Northern Arizona Healthcare pauses new hospital planning, says Flagstaff Medical Center near capacity

Colleen Mehring, chief people officer at Northern Arizona Healthcare, told the Coconino County Board of Supervisors on Feb. 17 that the health system has paused planning for a new regional hospital because of uncertain finances driven by cuts to Medicaid reimbursement and changes in commercial insurer payments. “We desperately need a new hospital,” Mehring said, but added that the organization must first understand how looming financial headwinds will affect its ability to remain sustainable.

Mehring described daily capacity pressures at Flagstaff Medical Center, saying inpatient units are often full and that staff have placed adult patients in operating-room pre-op spaces and on labor-and-delivery units when no other beds are available. “When we do these things … we actually bring in extra staff to care for those patients,” she said, describing ad hoc measures used to maintain safe care under physical constraints.

Mehring said the system completed due diligence on additional sites and has paused work with three other landowners so they could pursue other options. She confirmed the county still owns the parcel adjacent to Fort Tuthill County Park and stated, “We have no plans to sell that land at this time.”

The presentation framed the pause as a timing and financial decision rather than a withdrawal of need: Mehring said demand and capacity constraints persist and that a new hospital remains necessary if funding and reimbursement conditions can be clarified.

Board members thanked Mehring and discussed continuing coordination between the health system and county on how potential plans might affect county-owned property and park operations. Chair Patrice Horstman said the county values the partnership and looks forward to “continued collaboration.”

The board did not take formal action on hospital planning at the meeting; Mehring’s remarks were delivered as public comment.