Opinion Number ( 2005 )

Dear Mr. Woolridge:

On behalf of the Louisiana Patient's Compensation Fund Oversight Board ("Oversight Board") you have requested the opinion of this office as to which, if any, state procurement laws apply to the procurement of professional and consulting services by the Oversight Board. More specifically, you ask whether the Oversight Board must comply with the applicable rules and regulations of the Office of Contractual Review, the State Procurement Code and/or other applicable Louisiana law where the Oversight Board and the Patient's Compensation Fund ("PCF") have a need to enter into a Professional Services Agreement to procure professional and consulting services. Attached to your request is a copy of a proposed professional services agreement that describes the services to be rendered including a business analysis of the PCF, a review of the PCF current computer application and recommendation for replacement, and a review and evaluation of the PCF current infrastructure and recommendation for improvements, if any.

Under the State Professional, Personal, Consulting, and Social Service Procurement Law, (R.S. 39:1481-1526), contracts for professional and consulting services less than $50,000 may be negotiated and awarded without the necessity of competitive bidding. Professional service contracts in excess of $50,000 may be negotiated and awarded without the necessity of competitive bidding but by definition shall be limited to lawyers, doctors, dentists, psychologists, certified advanced practice nurses, veterinarians, architects, engineers, land surveyors, landscape architects, accountants, actuaries, claims adjusters, and any other profession that may be added by regulations adopted by the office of contractual review of the divisions of administration. Contracts for consulting services which have a total maximum amount of compensation of $50,000 or more shall be awarded through a request for proposal process under the rules and regulations issued by the office of contractual review. See R.S.39:1484A (18), R.S. 39:1494, and R.S. 39:1496.

The state procurement and bid laws, enacted to further the public policy favoring competitive bidding, are prohibitive in nature and thus, in the absence of a clear, express and unambiguous exemption in the statutes establishing the Oversight Board or in the various professional and consulting service procurement provisions, the Oversight Board is subject to these latter provisions.

The Louisiana Patient's Compensation Fund and its Oversight Board were created by Act 817 of the Regular Session of 1975 and organized as an agency and instrumentality of the state of Louisiana pursuant to LSA-R.S. 40:1299.44. The purpose of the statute is to limit the liability of health care providers who qualify under the statute and to provide compensation to medical malpractice victims who have been injured by qualified health care providers. See Tucker v. Lain, 1998-2273 (La.App. 4 Cir. 9/5/01, 798 So.2d 1041; Prisk v. Palazzo, 95-1475 (La.App. 4 Cir. 1/19/96), 668 So.2d 415. The statute also created in the state treasury a special fund designated as the Patient's Compensation Fund ("the Fund") into which are deposited monies collected from private health care providers. The monies are derived from an annual surcharge levied on all participating health care providers in Louisiana for the use, benefit and protection of medical malpractice claimants and the private health care provider members of the Fund.

Pursuant to LSA-R.S. 40:1299.44(A)(5)(a) "All expenses of collecting, protecting, and administering the fund shall be paid from the fund." Section 1299.44(A)(5)(e) (f) states that the Patient's Compensation Fund shall be a budget unit of the state and that the legislature shall appropriate from the fund sufficient monies for the Oversight Board to carry out its statutory duties, functions and responsibilities.

LSA-R.S. 40:1299.44(D), provides, in pertinent part, with respect to the powers of the Oversight Board, the following:

D. (1)(a) The Patient's Compensation Fund Oversight Board is hereby created and established in the office of the governor.

(2)(a) The board shall be responsible, and have the full authority under law, for the management, administration, operation and defense of the fund in accordance with the provisions of this Part.

(b) In addition to such other powers and authority elsewhere expressly or impliedly conferred on the board by the Part, the board shall have the authority, to the extent not inconsistent with the provisions of this Part, to:

(iv) Employ, or in accordance with the provisions of law applicable to contracting for personal, professional or consulting services, retain the services of a qualified competent actuary to perform the annual actuarial study of the fund required by the Section and to advise the board on all aspects of the fund's administration, operation and defense which require application of the actuarial science.

(v) Contract for any service necessary or advisable to implement the authority and discharge the responsibilities conferred and imposed on the board by this Part.

A review of the provisions establishing the Oversight Board do not reflect any express or special statutory language that would exempt the Oversight Board from the provisions of Title 39 relating to the procurement of professional and consulting services.

The Oversight Board is a budget unit within the Executive Branch of state government and pursuant to statute it is subject to the State Procurement Laws and the various professional and consulting provisions established by the Division of Administration.

It is therefore the opinion of this office that the Patient Compensation Fund Oversight Board must comply with the State Professional, Personal, Consulting, and Social Services Procurement Law (R.S. 39:1481-1526) and its rules and regulations when entering into contracts procuring professional or consulting services.

We trust that this answers your inquiry.

Yours very truly,

CHARLES C. FOTI, JR. Attorney General

BY: _______________________________ RICHARD L. MCGIMSEY Assistant Attorney General