When you lose a battle or fail certain crimes, you may be thrown in the infirmary.
While in the infirmary you can not explore the prison, access your bank account, use items, modify armor and do many other things. You can get yourself out of the infirmary early by paying the bribe price. Paying the bribe will get you out ASAP and recover you to a minimum of 75% hp.
If you chose not to bribe out, your hp is restored to a minimum of 40% when you are out.