A report from

State Prisons and
the Delivery of
Hospital Care
How states set up and finance off-site care for incarcerated individuals

July 2018

Contents
1	

Overview

2	

States look to hospitals to provide range of services

4	

Models states use to structure prison hospital care

6	

How officials approve and review hospitalizations

9	

State strategies vary in locating hospitals

11	

Transporting and securing correctional patients at hospitals

12	

Paying the hospital bill

13	

Medicaid expansion has helped cut costs

13	

Promising approaches to reducing costs

14	

Conclusion

15	

Endnotes

ii

The Pew Charitable Trusts
Susan K. Urahn, executive vice president and chief program officer
Michael D. Thompson, vice president, state and local government performance

Project team
Kil Huh, senior director
Alex Boucher
Stephen Fehr
Frances McGaffey
Matt McKillop
Maria Schiff

External reviewers
This report benefited from the insights and expertise of three external reviewers: Jeff Dickert, former chief
operating officer at University Correctional Health Care, Rutgers, the state university of New Jersey; Karah
Gunther, executive director of government relations and health policy at Virginia Commonwealth University
and the VCU Health System; and Dr. Steven Shelton, former medical director at the Oregon Department of
Corrections. Although they have reviewed the report, neither they nor their organizations necessarily endorse its
findings or conclusions.

Acknowledgments
The project team thanks our Pew colleague Adam Gelb for his assistance and guidance in the research
process. We also thank Casey Ehrlich, Rachel Gilbert, Steve Howard, Elizabeth Hughes, Bernard Ohanian, Erika
Compart, Anne Usher, Liz Visser, Henry Watson, Gaye Williams, and Dave Lam for their editorial and production
assistance.

Cover photo:
Noah Berger/AP

Contact: Sarah Leiseca, communications manager
Email: sleiseca@pewtrusts.org
Project website: pewtrusts.org/correctionalhealth

The Pew Charitable Trusts is driven by the power of knowledge to solve today’s most challenging problems. Pew applies a rigorous, analytical
approach to improve public policy, inform the public, and invigorate civic life.

Overview
Delivering adequate medical care to the more than 1 million adults in state prisons is a growing challenge
for states, in part because of the high costs and complex logistics required to hospitalize people who are
incarcerated.
While most care for incarcerated individuals is delivered on-site, some of them periodically need to be
hospitalized for acute or specialized care. As is true generally, this treatment is expensive because of the
labor-intensive and sophisticated services provided. And hospitalizing someone who is in prison brings added
expenses, such as providing secure transportation to and from the hospital and guarding the patient round-theclock. State officials nationwide are under increasing pressure to contain hospitalization costs while also ensuring
the constitutional right to “reasonably adequate” care.
Hospitalization expenses are already a significant portion of correctional health care spending and are likely
to grow if prison trends continue. The average age of those behind bars is rising, and the health needs of these
individuals—like older people outside of prison—are more extensive than those of younger cohorts, including
more hospitalizations. State officials are also noting an increase in the amount of care required for all adults
entering correctional facilities. Looming over these considerations is the future direction of national health care
policy, especially the role of Medicaid, the federal-state program for low-income individuals.
With these challenges in mind, The Pew Charitable Trusts explored hospital care for people incarcerated in
state prisons, tapping data from two nationwide surveys conducted by Pew and the Vera Institute of Justice and
from interviews with more than 75 state officials. This first-of-its-kind analysis of hospital care for this patient
population is part of a broader examination by Pew of correctional health care in the United States.
This report will discuss the ways states arrange and pay for hospital care for their incarcerated population and
how such care supplements on-site prison health services. Its findings include:
•• Off-site care costs are a significant part of correctional health budgets. For example, Virginia spent 27 percent
of its prison health care budget on off-site hospital care in 2015, while New York spent 23 percent.
•• The health care delivery model that state prisons use to provide on-site services informs decisions they must
make regarding hospitalization arrangements, including who holds authority to send someone off-site, how
the care is coordinated and reviewed, and which entity pays the bill.
•• The federal Affordable Care Act (ACA) offers state policymakers who elect to expand their Medicaid
programs’ eligibility a way to reduce inpatient hospital spending.
•• Though incarcerated individuals always will need to be treated at hospitals for certain conditions or
tests, some states have promising practices to avert some off-site care, saving money and mitigating public
safety risks.
The report’s discussion of state approaches to providing care to incarcerated individuals is designed to help
the officials involved in setting hospitalization policy—lawmakers, prison and hospital medical staff and
administrators, correctional officers, and sometimes private contractors—better manage costs while working
toward or maintaining a high-performing prison health care system.

1

States look to hospitals to provide range of services
States have a constitutional mandate to provide people in prisons with necessary health care. Prisons typically
provide on-site primary care and basic outpatient services. Departments of corrections also usually arrange for
some prisons within their system to house specialized clinics or units.1 Such facilities are designed for people with
acute or chronic illnesses that do not require highly specialized off-site services; can provide recurring care, such
as kidney dialysis; or can house patients recuperating after a hospital stay. However, every correctional system’s
on-site facilities and equipment are limited, so all states rely on hospitals for some specialist consultations,
diagnostic tests, surgery, and other services.²

Types of Health Care Outside Prisons
•• Off-site care: Any care provided off the prison’s premises. It could be provided at a hospital,
surgical center, or specialty clinic, such as for radiology or dialysis services.
•• Inpatient hospitalization: An admission to a medical institution, such as a hospital, for
longer than 24 hours. This is the only type of care for which state Medicaid agencies may
provide coverage for incarcerated individuals, if they are eligible and enrolled in the program.
•• Outpatient care: Emergency, diagnostic, or therapeutic services that do not require the
patient to be admitted to a hospital.

