Combine first 4 ingredients in a large saucepan over medium heat; bring to a boil, stirring constantly. Reduce heat; simmer 10 minutes, stirring frequently. Remove from heat, and let stand 10 minutes. Drain potatoes in a colander over a bowl, reserving 1 cup milk mixture. Discard bay leaves.
Cook haricots verts in boiling water for 2 minutes or until crisp-tender. Rinse in cold water; drain.
Arrange half of potatoes in bottom of a 13 x 9-inch baking dish coated with cooking spray. Arrange haricots verts and ham over potatoes. Sprinkle with half of cheese, salt, and pepper. Top with remaining potatoes. Sprinkle with remaining cheese, salt, and pepper. Stir nutmeg into reserved milk mixture; pour over potatoes.
Cover with foil; cut 3 (1-inch) slits in foil. Bake at 400° for 20 minutes. Uncover and bake an additional 20 minutes or until cheese begins to brown. Let stand 10 minutes before serving.
I have made this recipe several times for my family and friends and have always had rave reviews and requests for the recipe. It's yummy and easy, but impressive enough for guests. I have used leftover fresh ham and when I didn't have any leftover ham, I've purchased enough ham from the deli....both ways it is delicious!
This is a comfort food. Old world recipe. If your sauce was too thin, you didn't cook it long enough. Next time, rely on your thermometer: 165 degrees in the center and your sauce should be thick. Not a reprimand, just a suggestion as I am a firm believer in recipes only being a guideline for cooking. Every-ones tastes are different!
I have eaten this casserole since I was a child. I make it proper and I "tweak it!
I disagree with the person who said the sauce was too thin - by the end of baking, it was a nice creamy coating over the potatoes. I thought the balance of flavors - potatoes, haricots verts, and ham - was delicious, and loved the touch of nutmeg.