BILL NUMBER:S7065

TITLE OF BILL:
An act to amend the education law, in relation to contracts for joint or
group purchasing of goods or services for state university health care
facilities

PURPOSE:
To provide that in the event State University health care facilities
purchase goods or services through joint or group purchasing arrange-
ments, such arrangements and purchases made through such arrangements
shall not be subject to the pre-approvals of the State Comptroller and
Attorney General, competitive procurement requirements, requirements to
purchase from preferred sources and through centralized contracts of the
Office of General Services and publication requirements.

SUMMARY OF PROVISIONS:
Section 1 of the legislation amends Education Law section 355(16)(b) to
authorize State University health care facilities to enter into joint or
group purchasing arrangements for goods and services, which arrangements
and purchases made through such arrangements shall not be subject to
State Finance Law section 112 (State Comptroller pre-approval), Execu-
tive Law section 63 (Attorney General approval), State Finance Law
section 163 (competitive procurement; preferred sources; OGS centralized
contracts), Economic Development Law Art. 4C (publication in Contract
Reporter or Education Law section 355(5)(a), (a-1)(rules of the State
              

Comptroller).

Section 2 provides that the legislation takes effect immediately.

EXISTING LAW:
Education Law section 355(26)(b) authorizes the State University to
purchase goods without prior approval of the State Comptroller and
Attorney General and to purchase services without the approval of the
State Comptroller and Attorney General at a cost under negotiated thres-
holds.  Generally, the provisions of State Finance Law section 163
require competitive procurement of goods and services and require
procurement first from preferred sources then through centralized
contracts of the Office of General Services and then through procurement
by a State entity directly.

JUSTIFICATION:
SUNY's hospitals exist in increasingly competitive and rapidly changing
health care markets, requiring that they be provided with additional
flexibility to deploy limited resources more efficiently.  All hospital-
including other public hospital in New York - use Group Purchasing
Organizations (GPOs) as a major purchasing tool to save money and maxi-
mize the efficiency of internal procurement resources.  Current procure-
ment requirements for SUNY's hospitals, which this legislation seeks to
amend, preclude them from taking full advantage of leveraging the shared
buying power of all three hospitals and the efficiency provided by using

GPOs as a purchasing tool. Nothing in this legislation either amends the
civil service law or impacts State employee contracts.

This legislation only provides flexibility for hospital joint or group
purchasing, thereby providing an incentive for the hospitals to purchase
together to maximize savings for all three of them and freeing them from
duplicative and time consuming requirements associated with current law.
This legislation is an important step in giving the SUNY Hospitals the
flexibility from overly burdensome processes that impede their ability
to survive and compete - so they are able to continue to support the
educational mission of SUNY's public academic medical centers at Down-
state, Stony Brook and Upstate.

LEGISLATIVE HISTORY:
New legislation.

FISCAL IMPLICATIONS:
Savings in expenditures for goods and services procured for State
University health care facilities.

EFFECTIVE DATE:
Immediately.