Watchdog report faults prison system on medical spending

WASHINGTON – The federal prison system is spending too much on medical care for inmates by overly relying on outside doctors and hospitals, the Justice Department’s watchdog said in a report Thursday.

The Bureau of Prisons likely spent at least $100 million more than the Medicare rate on outside medical care in the 2014 budget year, according to an inspector general report. All of the 69 prison facilities analyzed for the report paid reimbursement rates higher than those paid by Medicare.

The report was issued amid a continued increase in prison health care spending, a growth driven in part by an aging inmate population with various medical needs.

Unlike other federal agencies, the Bureau of Prisons — which purchases outside medical care for roughly 170,000 inmates nationwide — negotiates its own rates for medical services with providers. Those providers are able to charge the BOP a premium above the Medicare rate because the BOP, unlike other federal agencies, is not covered by a statute under which the government sets the reimbursement rate.

The inspector general report recommends that the prison system explore ways for cutting its medical spending. In response, the Bureau of Prisons agreed to improve the collection and analysis of data and to consider “potential legislative options” to find ways to rein in reimbursement costs.