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A loophole in Medicaid and Medicare rules allowed the Utah Department of Corrections to get the federal government to cover $1.4 million in health care expenses for inmates in fiscal 2013, and savings to the state may be even greater in coming years as the Affordable Care Act takes hold.

The loophole: Inmates are not eligible for the federal programs while incarcerated, but may apply if they are receiving care off-site for more than 24 hours. The savings are a first for the department, which has worked for several years to take advantage of the loophole pointed out in an internal audit.

"For the first time, we established eligibility, made claims and got payment," said Richard Garden, medical director.

Most felons arrive at the prison without any individual health-care coverage, though there are exceptions. One inmate, for example, was able to draw on private insurance in recent years to get a kidney transplant. Even if an inmate arrives with private coverage, keeping up with premiums often becomes impossible.

"It's usually not very long before that insurance is no longer in place to provide coverage for them," Garden said.

And that leaves the state legally responsible for providing inmates' medical, dental, mental health and other needs while incarcerated. The cost of doing so runs $28 million a year — approximately $11.35 a day per inmate.

A recent audit shows Utah's costs of providing medical care to inmates are lower than those of other nearby and similar states but are nevertheless on a steady upswing, a trend attributed largely to the aging prison population, increased cost of prescription drugs and uncommon treatment needs.

In 2011 and 2012, for example, the department covered the cost of two bone marrow transplants, an expense of more than $1 million. A 2011 botulism outbreak resulted in a $550,000-plus medical bill. Corrections was able to get Medicaid coverage for one of the 12 inmates sickened — three of whom were treated at University Hospital — after drinking a batch of tainted alcohol brewed in one felon's cell.

If Utah were to adopt the expanded Medicaid criteria — which Utah Gov. Gary Herbert is still mulling — it is likely the department would be able to get more inmates who require off-site care covered by the federal program. As of January, anyone who makes less than 133 percent of the federal poverty line — currently $15,282 — will qualify.

"I couldn't imagine any inmates making more than that," Garden said. "So a greater number of folks admitted to University Hospital will be eligible, and there is potential there[to bill the federal government] for that hospitalization. It could have a great impact on us in a positive sense."

Garden also believes there may be other savings for the state as a result of the Affordable Care Act.

Currently, the moment someone who is on Medicaid is booked into jail, that coverage is suspended. Under the act, the coverage will stay intact until the individual is adjudicated and sentenced, Garden said.

"If you go in [to jail] for a few days and have it suspended," he said, "it's time consuming to re-establish your Medicaid."

Savings also may come as inmates are paroled or have their sentences terminated and are then able to get insurance and treatment for health problems or illnesses that weren't resolved during their incarceration.

An example: An inmate injures his knee and needs surgery but is released before that can be scheduled.

"That same person may come back to us a year later with a knee in worse shape," Garden said, describing such situations as "commonplace."

"The hope isthat that health care will be more available and they'll get that knee fixed. ... We're hoping that situation improves, that if someone is released from prison with time served or on parole, there is less problem getting health care, especially mental health care, so they can get the care they need and increase their chance of success on the outside. That is something going forward we are hoping will make a big difference in prison health care."

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