Clinic director asks Skagway assembly for $6.11 million as health‑care costs climb

Al Wall, director of the Dell Memorial Clinic, told the Skagway Municipality assembly that the clinic is seeking $6,112,126 in operating funds and an additional $197,235 in capital spending for the next budget year. He said the overall request represents about a 37% increase from the prior year and reflected delays in fee changes and in getting the clinic pharmacy and other administrative systems fully operational.

"The cost of health care is going to go up by 30 to 50% every year regardless of what this assembly does," Wall said, arguing the clinic must shift toward an enterprise model that recovers more costs from insurance and grants rather than relying on municipal subsidies.

Why it matters: The assembly faces a budget cycle in which revenues are constrained and several departments asked for higher funding. Wall told members the clinic has three drivers of increased costs — a newly licensed pharmacy to stop unreimbursable prescription write‑offs, higher staffing costs as permanent providers move to Skagway, and new accounting capacity to improve billing and collections — and that the municipality’s taxpayer contribution depends on the clinic winning a set of discretionary grants.

Wall explained the pharmacy problem in concrete terms: the clinic historically used a dispensary model that did not qualify prescriptions for insurance reimbursement, causing many prescription costs to be written off. "For proprietary medicines, it can be... a thousand dollars a prescription," he said, noting unreimbursed refills compound quickly.

On staffing, Wall said the clinic has added two physician assistants, a medical doctor and a dental hygienist who live in Skagway and receive benefits, which increases personnel costs but improves continuity of care and reduces reliance on expensive traveling locum providers.

Assembly members pressed for detail. Assembly member Hillis asked whether the budgeted $1,878,449 figure was the correct taxpayer ask; Wall clarified that number was the sales‑tax portion and that roughly $1.3 million in grant revenue is included in the draft budget. He emphasized the grants are not certain: "If we don't get the grants, your taxpayer dollar investment goes up," Wall said.

Wall listed four potential federal grant opportunities: two SAMHSA grants (including a targeted capacity grant and an SBIRT behavioral health grant), a Community Development Block Grant, and a National Institutes of Health remote intervention grant he estimated at about $250,000 per year. He said applications typically depend on the federal budget timetable, often opening after a federal fiscal‑year appropriations decision.

Assembly member Potter thanked Wall and asked for more detail about the grants' timelines; Wall said applications generally begin shortly after the federal budget is signed and acknowledged uncertainty about award timing.

On capital needs, Wall described the $197,235 oxygen generator request as replacement for an aging unit (about 15 years old) used in urgent care and to fill tanks for the fire department. He said replacing the generator avoids repeated, costly deliveries of oxygen tanks to Skagway and that he will pursue capital grant funding if available.

Wall said the clinic has contingency plans if grant funding fails, noting municipal code requires primary care, emergent services and behavioral health but not dental; if forced to cut services, he would present prioritized options to the clinic board and the assembly.

The assembly asked for additional budget detail and follow‑up materials (for example, more granular travel and training breakdowns and verification of revenue assumptions), and the meeting moved on to other fund reviews.