Inmate care may go private

The state wants proposals for outsourcing health care to one vendor.

cjarvis@newsobserver.comNovember 12, 2011 

North Carolina is considering outsourcing health care for all of its prisoners in order to save money.

State prison officials have asked for proposals from companies that are big enough to coordinate all aspects of medical care - from dental work to pharmacies to mental health to hospital care and billing.

"We want one vendor accountable for all of it," said Frank Rogers, a deputy secretary at the N.C. Department of Correction.

It would be a big job. The state spends $244 million a year on health care and employs about 2,000 medical personnel. On any given day, there are about 40,000 prisoners scattered around 70 facilities.

The state wants to know if anyone can do it cheaper, and has asked for proposals for a five-year contract that could be renewed for up to two more years.

There are companies out there that are big enough to oversee the whole range of prison health care, although portions of the job would have to be subcontracted. Rogers says about half a dozen firms have submitted proposals since the request went out two months ago.

Last year, the General Assembly directed the Department of Correction to identify ways to save medical costs, including outsourcing or partnering with the federal government.

Rogers said by next July, the department will have a sense of whether it is more cost-effective to privatize or to continue with its own employees and through contracts with hospitals and private providers.

"No one should assume this is going to happen for sure," Rogers said.

If a private company is brought in, it would run, for instance, the new five-story medical complex at Central Prison in Raleigh. The hospital and mental health facility is expected to reduce the cost of treatment compared to outside care by one-third.

The state would also like to see a vendor expand the use of "telemedicine," which allows inmates to consult with medical staff through a video connection, cutting down on security costs.

Other states are experimenting with private health care for prisoners with mixed results.

Florida Gov. Rick Scott campaigned last year on a pledge to outsource the full range of prisoner health care, and the legislature passed a law requiring it. But the plan has been delayed because it has run into vendors' complaints, according to the St. Petersburg Times.

Vendors there are concerned about some of Florida's requirements for the contract, including having to post an $82 million performance bond, which some have called excessive. North Carolina has set a $100 million performance bond in its requirements. The winning North Carolina vendor would also have to take over all health care immediately, rather than in phases.

Rogers says the 2,000 state employees currently working in prison health care would most likely be hired by the new vendor. "Whoever gets this is not likely to bring 2,000 people from out of state," Rogers said. "They'll be looking to start with our employees."

The State Employees Association of North Carolina is not reassured.

"Privatizing prison health care would be a disaster for North Carolina's taxpayers," Executive Director Dana Cope said Friday. "We've been down this road before, and state employees were called in to fix the private contractors' mess."

Adam Searing, director of the N.C. Health Access Coalition, said it's always a good idea to look for ways to make health care better for everyone and save money, but he is skeptical of outsourcing.

"We always think there's some magic thing in health care if we just sell it off to a private company," Searing said. "There's no magic. Either you pay the doctors less or you provide less services."

Rogers said a vendor would be expected to meet the current level of care.

The General Assembly this year also directed the department to explore expanding private maintenance contracts beyond the three prisons that currently have them. The department has also begun that process, Rogers said.

Jarvis: 919-829-4576

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