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Governor Dunleavy will introduce a new Executive Order (EO) on the first day of the 2022 legislative session to restructure the Department of Health and Social Services (DHSS) into two departments.

Restructuring DHSS into two departments allows for better alignment of mission sets and the time and space to work with providers, beneficiaries and federal partners to improve the system of care. The state is committed to ensuring continuity of services to beneficiaries and timely payments to providers. Avoiding such disruptions will be each department’s highest priority.

The first significant step in this direction was taken in December 2020, when Governor Dunleavy introduced Executive Order 119 (EO) to restructure DHSS into two departments. EO 119 was introduced in both the Alaska Senate and House in January and February 2021, respectively, but was withdrawn in March 2021 due to drafting errors in the document. These have been corrected and addressed, and the new EO will provide a clear path ahead.

I. Department of Health (DOH)

  1. Division of Public Health
  2. Division of Public Assistance
  3. Division of Behavioral Health
  4. Division of Healthcare Services
  5. Division of Senior and Disabilities Services
      

 

 

 

II. Department of Family and Community Services (DFCS)

  1. Division of Juvenile Justice
  2. Alaska Psychiatric Institute
  3. Alaska Pioneer Homes
  4. Office of Children’s Services

Organizational ChartsPDF | Questions or concerns? Contact us: dhssreorg@alaska.gov

Will the restructure change any services?

While both departments serve Alaskans, they will have different missions, tasks and priorities.

DOH will have oversight of health care services, payment and public health. The Divisions of Behavioral Health, Health Care Services and Senior and Disabilities Services provide regulatory oversight, claims processing, facility licensing and enforcement of Medicaid and state regulations. DOH will also actively engage with stakeholders to find opportunities for innovation within Medicaid and improve outcomes for all Alaskans.

DFCS will focus on supporting our child welfare system and 24/7 facilities providing direct services to Alaskans. For example, Alaska Psychiatric Institute and the Alaska Pioneer Homes provide care for patients and elders, and when eligible can bill Medicaid for the services provided – in much the same way that hospitals and clinics work.

As mentioned previously, each department’s primary goal is to avoid disruption in services to beneficiaries or delay in payments to providers. The divisions that provide service to the public are remaining intact and will continue their operations uninterrupted. The divisions that will see the most operational change will be the internal divisions of Finance and Management Services. These groups include budget, finance, grants, contracts and IT teams, which will adapt to serve the same divisions within separate departments.

Why restructure?

No other department in the state comes close to the volume of personnel, budget or services that DHSS is responsible for. For example, the number of personnel in DHSS equals that of six other state departments combined, and the DHSS budget is equivalent to that of 12 other state departments, the Alaska Court System, the Legislature, and the Office of the Governor combined.

In our research, it became clear it is not standard practice to have this type of “mega-agency” providing health and community services. For example, Wyoming breaks these services into two departments and South Dakota spreads them across four departments.

The work done at DHSS touches nearly all Alaskans. The breadth and span of this work is tremendous, and all agree there is an undeniable need in this state to improve outcomes.

Are there examples of complex issues the department deals with?

Within the Office of Children’s Services, there is a 59% turnover rate for case carrying workers. Conservative estimates show this costs $13 million a year to the state and the high turnover results in children staying in foster care too long while families are delayed in working plans, which decreases family resiliency.

Medicaid’s budget, the most expensive budget item in the state, has a traditional 4-5% annual growth rate (prior to the COVID-19 Public Health Emergency). SB 74 (2016 law) provided authorities to pursue many innovations, but these goals have not all been achieved because of the lack of bandwidth to work effectively with stakeholders and federal partners. Alaska is one of the last remaining fee for service states, and we must collaborate on solutions for value-based care.

This restructure will allow us to better serve Alaskans by narrowing the span of control, aligning the divisions with similar missions and focusing on long-term system improvements and stakeholder engagement. The leadership of each department will be able to focus on work processes to maximize efficiencies and incorporate innovative ideas, with the mission of improving outcomes for the Alaskans that we serve.