Nearly $21 million worth of state-owned equipment at hospitals in New Orleans and Baton Rouge either was never logged into the state’s property management system or can’t be located, according to a state audit released Monday.
The hospitals in question are University Medical Center in New Orleans, where $15.1 million worth of new equipment has gone unrecorded; UMC’s shuttered predecessor, Interim LSU Hospital, where more than $1 million in equipment could not be found; and the closed LSU Earl K. Long Medical Center in Baton Rouge, where more than $4.6 million of equipment was never logged.
In his report, state Legislative Auditor Daryl Purpera warned that “failure to tag and enter data into the state’s asset management system increases the risk that assets will be misappropriated” or go missing.
Typically, private hospital operators such as LCMC Health, which runs UMC, must tag certain state-owned equipment or other assets and report that equipment to the Louisiana Property Assistance Agency.
All acquisitions of qualified assets must be reported within 60 days of receipt, and all equipment transactions must be reported on a monthly basis, the audit noted. Purpera said there’s an annual check to see if the property is still where it’s supposed to be.
The state Division of Administration paid for $15.1 million worth of equipment for UMC but never gave LCMC or LSU any invoices listing what equipment was purchased and how much it cost, the audit said.
“Nobody right now can put their hands on a list and find the property,” Purpera said. “Because we don’t have a list, it may not be there. It may never have been there.”
The audit does not go into detail about the missing equipment at Interim LSU Hospital, which was also operated by LCMC before it closed in October. But it says LCMC was responsible for about $586,000 of the $1 million total.
The findings are included in a financial audit of the LSU Health Sciences Center — Health Care Services Division for the fiscal year that ended June 30. HCSD has leases with six private hospital partners now managing LSU hospitals. The private partners lease both buildings and some equipment as part of Jindal administration deals privatizing operations of the charity hospitals.
Late Monday, HCSD official Jerry Jones said the agency is confident the $15 million in equipment at University Medical Center is not missing.
Jones said the items referred to in the audit report, part of more than $100 million of equipment being used in the hospital, are being entered into the inventory system.
“The time lag for entry is due to the volume of items needing entry, but that process is taking place,” he said. “The equipment has been received with documented receiving reports and, according to the University Medical Center Management Corp., the equipment is in the hospital and has been tagged.”
Staff writer Marsha Shuler contributed reporting.
Follow Jessica Williams on Twitter, @jwilliamsNOLA.