RD516 - Review of Senate Bill 837 (2020 Regular Session) – Lawrenceville Correctional Center Management Study – September 18, 2020
Termination of the current contract with GEO for management and operation of the Lawrenceville Correctional Center (LVCC), followed by transition to management and staffing of the facility by the Virginia Department of Corrections (VADOC) will increase the overall cost of LVCC operations.
FY 2020 total expenditures for Lawrenceville, including medical and administrative spending outside the GEO contract, were $29.2 million. On a per capita basis, this is approximately 49 percent below spending levels at other VADOC Level 3 facilities. An analysis of VADOC operation of Lawrenceville, shows that the Department would increase staffing at the facility to provide adequate relief and address needs for improved security. The additional staff and the higher overall compensation levels for state employees would drive the projected operating cost of the facility up to $38.5 million, an increase of $9.3 million above current spending levels.
However, even at this increased cost, Lawrenceville would still be significantly less expensive to operate than other VADOC Level 3 (medium security) facilities. The per capita cost of housing an inmate at Lawrenceville under VADOC management would be $67.99 per day. The current average per diem cost for other Level 3 facilities comparable to Lawrenceville is $76.64 per day. The analysis indicates that adjusting Lawrenceville operations under VADOC management to reach consistency with Department operating practices and policies would increase costs, but that the increased expenditure level would still be efficient relative to other VADOC facilities.
There are significant issues which need to be addressed in the evaluation of this policy decision. These issues include the timing of the decision relative to the remaining term of the GEO contract, the logistics of replacing the current staff and management of an operating correctional facility, developing a plan to address capital repair needs and deferred maintenance, mitigating disease spread during the transition process, and evaluation of the operational benefits of VADOC management relative to the increased cost of facility operations. Analysis of recruitment, hiring, and training requirements associated with a transition to VADOC management of Lawrenceville show that Department will require up to 9 months to develop the staffing complement required to operate the facility.
An analysis of healthcare service delivery at LVCC shows little potential that an alternative delivery model would produce a significant reduction in costs without a negative impact on service quality. Virginia is somewhat unique in its approach to inmate healthcare, with a complex mix of state-managed and private vendor services at each facility.
The Department’s approach to healthcare management has several significant features that work to contain costs. These include use of VCU Health for inpatient services and access to the 340B program to reduce pharmaceutical costs. The Department’s relationship with Anthem as Third Party Administrator provides access to its negotiated network rates for outpatient services in the community.
Assuming the Department can recruit and retain healthcare staff at LVCC, the most efficient model for management of healthcare services at LVCC appears to be management and staffing provided by the VADOC. The projected annual cost of VADOC-managed healthcare services at Lawrenceville under this approach is $6,225,780, or 11.01 per inmate per day. This compares favorably to the Department’s average per capita costs of $22.06 in facilities that outsource healthcare services.