A change in the timing of certain Medicaid reimbursements has led the Nassau Health Care Corp. to turn to the debt market to deal with the scheduling mismatch.

Until recently, municipal hospitals and nursing homes would receive Medicaid payments called intergovernmental transfers and upper payment limit funds in March and October. That changed last year when the state amended its Medicaid program.

"In essence we're incurring expenses in the front end of the year that we don't have revenue for, and when the money comes in October, we're good," said NHCC vice president for finance Richard Perrotti. "We're floating a [revenue anticipation note] to basically handle our short-term cash flow needs."

The Nassau health care provider plans to sell $55 million of short-term notes on Tuesday that will be repaid in December after it receives federal funds.

The health care corporation did the same thing last year. The notes received Moody's Investors Service highest short-term rating of MIG-1 in part because it pledged its pension reserves and other cash in case the federal funds are delayed.

The change also affects the New York City Health and Hospital Corp. and Erie County Medical Center, but neither of those have turned to borrowing.

"The change is not causing a cash-flow issue for us," HHC spokeswoman Evelyn Hernández said in an e-mail.

The NHCC is a public benefit corporation that operates the Nassau University Medical Center, a nursing home and several health centers under the name NuHealth.

Latest videos