In 2005, the Delaware Department of Correction signed a contract with the company Correctional Medical Services (CMS) to provide medical services to inmates in state prisons. The promise of cost savings quickly evaporated, as the state paid the company more than $130 million over three years for poor quality inmate healthcare.
In March 2006, the U.S. Department of Justice's civil rights division launched a formal investigation of Delaware's prison system following reports of problems in the prison health care system, including high inmate death rates, especially from AIDS. After the federal investigation determined the substandard medical care violated inmates' civil rights, the state agreed to improve the care and allow a federal monitor to closely watch and evaluate the state's progress. In the progress report released in January 2009, Delaware prisons earned a rating of "substantially compliant" in 38 areas, partially compliant in 163 areas and non-compliant in 15 areas. Many state officials believe that the medical care will not improve until CMS is no longer the prison medical care vendor, but the company's contract with the state was extended once again in January 2009 until June 2010 for $39.8 million.
The state announced in October 2009 that it will split the work into multiple contracts next time, to allow smaller companies to bid. It also will introduce a "shared risk" model for the medical costs because, the DOC statement says, the current model of a contractor receiving a fixed price for all inmate care "provides the potential for contractors to limit inmate care in order to maximize profits."