Off-site care represents a sizable portion of corrections departments’ health expenditures. Hospital care
accounted for about 20 percent of health spending in 10 states between 2007 and 2011, according to Pew
research. More recent data from two additional states, New York (23 percent) and Virginia (27 percent), showed
the proportion may now be greater.3
While the ACA lowered inpatient hospital expenses for corrections departments in states that expanded
their Medicaid programs, off-site care remains a financial challenge, especially when considering ancillary
transportation and security costs. (A discussion of how some states’ hospital payment policies have changed due
to the ACA’s optional expansion of Medicaid eligibility can be found in the “Medicaid expansion has helped cut
costs” section.)
Older individuals have more need for specialized care because of a greater prevalence of chronic conditions
such as heart disease, cancer, and diabetes.4 In the community, older people have significantly higher rates of
hospitalization and make more emergency room visits than do others, raising health care costs for this sector.5
Prison populations are also aging, with similar implications for spending. From fiscal year 2010 to 2015, the
share of incarcerated people 55 and older increased by a median of 41 percent in the 44 states that reported
this statistic, indicating that corrections departments face rising health care costs for the foreseeable future.6
Moreover, most incarcerated individuals experience the effects of age sooner than people outside prison because
of such issues as substance use disorder, often inadequate preventive and primary care before incarceration, and
stress linked to isolation and the sometimes violent environment in prison.
Virginia’s corrections department illustrates these patterns. The cost of off-site care for incarcerated adults 55
and older is nearly double that for younger individuals. While 12.2 percent of the state’s prison population was in
2

the 55-plus age bracket in fiscal 2016, they made up 28 percent of those receiving off-site care that year. Their
treatment accounted for 40 percent of the department’s hospital bill.7 States that have an even higher proportion
of aging inmates than Virginia probably spend a larger proportion of their corrections department health dollars
on off-site services.
In addition to those who are aging, a relatively small subset—disproportionately but not exclusively older than
55—is a particular cost challenge. (See Figure 1.) They most commonly have cancer, heart disease, and other
severe conditions. Nearly half of the $62 million that Virginia spent on off-site health care in fiscal 2016 was for
179 people, who made up less than 1 percent of the state’s prison population.8

Figure 1

Small Subset of Virginia’s Prison Population Accounts for Nearly
Half of Off-Site Costs
Outside health care spending for incarcerated individuals, April 1, 2015March 31, 2016
100%

$33.2
million
(53.2%)

50%

37,011
individuals
(99.5%)
$29.2
million
(46.8%)
179
individuals
(0.5%)

0%

Number of
incarcerated individuals

High-cost claimants

Other individuals

Source: Virginia Joint Commission on Health Care
© 2018 The Pew Charitable Trusts

3

Off-site health
care spending

Models states use to structure prison hospital care
Creating a prison health system starts with designing on-site access to primary care and common outpatient
services. Off-site services supplement such care. (See Table 1.) Pew and Vera’s research revealed that state
corrections departments deliver on-site care using one of four systems:
•• Direct model. State-employed corrections department clinicians provide all or most on-site care.
•• Contracted model. Clinicians employed by one or more private companies deliver all or most on-site care.
•• State university model. The state’s public medical school or affiliated organization is responsible for all or most
on-site care.
•• Hybrid model. On-site care is delivered by some combination of the other models.

Table 1

Delivery System Organization Structures, Fiscal 2015
Delivery system

States

Number of states

Direct

Alaska, California, Hawaii, Iowa, Nebraska, Nevada, New
York, North Carolina, North Dakota, Ohio, Oklahoma,
Oregon, South Carolina, South Dakota, Utah, Washington,
and Wisconsin

17

Contracted

Alabama, Arizona, Arkansas, Delaware, Florida, Idaho,
Illinois, Indiana, Kansas, Kentucky, Maine, Maryland,
Massachusetts, Mississippi, Missouri, New Mexico,
Tennessee, Vermont, West Virginia, and Wyoming

20

State university

Connecticut, Georgia, New Jersey, and Texas

4

Hybrid

Colorado, Louisiana, Michigan, Minnesota, Montana,
Pennsylvania, Rhode Island, and Virginia

8

Note: New Hampshire did not provide data.
© 2018 The Pew Charitable Trusts

States select a model based on historical patterns, staffing needs, policy preferences such as privatization, and
other factors. The model officials choose is significant in part because of the impact it has on hospitalization
arrangements. For example, in the contracted-provision model, state officials must incorporate rules into a
vendor’s contract that delineate who has authority to send someone for nonemergency hospital care. Those
rules cover such questions as, Can the contractor’s medical employees decide on their own to send a person to
a hospital or do they need approval from a state official, such as the corrections department’s medical director?
The agreement must also clarify whether the contractor, the corrections department, the state Medicaid agency,
or a combination of the three pays the off-site care bill.

