A large Hudson Valley hospital network, WMCHealth, has agreed to restore psychiatric beds taken offline during the COVID-19 pandemic and make other improvements to its mental health services following a state investigation, the New York attorney general’s office announced Monday.

HealthAlliance Hospital in Kingston reopened 20 of its psychiatric beds in December, after the investigation, and WMCHealth has agreed to create a new 20-bed psychiatric unit at MidHudson Regional Hospital in Poughkeepsie, Attorney General Letitia James said.

WMCHealth has also agreed to reform its discharge planning process and protocols for using restraints on psychiatric patients, especially children. And the health system agreed to pay $400,000 in penalties and fees to the state and will face additional fines of $10,000 per violation if it fails to comply with the terms of the settlement, the attorney general’s office said.

James launched an investigation into psychiatric services at WMCHealth, a system with nine hospitals across the Hudson Valley, in 2022. She said the investigation was inspired by “powerful testimony” from community members about the impact of a 40-bed psychiatric unit closing at HealthAlliance Hospital and inadequate care for patients experiencing mental health crises at Westchester Medical Center and MidHudson Regional.

“Mental health care is medical care, and mental health crises must be treated as the emergencies they are,” James said in a statement. “My office will continue to fight to ensure all New Yorkers have access to quality, compassionate emergency mental health care.”

Andrew LaGuardia, a spokesperson for WMCHealth, said the health system is the largest provider of inpatient psychiatric care in the Hudson Valley and often treats patients under “difficult and complex circumstances.”

“Our goal is always to provide the highest quality care for every patient and take immediate action to address any situation where our standard of care has not been met,” LaGuardia said.

The investigation found lapses in patient care at these three facilities, including instances when patients who were suicidal or in the midst of other psychiatric emergencies were allowed to leave without being properly stabilized, leading to what the state called “preventable tragedies.” The hospitals at times maintained inaccurate or incomplete medical records, among other issues, James said.

Hospitals across the state, including several in New York City, shut down psychiatric units early in the pandemic after receiving orders from then-Gov. Andrew Cuomo to create “surge capacity” for COVID-19 patients. The changes were supposed to be temporary, but some hospitals have taken years to bring those beds back online. Gov. Kathy Hochul has sought to restore the previous psychiatric inpatient capacity, threatening fines for hospitals that don’t comply.

To reach the settlement with WMCHealth, James said she invoked the Emergency Medical Treatment and Labor Act, a federal law requiring hospitals to screen and stabilize any patient who shows up with a medical emergency, regardless of their ability to pay. Her office said this is the first time the law has been used by an attorney general to reach a settlement over behavioral health care.