CA AB 1392

Title: Hospitals: procurement contracts.
Author: Freddie Rodriguez

Summary
AB 1392, Rodriguez. Hospitals: procurement contracts. Existing law requires a licensed hospital with operating expenses of $50,000,000 or more, and a licensed hospital with operating expenses of $25,000,000 or more that is part of a hospital system, to submit an annual report to the Department of Health Care Access and Information, formerly structured as the Office of Statewide Health Planning and Development, on the hospital’s minority, women, LGBT, and disabled veteran business enterprise procurement efforts, as specified. Existing law imposes certain civil penalties for failure to file a report.This bill would require those hospitals to annually submit, beginning July 1, 2025, and annually by July 1 thereafter, a plan, instead of the above-described report, for increasing procurement from minority, women, LGBT, and disabled veteran business tier 1 and tier 2 enterprises. In addition to the existing required contents within the report, the bill would require the plan to include short- and long-term goals and timetables, but not quotas, for increasing procurement from those business enterprises, the methods in which the hospital resolves any issues that may limit or impede an enterprise from becoming a supplier, and planned and past implementation of relevant recommendations made by the hospital diversity commission described below, among other changes.The bill would authorize the department to review the plans for completeness. The bill would require the department to establish guidelines for hospitals to voluntarily utilize when pursuing procurement efforts, activities, or programs in accordance with these provisions.The bill would make legislative findings that each licensed hospital and hospital that is part of a hospital system that is not required to submit a plan is encouraged to voluntarily adopt one for increasing procurement from the above-described business enterprises.Existing law requires the department to convene a hospital diversity commission comprised of the public and health care, diversity, and procurement stakeholders, and sets forth the composition of the commission, including, among others, representatives of minority, women, LGBT, and disabled veteran business enterprises. Existing law prohibits the commissioners from receiving compensation for their services, but authorizes the department to reimburse them for their actual and necessary expenses, as specified.This bill would add, to the list of commissioners, a representative of a group purchasing organization, as defined, manufacturer, or vendor of goods and services for hospitals who, at the time of appointment, is a practitioner or expert in the field of supplier diversity. The bill would make other changes to the commission’s structure and functions. The bill would authorize the department, upon appropriation for this purpose, to provide compensation to the commissioners for their services.The bill would require the department to undertake outreach and provide assistance, based on the commission’s recommendations, to hospitals, manufacturers, vendors, or group purchasing organizations of hospital goods and services, and to minority, women, LGBT, and disabled veteran business enterprises, as specified. The bill would authorize the department, upon appropriation for this purpose, to establish and operate a clearinghouse to maintain a database, and verify the statuses, of minority, women, LGBT, and disabled veteran businesses enterprises that are prime suppliers or subcontract suppliers to hospitals or other entities in the procurement ecosystem of hospital goods and services, as specified.The bill would also make conforming changes to related provisions containing references to the above-described report and to the predecessor of the department.

Status
Enrolled and presented to the Governor at 3:30 p.m.

Bill Documents
CA AB 1392 - 09/18/23 - Enrolled
09/18/23 - CA AB 1392 (09/18/23 - Enrolled)