Opioid use disorder (OUD) has emerged as one of the most significant public health crises in the United States. Despite the growing awareness around this issue, many individuals who struggle with OUD still face overwhelming barriers to accessing effective treatment. Among these barriers, structural issues—such as a lack of available clinicians and affordable care options—continue to plague the system, leaving Medicaid beneficiaries, who are disproportionately impacted by OUD, in a particularly vulnerable position.
However, there is hope on the horizon. Virtual OUD treatment providers like Ophelia are working tirelessly to bridge the gap between patients and effective care, especially for those relying on Medicaid. Ophelia, a telehealth platform that provides medication-assisted treatment (MAT) for opioid use disorder, has recently expanded its Medicaid coverage to include 3 million residents in New Jersey through new reimbursement contracts. This expansion is part of Ophelia’s broader mission to make OUD treatment more accessible, affordable, and effective for populations that need it the most.
Addressing Critical Gaps in Medicaid Opioid Use Disorder Treatment
Ophelia’s journey to New Jersey is part of a larger initiative to address the significant treatment gap that exists for Medicaid beneficiaries struggling with opioid use disorder. According to Zack Gray, founder and CEO of Ophelia, the company has been treating patients in New Jersey for over two years but had previously failed to prioritize expanding insurance coverage. As a result, many patients in the state were forced to pay for treatment out of pocket, which Gray acknowledges is not a sustainable or responsible approach to care. “We know that that is an irresponsible way to care for patients,” Gray said in a recent interview with Addiction Treatment Business.
Given the financial burden that out-of-pocket expenses place on individuals, particularly those with low-income backgrounds, Ophelia’s decision to prioritize insurance coverage for New Jersey residents was a key step forward. The company’s ability to expand its Medicaid contracts has allowed it to offer more accessible Medicaid opioid use disorder treatment to a larger number of individuals who might otherwise be unable to afford the care they need. This move reflects Ophelia’s broader strategy to provide high-quality, affordable OUD treatment, leveraging telehealth to reach underserved populations.
Ophelia’s commitment to providing care to Medicaid patients is evident in its patient base. Approximately 70% of Ophelia’s overall patient population relies on Medicaid for treatment, highlighting the critical need for providers like Ophelia to work closely with Medicaid managed care organizations (MCOs). Ophelia’s strategy has been to establish partnerships with Medicaid plans to ensure that individuals struggling with OUD can access MAT without facing undue financial strain.
Strategic Expansion in New Jersey for Medicaid Opioid Use Disorder Treatment
Ophelia’s approach to expanding its services in New Jersey follows a clear set of objectives. One of the company’s key strategies is to aim for 70% Medicaid penetration in a state before establishing a presence there. This approach ensures that Ophelia has the necessary infrastructure and financial support to serve a significant portion of the population. With new partnerships established with major Medicaid plans, including Horizon BlueCross BlueShield, UnitedHealthcare, and Wellpoint, Ophelia has surpassed its 70% target, achieving a remarkable 89% Medicaid coverage in New Jersey.
This expansion is not only crucial for increasing access to care but also for improving patient outcomes. Research has shown that patients who have in-network coverage are significantly more likely to remain in treatment for longer periods. A study published in Health Affairs revealed that individuals with in-network coverage were 50% more likely to stay in treatment with Ophelia for six months or longer. This finding highlights the critical role that insurance coverage plays in promoting long-term recovery and emphasizes the importance of expanding Medicaid opioid use disorder treatment to reach those who need it most.
The Business Case for Medicaid Opioid Use Disorder Treatment
While Ophelia’s primary focus is on providing high-quality care for those struggling with OUD, establishing partnerships with Medicaid payers also has important business implications. For Ophelia to sustainably serve patients, the company must ensure that it has sufficient coverage in a given market. Gray explained that having adequate Medicaid coverage is essential for the company’s ability to meet demand, operate efficiently, and keep its doors open.
