The splitting of the state Department of Health and Social Services into two agencies is now law and the two agencies will operate separately beginning this summer, Gov. Mike Dunleavy announced Monday.

“The idea is that with better oversight and better focus, that we will get better outcomes that not only will drive down costs over, we think, a short period of time, but I think we’re going to see an improvement in the response time, the implementation programs and the outcomes that we all expect,” Dunleavy said at a press conference.

By July 1, DHSS will operate as two new agencies — the Department of Family and Community Services and the Department of Health.

Dunleavy issued Executive Order 121, which called for the reorganization of the existing agency, at the start of the current legislative session, according to a release from the DHSS.

Alaska constitutional authority states the Legislature is granted 60 days to evaluate orders and vote them down in a joint session, according to the release. If the vote is absent from legislative action, as it was with the executive order, the order becomes law.

Adam Crum, commissioner of DHSS, said some of the major issues Dunleavy has tasked him with include stabilizing the Alaska Psychiatric Institute, correcting backlog in the Division of Public Assistance, and finding savings in the state’s Medicaid program.

The split of DHSS, he said, is supposed to make operations such as these more efficient.

“It was from my staff and my division directors, and people that have years and decades in the department, (who) brought forward that the way we are doing our business and health and social services can change because we need to be realigned differently,” Crum said Monday.

DHSS is the state department with the most personnel and the largest budget, as well as the most services, Crum said.

“We’re offering so many services all across Alaska,” Crum said. “By reorganizing into two departments, we will have a focused approach that supports stakeholder engagement for innovations and working to remove administrative burdens.”

Both Dunleavy and Crum reiterated that the restructuring is not as a result of the COVID-19 pandemic. The governor first proposed splitting DHSS in 2020, and the effort has been present in the state Legislature since.

Senate President Peter Micciche, R-Soldotna, sat in on the press conference Monday and praised the Legislature for the nonpartisan move.

“This is not a political decision, this was a decision specifically designed to improve services to the most vulnerable Alaskans, to identify cost reductions and efficiencies for the second leadership team, to provide both the bandwidth to deliver a better result,” Micciche said.

The Department of Family Community Services will encompass the Division of Juvenile Justice, the Alaska Psychiatric Institute, Alaska Pioneer Homes and the Office of Children’s Services. The Department of Health will include the Division of Public Health, Division of Public Assistance, Division of Behavioral Health, Division of Health Care Services, and the Division of Senior and Disabilities Services.

Reach reporter Camille Botello at camille.botello@peninsulaclarion.com.