Medicaid ACO Demonstration Projects

Medicaid ACO Demonstration Projects

Camden submits application to be certified as a Medicaid ACO

NJ

The Camden Coalition of Healthcare Providers seeks to be certified as a Medicaid ACO so that it may participate in the New Jersey Medicaid ACO Demonstration Project (N.J.S.A. 30:4DK8.1 et seq.).

We believe the certification of the Coalition as a Medicaid ACO will represent an important step forward in improving the quality, capacity, and efficiency of the healthcare system in Camden, NJ.

A Community-Based Medicaid ACO Demonstration Project

In August 2011, Governor Christie signed into law NJ P.L. 2011, Chapter 114 requiring DMAHS to establish a three-year Medicaid Accountable Care Organization (ACO) demonstration project. ACOs are designed to improve health outcomes, quality, and access to care through regional collaboration, and shared accountability while reducing costs.

The law authorizes a three-year Medicaid ACO demonstration project whereby community-based, non-profit coalitions can apply for recognition by the State of New Jersey as a Medicaid ACO.  The applicants must propose a community focus and will need 100 percent of the acute care hospitals, 75 percent of the primary care providers, four behavioral health providers, and two community residents from that community on the board of the organization.  The providers in the community will continue to receive their usual Medicaid payments and the ACO, if its providers meet quality benchmarks, would be eligible to receive shared savings payments, that can be distributed to participants based on a proposed gain sharing plan.

Why is Medicaid so Important for New Jersey?

The concept of Medicaid ACOs in New Jersey makes particular sense because NJ has a very fragmented provider, hospital, and payer marketplace.  Medicaid patients are highly concentrated in urban, impoverished cities, with a high percentage covered by government-sponsored health plans that will make implementation of an all-payer ACO model easier.  Also, reducing unnecessary ER and hospital use for complex, Medicaid patients is less disruptive to the existing business model of New Jersey’s hospitals and healthcare providers.

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