Legislature(2001 - 2002)
05/03/2001 09:20 AM Senate FIN
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* first hearing in first committee of referral
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CS FOR SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 76(FIN)
"An Act providing for and relating to the issuance of
certificates of participation to finance construction of a new
facility to be known as the Alaska Psychiatric Institute;
giving notice of and approving the entry into and the issuance
of certificates of participation in a lease-purchase agreement
for construction of a new facility to be known as the Alaska
Psychiatric Institute; giving notice of the intent and
approval to retain investment income from pertinent
appropriations to be applied to the cost of construction of a
new facility to be known as the Alaska Psychiatric Institute;
relating to the construction of a facility to be known as the
Alaska Psychiatric Institute; and providing for an effective
date."
This was the second hearing for this bill in the Senate Finance
Committee.
SAM DICKEY, President, University Area Community Council, and
former president, Airport Heights Community Council, and
participant of the Coalition for API [Alaska Psychiatric
Institute], testified via teleconference from Anchorage about his
involvement in this matter since the state's pursuit of the Charter
North purchase option. He described the Coalition for API as a
group of "families, friends, consumers, providers and just
concerned citizens" who would like a resolution to the situation.
He emphasized his support for the Shared Vision document as put
forth by the state and "all the major stakeholders in the area" and
therefore encouraged passage of HB 76.
ELAINE PRATT, Member, Coalition for API, testified via
teleconference from Anchorage to encourage passage of this bill.
She stated that additional funding is desperately needed for a new,
asbestos-free building. She relayed this project has been ongoing
for over 15 years and adoption of this legislation is necessary to
"bring it to closure." She noted this legislation, coupled with the
recently signed, Shared Vision Memorandum of Understanding, creates
"win-win solutions for all parties involved."
Senator Ward understood that a structural engineer report was done
on the existing facility. He requested a copy of this report to
assist him in determining the remaining life expectancy. He also
requested information related to the option of remodeling this
facility and the cost of such a project.
JEFF JESSEE, Executive Director, Alaska Mental Health Trust
Authority, Department of Revenue, testified via teleconference from
Anchorage that this information exists and would be provided.
Senator Ward asked the life expectancy of the building according to
the structural engineers.
RANDALL BURNS Chief Executive Officer, Alaska Psychiatric
Institute, testified in Juneau about the reports in question. He
stated one report was completed this year and reviews previous
studies on renovation costs. He detailed Option One, to move
patients and staff from the hospital for two years and renovate the
facility, that would cost an estimated $74 million not including
the cost of the temporary relocation. Option Two, he explained, is
a phased renovation of three to four years with patients remaining
in the facility and would cost approximately $81 million.
Mr. Burns told of another study commissioned by the Alaska Mental
Health Trust Authority (AMHTA) that reviewed due diligence of the
Trust's property. This report, he shared, found that the facility
has two to five years remaining of service and that "it would not
be reasonable to consider continued use of the improvements, which
is the hospital, beyond the two to five year timeframe." He noted
this report also warned that the physical risks of continued use
beyond this time should be of significant concern.
Senator Ward referred to the latest report released on March 22,
2001, which states, "This estimate has been prepared and developed
from the 1989 report." He noted the 1989 report gives estimates of
remodeling costs based on square footage. He again asked if a
structural engineers report on the building has ever been conduced.
Mr. Burns responded there were several studies done, two of which
occurred in 1989 and 1993. He corrected Senator Ward's reference is
to the study completed in 1997. Mr. Burns stated the 1989 and 1993
studies examined the structural aspects of the facility and
reported that since the facility was not seismically braced,
additional structural problems affected the recommendations for
continued use.
Senator Ward requested these reports as well.
Senator Wilken shared estimates of population projections recently
given to him. [Copies on file.]
Co-Chair Kelly announced the bill would be held in Committee for
further consideration.
Senator Wilken relayed his question of whether a larger a facility
should be built to address the future needs rather than
constructing a building only adequate for today's population. He
informed that over the previous two years, the population has
exceeded capacity 65 percent of the time. He referred to future
estimates and noted that in FY 10, at a cost of $60 million, the
new facility would be full. He expressed there would be a need for
an additional facility five years after this one is completed. He
surmised, "We're penny-wise and pound foolish here".
