Critical access hospital considers returning $1.5M grant for psychiatric unit

Due to financial concerns, Jefferson Healthcare, a critical access hospital in Port Townsend, Wash., may return a $1.5 million grant awarded by the state department of commerce to build a seven-bed inpatient psychiatric facility, reports PT Leader

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Below are three things to know.

1. Even with grant funding, hospital officials said the extra costs to build, staff and operate the psychiatric unit would make the unit financially unsustainable.

Jefferson Healthcare CEO Mike Glenn said total estimated cost to build the unit is around $4 million, meaning the hospital would have to contribute around  $2.5 million for construction on top of the grant. The unit would result in annual income losses of $2 million owing to operating expenses and unsustainable reimbursement, Mr. Glenn said.  

2. After receiving the grant last year, hospital officials lobbied state legislators for an additional $1 million in capital funding for the psychiatric unit. The hospital was recently notified its request was denied.

3. As an alternative to the seven-bed unit, hospital commissioners proposed building a two-bed crisis and stabilization unit, known as a safe room. They are also considering telepsychiatric consulting service options. The hospital has assembled a task force comprised of registered nurses and other staff to head up alternative efforts.

More articles on finance issues: 

Baystate Health asks for $10M to save 200 jobs
Maine hospital to stop outpatient addiction services
Baker Tilly partner appointed to HFMA Principles and Practices Board: 3 things to know

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