4

Which model is followed also affects the way payments are tied to care. Most corrections departments that
outsource their on-site care negotiate a contract with their health vendor that establishes a capitation—a fixed
per-person, per-month payment—that vendors receive for caring for the individuals in the prison system.9
Corrections departments weigh how best to obtain good-quality care at a reasonable cost while balancing the
contractor’s financial obligations.
The contract between the corrections department and the vendor must detail what services the capitation covers.
Because of the potential to incur substantial and unpredictable expenses, vendors can be apprehensive about
assuming financial responsibility for patient hospitalizations. Thus, some states agree to exclude completely
(carve out) or partially (risk share) such expenses from the vendor’s contract, retaining that responsibility fully
or in part. Such arrangements may apply only to off-site outpatient care and any inpatient care not eligible for
coverage by other payers such as Medicaid. States that expanded their Medicaid eligibility under the ACA might
also choose to carve inpatient care out of their vendors’ contracts since so many hospital stays will qualify for
coverage under that law.
Arkansas, Illinois, Pennsylvania, Vermont, and Virginia fully or largely contract out their on-site prison health care
but carve out inpatient hospitalization costs. At the other extreme, Arizona, Delaware, Florida, Indiana, Kansas,
Kentucky, Massachusetts, and Missouri hold vendors completely responsible for such care through an allinclusive capitation rate. States that use the risk-share model include Maryland, Michigan, Minnesota, Tennessee,
West Virginia, and Wyoming, but their arrangements vary.
The 17 states that deliver on-site prison health care directly and the four that use a state university model pay for
the cost of off-site care in varying ways. For example, lawmakers in Connecticut and Iowa appropriate funds to
cover the cost of inmate patient medical services at the University of Connecticut hospital (the state correction
department’s primary hospital partner) and the University of Iowa Hospitals and Clinics, respectively. But when
Iowa’s corrections department uses a community hospital, it pays for the care out of its own budget.10 Hospitals
bill the New York state Medicaid agency for inpatient care of Medicaid-enrolled individuals but charge the
corrections department for outpatient care and the inpatient care of offenders who are not enrolled in Medicaid.11

5

Custody Arrangements
Nearly 9 in 10 individuals under the legal authority of state departments of correction in
fiscal 2015 were housed in state-run prisons. The operation of these facilities, including health
care, is directly managed by state officials and carried out by a mix of state employees and
private vendors.
A majority of states also put some of their incarcerated population under the physical custody
of privately owned and operated institutions or local jails. Private prisons are for-profit entities
that manage all correctional functions. Jails primarily contain people awaiting trial and those
convicted of misdemeanors who are serving sentences of less than one year.
State decisions about when and how best to make use of these alternative settings result from
a number of considerations, including cost and space. States retain legal liability for health care
provided to those under their jurisdiction, even when the services are provided outside state-run
facilities. States lose some direct control and influence over the care that is provided—though
they can seek to track performance against established quality requirements—and typically
have less access to detailed cost and spending data, as health care costs are incorporated into
correctional per diem payment totals.

How officials approve and review hospitalizations
Nonemergency hospital care requires authorization in advance by a corrections department to ensure there is not
an appropriate, less expensive treatment available. In this way, officials attempt to control costs while complying
with required standards of care. All states have a system to ensure case review for such authorization, regardless
of whether the state or a private contractor manages on-site health care. Most states authorize the contractor’s
medical director and/or the medical director of the state corrections agency to consider requests from the prison
medical staff for preapproval for such nonemergency treatments as a hip replacement or hernia repair.12 The
director may approve the proposed procedure, reject it, or suggest an alternative treatment.13
Hawaii, a direct-provision state, is a good example of how such reviews are conducted for the portion of its
prison population housed in the state. The department of corrections’ medical director heads a panel of state
physicians and nurse practitioners who review requests from prison medical providers to send a person to a
hospital or specialist outside the prison. The panel makes a decision based on clinical findings and other criteria,
such as community standards of practice for the service and the person’s remaining time in prison. If the request
is approved, the corrections security staff is told to arrange screening, transportation, and supervision during
the off-site stay. After the treatment, the off-site hospital and specialist must inform the committee of their
diagnosis, test results, treatment provided (including medications), and future recommendations.14
Other states generally do much the same for nonemergency care. In Connecticut, physicians from the University
of Connecticut and the correction department conduct the review, in part because the university—which is
providing on-site health care until mid-2018—also operates a 10-bed inmate unit at the university hospital. The

6

state requires the university to report the number of requests for off-site care and the percentages of those that
are approved and denied, and for what reasons.15
Hospitals must also preapprove inpatient hospitalizations that corrections departments expect their state
Medicaid agency to cover to ensure that the admission meets Medicaid guidelines.
State corrections officials can also review hospitalizations retrospectively. As in nonprison settings, a rise in
“preventable hospitalizations”—admissions due to conditions that are generally treatable in a primary care
setting—could indicate that a vendor or its staff at a facility is not providing timely, effective primary care or
using prescription drugs effectively. Pennsylvania corrections officials, for example, scrutinize each incarcerated
individual’s treatment that preceded hospitalization to learn if it could have been averted.
Another area of review involves hospital readmissions. Repeat trips to the hospital following initial treatment
increase costs and may indicate inadequate care in the hospital or during the patient’s recuperation. In 2012, the
federal government made readmissions a focal point for improving care after finding that nearly 1 in 5 Medicare
patients returned to a hospital within 30 days of discharge.
Attempting to reduce avoidable readmissions, California officials chose to focus on the state prison with the
highest rate. (See Figure 2.) They developed an algorithm to identify patients most at risk for readmission16 and
then required a registered nurse to check on them within one business day after they returned from the hospital.
Doing so meant that incarcerated individuals who had had surgery, for example—and might be prone to an
infection—would be treated at the first sign of one, reducing the likelihood of rehospitalization. Over two years,
the hospital readmission rate for this prison dropped from 9.3 to 2.4 percent.17

7

Figure 2

Interventions Reduce Community Hospital Readmissions in the
California Department of Corrections and Rehabilitation
Hospital readmissions, May 2014-May 2016
10%

