Industry Pulse: December 2008

CALIFORNIA – Talk about controversy. California’s healthcare receiver for the state’s prison system, J. Clark Kelso, has devised a plan to build seven new prison hospitals with a total of 10,000 beds. The plan to build the newer and better hospitals for inmates came in response to a judge’s ruling that the healthcare provided by the state’s prisons is inadequate. A report in 2005 determined that California inmates died about once a week because of because of the system’s poor healthcare services. One would think Californians would be embracing Mr. Kelso’s plan. However, many are questioning the size, scope and cost of the proposal. Building the 10,000 beds – for a current prison population of 170,000 inmates – is expected to cost about $8 billion over 25 years. Mr. Kelso is also drawing some ire from residents and lawmakers alike, as he is asking for $250 million right away to begin planning for the facilities. He also wants $3.1 billion by July 1 to begin construction. All of this comes at a time when California officials say the state is facing a deficit of at least $11 billion – unless new taxes are enacted or budgets throughout the state are cut. The hospitals are proposed for prisons in six cities: Stockton, Vacaville, San Diego, Chino, Folsom and Camarillo. In some communities, residents are speaking out against the plan, saying the new facilities could cause added traffic congestion and deplete their local and community hospitals of key personnel. Others, however, say the projects could add to the job base and be a boon for local economies.