An investigation has revealed dozens of intellectually disabled Aboriginal people are being kept in prison indefinitely because of a lack of proper healthcare facilities.

The ABC's Lateline program exposed the case of 23-year-old Rosie Anne Fulton, who has spent the past 18 months in a Kalgoorlie jail without a trial or conviction after she was charged with driving offences.

The magistrate in her case declared her unfit to plead because she is intellectually impaired - a victim of foetal alcohol syndrome - and has the mental capacity of a young child.

Her legal guardian, former police officer Ian McKinlay, says Ms Fulton ended up on a prison-based supervision order because there were no alternatives in the area at the time.

"At the moment this outcome is almost entirely reserved for Aboriginal, Indigenous Australians," he said.

The Aboriginal Disability Justice Campaign says there are at least 30 Indigenous people in a similar situation around the country.

Western Australia's Inspector of Custodial Services, Neil Morgan, says the state has no option but to incarcerate Ms Fulton as existing options are limited.

"One is a 'declared place', which was always intended to be for people like this. Unfortunately we still don't have any declared places 15 years after the Act came into force," he said.

"The second option is an authorised hospital, and that's only for a person with a treatable mental illness.

"And the third option, which is almost the option of default, is that the person ends up in prison or in a juvenile detention centre."

Mr Morgan concedes that most of those caught up in the system are Indigenous, although he says the law does not target Aboriginal people.

"The vast majority of people who've been caught under the Act and held under a custody order by reason of a cognitive impairment are in fact Aboriginal people, and a large number of them are Aboriginal men and women from remote and regional Western Australia."

Meanwhile, Mr McKinlay has been trying to get Ms Fulton moved to Alice Springs to be closer to her family.

"She rings several times a week, sometimes twice a day, wanting to know when she is coming back to live in Alice Springs," he said.

Last year, the Northern Territory health department agreed to move Ms Fulton to a secure care facility built next to the Alice Springs prison.

The centre was specifically designed to house people with intellectual disabilities and challenging behaviours.

Mr McKinlay says he received repeated assurances last year from the department that Ms Fulton would be moved there.

"They identified her as a prime candidate for secure care and they rejected any other form of service that guardians were advocating for pending the completion of this facility," he said.

Rejected by health department due to 'untenable' risks

One set back may be that Mr McKinlay last month he received a new letter from the health department, this time rejecting Ms Fulton.

The letter states that she is not compatible with the male residents staying at the centre.

"From a clinical risk management perspective, the risks posed to Ms Fulton's safety were she transferred to the facility are untenable," the letter stated.

A statement issued from the NT health department said secure care facilities were not gender specific.

"The Department of Health always holds the health and wellbeing of clients as paramount," the statement said.

"Due to its responsibility to client privacy, the department is unable to provide comment on specific client circumstances, treatment or care."

Mr McKinlay says he believes the rejection of Ms Fulton is a bid to save money.

"Well, it comes down to cost in the end. People in Rosie Anne's category of need are virtually just waited out until they become prison-ready, default to the criminal justice system and imprisonment and jail," he said.

Warren Mundine, the chairman of the Prime Minister's Indigenous Advisory Council, says Ms Fulton is trapped in a bureaucratic nightmare.

"From day one she should never have been in a prison situation," he told Lateline.

"She should have been in a health facility in a proper service area, and that's going to be the challenge between the Federal, the West Australian and Northern Territory governments to fix this, because you just can't have people indefinitely with mental health issues like that being trapped in a prison."

Family want Rosie Anne moved closer to home

Mark O'Reilly, principal legal officer at the Central Australian Aboriginal Legal Aid Service, says Ms Fulton's story is not unique.

"We've had situations where following the ordinary process someone might be looking at three months in prison. We've had people in jail for four to five years, just waiting for an outcome," he said.

Rosie Ann Fulton is being held in a Kalgoorlie jail without conviction because she was declared unfit to plead to driving offences. ( Supplied )

In a widely publicised case, a mentally impaired West Australian man - Marlon Noble - spent 10 years behind bars without ever standing trial on child sex assault charges.

He was released in 2012 under strict conditions.

Two facilities for mentally impaired prisoners are currently being built by the West Australian Government, which says it is committed to building facilities for mentally impaired people who are accused and not convicted.

But Ms Fulton says she has no family in Perth and does not want to be moved there. She wishes to return to Alice Springs.

Will MacGregor runs a drug and alcohol rehabilitation service for young people in Alice Springs called Bush Mob.

He said there was a desperate need for more facilities for intellectually impaired Indigenous Australians, especially those suffering from foetal alcohol syndrome.

"Whether it's secure care or supported accommodation options, the models are out there and a lot of people have been advocating the models for a lot of years," he said.

"But again it comes back to a global financial crisis-type of budgets and maybe a hardening of hearts."

Ms Fulton's family want her moved closer to Alice Springs so they can help her.

"I want to talk to this girl when she come out, I'll tell her you are a pretty girl," aunt Ingrid Kanari said.

"You can have a better life, you can get work, settle down and work in the community. That's what I want her to do."