9.3 %
8.3%

5.2 %

5%
%

2.4 %
0%
May 2014
Intervention facility

May 2016
Systemwide

Source: Clarence Cryer Jr., “Reducing Hospital Readmissions Among Incarcerated Patients,” Journal of Correctional Health Care 24, no. 1 (2018):
5, http://dx.doi.org/10.1177/1078345817745054
© 2018 The Pew Charitable Trusts

Corrections departments can contract with independent third parties to review hospitalizations, as Ohio,
Nevada, and Virginia do, but such reviewers and hospital and corrections officials need to consider incarcerated
individuals’ special circumstances when applying standards to admissions and lengths of stay. For example, a
hospital should not be penalized for a longer-than-average stay if it stems from a lack of available correctional
staff to transport the patient back to prison. Or a person might need to remain in the hospital longer than a
general patient would if the prison to which he will return lacks proper recuperative services, such as would
ordinarily be provided by a visiting nurse or a community rehabilitation facility.18

8

Deciding When to Hospitalize
Requests for hospitalization generally fall into three categories, depending on the urgency of the
treatment. Florida, for example, defines the categories as follows:
•• Emergencies: Life- or function-threatening conditions that require immediate treatment,
such as a heart attack. In these situations, the formal request process is not used. A 911
responder can decide to take the incarcerated individual to the hospital, collaborating with
a medical official or, if one is not available, deciding on their own to take the patient to a
hospital.
•• Urgent: Conditions that must be treated within 21 days to avoid becoming emergencies.
•• Routine: Conditions that can tolerate a treatment delay of 45 days. For nonurgent diagnostic
tests or surgery, such as a hip replacement, some states allow even more time to determine
whether a procedure is needed and, if so, whether it must be performed before the end of the
person’s sentence.19

State strategies vary in locating hospitals
Regardless of the on-site health care delivery model, corrections departments need to identify hospitals
capable of providing supplemental services and willing to treat incarcerated individuals. Their efforts are
complicated by the fact that correctional institutions are scattered throughout a state, often in rural areas, and
vary in size, security level, and the age and gender makeup of the incarcerated population. They also differ in
their on-site capabilities.
Hospitals, too, are dispersed throughout a state and have varying capabilities that do not necessarily mesh with
the needs of those incarcerated nearby. States often place their oldest, sickest inmates in correctional institutions
with the greatest on-site capabilities or those closest to a major medical center.
State corrections officials can choose to contract with some or all community hospitals near prisons or may
concentrate inpatient treatment at one or two hospitals within the state if geographically possible. While officials
try to keep off-site care within the state, the closest appropriate hospital may in some cases be in another state.
As Jared Brunk, chief financial officer of the Illinois Department of Corrections, said, “Certain institutions are so
[near] the border that it is closer for inmates to go to another state for hospitalization services.”

9

When States Build Their Own Prison Hospitals
On the grounds of North Carolina’s maximum security prison near the state Capitol in Raleigh
sits a five-story building that is rare in correctional health care. It is an on-site hospital with 120
inpatient medical/surgical beds and another 216 beds for those with mental illness.
The General Assembly spent $180 million to build the medical center and hired more than
300 employees to consolidate health care and inpatient hospitalization for many of the state’s
incarcerated adults. Opened in 2011, the hospital was designed with security in mind. For the
many patients coming for treatment at Central Prison, elaborate off-site transportation planning
is not needed. And since most are serving long sentences, they will probably need more medical
care over the course of their stays than those serving shorter sentences.
Incarcerated individuals at the 54 other North Carolina institutions do come to the Raleigh
prison campus for nonemergency services, including ultrasounds, X-rays, CT scans, and sameday surgical procedures. The state buses patients from facilities around the state to the Raleigh
facility.20
Unlike North Carolina, Texas located its free-standing prison hospital on the campus of
the University of Texas Medical Branch in Galveston. Staffed by university employees and
correctional officers, the teaching hospital includes 172 inpatient beds secured by a locked
gate.21 Given the size of the state, most acute and emergency care is delivered at the hospital
closest to the patient’s prison, but once stabilized, he or she is transferred to the Galveston
prison hospital.
Georgia also consolidates most specialized care at a state-owned hospital in Grovetown that
treats only incarcerated adults.
All three states have the potential to provide seamless care between their prisons and hospitals.
In Georgia and Texas, the same university that provides most in-prison health care also runs the
correctional hospital, allowing for common protocols and easier coordination. North Carolina’s
corrections department oversees in-prison care and its dedicated hospital. With the recent
addition of electronic health records by the Texas corrections department, patient data can be
shared effortlessly among settings.22
Some counties have also constructed on-site correctional medical centers, allowing local jails to
offer more expansive services. Dallas County, Texas, built a $50 million medical center at its jail,
staffed by clinicians from its county safety net health care provider, Parkland Hospital, to handle
most inmates’ health needs.23 And Los Angeles County built an urgent care center at its jail
to reduce hospital bills and cut transportation costs.24 After the LA facility opened, about five
fewer patients a day, on average, were sent to a hospital. After six months, the jail had saved
over $1 million in transportation costs and a nearly identical amount from fewer visits.25

