South Carolina's disastrous 15-year experiment with prison health care privatization should be a warning to those hardheaded state leaders who plan to do it again, according to a report sponsored by Grassroots Leadership and South Carolina Fair Share. Authored by Dr. Marguerite Rosenthal, sociology professor at Salem State University in Massachusetts, Prescription For Disaster: Commercializing Prison Health Care In South Carolina details the state's failed effort at privatization from 1986 to 2000 and documents the myriad problems encountered by other states that have experimented with commercializing prison health care services. Released on April 12, 2004, the sharply critical 12-page report followed an announcement by the South Carolina Department of Corrections (SCDC) that health care services in all of the state's prisons would soon be privatized. Three companies have already submitted bids: Correctional Medical Services of St. Louis, Wexford Health Services of Pittsburgh, and Prison Health Services of Brentwood, Tennessee.
The South Carolina Experience
From 1986 to 2000, the SCDC contracted a portion of its prisoner health services to the notoriously corrupt Correctional Medical Services (CMS). Initially covering just 3 prisons, CMS was providing medical services to ten prisons when the company terminated its state contract in January 2000. Two months later a blistering report by the Legislative Audit Council of the South Carolina General Assembly exposed a system "rife with problems," including extremely poor medical care, cost over-runs, and services that were paid for but never provided.
The legislative audit specifically noted that CMS timely dispensed medication to mentally ill prisoners only 54% of the timecompared with a 92% rate for state-run prisons, that "CMS failed completely in its discharge planning responsibilities for the mentally ill leaving prison," and that CMS mental health workers did not meet the minimum contract requirements.
Furthermore, according to the legislative audit, the SCDC failed utterly in discharging its mandated oversight responsibilities, performing "no behavioral health audits between July 1998 and May 1999, no medication audits of 7 of 8 institutions where they were supposed to be done, and no re-audits of the preponderance of institutions where a corrective plan was required." Additionally, the SCDC neglected to monitor staffing levels at prisons where health care was contracted, and failed to ensure that CMS was providing adequate care. And yet, according to the Grassroots report, even with the incredibly poor state oversight, CMS still "complained that monitoring was `excessive and disruptive'" when citing reasons for terminating its contract.
The report also notes that despite being inadequate, private health care apparently costs more as well. When the SCDC closed five prison infirmaries in January 2003, 18 prisoners went to Columbia Care, where health services were provided by Just Care of Alabama. Bruce Bennett, SCDC's chief accountant, "estimated that private care would cost the state $20,000 more per prisoner per year."
Problems in Other States
The pipe dream of prison health care privatization has become a popular theme throughout the country, notes the report. But for the many prisoners who suffer needlessly at the hands of private care providers concerned only with bolstering their bottom line, and for states that have lost millions in damages awards and settlements in repeated lawsuits over inadequate private care, the dream has become a nightmare.
CMS has been the subject of numerous audits and investigations, according to the report, which cites only a few examples.
One study noted that CMS exploits the publics' ill will towards prisoners in order to make a profit while giving poor care. The same study cited 20 examples of deaths resulting from "negligence, indifference, understaffing, [and] inadequate training or overzealous cost-cutting."
Another study found that although hepatitis C is rampant in the nations' prisons, CMS employed convoluted protocol pathways to discourage treatment of the 214,000 prisoners in its care. This report also cited prisoner deaths resulting from negligent medical care.
An investigation of CMS performed by the former editor of the Journal of the American Medical Association found that a number of CMS doctors had disreputable backgrounds. In Missouri, the author wrote, 9 CMS doctors had been disciplined by licensing boards. In Alabama, CMS employed one doctor whose license had been revoked in Missouri and another who had sexually assaulted an underage mentally retarded boy in Tennessee.
The care provided by other prison health care contractors is generally no better than that of CMS, asserts the report. For example, a lawsuit against provider NaphCare alleged the company's negligent care resulted in the premature and agonizing deaths of dozens of HIV infected prisoners in the Limestone Correctional Facility in Alabama. [See PLN, Oct. 2003] Moreover, Prison Health Services (PHS) has been investigated for providing shoddy medical care and for suspicious deaths in Pennsylvania and Florida.
In New York, a subsidiary of PHS, EMSA Correctional Care, employed in a Westchester county jail a psychiatrist who had served time for killing a college sophomore in a botched abortion and then tried to hide it by "cutting her up and flushing her down his toilet." This same "doctor," Lothringer, took a 17-year-old female prisoner off antidepressants, and the girl killed herself. A wrongful death action brought by the girl's family resulted in a settlement of $700,000 from EMSA and $745,000 from the county.
Although it is difficult for prisoners and their families to bring lawsuits against negligent health care providers, according to the report, a number of lawsuits are successful, costing the companies and state governments millions. From 1981 to 1994, CMS had 500 suits pending against it and paid out $4.1 million in indemnity claims. In Ohio, prisoners won a $1.5 million judgment against CMS for "a variety of medical care abuses." The report noted that a number of lawsuits are currently pending against CMS. [Editor's Note: Lawsuits against the private prison industry are shrouded in secrecy as the companies almost always seek confidential settlements with little on lawsuit outcomes being reported in the public record. As a result, the figures cited in this study should be deemed to be very conservative figures.]
In Florida, PHS has settled several lawsuits, "including one for $3 million brought by the family of an inmate who was beaten and then medically neglected and another by a nurse who sued after being fired for refusing to falsify medical records." PHS and its subsidiary, EMSA Correctional Care, currently face over 1,100 lawsuits.
It's a Money Thing
The report contends that a major problem with private health care companies is that they exist to make the greatest possible profits for executives and shareholders. As a result, these companies cut costs by "creating obstacles to care, hiring too few staff, employing staff who are not licensed to practice on the general public (and thus will work for less money) or unqualified or inexperienced staff, and skimping on medication (including using expired medication)."
Citing several examples, the report notes that prison health care contractors are notoriously unreliable, reneging on their contracts "when costs exceed their contracted reimbursement rates." South Carolina's own experience with CMS is typical. Three months before its 2-year contract expired in April 1999, CMS informed the state that it did not want to renew its contract. CMS continued providing medical services on a month-to-month basis while the state frantically searched for another provider.
Unsuccessful, the SCDC was forced to resume medical services in February 2000.
The problems experienced by South Carolina and other states in their encounters with private health care providers should serve as a cogent warning to any sane state legislator. Why, then, would the lawmakers in South Carolina even be considering such an insane option? Indeed, as the report notes: It didn't work then, why would it work now?
Get a copy of the report online at www.grassrootsleadership.org or by mail from Grassroots Leadership, 400 Clarice Avenue, Suite 400, P.O. Box 36006, Charlotte, N.C. 28236. [PLN has reported extensively on CMS and other private health care contractors.]
Additional source: Associated Press
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