximately 11% for emergency department visits. 

A recent Newsday investigation revealed the health system has consistently failed to make money, or even break even, for 24 out of the last 25 years.

The Nassau Interim Finance Authority, the county's state-appointed fiscal watchdog, is expected to review and approve the NUMC budget.

NIFA chairman Richard Kessel said NUMC budget officials have been "open, honest and transparent" with their projected losses. He called it a "welcome change." 

"The notion that the prior administration ended the deficit over there is preposterous," Kessel said. "And, I'm not sure we ever believed it to begin with but this proves it. This budget is presenting an honest picture." 

A Blakeman spokesman declined to comment. 

By Candice Ferrette

candice.ferrette@newsday.comcandiceferrette

Candice Ferrette covers Nassau County government and politics on Long Island. She has been a reporter at Newsday since 2011.