Skip to main Content

The Alaska mental health trust broke the law, but that matters less than the crisis at hand

  • Author: Charles Wohlforth
    | Opinion
  • Updated: June 24, 2018
  • Published June 24, 2018

Board members for Alaska's mental health trust broke a bunch of laws, but that's about the fourth most important thing happening in our mental health care crisis.

The social disintegration gripping Anchorage — crime, addiction, homelessness and violence — all relate to a lack of behavioral health services. The Alaska Mental Health Trust Authority should be a ferocious advocate to fix that.

The trust's board failed in two ways, according to a report released in early June by the Alaska Division of Legislative Audit.

The board did important public work in secret meetings, excluding some members. While meeting illegally, it demoted its admired longtime CEO, Jeff Jessee. He is now a University of Alaska Anchorage dean.

Jessee would not comment on whether he will take legal action against the trust over his treatment.

The trust also invested some of its money in violation of state law, the audit found. The trust is required to invest only with the Alaska Permanent Fund, but it bought commercial real estate with less than 10 percent of its funds, around $40 million.

Trust officials now admit the secret meetings were wrong, but they still want to hold onto the real estate. Misbehaving board members are gone and no one stole any money. The real estate is performing well.

"I think it was blatantly illegal, and they actually got pretty good results from it," said Jim Gottstein, an attorney who helped found the trust through litigation and negotiations in the 1980s and 1990s.

Alaska entrusts billions in assets to various authorities and quasi-public corporations that are run by obscure boards that hardly anyone pays attention to. Combining huge amounts of money and no oversight is a dangerous mix.

But I'll write a column about that another time. Right now, Alaska's mental health system is in a deep crisis. Spending money is the issue, not how it is invested.

Hospital emergency rooms are overwhelmed by patients needing psychiatric and substance abuse help that is unavailable. The state mental hospital, Alaska Psychiatric Institute, is undersized and understaffed for its role, releasing patients quickly, sometimes straight to the streets.

That's where most of us encounter the mental health crisis every day, seeing the tragedy of chronically mentally ill Alaskans who wander homeless.

The Alaska Legislature addressed parts of the problem this year. But other parts are getting worse or are in limbo during a massive bureaucratic process to remake of how care is paid for in Alaska.

At the request of Gov. Bill Walker, the Legislature spent $12 million for substance abuse treatment, $3.1 for nurses at API, and $7 million to help the hospitals affected by the bed shortage at API.

That's in addition to continuing mental health spending: $64.9 million for grants and $182.7 million for Medicaid. Of those amounts, the state paid $107.9 million and the federal government $139.8 million.

These are big numbers. They dwarf the $22 million the trust spends on programs annually.

But even with this spending, the most cost-effective care, based in the community, is in trouble. Anchorage Community Mental Health Services, a key front-line agency, is struggling to fund its mission, and facing new state regulations that could make the homeless mentally ill population larger.

These may be temporary gaps on the way to a better system using Medicaid funding for community care. But that is taking a very long time.

Through much of the Walker administration, the state has been working on an application called a "waiver" to use Medicaid money in new ways, including work in the streets.

But when a plan for the waiver came out earlier this year, provider organizations panned it as vague and problematic.

State officials say that vagueness is normal early in the process. The details of how the system would actually work haven't been worked out with federal Medicaid officials, said Gennifer Moreau, who is working on it for the Department of Health and Social Services.

She said a new system is still at least a year away. The timing depends on action within the federal government.

The Mental Health Trust funded this waiver process with a $10 million grant. But its new CEO, Mike Abbott, worries the state is shortchanging community mental health services while developing a system that still won't happen for more than a year.

Federal rules require that the new system cannot cost more. Moreau said the system will provide more care by supporting community workers outside clinics, saving money for Medicaid and the state. Those are the workers feeling the cut of funding shortfalls and new regulations now.

For more than two years I've been writing about this subject, this waiver has floated out in the future as hope for fixing these problems. But some experts doubt the system really can be made to work without more money.

"I don't think we have as much confidence as we would like to have that this is going to work," Abbott said. "I think there is a possibility that we are going to find that this is not going to work."

Alaska's behavioral health crisis feeds the social dysfunction dragging down our communities. Adequate care wouldn't cure everything, but it would begin to address causes rather than just symptoms.

Imagine if immediate treatment were available for every addict the moment he or she hit rock bottom.

With this much on the line, we should not rely on a hope that juggling some federal money will fix it for free at some point in the future. We should spend our own money—as the Legislature and Gov. Walker started to do this year—to take care of our own, regardless of what Medicaid does.

And to do that, as Jeff Jessee said, we need a state fiscal plan with a stable source of revenues . In other words, taxes.

Social disintegration begins with people who need help for problems they can't handle. Alaskans shouldn't wait for the federal government. This is our responsibility.

The views expressed here are the writer's and are not necessarily endorsed by the Anchorage Daily News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary(at) Send submissions shorter than 200 words to or click here to submit via any web browser.

Local news matters.

Support independent, local journalism in Alaska.