Audit shows NHCC lost $6.5M in 2009

The Nassau Health Care Corp., which runs the county's only public hospital, lost $6.5 million in revenue through 2009 because of faulty billing procedures, according to an audit by Nassau County Comptroller George Maragos.

Maragos also scolded NHCC, which operates Nassau University Medical Center, a nursing home and several health clinics, for allowing a $250,000 contract with a consultant to balloon to $4 million during the course of four amendments.

"The hospital system has been struggling financially for years," said Maragos, a Republican. "Our audit found 14 major operational deficiencies with significant revenue or expense consequences that may partially explain the financial situation."

Maragos stressed at a news conference that "the quality of health care was never in question and is not in question now."

In its response to the audit, NHCC said the amount of lost revenue due to billing errors and inaccurate registrations amounted to $391,000. Moreover, "charges are not an accurate predictor of the amount a hospital will receive when payment is made," NHCC said.

"The figures cited by the Comptroller's office . . . dramatically overstate the amount of revenue which potentially could have been collected," spokeswoman Shelley Lotenberg said. "We disagree with many of the comptroller's findings . . . For those minor findings with which we did agree, corrective action plans will be developed and implemented, if such plans aren't already in place."

Lotenberg said NHCC president Art Gianelli, once Democratic County Executive Thomas Suozzi's deputy for budget and finance, had no additional comment.

The NHCC response said much of the billing the comptroller's office examined had occurred between 1998 and 2007; the charges were an inappropriate subject for the audit "since these accounts have nothing to do with current operations," NHCC said.

Maragos' audit also charged that some contracts are awarded without competitive bidding; one for an assessment and analysis of NHCC's financial and operational performance had an original cost of $250,00, but jumped to $4 million after amendments, Maragos said.

NHCC said it disagreed with the findings and that the contract had followed all state guidelines. "The suggestion contained in the audit report that NHCC should have issued new RFPs [requests for proposals] for each amendment/stage is unreasonable and would have been counterproductive," NHCC said.