State seeks review of options to privatize Alaska Psychiatric Institute

State health department officials want to take another look at options for running Alaska’s state-owned psychiatric facility, including privatization.

The request for proposals was released Monday, the same day Gov. Mike Dunleavy and department officials touted progress at the Alaska Psychiatric Institute. The state Department of Health and Social Services has been under contract with Wellpath Recovery Solutions to stabilize the facility and take steps to bring it to full operation. The contract is set to run through 2019.

The facility has been under scrutiny from the federal Centers for Medicare and Medicaid Services, which the state said found more than 80 deficiencies between July and December 2018.

State officials said Monday that the facility is now considered to be in good standing with federal requirements. The federal agency, in a report, said an unannounced visit last month found the facility to be in "substantial compliance."

Dunleavy, speaking to reporters at the Anchorage facility, said the Alaska Psychiatric Institute was failing in its mission when he took office in December. He said things are moving in the right direction, citing as an example an increased number of patients who can be accepted due to additional staffing. But he said there remains room for “a lot of improvement.”

Health Commissioner Adam Crum said there is a demand nationally for psychiatric care providers and that hiring psychiatric nurses and psychiatric nurse assistants has been difficult.

Albert Wall, a deputy health commissioner, said the number of available beds has more than doubled over the last eight months. It remains below an 80-bed target.

Rep. Ivy Spohnholz, co-chair of the House Health and Social Services Committee, said she hasn't seen a concerted effort from the administration to fill positions at the facility. The Anchorage Democrat also said she sees no need to do another study.

The request for proposals seeks an analysis of privatization options, such as having an outside party assume hospital management and operations. Other areas the state wants studied include maintaining state ownership and operation but looking for more efficiencies or contracting for certain services. It also seeks analysis on whether and how the facility could remain exclusively state run.

The state has studied privatization before. A 2017 consultant's report called the full privatization option it analyzed cost prohibitive.

Wall said a lot has changed since that report was written and it was determined that a fresh look was needed.

Related:

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