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Providers and advocates urge $15–30 million boost to behavioral health funding amid ‘crisis’
Summary
Behavioral‑health providers, program leaders and community organizations told the Senate Finance Committee that Medicaid rates lag costs, providers are closing or shrinking, and the state should add $15–30 million to behavioral health funding and address delayed rate rebasing.
Testimony before the Senate Finance Committee on Feb. 27 repeatedly described Alaska’s youth and behavioral‑health system as a crisis and urged increased operating funding and rate rebasing to stabilize providers.
Jay Bechtel of South Peninsula Behavioral Health Services said the state is “in the middle of a mental health crisis” and that his agency serves about 400 clients annually while revenue increases have not kept pace with costs. “We are in a mental health crisis,” he said.
Multiple providers and advocacy organizations asked the committee to add substantial operating funding. Denali Family Services requested a $30,000,000 increase (about 15 percent) to behavioral‑health funding, citing workforce loss and reduced capacity. Volunteers of America Alaska asked the committee for a $15–30 million increase to the operating budget for behavioral health to sustain and expand services; VOA noted program closures due to “unsustainable rates.”
Several speakers raised delayed Medicaid rate rebasing. Polly Beth Odom and others said rate rebase work is more than two and a half years overdue, causing roughly $14–14.5 million in lost revenue for providers. Cody Chipps, a licensed psychologist, described behavioral‑health reimbursement lagging behind medical counterparts and urged a $15–30 million supplemental or base increase.
Why it matters: Witnesses linked underfunding and low reimbursement to program closures, workforce shortages and reduced access to care; several speakers described rising youth suicide and overdose rates and urged urgent action to maintain the provider network.
Ending: The Feb. 27 hearing collected requests and anecdotal evidence but did not produce committee votes. The Senate Finance Committee will consider these funding requests as it moves SB 58 (mental‑health budget) and SB 56 (operating budget) through budget deliberations.
