Medicaid Accountable Care Organization Demonstration Project

In August 2011, Governor Chris Christie signed into law NJ P.L. 2011, Chapter 114 requiring the NJ Department of Human Services, Division of Medical Assistance and Health Services (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 Medicaid ACO demonstration project provided the New Jersey Medicaid program an opportunity to explore innovative system re-design including testing the ACO as an alternative to managed care; evaluating how care management and care coordination could be delivered to high risk, high cost utilizers; stretching the role of Medicaid beyond just medical services to integrate social services; and testing payment reform models including pay for performance metrics and incentives.

Efforts begun in 2011 under New Jersey’s Medicaid ACO Demonstration Project evolved into four regional partnerships (Trenton, Camden, Newark and Paterson) that integrate, coordinate and align all those disconnected programs aimed at making communities healthier. The focus is on residents who receive healthcare coverage through Medicaid–those who often lack access to the resources needed to be, and stay, healthy.

New Jersey ACOs are required to be nonprofit organizations serving a minimum of 5,000 Medicaid beneficiaries within a designated region. In addition, the ACO is required to contract with 100% of the hospitals, 75% of the primary care providers, and at least four mental health providers in the intended service region.

An ACO is a healthcare model with  a three-part goal of improving health outcomes, lowering healthcare cost, and improving the patient’s experience of receiving care. While the ACO model has been tested and found to be effective in achieving improved outcomes and reduced costs within Medicare, New Jersey’s adoption for Medicaid represents an important innovation in the design. 

Trenton Health Team was certified as one of the first Medicaid Accountable Care Organizations in NJ, serving the greater Trenton community. Through this model, the THT-ACO has been serving Medicaid beneficiaries residing in the six zip codes of Trenton: 08608, 08609, 08611, 08618, 08629, and 08638.

In 2019, THT-ACO announced grants totaling about $145,000 to seven community-based nonprofits helping Trenton residents address complex health concerns ranging from long-term effects of trauma to bed bugs. See projects

THT-ACO relied on on the collaborative structure of THT, bringing together the vast majority of Trenton’s primary and specialty care providers through both of the city’s hospitals (Capital Health and St. Francis Medical Center), its only Federally Qualified Health Center (Henry J. Austin Health Center), and the City of Trenton itself, through its Department of Health and Human Services, in a shared effort to transform healthcare for the community.

In addition, behavioral health providers, social service agencies, community organizations and city residents joined in this community-wide endeavor to bring better healthcare at lower cost to Medicaid recipients within the Trenton geography.

“Trenton Health Team has been preparing for this initiative for several years, bringing together key community partners and developing the infrastructure and data capacity to manage the responsibility,” said James Brownlee, then-director of the Department of Health and Human Services and Health Officer for the City of Trenton, who also served as THT’s vice president. “As a public health professional, I especially value the emphasis on health at the community level that is built into the project design, which will ultimately lead to improved health outcomes for our citizens.”

To improve the coordination of care and support the ACO project, THT established the Trenton Health information Exchange (HIE), a shared database that allows doctors and other providers to communicate directly about patient needs. This means less time is spent filling out paperwork and repeating one’s medical history to various providers. It also means fewer repeated medical tests or missed diagnoses.

“This recognition by the State is an important validation of our work to-date, establishing essential technological tools and building partnerships and trust across the range of medical and behavioral service providers,” said Trenton Health Team Executive Director  Gregory Paulson. “We believe the recognition as a Medicaid ACO will enhance our ability to serve the health needs of Trenton residents, providing a higher level of coordination and efficiency in the delivery of care, thereby improving outcomes for patients and containing costs for the healthcare system.”

“THT’s Medicaid ACO will achieve the goals of improving health outcomes and patient satisfaction while reducing costs through the strategic use of data and technology coupled with our continued and expanding community collaboration, which has defined our work for the past ten years,” said Paulson. “We are pleased to partner with the State in bringing this opportunity to the Trenton community.”

Significant funding for the establishment of the THT-ACO infrastructure was provided through the generosity of the Nicholson Foundation.