Update on ACO Operations and Care Management Strategies in the New Jersey Medicaid ACO Demonstration Project

Derek DeLia, Michael J. Yedidia, Oliver Lontok

Publication Date: 11/01/2018

The New Jersey Medicaid Accountable Care Organization (ACO) Demonstration was implemented over a three-year period beginning on July 1, 2015 and recently, a one-year extension of the Demonstration was recently authorized. Previously published reports provided quantitative and qualitative information about activities leading up to and in the first year of the Demonstration. This report provides a detailed assessment of ACO activities in Demonstration year 2. It relies on the second round of interviews with leadership and care coordination staff from NJ’s three certified Medicaid ACOs and the Medicaid ACO-like group, the Health Coalition of Passaic County (HCPC). The study team performed a content analysis of the interviews and developed core themes and perspectives, which are outlined below. As in the first round, the content analysis emphasized a search for common themes across the ACOs. Although some commonality was evident, this latest round of interviews produced more information about ACO-specific activities, accomplishments, and plans for the near future. Three overarching themes that emerged from the interviews are listed below:

Theme 1: Access to comprehensive Medicaid claims and encounter data is the most important resource made available to ACOs by the state.
Theme 2: ACOs serve as conveners and connectors to build upon, enhance, and initiate healthcare delivery changes in their local service areas.
Theme 3: ACOs are using startup funds (state and private) to leverage other grant revenue, which is the main source of funding for the foreseeable future. Prospects for shared savings have been deemphasized.

In the second Demonstration year, the Trenton Health Team (THT) solidified its coalition and data analytic infrastructure. This infrastructure is used to quantify details about their patient population, precisely specify and implement intervention opportunities and begin assessment of intervention effects. These data analytic capabilities have placed the THT at the center of many health and social service planning activities for their region. They have leveraged these capabilities and state funding under the Demonstration to obtain additional private funding, iii Rutgers Center for State Health Policy, November 2018 which has stabilized their current financial position. At the time of the interviews, the THT was negotiating the second year of their service contract with Amerigroup and pursuing similar initiatives with other managed care organizations (MCOs).