Petersburg hospital gets preliminary nod for behavioral health grant

Petersburg Medical Center has preliminary approval for a federal grant worth roughly $400,000 for behavioral health services, but the amount is not final. The hospital cannot hire staff or buy supplies until the state approves a budget and signs a grant agreement.

CEO Philip Hofstetter told the hospital board that word came the previous Friday. "We did receive word last Friday that was one of the projects we did get approval on. We don't have a budget yet on that," he said, adding the figure holds only if the state funds what the hospital submitted.

The behavioral health award is one of three Rural Health Transformation Program projects PMC cleared, along with a telehealth project and a maternal-child health project. Hofstetter put the combined estimate at upward of $1 million, though final amounts and scopes are not set. None of it is in the hospital's financials yet.

Hospital officials connected a utilization review presented to the board to their plans to expand behavioral health services. In the second quarter of 2026, behavioral health accounted for six of 30 inpatient admissions and 25 patient days, up from four admissions and 10 days in the first quarter. Most were suicidal ideation, and two patients were transferred to another facility for a higher level of care. The hospital recorded 12 behavioral health admissions and 41 patient days across all of 2025.

Hofstetter tied the funding to staffing already in place: a psychiatrist who sees patients on site and by telehealth, and a behavioral health director who returned to Petersburg after several years working remotely.

Grants Planning and Evaluation Director Katie Bryson, who leaves the hospital in September, said the award notice is not money in hand. "We are still waiting to hear what we need to give them to get final budget approval and grant agreements so that we can actually begin hiring and, and buying supplies," Bryson said. By the time the state approves a budget, she said, about 10 months will remain in the fiscal year to spend the award.

Proposal materials describe the project as establishing and staffing a PMC behavioral health department with internship capacity, at $443,000 requested. Residents now rely on a mix of hospital-based care, telepsychiatry and Petersburg Mental Health Services, a community-based provider operating locally since 1993. Access, wait times and whether care is available without transfer are at stake. Alaska received nearly 1,800 letters of interest seeking about $2.5 billion against a first-year federal award of $272.2 million. An earlier Alaska News article noted PMC's two largest proposals, for facility and equipment work, were deferred without feedback.