Former top NUMC executives spent thousands on expenses amid financial woes, reports show

On the eve of Gov. Kathy Hochul appointing new leadership at the cash-strapped Nassau University Medical Center, a few top executives ate $175 lobster and $68 Wagyu steak, running up a $1,437.75 bill in a Manhattan restaurant at the hospital's expense,  reimbursement records show.

The seven people dining at The Lobster Club on East 53rd Street and Park Avenue on May 29 were in the city for the Greater New York Hospital Association's annual meeting and reception, according to the stated purpose for travel. The hospital group's annual meeting and reception ran from 5 to 9 p.m. at the Jacob Javits Convention Center on the West Side.

The dinner across town was among the thousands of dollars in expenses racked up by former NUMC CEO Megan Ryan and other executives at Nassau's only safety-net hospital, which is more than $1 billion in debt. Ryan, who had served as interim CEO, was named the permanent pick at a December meeting of the former board with a salary of $550,000 and is in a dispute with the new leadership over the terms of her departure. 

Newsday obtained expense reports and reimbursement request forms filed by the former leadership through the state's Freedom of Information Law.

A review of hundreds of pages of the most recent credit card statements and receipts obtained through a request to the Nassau Interim Finance Authority provide a snapshot of executive spending for conferences and advocacy trips, showing meals, hotel and travel that lack  the itemized receipts hospital policy requires. 

While some government and health management experts say such expenses are necessary to conduct hospital business and a necessary part of the role of CEO and top leadership, the precarious financial situation and lack of transparency under the former leadership begs for the most prudent accounting of executive spending, they say.

The disclosures come as the hospital's new leadership commissioned Deloitte, a multi-national accounting firm, to closely examine the institution's cash flow, revenue and spending.

NIFA Chairman Richard Kessel called the expenses "an absolute outrage." 

He told Newsday this is the first time in years NIFA officials have had access to records that showed the "mismanagement" at NUMC and the recent expenditures point to why "Gov. Hochul did the right thing" in changing the leadership.

"On their last day, they went to the city and celebrated with a lobster dinner and other activities and spent hospital money," said Kessel, a Hochul appointee. "This is a hospital with deep financial challenges — that's got very low cash — and these guys were supposedly working for the betterment of the hospital and the taxpayers."

Tom Basile, a spokesman for Ryan, defended the expenses.

"During her short tenure, Ms. Ryan personally fronted thousands of dollars in expenses for initiatives that were not reimbursed, including food for employees, transportation, and supplies for community events," Basile said in a statement to Newsday on Monday. He did not provide any proof of unreimbursed expenses. "Any suggestion that she did anything improper or was reimbursed inappropriately is just another effort to distract ..."

Credit card statements also show Ryan spent $2,821.83 for a three-night stay at the Willard InterContinental Hotel in Washington, D.C., in early February  — $940.61 per night — during a trip to lobby congressional leaders.

In March, for an advocacy trip to Albany, she charged $1,072.28 booking two rooms for one night at the Desmond Hotel in Albany, another statement shows.

Ryan spent $7,801.88 in late April for three round trip United Airlines tickets for herself and two other executives to attend a conference in Chicago hosted by Becker's Hospital Review, a health care  industry publication, according to the forms. Two of the tickets cost $2,092.48 and the third ticket was $2,830. Because a copy of the airline tickets were not submitted with the reimbursement form, it was unclear which section of the plane the three sat for the two and a half hour flight.

NUMC, the 530-bed East Meadow hospital, is operated by Nassau Health Care Corporation, a quasi-public entity that also runs the A. Holly Patterson nursing home, community health centers and delivers health care to inmates at the county jail. The health system logged an operating loss of $144 million last year, according to a draft financial report from May, bringing its total debt to $1.4 billion. 

As part of the state budget in May, the hospital received $50 million tied to legislation creating a new hospital governing structure, which would then install a new CEO and management team, by shifting the majority of board appointments from county to state lawmakers.

According to the hospital expense policy, employees are limited to $20 for breakfast, $30 for lunch and $50 for dinner per day during out-of-town travel. When booking lodging and/or transportation, employees are to request for the "government rate." Exceeding those limits requires the approval of the CEO "or a designee" such as the chief financial officer, the policy says. 

"It smacks of wastefulness and abuse," said Bill Hammond, health policy analyst at The Empire Center for Public Policy, a government fiscal watchdog group based in Albany, who has followed the hospital's financial struggles closely. "They are losing money. ... They are pleading for a state bailout and they are suing the state. It's hard to characterize this as a successful operation. So it's important for the executives in this situation to not or not even appear to be self-serving."

Ge Bai, a professor of health policy and management at Johns Hopkins University in Maryland, said after hearing details of the receipts obtained by Newsday she saw "little necessity" in the lobster dinner, D.C. hotel and Chicago airfare expenditures and did not think they ought to be reimbursed. She said in general, travel spending should "exclusively support the hospital's mission." 

"This behavior reflects two things: poor understanding of their duties toward taxpayers and the community and a lack of internal control within the hospital," Bai said. "These are just the tip of the iceberg." 

Referring again to the hotel rates and airline tickets, Bai said: "It's crazy how blatant these are."

State officials had alleged mismanagement with the state health commissioner in 2024 calling for a national search to hire a new CEO before approving a state bailout for financially distressed hospitals.

Ryan, empowered by former hospital board chairman Matthew Bruderman and Nassau County Executive Bruce Blakeman, fought to stay at the helm until submitting a resignation letter on May 21. Her resignation turned into a termination "for cause" when new hospital leadership alleged she inappropriately authorized $3.5 million in separation pay for herself and 12 other top executives. Those payments were made on May 30, according to new interim CEO Dr. Richard Becker. 

Chris Boyle, Blakeman's spokesman, declined to comment on Monday.

Stuart Rabinowitz, whom Hochul named board chairman of the health system on May 31, declined to comment citing the ongoing audit of NUMC finances.    

Hammond, from the Empire Center, said he believes the findings warrant further investigation into the spending habits of NUMC's former executive team. He questioned whether it was "a burst of irresponsibility" in the final months because the state revamped the leadership or a pattern of luxury spending that spanned several years. 

"It's not like these are underpaid employees. They have the means to live a nice lifestyle without dipping into the hospital's money," Hammond said.