New Jersey Funds Integrated Care at Two Community Health Centers

New Jersey has awarded nearly $666,000 in state contracts to two nonprofit community health systems to expand integrated care — clinics where patients can receive mental health and addiction treatment and primary care in the same building, from one care team. The Department of Human Services announced the awards in the week of October 5: $391,275 to St. James Health, a federally qualified health center in Newark, and $274,653 to Zufall Health, which serves patients across central and northern New Jersey.

The contracts are the first money to flow under a licensing change that took more than a decade to produce, and they arrive as the state reviews roughly 20 additional applications from providers that want to offer the same combined model.

What the contracts actually pay for

The funding comes from the tens of millions of dollars New Jersey receives annually from the federal Substance Abuse and Mental Health Services Administration to address opioid abuse, routed through a program designed to let federally funded primary care clinics add screening, assessment, referral and addiction treatment without obtaining a separate license. The goal, the department said, is to help patients who carry a substance use disorder, a mental health condition and a chronic physical illness — diagnoses that together can shorten life expectancy by decades — connect with both behavioral health care and primary care without navigating multiple systems.

"Too often people have to navigate multiple systems to get treatment for mental health conditions, addiction, and physical health needs," said Stephen Cha, the state human services commissioner and a physician.

St. James operates three Newark locations offering medical, dental, behavioral health and pharmacy services; one of its clinics also runs a food bank. Zufall Health operates more than half a dozen sites, a mobile health unit and, since May, a school-based clinic in Franklin Township. Both plan to use the contracts to place behavioral health staff and addiction services alongside their existing primary care.

The licensing change underneath the money

For years New Jersey providers who wanted to treat body and mind under one roof had to assemble three separate licenses administered by two different state agencies — a paperwork burden that stopped most clinics from trying. That changed on April 6, 2026, when an integrated facility license, N.J.A.C. 8:43K, took effect after being adopted in January. The new license lets a single outpatient facility provide mental health, substance use disorder, opioid treatment program and primary care services.

The Department of Health, which oversees licensing, has issued one integrated care license under the new rules — to Zufall Health — and a second Zufall application is expected to be approved shortly, according to communications director Dalya Ewais. Another 20 applications are under review, a volume she described as reflecting growing provider interest.

Sarah Aleman, the senior vice president who oversees behavioral health at Zufall, said integrated care cuts down on referrals and repeat visits across separate health systems, a benefit that reaches all primary care patients but matters most for people with mental health or substance use issues, who already face more barriers to care. "The goal in integrated care is to ensure access to the right care, with the right team members, at the right time — all within a coordinated system of care," she said.

Why one-stop care matters for addiction

People with co-occurring mental health and addiction diagnoses are the clearest beneficiaries of a single clinic that can manage both conditions. Historically the two were treated in separate systems with separate records, and patients who showed up for a physical complaint but screened positive for a substance use disorder often fell through the gap between them. Co-locating services shortens the distance between a screening and a medication-assisted treatment prescription or a therapy appointment — a difference that research links to whether people stay in care.

"Integrated care programs help ensure that people are treated as whole individuals, not a collection of separate health needs," said Valerie Mielke, the human services deputy commissioner who oversees behavioral health programs.

Some New Jersey providers already operate integrated models, including Care Plus in Bergen County and Integrity House in Newark, both large organizations with the staff and administrative capacity to navigate the old, fragmented licensing process. The change is aimed at the smaller clinics that could not. New Jersey also has been part of a federal pilot since 2017 that lets community-based behavioral health providers bill Medicaid for integrated care and case management; the state had 19 certified community behavioral health clinics as of 2024.

What the contracts do not settle

The combined $666,000 is modest against a state of roughly 9 million people, and it covers two organizations rather than the 20 waiting in the licensing queue. Money can build a co-located team; it does not by itself guarantee that a patient seen for diabetes or a dental problem is screened, referred and then actually connected to addiction or mental health care in the same visit. How well the two grantees perform that handoff — and whether the state expands the model beyond its first two contracts — is the test of whether New Jersey's decade-long regulatory project changes care in practice.