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State puts a hold on plans to open psychiatric units

The Department of Health has questions about a proposal by one parent organization to buy the other.

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Proposals to open two new psychiatric units in Everett and Lynnwood have been at least temporarily put on hold over plans for the parent organization of one the two companies to buy the other.
Kirkland-based Fairfax Hospital proposed opening a 30-bed unit next year, leasing space on the Pacific Campus of Providence Regional Medical Center Everett. It would spend $3.9 million to upgrade and secure the seventh floor of the hospital building on Providence's Pacific Campus.
The hospital is a subsidiary of Universal Health Services Inc., based in King of Prussia, Pa.
Ascend Health Corp., based in New York City, announced plans to spend nearly $24 million to open a 75-bed inpatient psychiatric hospital in Lynnwood, with the first 60 beds available for patients next year.
However, the state Department of Health has put those plans on hold, asking for additional information on the proposed business agreement between the parent companies for the two organizations.
"That raises some issues with us," said Bob Russell, an analyst with the state agency.
"Any change in ownership like that really changes the application. You have new owners."
Letters have been sent to both organizations asking if the proposals for two psychiatric units will go ahead, he said.
"There's no sense in us going forward until they advise us what they're going to do," Russell said.
The companies have until Aug. 20 to provide the information. The state agency is expected to finish its evaluation of the projects and make its decision on whether to allow either or both to be approved by Oct. 22.
A public hearing was held in Everett on the proposals
">in May
, drawing a mostly supportive response from those who attended.
Some questions were raised about what plans would be made for patients once they were discharged. Several people told stories of their life with a mental illness to underscore the need for more local in-patient psychiatric services.
Snohomish County has some of the worst access to in-patient psychiatric care in the state, about 3.5 beds per 100,000 population, according to documents submitted to the state Department of Health by Fairfax.
Currently, in-patient psychiatric beds for adults are offered at only one facility in the county, Swedish/Edmonds. Its 18-bed unit treated 546 patients last year.
In June, Universal Health Services announced plans to buy Ascend Health Corporation and assume its debt. The overall deal is said to cost about $517 million, according to a company statement.
However, the proposal for the Lynnwood facility was made by a wholly owned subsidiary of Ascend, called North Pointe Behavioral Health.
The Lynnwood psychiatric unit was excluded from the sale to Universal Health Services, according to Richard Kresh, Ascend's chief executive.
"We intend to go forward," he said. "We think the Seattle area is in need of our service and we'd like to provide it."
An official with Fairfax Hospital in Kirkland said his organization still plans to open its proposed psychiatric unit in Everett.
Pending approval from the state, it could still open within the first three months of next year, said Michael Uradnik, the hospital's chief operating officer.
The proposal for Universal to take over Ascend is being reviewed by the Federal Trade Commission.
Sharon Salyer: 425-339-3486;
Story tags » Health organizationsMental health

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