One of Orange-based American Correctional Solutions Inc.’s biggest customers is going into receivership.
That may not be all bad, said Barry Goldstein, the company’s founder and chief executive.
American Correctional provides medical services to California’s 32 prisons. It offers radiology and eye care services from doctors and others willing to provide services in prison.
But the troubled California Department of Corrections’ healthcare system is about to go from state control to receivership to deal with administration and cost issues. Medical incompetence or neglect kills an average of one inmate a week in the system, according to experts.
Goldstein said he sees opportunity for his company in the move.
“CDC will have to start focusing on healthcare and healthcare costs,” he said. “We develop healthcare in the institution. We think the receiver will understand (that we’re) supplying the proper medical support.”
A receiver could see American Correctional and other contractors as the best way for the state to save money and provide better healthcare for prisoners.
But going into receivership is a crapshoot for American Correctional and others.
“It’s going to affect everything,” said Todd Slosek, a Department of Corrections spokesman.
A nationwide search is under way for a receiver, according to Slosek.
He declined to offer specifics on how a receiver could address contractors and other prison health issues.
Providing healthcare for prisoners is a lonely job, but American Correctional isn’t the only one doing so. Rivals include Corrections Corporation of America, a Nashville, Tenn.-based contract prison operator, and Cornell Cos. of Houston.
American is considerably smaller than those companies. It expects around $3 million in revenue this year and could reach $6 million next year, according to Goldstein.
The company has some 10 workers and 30 to 40 part-time doctors and medical staff to service prisoners.
American recently signed a contract with DaVita Inc., an El Segundo-based provider of dialysis, to serve inmates.
The company often hires retired military practitioners, who “feel comfortable in a correctional environment,” Goldstein said.
“They go in and do clinics in the institution,” he said.
Besides the California Department of Corrections, American also works with jails and coroner’s offices around the state.
“We do radiology services on cadavers,” Goldstein said.
Goldstein started what eventually evolved into American as a provider of eye care services in 1985 with the late Nathan Roth, a Pasadena eye doctor who also has a place in rock music history.
“Van Halen started in Nathan’s garage,this is the doctor in Pasadena whose son is David Lee Roth,” Goldstein said.
The company began doing clinics at the California Institution for Men in Chino.
“I saw a contract bid go out for ophthalmology services for a prison,” Goldstein said. “I didn’t know anything about it. But I bid on it. We got the bid and we went out there. Of course, they didn’t know what they were doing. At the time, in-house services for prisoners were not particularly popular.”
Eventually, Goldstein said he and Roth got a call from Pelican Bay State Prison in Northern California, asking if they’d start a healthcare service there.
“And one thing led to another,” Goldstein said. “Slowly but surely, we started to expand.”
American adopted its current name nearly three years ago, after Roth’s death. Goldstein brought on another partner, radiologist Frank Grossman.
“We started all over again,” Goldstein said.
How healthcare shakes out in California’s prison system is a variable. But Goldstein said he could expand to other states.
“If the system works in California, it certainly can work in Idaho,” he said. “It’s just that California stands out because of the significantly high number of inmates.”
