Mental health hospital in NE Lacey on hold after partner pulls out
A partner in Olympia Behavioral Health, an 85-bed mental health hospital proposed in northeast Lacey, has pulled out of the project, citing rising costs and a difficult labor market.
The joint venture was between UHS Fairfax, which operates a number of mental health hospitals in the state, and Providence St. Peter Hospital. Providence announced the news Thursday after learning of Fairfax’s decision.
“We worked with the Providence team in good faith partnership and made continuous progress to develop Olympia Behavioral Health. We appreciated the ongoing efforts of the city of Lacey and Department of Health during this process,” said Bob Deney, senior vice president of strategic operations for UHS.
“However, after considering all factors including the rise in construction costs and the ongoing challenging labor market, we made the difficult decision to not move forward with the project,” Deney said in a statement.
The project has received a conditional use permit from Lacey and a Certificate of Need from the state Department of Health. UHS Fairfax was to be the majority partner and operator of the proposed hospital, according to a news release.
The project isn’t dead, Providence Swedish South Sound spokeswoman Angela Maki said on Thursday, adding that the hospital is exploring all its options, including possibly finding a new partner.
Maki said Providence still offers behavioral health services at St. Peter and within its clinics.
“We know the need for behavioral health services remains,” said Darin Goss, chief executive of Providence Swedish South Puget Sound, in a statement. “We will determine the best options on how to move forward as improving behavioral health access continues to be a top priority.”
This story was originally published January 26, 2023 at 2:29 PM.