RUSS WEBB, Deputy Commissioner, Department of Health and Social
Services, testified in Juneau to address misconceptions. He
clarified that over the previous two years, the existing facility
has operated at or below the planned 72-bed capacity of the
proposed facility 94 percent of the time. He noted that it had
operated over the 72-bed projection only six percent of the time, a
total of 43 of 670 days.
Mr. Webb noted that the size of the new facility had been the
subject of extensive discussion and studies before the 72-bed size
was decided. He showed the declining trend of average daily census
of the hospital over the past 23 years. He explained that increased
knowledge of mental illness, and improved technology primarily with
medication, has made it possible to treat mental illness more
effectively than in the past and thus reduce the need for, and the
length of, hospitalization stays. At the same time, he continued,
community service alternatives have been developed that also reduce
the length of hospital stays and provide alternatives.
SFC 01 # 93, Side B 10:08 AM
Mr. Webb continued by listing new services that are specifically
planned to reduce the need for hospitalization at API. He shared
that a single point of entry agreement recently reached with
Providence Hospital would provide an opportunity to divert up to 25
percent of admissions to API. He noted enhanced detoxification
service has been implemented to provide treatment for people
suffering a combination of mental illness and substance abuse. At
the same time, he stated, API has implemented a system of dual
diagnosis treatment to serve the same patients. He said this allows
these patients to be treated within the community and without
hospitalization.
Mr. Webb continued, telling of enhanced crisis treatment for
persons with mental illness in other programs, which provides
community-based alternatives to API. He said a solicitation had
been made for specialized intensive services targeted to treat 80
patients who have been hospitalized for 30 or more days in the past
year at API with the goal of reducing their future hospital days by
one-half. He spoke of special needs housing opportunities,
explaining that some people are hospitalized because they do not
have appropriate housing. He detailed a proposal with the Alaska
Housing Finance Corporation (AHFC) to address these housing needs.
Mr. Webb reminded that a critical element of community services was
recently addressed in the Senate Finance Committee through SB 154,
which continues designated evaluation and treatment services
throughout the state. He stated the intent is to provide an
additional 18 beds in Anchorage through this legislation. He said
there have been some difficulties in getting this service to other
communities, but that some of these problems have been addressed.
He gave as an example the Providence Medical Center, which has been
prevented from expanding due to land availability but noted this
funding allows for the purchase of the needed land.
He summarized how the aforementioned factors contributed to the
determination that the new facility would contain 72 beds. He
stated this amount of beds is adequate to meet the future needs,
including the occasional spikes in admissions. He calculated the
average daily bed need at 54 beds.
Senator Wilken asked if the board of trustees of the MHTA have
reviewed the proposal and support the proposed 72-bed size.
Mr. Jesse replied that the board had reviewed the building and the
program capacity. He noted that in the early 1980s, API housed
approximately 200 patients and by the 1990s, the number had been
reduced by half. He relayed the board's opinion that the proposal
is realistic and told of his "very firm direction" by the trustees
to proceed with the plan as presented. He pointed out the
expectation is not to operate a facility such as Harborview
Developmental Center, which had served people with developmental
disabilities in an institutional setting.
Mr. Jesse warned against building too large a facility, noting the
increased operating costs for a facility with numerous unused beds.
Senator Wilken requested written analysis of the draft as detailed
by Mr. Webb, noting he counted five alternative programs that would
lessen the demand for API facilities.
Senator Olson wanted to know if the new state-operated facility
would affect delivery of mental health care services provided by
the private sector.
Mr. Webb described the private community hospitals in Fairbanks and
Juneau that provide designated evaluation, which he stressed are
short-term evaluations and treatment services of up to 30 days. He
stated that SB 154 allows for continuation of these services and
for future expansions.
Senator Olson asked specifically about Charter North Hospitals.
Mr. Webb replied that Charter North has not been a provider of
designated evaluation and treatment services in the past. He
informed that the company is in bankruptcy at the national level
and that there has been some discussion about selling the facility
in Alaska, but qualified that he did no know the future business
plans.
Co-Chair Kelly ordered the bill HELD in Committee.
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