Corrections Law
for Jails, Prisons and Detention Facilities

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Incarceration Cost Recovery

     Monthly Law Journal Article: Legal Issues Pertaining to Inmate Funds, 2008 (4) AELE Mo. L.J. 301.

      Police officers investigating a domestic disturbance went to a home where a man then went into a bedroom and shot himself. They radioed for an ambulance which took the man to a hospital, where he received treatment while officers kept watch over him. Neither the man nor later his estate when he died could pay the hospital bill of almost $30,000, which was then billed to the city. The Colorado Supreme Court overturned rulings by the trial and intermediate appeals court interpreting Colorado’s “Treatment while in custody” statute as entitling the hospital to payment from the city, and assigning police departments (or any agency that detains people) a duty to pay healthcare providers for treatment of those in custody. The high court concluded that the statute did not create any duty to a healthcare provider. However, the hospital’s claim for unjust enrichment survived, and as that claim was contractual, the court held that the Colorado Governmental Immunity Act did not prohibit it, and ordered further proceedings. City of Arvada ex rel. Arvada Police Dept. v. Denver Health, 2017 CO. 97, 403 P.3d 609 (2017).

     A federal statute, 42 U.S.C. Sec 1396d(29)(A), bars the payment of federal Medicaid funds for the medical care of “any individual who is an inmate of a public institution (except as a patient in a medical institution),” A person is not, however, an “inmate of a public institution” if he resides in the public institution “for a temporary period pending other arrangements appropriate to his needs.” The state of Ohio sought to classify pretrial detainees under age 19 as non-inmates, living in a public institution for only “a temporary period pending other arrangements appropriate to [their] needs,” for whom the state could claim Medicaid reimbursement. Federal Medicaid officials rejected this, finding that the inmate exclusion recognized “no difference” between adults and juveniles, or convicted detainees and those awaiting trial. A federal appeals court agreed, ruling that the involuntary nature of the stay is the determining factor. The exception does not apply when the individual is involuntarily residing in a public institution awaiting adjudication of a criminal charge, whether adult or juvenile. Ohio Department of Medicaid v. Price, #16-3550, 410 F.3d 919 (6th Cir. 2017).

