Justice Department says it will end use of private prisons

[DINGO Joe]

Amazing news! Hope this trend continues.

Is this effective across the nation, in certain states, or only federally?

The federal government has no direct control of state prisons/jails, short of using federal funding mandates. So this decision is for federal prisons only.

https://www.bop.gov/about/statistics/population_statistics.jsp

22,104 prisoners are housed in private facilities, which is almost 12% of the total federal prison population.

It should be noted that the reform of sentencing guidelines last year has lead to a sharp decline in the federal prison population from a peak of 219,000 in 2013 to 193,000 today so there does seem to be space available to reduce and eliminate the private facilities in orderly manner.

[DINGO Joe]

Most importantly, how will this affect the plot of future seasons of OITNB?

Obviously it was the mismanagement of Litchfield that led to the change in policy.