10

Transporting and securing correctional patients at hospitals
Moving someone between a prison and a community hospital and guarding them during treatment involves
a unique set of considerations. The geography of a state, the locations of its prisons and hospitals, and the
preferences of state lawmakers all play a role in determining a corrections department’s transportation and
security strategy.
Underlying the planning for secure transportation and hospital security is the risk an incarcerated individual
may attempt to escape the vehicle or the hospital, posing a threat to corrections staff, health care workers, and
the community. One state corrections medical director recalled a prisoner fleeing two officers in a community
hospital. The facility was placed on lockdown until the escapee was recaptured. “The hospital is not going to take
that very well,” he said.26 In 2017, a rape suspect in Ohio overpowered a sheriff’s deputy while being transported
between a psychiatric hospital and the jail, stole the officer’s gun, and fled after demanding that the deputy
remove his leg shackles and handcuffs.27
The logistics of a hospital trip are intricate.28 Many states have specially trained transportation units within the
corrections department, supplemented by state or local police during staffing shortages. Security personnel
at the prison and the hospital must be notified of the planned trip and the person’s custody level—minimum,
medium, or maximum. At least two officers usually accompany an individual when he or she is being taken
to a hospital. Distances between correctional institutions and hospitals can be a challenge, especially during
inclement weather. Alaska corrections officials, who usually transport incarcerated individuals off-site in buses
and vans, sometimes fly someone to a hospital on a charter or commercial flight.29 The arrangement between
Texas’ corrections department and the University of Texas Medical Branch includes a specialized cadre of nurses
to handle the logistics of moving patients from hospitals around the state, where they are initially stabilized, to
the state corrections department’s hospital in Galveston.30
Once at the hospital, the patient’s security must be coordinated between the state corrections system and the
hospital. Several states, including Connecticut, Colorado, Louisiana, New York, New Jersey, Ohio, Texas,31 Virginia,
and Wisconsin, have converted, or “hardened,” a floor or section of one or more hospitals to an inmate-only
wing for minor procedures and noninvasive in- and outpatient care. For surgery and other specialized care, the
person is transported to other public areas of the hospital but returned to the secure unit for observation and
recuperation. Hospital nurses and doctors staff such secure areas, but state correctional officers guard them.
The hospital rooms are modified to meet strict security standards—including bolted-down television sets and
no windows or toilet seats—but must still meet the rigorous standards of hospital accrediting organizations.
Although these units require a sizable upfront investment, they may be cost-effective over the long run compared
with housing each sick adult in a single room guarded by two officers round-the-clock.
Corrections officials report that special training and scheduling add to hospitalization costs and challenges. State
corrections security personnel and state troopers transporting sick patients usually undergo training to prevent
their guns from being grabbed. Hospital security, nurses, doctors, and other personnel must also be taught how
to deliver care to incarcerated individuals who may be shackled and handcuffed during treatment.
When a patient must be moved off-site for nonurgent care and it can be scheduled in advance, state officials
must arrange for transport and 24-hour-a-day security at the hospital. This often requires overtime pay because
of chronic staff shortages.32
In Alaska, corrections officials have reported extensive overtime costs, a lack of relief staff, having to pull
nontransportation officers off their shifts to take patients to off-site medical visits, and staff turnover. “Despite

11

the fact that thousands of staff hours are spent each month supervising inmates in outside community hospitals,
facilities do not have dedicated posts for this function. As a result, facilities must reassign staff from critical
facility posts to provide hospital supervision or rely on overtime to provide required supervision,” officials said in
a 2016 staffing analysis.33 Virginia and Nevada corrections officials, among others, have warned lawmakers that a
shortage of officers has hurt patient care.34 “Transport occurs, but often there are no officers to escort the patient
to their appointments or procedures,”35 causing delays, officials said. The same staffing shortages can also
postpone an individual’s timely discharge from a hospital.

Paying the hospital bill
Corrections officials or vendors reimburse hospitals using a variety of rates for inpatient and outpatient care. As
correctional health care costs per inmate are rising in many states, according to Pew research,36 state officials
aim to pay the lowest rates possible without discouraging hospitals from providing care to those who are
incarcerated. (Hospitals are legally required to accept and at least stabilize emergency patients but can then
terminate treatment.)
Corrections officials often try to piggyback on an existing fee schedule or a percentage thereof, such as the one
used by their state Medicaid agency,37 the federal Medicare program,38 the state employee health insurance
plan,39 or a large insurer’s negotiated rates.40 States that concentrate off-site care at one or two hospitals have
different considerations, given their volume, than corrections departments that use hospitals throughout their
state, since the latter’s effect on any one hospital is somewhat diluted. Similarly, states that invest in hardening a
unit at a hospital must ensure that the corrections department and the hospital are both satisfied with the rates
since corrections officials cannot easily move the care to another facility without wasting the state’s investment
in the infrastructure modifications. Texas—which has both a corrections department-only hospital in Galveston,
in the southern part of the state, and a hardened unit at a hospital in East Texas—reported that opening the latter
unit not only benefited prisoners, but the volume of patients from correctional facilities also has helped stabilize
the finances of this rural hospital.41
Because a state’s Medicaid program typically negotiates the lowest rates of any payer in a state, a corrections
department that uses this fee schedule usually pays less for services than corrections departments in states that
use other schedules. Agencies that use a Medicaid or Medicare rate do so regardless of the patient’s insurance
status. Usage simply relieves the corrections department from having to negotiate its own rates.
Given the significant accommodations that must be made when treating incarcerated individuals, hospitals may
seek a premium over the Medicaid rate. Some corrections departments and private vendors are willing to pay this
fee, especially if the hospital locks in a contract with them. For example, in addition to paying the Medicaid rate,
New Jersey’s department of corrections pays a hospital a fixed monthly supplement for these costs. Mississippi’s
corrections department pays hospitals 200 percent of Medicaid rates for inpatient care, partly in recognition of
the special conditions imposed on the staff by such patients, and as an incentive for the institution to willingly
accept them. If the hospital or specialist does not have a contract with the corrections department, the state
reimburses at only 100 percent of the Medicaid rate. Laws in Utah and North Carolina also require that a lower
rate be paid to hospitals that do not contract with their corrections departments. New York does the same,
although the practice is not required by state law.

