From a 2009 paper by Keith Humphreys, Alex Harris, and Daniel Kivlahan:
Consider two related questions: (1) Why are there no bad restaurants in San Francisco? and (2) Why do prison cafeterias serve lousy food? The answer to the first question is that San Francisco has a large number of people who eat out frequently and have excellent judgment about the quality of food. Further, when they sign the bill, like all restaurant goers, San Francisco diners can assess if the quality they received justifies the cost. Through normal market forces, this results in poor restaurants (i.e., those who do not deliver quality appropriate to the price they charge) going out of business and good restaurants staying in existence. In short, because consumers can detect quality and cost, it makes sense for restaurants to invest in producing the best possible food at the most attractive price.
If serving good food is rewarded, why do prisons, even prisons near San Francisco, serve lousy food? Even prisoners of the most refined taste must eat whatever the cafeteria serves. Lack of investments in quality food thus cannot be punished in the market place by prisoners because they don’t have the choice to eat somewhere else.
That’s all rather intuitive. The questions for you are: (a) How can one get better quality food to the prisoners? and (b) What has this got to do with health care? The authors’ paper is ungated (pdf) so you can read their answers yourself.
UPDATE: The paper is in the public domain and ungated.
[Cross-posted at The Incidental Economist]