“Starting with having adequate coverage among Medicaid” is a key strategy, Gray said. Establishing strong relationships with Medicaid payers allows Ophelia to better serve its patients while also maintaining financial stability. However, securing these partnerships is no simple task. The Medicaid landscape is complex, with state Medicaid programs varying in structure and fragmentation. In order to reach its goal of 70% Medicaid coverage in a state, Ophelia often needs to forge multiple contracts, which can be a time-consuming and resource-intensive process.
In New Jersey, Ophelia was able to expedite this process by leveraging the state’s Office Based Addiction Treatment (OBAT) Care Coordination Services, which streamlines reimbursements for MAT and OBAT services. As a certified OBAT provider, Ophelia was able to enter into contracts with health plans that bill OBAT codes, making it easier for the company to expand its services without having to negotiate each contract from scratch. This framework, created by the state, significantly reduces the complexity of entering the market and allows providers like Ophelia to bring their services to patients more quickly.
Innovative Care Models: Value-Based Medicaid Opioid Use Disorder Treatment
Ophelia’s approach to treating opioid use disorder is built around a combination of medication-assisted treatment (MAT) and asynchronous medical care. This model allows patients to receive ongoing treatment without the need for regular in-person visits, reducing barriers to care for individuals who may not have easy access to traditional brick-and-mortar clinics.
In addition to its virtual care model, Ophelia is focused on value-based care, which aligns financial incentives between providers and payers to improve patient outcomes while keeping costs low. This approach contrasts with traditional fee-for-service treatment models, which often result in higher costs for both providers and patients. Ophelia’s ability to provide more cost-effective Medicaid opioid use disorder treatment is an important advantage in a space where financial constraints often limit access to care.
“We want to show that it is possible to treat the Medicaid population, to structure contracts that align incentives between health plans and providers, and to be the low-cost provider,” Gray said. Ophelia’s goal is not only to offer more affordable care than traditional clinics but also to offer immediate cost savings for health plans. When comparing Ophelia’s bundled, value-based treatment to the costs associated with traditional fee-for-service programs, health plans can see a reduction in expenses right from the start.
Plans for National Expansion of Medicaid Opioid Use Disorder Treatment
Ophelia’s expansion into New Jersey is just one part of its broader vision for nationwide growth. The company intends to expand its geographic footprint by leveraging its existing relationships with national payers to establish new coverage in other states. Although some states may not be feasible for Ophelia to enter due to the complexity of their Medicaid systems or legal regulations, Gray is optimistic about the company’s potential for growth.
“We’re not necessarily serving the entire state, because we don’t have contracts with all of the other health plans in that state,” Gray said. Instead, Ophelia is targeting states where it can efficiently establish insurance coverage, gradually expanding its presence in a way that aligns with the needs of its patients and the capabilities of its payer partners.
Ophelia’s expansion will also focus on strengthening relationships with payers and partnering with other organizations, such as correctional facilities, to broaden its reach. Gray’s goal is to demonstrate the financial sustainability of the company while maintaining its focus on providing high-quality care. Ophelia is working toward long-term profitable growth, without relying on external investors, although Gray acknowledges that investors could help accelerate the company’s growth and impact.
The Future of Medicaid Opioid Use Disorder Treatment: A Model for the Nation
Ophelia’s innovative approach to expanding access to opioid use disorder treatment, especially for Medicaid beneficiaries, has the potential to set a new standard for how telehealth services can address the opioid crisis in the United States. By leveraging virtual care, focusing on value-based treatment, and forging partnerships with Medicaid payers, Ophelia is providing a more cost-effective, accessible, and efficient way to treat OUD.
As Ophelia continues to expand its reach, the company’s model offers hope for a future where more individuals struggling with OUD can access the treatment they need without facing financial barriers. Through its dedication to both patient care and business sustainability, Ophelia is not just transforming the treatment landscape for opioid use disorder—it’s paving the way for a more inclusive, effective, and affordable healthcare system.
