WITN Investigates: State Auditor Says Taxpayers Footing The Bill For Medically Questionable Inmate Services

Inmate health care for state prisoners costs North Carolina taxpayers $254-million dollars a year. And while elective surgeries and procedures are not allowed, and the state has a constitutional obligation to provide care, some might argue prisoners have better health access and coverage than people who aren't behind bars.

Taxpayers like Henry Spruill find that outrageous. Spruill says, "It's not fair. I don't think it's fair."

An audit by State Auditor Beth Wood in 2010 revealed payments were made for inmate medical procedures that would not be considered allowable charges under either the state employee health plan or the Medicaid program. Three years after the state auditor raised that issue, public safety officials tell WITN that practice continues because they have no other choice but to pay.

That doesn't sit well with people like Surmeeka Nwachinemere. She doesn't have health insurance and doesn't qualify for Medicaid. Nwachinemere says, "It doesn't make sense at all."

That audit also reported another big problem. Wood says, "The state of North Carolina, with our tax dollars, was paying almost five-times more than Medicare or Medicaid would pay for the exact same service that was being rendered to a prisoner."

Dealing with those health care costs is now the job of Kieran Shanahan. He just took over as new Secretary for the Department of Public Safety. He says, "Whatever we do we should spend every cent of taxpayer dollar wisely."

Shanahan says even before that audit, and before he got here, the department was working to rein in expenses, and that job continues. One way is by treating more inmates in house at the new $150-million dollar five-story state of the art prison hospital. It opened a little more than a year ago at Central Prison in Raleigh. Shanahan says, "We're showing dramatic savings and we'll have continued reductions in health care."

In addition to the savings from the new medical facility, the state auditor says changes that were made following her 2010 audit are saving millions of dollars annually. But another recent audit just out shows there are still some problems. Or are there? It depends on who you talk to.

Findings in the the new audit show a review of ten of the largest hospital claims for prisoners identified nearly $105,700 in overpayments made to eight hospitals, despite legislation enacted by the General Assembly following that 2010 audit that was supposed to put an end to overpayments.

Wood says, "They were not following that law. Whoever's entering this information into the computer system to pay the bills they weren't making the right choice. So yes, there's still some overpayments to the hospitals."

Secretary Shanahan says his department discovered something different after reviewing the claims in question.

Shanahan says, "And what we found was that these folks were actually paid precisely what the contracts call for. So we have a lot of respect for the auditor and their work in this matter but the truth is it doesn't appear there was an overpayment."

So how can two state agencies review the same prisoner health claims and come up with different results?

Shanahan says, "Her department does what they do and maybe they just didn't review the contracts."

The state auditor says her report is not about contracts per se, it's about what is contained in the inmate medical bills. And she says the audit determined the Department of Public Safety paid for medically questionable services, or for services already paid for in other bills.

Wood says the bottom line is that efforts need to be made to correct the problem or it's going to continue, just as some issues linger from the 2010 audit.

Department of Public Safety officials say they're looking to contract out a third party claims management firm that will handle claims and reimbursement to providers and it will have an audit and recovery component to it.