Report: New York taxpayers bilked over COVID stockpile

ALBANY, N.Y. (NEXSTAR) — New York state spent $452.8 million on almost 250,000 pieces of medical equipment during COVID, but almost none of the inventory helped during the crisis. Hundreds of thousands of items remain unused in warehouses, according to State Comptroller Thomas DiNapoli.

DiNapoli said, “I urge the Department of Health to develop and execute a strategic plan for the maintenance and use of these and future medical equipment purchases so New York is well prepared for the next public health emergency.”

An audit report released on Friday—available to read at the bottom of this story—showed major gaps in maintenance and oversight, with weak controls and poor recordkeeping leaving taxpayers on the hook for millions in fees to store the devices. Out of 247,343 medical items purchased and 51 donations from the federal government, only 324 got to COVID patients.

New York's stored COVID equipment includes ventilators, CPAP and BiPAP machines, oxygen tanks, pulse oximeters, x-ray machines, oxygen concentrators, and infusion pumps, according to the report. Today, the state still pays to store them in warehouses managed by the New York State Division of Homeland Security and Emergency Services.

After COVID wound down, a Medical Stockpile Steering Committee recommended keeping 51,140 devices in the stockpile. It also suggested scheduled, preventive maintenance on 4,468 items. That left over 190,000 pieces of equipment without any plan for use or upkeep. A December 2021 survey showed that 546 hospitals could put to use 24,585 of the unused items, but only four of them were ultimately used in 2023 and 2024, according to the auditors.

They highlighted several gaps in oversight, including a rapid procurement process that broke with policy at the Office of General Services. Because of the state of emergency, the state suspended and loosened standards around approvals and competitive bidding. Consulting firm McKinsey & Company projected the demand and volume for medical devices, and the executive chamber of former Governor Andrew Cuomo had final purchasing power.

Per the report, the DOH staff that usually managed such purchases often didn't know what had been ordered, with gaps in documentation meaning DOH couldn't verify details. Four out of five credit card transactions reviewed by auditors—totaling $329,790—didn't have proof of delivery for 140 pieces of equipment—totaling $312,644.

The Office of Health Emergency Preparedness managed the Medical Emergency Response Cache, expanding from three to almost 20 warehouses when COVID started. But by early 2024, they consolidated to five warehouses managed by DOH and DHSES. Still, these two agencies track data in separate inventory systems, which complicates their recordkeeping.

DOH hired the vendor Quality Medical Group in April 2020 to inspect and take care of those 4,468 items recommended for preventative maintenance. That contract ended at the end of 2023, with no replacement so far. And by December 2024, 90% of those recommended were overdue for scheduled maintenance. The audit said this would void warranties and force the state into even more expensive repairs whenever we should need the equipment again.

The report called for tighter controls, recommending that OGS and the State Procurement Council develop statewide guidance to properly record transactions and vet vendors during emergencies. The report further recommends creating a statewide public health plan to use the surplus, decide which equipment to keep and service, and start accepting proposals for such services.

The comptroller's office called for closer adherence to state law through better documentation of decisions from the Medical Stockpile Steering Committee. DiNapoli also referenced State Finance Law Section 167—letting state agency heads transfer or dispose of equipment deemed no longer useful—as a potential method for shrinking the stockpile.

Take a look at the audit report below: