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Seeks to Improve Health Outcomes, Reduce Cost Of Health Care


TRENTON – Legislation sponsored by Senators M. Teresa Ruiz and Nilsa Cruz Perez to create a new method of generating capital for programs designed to improve the quality of life for residents, particularly in the area of health care, and to reduce costs related to health care delivery was approved today by the Senate Economic Growth Committee.


“This bill will provide an opportunity to improve the healthcare delivery system in our communities through a program that encourages organizations to implement new and innovative strategies that will focus on preventive care and early intervention,” said Senator Ruiz (D-Essex).  “This is about really thinking outside of the box about how health care services are delivered and through that process determining how the system can be improved to better protect the health of residents but also to lower costs.”


The “New Jersey Social Innovation Act” seeks to attract private funding for programs aimed at reducing the public cost of providing health care services to residents. The bill (S-452) would establish a five-year pilot program aimed at encouraging private investment in preventive and early intervention health care and reducing public expenditures related to those services. The Economic Development Authority (EDA) will administer the program and oversee a study commission established by the bill.


Under the bill, the EDA would establish a social innovation loan fund to guarantee loan agreements among lenders, eligible non-profit organizations, and public sector entities.  The fund would be credited with money from state appropriations, public or private donations, grant funding and loan guarantee program fees. The study commission would aid the EDA by determining a non-profit to receive the investment funds from private investors, and issuing annual reports detailing the progress of the program. Only nonprofit organizations would be eligible to receive loans issued by the EDA under the pilot.


“Non-profit entities have developed innovative programs that improve the delivery of services traditionally provided by the public sector and in that process have also found ways to lower costs,” said Senator Cruz-Perez (D-Camden/Gloucester). “These are the kinds of programs we should be encouraging, so that their successes can be duplicated in other areas of the state. This bill will put the framework in place to allow that to happen.”


Similar programs have been introduced to address prison populations in New York and in England, as well as homelessness in Massachusetts.


The committee approved the bill by a vote of 5-0.