     The state of Illinois sued a prisoner for reimbursement of the costs of his incarceration, alleging that he had assets to cover part or all of a possible judgment. An intermediate appeals court upheld an award of $19,925 for the state, and an order to a prison trust fund to hold the prisoner's money which he received as a wrongful death award for the death of his mother. The prisoner's due process rights were not violated by the lack of advance notice, since a pre-attachment notice and hearing might have caused him to hide or transfer the funds, and he was afforded the opportunity to contest liability and the attachment after the funds were attached. People ex rel. Director of the Department of Corrections v. Melton, #4-13-07002014 IL App (4th) 130700, 2014 Ill. App. Lexis 644.
     Correctional officials in Illinois had the right to attach funds that a prisoner saved from his wages while incarcerated over a period of decades to recover the cost of his incarceration. A state statute concerning this placed no limitation on the right of the state to file a lawsuit to recover such funds. In this case, the prisoner saved over $11,000 from his $75 a month prison wages by failing to spend much at all. The state got a $455,203.14 judgment against him for the cost of his incarceration, and the appeals court rejected the argument that the state was barred from such a recovery from inmate savings by the fact that it already takes a 3% offset from inmate wages for incarceration costs. The inmate, not eligible for parole until 2028, has appealed the ruling to the Illinois Supreme Court. People ex rel. Dep't of Corr. v. Hawkins, #3-09-0418, 2010 Ill. App. Lexis 621, 402 Ill. App. 3d 204 (3rd Dist.).
     County policies under which money from a detainee's canteen account was withheld for booking and arraignment fees, and for room-and-board did not violate due process even though no pre-deprivation hearing was provided. A county's interests in encouraging offender accountability and sharing the costs of incarceration were substantial and outweighed the "small" private interest in a detainee retaining the money. Relatives of detainees who sent funds to be deposited in such canteen accounts voluntarily gave up any interest they previously had in the money. Sickles v. Campbell County, Kentucky, No. 06-6055, 2007 U.S. App. Lexis 21163 (6th Cir.).
     Inmate at municipal jail was not entitled to a hearing before the facility withheld a part of his canteen funds to cover the costs of his booking, room and board. Recovering such costs of incarceration did not violate the inmate's due process rights. Sickles v. Campbell County, No. 06-6055, 2007 U.S. App. Lexis 21163 (6th Cir.).
     Four prisoners whose pension benefits were seized by the state of Michigan under a state statute to partially reimburse the state for the cost of their incarceration did not show that they did not have a full and fair opportunity to challenge the seizure in state courts which had issued orders for the seizures. The prisoners, therefore, could not challenge in federal court the constitutionality of the seizures under the due process clause of the 14th Amendment or its legality under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. Sec. 1001 et seq. Abbott v. State of Michigan, No. 06-1434, 2007 U.S. App. Lexis 1313 (6th Cir.). [N/R]
     State of Wisconsin was entitled to Eleventh Amendment immunity in federal court against a lawsuit by a county seeking to recover expenses that occurred while jailing a fugitive awaiting extradition. The state never made an express waiver of its immunity to suit in federal suit which would apply in these circumstances. Charles County v. State of Wisconsin, No. 05-2808, 447 F.3d 1055 (8th Cir. 2006) [N/R]
     Illinois correctional officials could properly recover, under a state statute, $124,191.22 as reimbursement for the cost of a prisoner's incarceration from the value of an annuity he bought with the proceeds of an insurance policy on the life of his mother, less a $2,000 statutory exemption. The fact that the annuity was bought with the proceeds of a life insurance policy did not make the annuity exempt from collection efforts. The court further found that because the inmate was not a dependent of his mother when she died, an exemption under state law for insurance proceeds paid to a dependent also did not apply. The fact that the prisoner himself had dependents also did not alter the state's ability to seize the annuity. People Ex. Rel. Director of Corrections v. Ruckman, No. 5-05-0132, 843 N.E.2d 882 (Ill. App. 5th Dist. 2006). [N/R]
     Seizure of inmate's disability pension benefits to pay for the cost of his care while incarcerated, pursuant to Missouri state statute, did not violate his right to substantive due process. Statute was not unconstitutionally vague as to specification of which of an inmate's assets could be considered in determining whether a prisoner had sufficient assets to support an assessment of costs of incarceration. State ex rel. Nixon v. Powell, No. SC 86453, 167 S.W.3d 702 (Mo. bank 2005). [N/R]
     Prisoner could not pursue federal civil rights lawsuit challenging the county jail's deduction of a subsistence fee from his prisoner account when his claim did not challenge the constitutionality of the state regulation allowing such a deduction, but merely the application of the regulation to him, which was an issue of state law. Cruz v. Aladro, No. 04-14671, 129 Fed. Appx. 549 (11th Cir. 2005). [N/R]
     Iowa statute allowing county sheriff to charge a convicted prisoner for room and board while in custody was not a violation of due process, equal protection, or the constitutional separation of powers, and courts had "inherent discretionary powers" to review whether an order for such charges was appropriate, despite the lack of an express provision in the statute providing for judicial scrutiny. State v. Abrahamson, No. 03-1907, 696 N.W.2d 589 (Iowa 2005). [N/R]
     Jail's policy of charging pre-trial detainees one dollar a day to help recover the cost of their housing did not violate their rights or constitute punishment before conviction. Slade v. Hampton Roads Regional Jail, #04-6481, 2005 U.S. App. Lexis 8070 (4th Cir.). [2005 JB Jun]
     Prisoner's due process rights were not violated by court proceeding which allowed State of Illinois to attach $4,000 in a bank account in the prisoner's name to recover costs incurred during his incarceration. State complied with applicable service and notice requirements of pre-judgment attachment statute. People Ex Rel. Director of Corrections v. Edwards, No. 5-02-0455, 812 N.E.2d 355 (Ill. App. 5th Dist. 2004). [N/R]
     State statute authorizing Kansas correctional officials to adopt a regulatory scheme for assessing fees against inmates did not violate a prisoner's due process or equal protection rights and was not an invalid retroactive enhancement of his punishment. The legislation was supported by legitimate goals such as teaching fiscal responsibility and reimbursing the state for the costs of incarcerating the prisoners rationally related to the scheme adopted. Elliott v. Simmons, No. 03-3280, 100 Fed. Appx. 777 (10th Cir. 2004). [N/R]
     Florida statutes making prisoners liable for $50 per day for the portion of their sentences remaining after the effective date of the statutes was not a violation of their due process rights or the prohibition on ex post facto laws that increase criminal punishments retroactively. The purpose of the statutes was not punishment but rather the reimbursement of public funds spent on the prisoners, who had no vested right to free room and board. Goad v. Florida Department of Corrections, No. SC00-785, 845 So. 2d 880 (Fla. 2003). [N/R]
          239:166 Illinois appeals court upholds $88,988 judgment requiring prisoner to repay Department of Corrections for the cost of his incarceration. People v. Adams, 278 Ill. App. 3d 803, 663 N.E.2d 1145 (4th Dist. 1996).

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