An inmate uses a phone. (Charles Rex Arbogast/Associated Press)

A FEDERAL appeals court decision denying the Federal Communications Commission the ability to cap prison phone rates within states is not much of a defeat for the FCC: The agency’s chairman chose to drop its defense of the regulations in February. The real losers are inmates and their families.

Correctional facilities pick service providers based principally on who offers them the biggest cut of their profits, and together the two charge prisoners rates so unreasonable that even free-market advocates admit someone must step in. The question has always been who, and though courts have affirmed the FCC’s right to regulate calls between states, on Tuesday the U.S. Court of Appeals for the D.C. Circuit ruled the FCC does not have that authority inside a state.

FCC Chairman Ajit Pai said in a statement following the court’s decision that he plans “to address the problem of high inmate calling rates in a lawful manner.” What that means is anyone’s guess, and Mr. Pai’s office would not say. The agency does have new instructions to follow on interstate rates: The court asked it to recalculate costs considering the commissions that providers pay prisons, and to rejigger its limits on the extra fees that phone companies charge inmates to set up, manage and close accounts so they apply only to calls between states.

But that leaves untouched the cost of intrastate calls, which phone providers have pushed even higher as interstate rates have declined. The FCC could try to introduce competition to the market by moving away from the exclusive contract system to a model in which one service provider owns the infrastructure in a single prison but others may pay to offer their services through the same wires. Such heavy-handed regulation on the FCC’s part, though, would probably invite new litigation from the phone industry.

More realistically, inmates will have to rely on states to bring rates down. At least 11 so far have taken some form of action. Fifty would be better. Congress could make that happen by amending the Communications Act to expand the FCC’s jurisdiction to include intrastate calls. Rep. Bobby L. Rush (D-Ill.) has introduced legislation to that effect, but in the past it has gained little traction — and each minute prisoners spend on the phone in the meantime costs them and their families more than they can afford. Almost everyone is willing to admit there is a problem. What’s needed now is a solution.