Medicaid ACO

New Jersey Transit.

New Jersey is doing interesting stuff with Accountable Care Organizations and medical homes to reduce costs and improve outcomes in its Medicaid programs.

New Jersey has certified three of six applicants for the New Jersey Medicaid Accountable Care Organization Demonstration Project — the Camden Coalition of Healthcare Providers, the Healthy Greater Newark ACO and the Trenton Health Team.

As HealthAffairs notes, “The approach grew out of work by Dr. Jeffrey Brenner and the Camden Coalition of Healthcare Providers,  chronicled in Dr. Atul Gawande’s 2011  New Yorker article, “The Hot Spotters.” Dr. Brenner and his colleagues analyzed local hospital claims data and found that a small percentage of patients were responsible for much  of hospitals’ costs —  leading t0 calls to implement a new model of healthcare delivery for state’s Medicaid enrollees.

The state legislation establishing the program requires that each Medicaid ACO to be a nonprofit corporation and  that governing boards  include “general hospitals, clinics, private practice offices, physicians, behavioral healthcare providers, and dentists; patients; and other social service agencies or organizations,”  along with  voting representatives from at least two consumer organizations that advocate for patients.

Many will watch the experiment to see how well it can align quality  (outcomes) objectives with payment incentives.