12

Medicaid expansion has helped cut costs
The ACA allowed states to expand their eligibility criteria for Medicaid coverage for all individuals under age
65 who earn up to 138 percent of the federal poverty level ($16,643 for a single adult in 2017).42 This expansion
made many more incarcerated individuals eligible for Medicaid coverage, as income for nearly all falls below
this threshold while they are in jail or prison. Thirty-one states and the District of Columbia have expanded their
criteria in accordance with the ACA.
States have never been precluded from enrolling those who are incarcerated in Medicaid. However, most of these
individuals historically could not enroll because, as nondisabled adults without dependent children, they did not
meet many states’ eligibility criteria despite their low income.
States may not provide Medicaid coverage for health care services provided to incarcerated individuals unless the
care is delivered outside of correctional facilities, such as at a hospital, and the eligible adult has been admitted
for 24 hours or more.43 In these cases, state Medicaid agencies can obtain federal reimbursement that covers at
least half of off-site inpatient costs—and substantially more if the person is newly eligible—as long as he or she is
enrolled at the time of the hospitalization or soon thereafter.
This policy change has caused a large shift of eligible inpatient hospital costs from state corrections agencies
to the Medicaid program. It has also allowed expansion states that use contracted vendors—and that, like
Massachusetts, hold those vendors financially at risk for off-site inpatient care—to lower their capitation rate.44
Officials in states that expanded Medicaid say they have achieved millions of dollars in savings because most
corrections hospitalizations have qualified for coverage. Alaska and Ohio are among states that reported
significant correctional cost savings due to ACA expansion.
Some state corrections departments also benefited by shifting the processing of hospital claims to their state
Medicaid agencies, which is required before claiming federal matching funds. After Nevada and Indiana expanded
their eligibility, both turned over their billing operations for inpatient care to their Medicaid agencies. This relieved
corrections officials of a function that Medicaid agencies routinely had carried out.
Georgia, North Carolina, and Texas, the states that operate a corrections-only hospital for most of their off-site
prison care, are not able to charge the Medicaid program when a prisoner is admitted to one of these hospitals
because they are not open to the public, a condition for Medicaid participation.45 However, that exclusion is of
less concern to these states because none has expanded Medicaid eligibility under the ACA.

Promising approaches to reducing costs
While states will always have to send some prisoners to hospitals, corrections officials can reduce inpatient stays
and costs by expanding programs such as telemedicine and mobile services. By examining people by video or in a
mobile van, doctors may be able to diagnose illnesses and injuries and prevent a trip to the hospital.
Texas arranges 11,000 patient-doctor video conferences a month—second only to the U.S. military.46
Telemedicine produces savings by reducing the need for transportation and staff supervision. An off-site medical
specialist may also help to identify subtle medical problems that might otherwise be overlooked, resulting in
improved care and fewer emergency room visits.47
In addition to cutting transportation and security costs, this use of technology gives corrections departments
more choice of specialists. Several state corrections departments reported challenges recruiting clinicians

13

stemming from prisons’ often remote locations and the correctional environment itself. These variables either
drive up what corrections departments must pay to recruit and retain skilled clinicians or extend the time and
effort required to fill each vacancy. Widening the field of potential medical consultants gives the state a
stronger negotiating position on compensation costs. Telemedicine also provides an opportunity for a prison’s
primary care provider to participate in a video session with a medical specialist and patient, improving the
coordination of care.
Corrections agencies in South Carolina and Wisconsin are partnering with their state universities to carry out
telemedicine programs. “We’re buying some new equipment that actually can do heart sounds and lung sounds
and EKGs,” and the results can be sent directly to the subspecialist, said James Greer, director of the Wisconsin
Corrections Department’s Bureau of Health Services.
Other states are bringing mobile technology to prisons, saving them the cost and logistics of having to transport
patients to hospitals or other off-site diagnostic facilities. One such use is mammography. A number of states
periodically lease a mobile mammography van to administer these screening tests.48 When Montana sent a
mobile van to its women’s prison in 2016, some of the individuals said it was the first time they had had the
procedure.49
Another way to reduce inpatient hospital days is to set up palliative care and hospice programs within prisons
for those who are dying, along with a process for compassionate release.50 However, some states report difficulty
finding suitable community placements for people who are sick enough to qualify.51

Conclusion
State corrections departments will always need to send people in their prison systems off-site for specialized
care. This report shows the complexity of arranging for and managing such services, whether the department or a
private vendor oversees them.
State policymakers must continue to look for ways to trim costs, especially as their prison population ages and
requires more intensive and frequent care. Periodically, corrections officials should evaluate the expense of
using specialized services off-site instead of on-site. But off-site care will always have to be designed—and have
its costs analyzed—within the context of an effective and efficient prison health care system. Understanding
how other state corrections departments arrange and pay for hospital care can help policymakers make better
decisions on this important and expensive category of care.

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Endnotes
1	

Jeremy Travis, Bruce Western, and Steve Redburn, eds., The Growth of Incarceration in the United States: Exploring Causes and Consequences
(Washington: National Research Council, 2014), 216, https://www.nap.edu/read/18613/chapter/1; Douglas C. McDonald, “Medical Care
in Prisons,” Crime and Justice 26 (1999): 427–78, http://www.journals.uchicago.edu/doi/abs/10.1086/449301.

2	 McDonald, “Medical Care in Prisons,” 443–44.
3	

The Pew Charitable Trusts, “State Prison Health Care Spending” (July 2014), http://www.pewtrusts.org/~/media/assets/2014/07/
stateprisonhealthcarespendingreport.pdf; New York data were reported for fiscal 2015. Virginia data were reported for fiscal 2016.

