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Should Alaska Psychiatric Institute be privatized?

  • Author: Annie Zak
  • Updated: August 26, 2016
  • Published August 25, 2016

A health care bill passed this year requires the Alaska Department of Health, in partnership with the Alaska Mental Health Trust Authority, look into how feasible it is to privatize API.   (Loren Holmes / ADN)

Members of the mental health community and general public had a chance on Thursday to voice concerns and ask questions about the possibility of the state-run Alaska Psychiatric Institute becoming a private entity.

A Boston-based company called Public Consulting Group Inc., is conducting a feasibility study to identify and analyze potential options for how to best manage API.

"Privatization is potentially a very polarizing word, and people have opinions about privatization regardless of the issue at hand," said Coy Jones, a senior consultant with PCG. "We try to be very objective about whether we think privatization is a good idea or a bad idea."

The Legislature passed a broad health care bill this year that mandates the Alaska Department of Health and Social Services, in partnership with the Alaska Mental Health Trust Authority, look at whether a private contractor for API works for the state.

The feasibility study will examine several options for what to do with the facility, including keeping it under state ownership and contracting out for some operations; forming a public corporation to operate API; keep it under state ownership but look for new sources of revenue; and contracting with a nonprofit or for-profit third party to take over management and operations.

PCG will consider how privatization would impact the cost, quality and access to services at API, and which option would be the best value for Alaska. 

At Thursday's forum, people spoke about their concerns over privatization and asked questions about what might change if API were no longer operated by the state.

"Our concerns have been system capacity," said Brenda Moore, a member of the Alaska Mental Health Board. "We are currently experiencing the adverse effects of higher need than we have capacity."

Alaska Dispatch News reported in January that "40 involuntarily detained, acutely mentally ill patients were transferred" to Juneau or Fairbanks since October because API didn't have enough doctors for them (though 15 of those "would have been traveling anyway").

"Whether we decide to privatize that facility or keep it as a state facility, improvements need to be made," said Rachelle Stockman, also a member of the state's Mental Health Board, who said she used to work at API. "There is a lot of waste and redundancy in that hospital, and I know it is also difficult to keep steady providers."

Charlene Tautfest, another Mental Health Board member, raised questions about what will be available to patients if the state no longer runs API.

"If it's privatized, will they see people without the ability to pay?" she asked. "Do they have a right to refuse service? … Will there be oversight for abuse and neglect?"

A private operator of API would be subject to a state oversight committee, according to the DHSS.

The discussion comes on the heels of a distinct but relevant decision the U.S. Department of Justice made last week to end the use of private prisons. That was after the agency decided such facilities were "less safe and less effective" than those run by the government, The Washington Post reported.

"We're definitely following that news pretty closely," said Jones. "It's part of our review to look at what the effects of privatization have been in the prison system as well as psychiatric hospitals as well as general hospitals. It's very timely and we're definitely taking account of it in our study."

Mental health advocate Faith Myers was critical of taking API out of the state's hands in light of that recent change at the federal level.

"From the point of view of a disabled patient or client receiving care, it would be a failure to privatize state-run Alaska Psychiatric Institute," said Myers, pointing to the DOJ news.

Members of the Alaska Commission on Aging also spoke about concerns for the aging population when it comes to psychiatric hospitalization.

"We want to make sure that when this privatization study is done, that we look at people with dementia and behaviors that many other assisted living or nursing homes can't handle," said commission member Lesley Thompson.

In addition to API, the state is also looking at the feasibility of privatizing four Division of Juvenile Justice facilities and the pharmacy program at Alaska Pioneer Homes.

The plan is to have the API feasibility study ready for the Legislature to review in January.