The board for Petersburg Medical Center Wednesday sought support for pursuing a new hospital facility in a work session with the Petersburg borough assembly. Some on the assembly continue to push back on the high cost of building a new community hospital.
Just before the global health pandemic, the local community hospital had released its completed master plan. The board and staff were ready to start making decisions about location for a new facility and pursue money for the design and site preparation work needed to advance the project. A year later, Petersburg Medical Center is asking for the assembly’s support for the project. Medical center CEO Phil Hofstetter outlined the next steps.
“In order to think about an 80 million dollar building, we have to have a selected site,” Hofstetter said, adding, “We have to have unified support. We have to be able to go to grantees to be able to obtain that.”
Hofstetter recommended getting the project ready for construction over the next 4-5 years and seeking outside funding, with potential sources the Denali Commission, U.S. Department of Agriculture and the Rasmuson Foundation.
PMC’s master plan looked at five sites for a new facility, including one near the existing building and others near Haugen Drive, the ballfields or Mountain View Manor. Cost estimates put total construction costs ranging from 66 to 79 million dollars for three different building options and with the total project cost ranging from 92 to 110 million dollars for those options. Hofstetter said he expected further investigation of the sites would help with selection based on depth of muskeg, access to utilities and other cost considerations.
Hospital staff and the board said the community needs to prepare as the existing building ages and fails.
Board president Jerod Cook echoed the need to make a decision.
“This project will never get cheaper and so if we’re going to go in this direction we’ve got to keep moving forward on this, because if we don’t, then we’ve got to start deciding where we’re going to go as a community with our medical facility and our medical treatment,” Cook said. “So I guess for me it’s just we’ve got to try.”
Board member Cindi Lagoudakis noted the cost of a new building keeps increasing.
“As we continue to drag our feet those costs are going to go up,” she said. “As we continue to drag our feet, there’s going to be increased maintenance costs that are needed at the hospital just to keep it functional. If we don’t keep it functional it’s over a 100 jobs that walk out of this community and that affects quality of life in Petersburg and those are all important things.”
The assembly in March voted to list planning and design work on the project as one of its top federal funding priorities. But it wasn’t a unanimous vote. Some assembly members said they’re not ready to commit to this direction for the hospital.
“I don’t feel like I’m dragging my feet on this thing,” said assembly member Jeff Meucci.
“I think when that 84 million dollar price tag popped up and a couple of months ago we moved this project to like our number four on the capital priority list and there was no discussion with it and I was thinking to myself, OK we’re all in on this project,” Meucci said. “And me personally I’m not all in on the project. I know we have to do something different. I have to be able to tell the voters in the community that this is a good idea.”
Meucci said the assembly has heard community opposition to the construction of other recent public buildings. With that price tag, the borough isn’t talking about bonding for that amount, it’s well above Petersburg’s debt capacity.
Mayor Mark Jensen thought Petersburg should look at other options.
“I agree with the concept of a community-run hospital but seeing how many of them are failing around the country, the discussion was earlier being taken over by PeaceHealth or (the Southeast Alaska Regional Health Consortium) or whatever, before I could support moving forward with giving land or support for it, I would like to have a discussion with other entities similar to this that could say what they have to offer,” Jensen said.
SEARHC, the Southeast Alaska Regional Health Consortium has built a new hospital in Wrangell and is constructing another in Sitka. It has also taken over behavioral health services and a dentist’s office in Peterburg this spring.
Hospital staff and the board made their case for keeping the medical center under local control. Dr. Courtney Hess commented that the local physicians were opposed to a takeover of the medical center by a larger health care company.
With around 155 employees, the critical access hospital has seen some growth in its staff in the last few years. Hofstetter said it pays around 11-12 million dollars in salaries. And he said local control meant the ability to more quickly meet the needs of Petersburg.
Assembly member Chelsea Tremblay supported local control of the facility and thought a phased approach to the high dollar project made sense.
“And so just figuring out how to put that foot in front of the other is where I’m coming from,” Tremblay said. “Because to me the alternative is kind of unthinkable. All the things that are difficult with health care right are made much harder without community input and decision making ability. Like if we have a health care provider that we don’t get to share our frustrations with and demand timely response from, all these kinds of things, just get more difficult.”
The next step could be investigation of the site options and the assembly may consider a resolution of support for the project.
The assembly and board also had a long discussion on operating the medical center and areas that have seen growth or decreased during the pandemic. Hofstetter said PMC’s home health care service expanded dramatically over the past year, but was already a service sought by the community even before the pandemic. At the same time there was a drop in some in-hospital services, like physical and occupational therapy. The medical center is also expanding some services like behavioral health and has hired some of the clinicians formerly with Petersburg Mental Health Services.