4	 AARP, “Chronic Conditions Among Older Americans,” https://assets.aarp.org/rgcenter/health/beyond_50_hcr_conditions.pdf.
5	 Ibid.
6	 The Pew Charitable Trusts, “Prison Health Care: Costs and Quality” (October 2017), http://www.pewtrusts.org/~/media/assets/2017/10/
sfh_prison_health_care_costs_and_quality_final.pdf.
7	 Stephen Weiss, “Medical Care Provided in State Prisons—Study of the Costs” (presented at the Joint Commission on Health Care
meeting, Oct. 5, 2016), http://jchc.virginia.gov/4.%20Medical%20Care%20Provided%20in%20State%20Prisons%20CLR.pdf.
8	 Ibid.
9	 The Pew Charitable Trusts, “Prison Health Care: Costs and Quality.”
10	 Lettie Prell (former director of research, Iowa Department of Corrections), interview with The Pew Charitable Trusts, Aug. 29, 2016.
11	 Mark Looney (senior budget examiner, New York State Division of the Budget), interview with The Pew Charitable Trusts, Feb. 21, 2018.
12	 Pew interviews with state corrections officials; Montana Department of Corrections, “Level of Therapeutic Care,” sec. IV-B, last modified
May 30, 2017, http://cor.mt.gov/Portals/104/Resources/Policy/Chapter4/4-5-10%20Level%20of%20Therapeutic%20Care%20
05.30.17.pdf.
13	 InterQual Criteria (McKesson) (https://www.changehealthcare.com/solutions/interqual) and Milliman Care Guidelines (https://www.
mcg.com/care-guidelines/care-guidelines) are typically used to document the “standard of care” by utilization review staff to justify
referrals and to support the level of care and care management of complex and/or serious health conditions.
14	 Hawaii Department of Public Safety, “Hospital and Specialty Care,” Oct. 20, 2015, https://dps.hawaii.gov/wp-content/uploads/2016/03/
COR.10.1D.05.pdf.
15	 State of Connecticut, “Memorandum of Agreement Between Connecticut Department of Corrections and University of Connecticut
Health Center for the Provision of Health Services to Inmate Patients” (August 2012), 23, 30, 41.
16	 The California corrections department defined readmission as the percentage of community hospitalizations that were linked
to a previous hospitalization for the same patient with no more than 30 days between the two episodes of care. They excluded
hospitalizations for scheduled aftercare such as chemotherapy and certain other circumstances.
17	 Clarence Cryer Jr., “Reducing Hospital Readmissions Among Incarcerated Patients,” Journal of Correctional Health Care 24, no. 1 (2018): 5,
http://dx.doi.org/10.1177/1078345817745054.
18	 Karah Gunther, executive director of government relations and health policy, Virginia Commonwealth University and the VCU Health
System, pers. comm. to The Pew Charitable Trusts, Nov. 22, 2017.
19	 Florida Department of Corrections, Office of Health Services, “Utilization Management Procedures” (March 17, 2015), 2, http://www.
dc.state.fl.us/business/HealthSvcs/Bulletins/15-09-04current.pdf.
20	 Terri Catlett (deputy director, prison health services, North Carolina Department of Public Safety), interview with The Pew Charitable
Trusts, August 2016; North Carolina Department of Public Safety, “New Prison Medical Facilities,” accessed Feb. 1, 2018, http://www.doc.
state.nc.us/DOP/health/new_facilities.html; Joe Watson, “New North Carolina DOC Hospital Promises Better Healthcare for Prisoners,”
Prison Legal News, Dec. 15, 2012, https://www.prisonlegalnews.org/news/2012/dec/15/new-north-carolina-doc-hospital-promisesbetter-healthcare-for-prisoners; North Carolina Department of Public Safety, Division of Adult Correction, “Research Bulletin,” accessed
Feb. 1, 2018, https://randp.doc.state.nc.us/pubdocs/0007078.PDF.
21	 University of Texas Medical Branch, “UTMB TDCJ Hospital: Mission and Overview,” accessed Dec. 17, 2017, https://www.utmb.edu/tdcj/
mission.asp.
22	 Electronic Signature & Records Association, “Electronic Health Records Change the Game for Texas’ Prison System,” Aug. 25, 2016,
https://esignrecords.org/news-electronic-health-records-change-game-texas-prison-system; Michael Ollove, “State Prisons Turn to
Telemedicine to Improve Health and Save Money,” Stateline, Jan. 21, 2016, http://www.pewtrusts.org/en/research-and-analysis/blogs/
stateline/2016/01/21/state-prisons-turn-to-telemedicine-to-improve.

