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As a response to rising health care costs and substantial cuts in state funding for correctional health care in Texas, we developed and applied a process framework for systematically prioritizing the provision of inpatient hospital services to prisoners. Specifically, all inpatient services provided from September 2009 through August 2011 at the University of Texas Medical Branch/Texas Department of Criminal Justice Hospital were sorted according to levels of care consistent with those previously defined by the Oregon Department of Corrections and the Federal Bureau of Prisons. Nearly all inpatient services (94%) were deemed medically mandatory (Level 1) or medically necessary (Level 2). These services must be funded to ensure an adequate level of care, and capitated-funding mechanisms may not be sufficiently flexible to cover their costs. Correctional health care systems may adapt the framework used here to inform state policymakers regarding provision of inpatient services and funding requirements.