Skagway’s Dahl Memorial Clinic has been serving the town’s medical needs for over 50 years. The clinic is run by the municipality and funded through a series of grants and tax revenues. Over the last couple of years, high staff turnover has been problematic.

In mid-June Skagway’s Borough Manager Brad Ryan floated the idea of bringing in the Southeast Alaska Regional Health Consortium – known as SEARHC – to take over the clinic.

“They have been a real resource to the community and we have been talking a lot. And they’ve mentioned a couple of times to me that they would love to be here on a bigger level and maybe even take over the clinic for us. So we’ve had lots of conversations back and forth, they’ve been pretty low-level. And finally, I requested if you are really willing to do this, come to town and give us a presentation,” said Ryan.

SEARHC is a private non-profit tribal healthcare provider with facilities in dozens of Southeast Alaska communities including Haines.

This week the organization submitted a Letter of Intent to take over Skagway’s public health clinic. One of the provisions in the letter says the municipality will not shop around for other potential operators for at least the next six months.

It also lays out their goals of expanding services offered in Skagway. SEARHC did not respond to requests for comment, however, according to the Letter of Intent, it would consider expanding behavioral health, dental, and optometry, though It didn’t make any guarantees. Patients requiring any services not offered locally would be referred to SEARHC’s main hospital in Sitka. 

Additionally, the letter spells out the health consortium’s sliding scale fee structure which on paper looks similar to the sliding scale Dahl Memorial Clinic already offers. It also spells out a lease agreement with a purchase option after five years.

Reba Hylton, chair of the Health Education and Welfare committee told KHNS that prevents the municipality from selling the building and land now.

“We will revisit that in five years on a municipal level which I believe would have to go through the voters first. But should, in the meantime, the municipality decide to sell that property, then that would give SEARHC the first right of refusal to purchase it,” said Hylton.

On Tuesday night Skagway’s Health Education and Welfare committee met with the borough manager and a SEARHC representative to go over the Letter of Intent and answer questions. Assemblyperson Jay Burnham asked SEARHC how they plan to make money while increasing services.

“If I was going to acquire a clinic or a hospital and it was losing about a million dollars a year, how do you expect to turn that around to make a profit?” Asked Burnham.

The SEARHC representative Heidi Ellsworth replied that not all of their facilities are profitable. 

“Our goal will be to get it to a break-even state,” said Ellsworth.

According to Skagway officials, the Dahl Memorial Clinic receives federal grants that total a little under $2 million, and the municipality spends an additional nearly $1 million in tax revenue to support its operations.

SEARHC went on to explain that the organization pools all grant monies from their various locations which allows them to funnel money to where it’s needed throughout the network. 

One major change at Skagway’s clinic would be the level of community involvement. SEARHC would look to dissolve the current clinic board of directors and establish an advisory council in its place. The current board president Cory Thole told KHNS that the board hasn’t established a stance on a deal with SEARHC one way or another, but they do have questions that have not yet been answered.

“One of those was a complete comparison of the pricing structure and the customer services. So for instance, in the letter of intent, they did, you know, provide the top 10 most billed services, which are appointments. But what wasn’t provided was what the clinic currently charges. And so that I think is maybe one of the more important aspects to fully inform the community of what it would look like if SEARHC took over,” said Thole.

For now, there are no binding agreements between the municipality and SEARHC other than to continue negotiations. No major binding agreements will be made without the approval of Skagway voters. Municipal officials say that community input will be encouraged at Health Education and Welfare meetings, assembly meetings and that there will likely be a town-hall-style meeting prior to a special election.

The municipality’s ideal timeline, according to Assemblyperson Hylton is to bring a discussion of the offer to the assembly in mid-January and then to the voters sometime in March.