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23	 The Pew Charitable Trusts, “Jails: Inadvertent Health Care Providers” (January 2018), 17, http://www.pewtrusts.org/en/research-andanalysis/reports/2018/01/jails-inadvertent-health-care-providers.
24	 Erick Eiting et al., “Reduction in Jail Emergency Department Visits and Closure After Implementation of On-Site Urgent Care,” Journal of
Correctional Health Care 23, no. 1 (2017), http://journals.sagepub.com/doi/abs/10.1177/1078345816685563.
25	 Ibid.
26	 A state department of corrections medical director, interview with The Pew Charitable Trusts, Sept. 21, 2016.
27	 WRC-TV, “Federal Officials Join Search for Ohio Rape Suspect Who Escaped,” last modified Aug. 6, 2017, https://www.nbcwashington.
com/news/national-international/Prisoner-Charged-With-Rape-Overpowers-Deputy-Steals-His-Gun--438800833.html?amp=y.
28	 Arizona Department of Corrections, “Inmate Transportation,” Department Order Manual, effective Nov. 19, 2012, https://corrections.
az.gov/sites/default/files/policies/700/0705u.pdf.
29	 Alaska Department of Corrections, “System Staffing Analysis” (Feb. 9, 2016), 219, http://www.correct.state.ak.us/doc/correctionsstaffing-report.pdf.
30	 John Pulvino (senior director, quality and outcomes, University of Texas Medical Branch), interviews with The Pew Charitable Trusts, June
30, 2017, July 28, 2017, and March 16, 2018.
31	 Texas has made this secure unit arrangement with a community hospital in Huntsville to supplement its inmate-only hospital in
Galveston, which serves the majority of Texas inmates. Pulvino, interview.
32	 American Correctional Association, “Standards,” accessed Nov. 12, 2017, http://www.aca.org/ACA_Prod_IMIS/ACA_Member/
Standards___Accreditation/Standards/ACA_Member/Standards_and_Accreditation/StandardsInfo_Home.aspx?hkey=7c1b31e595cf-4bde-b400-8b5bb32a2bad; Virginia Commonwealth University, “VCU Health and the Department of Corrections” (presentation
to the Virginia Senate Finance Committee, Virginia Commonwealth University, Aug. 25, 2016), http://sfc.virginia.gov/pdf/Public%20
Safety/2016/Interim/082516_GuntherPresentation.pdf; Oklahoma Department of Corrections, “Transportation of Inmates,” effective
Oct. 20, 2016, http://doc.ok.gov/Websites/doc/Images/Documents/Policy/op040111.pdf; Oklahoma Department of Corrections,
“Security of Inmates in Non-Prison Hospitals,” effective April 11, 2018, http://doc.ok.gov/Websites/doc/Images/Documents/Policy/
op040114.pdf.
33	 Alaska Department of Corrections, “System Staffing Analysis,” 220.
34	 Sean Whaley, “Nevada Dept. of Corrections Paid $15.5M in OT in Fiscal 2017,” Las Vegas Review-Journal, Sept. 12, 2017, https://www.
reviewjournal.com/local/local-nevada/nevada-dept-of-corrections-paid-15-5m-in-ot-in-fiscal-2017; Ramona Giwargis, “Policy Change
Could Save Nevada Prisons Millions in Overtime Pay,” Las Vegas Review-Journal, Feb. 15, 2018, https://www.reviewjournal.com/news/
politics-and-government/nevada/policy-change-could-save-nevada-prisons-millions-in-overtime-pay.
35	 Virginia Commonwealth University, “VCU Health.”
36	 The Pew Charitable Trusts, “Prison Health Care: Costs and Quality.”
37	 For example, Maine, North Dakota, Texas, Washington, and West Virginia.
38	 For example, Indiana, Wisconsin, and Wyoming.
39	 For example, Alabama and South Carolina.
40	 Virginia, for example.
41	 Pulvino, interview.
42	 U.S. Department of Health and Human Services, “U.S. Federal Poverty Guidelines Used to Determine Financial Eligibility for Certain
Federal Programs,” accessed Feb. 15, 2017, https://aspe.hhs.gov/poverty-guidelines; Centers for Medicare & Medicaid Services, “Updated
Guidance to Surveyors on Federal Requirements for Providing Services to Justice Involved Individuals” (Dec. 23, 2016), https://www.cms.
gov/Medicare/Provider-Enrollment-and-Certification/SurveyCertificationGenInfo/Downloads/Survey-and-Cert-Letter-16-21.pdf.
43	 The Pew Charitable Trusts, “How and When Medicaid Covers People Under Correctional Supervision” (August 2016), http://www.
pewtrusts.org/en/research-and-analysis/issue-briefs/2016/08/how-and-when-medicaid-covers-people-under-correctionalsupervision.
44	 Jeffrey Fisher (director of contract compliance, Massachusetts Department of Correction), interview with The Pew Charitable Trusts, Oct.
19, 2016.
45	 The Pew Charitable Trusts, “How and When Medicaid Covers People.”
46	 Pulvino, interview.
47	 Karen C. Fox, Grant W. Somes, and Teresa M. Waters, “Timeliness and Access to Healthcare Services via Telemedicine for Adolescents in
State Correctional Facilities,” Journal of Adolescent Health 41, no. 2 (2007): 161–67, http://dx.doi.org/10.1016/j.jadohealth.2007.05.001.

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48	 Karishma A. Chari et al., “National Survey of Prison Health Care: Selected Findings,” National Health Statistics Reports 96 (2016): 8, https://
www.cdc.gov/nchs/data/nhsr/nhsr096.pdf.
49	 Billings Gazette, “How Medicaid Can Help Reduce Montana’s Prison, Jail Crowding,” Aug. 14, 2016, https://billingsgazette.com/printspecific/column/gazette-opinion-how-medicaid-can-help-reduce-montana-s-prison/article_694dc50b-ef8d-5af2-9d48-6b6a8adcf27e.
html.
50	 Adam Wisnieski, “‘Model’ Nursing Home for Paroled Inmates to Get Federal Funds,” Connecticut Health I-Team, April 25, 2017, http://chit.org/2017/04/25/model-nursing-home-for-paroled-inmates-to-get-federal-funds; Prell, interview.
51	 David Drury, “Feds: No Medicaid Reimbursement for Prisoners at Rocky Hill Nursing Home,” Hartford Courant, Sept. 5, 2015, http://www.
courant.com/community/rocky-hill/hc-rocky-hill-nursing-home-0905-20150904-story.html.

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