What Is PACE
PACE (Program of All-Inclusive Care for the Elderly) is a Medicare and Medicaid program that delivers comprehensive medical, social, and support services to frail seniors age 55 and older who would otherwise qualify for nursing home care. Instead of moving to an institution, participants receive coordinated care in their homes and communities through an adult day center model combined with home visits.
PACE operates as a capitated managed care program, meaning one organization receives a fixed monthly payment per participant to cover all services. This structure aligns financial incentives with keeping people healthy and independent at home. Unlike traditional fee-for-service Medicare or Medicaid, PACE bundles primary care, specialists, medications, therapies, hospital care, nursing home stays, and transportation into one integrated benefit.
How PACE Works in Practice
- Enrollment requirements: Your loved one must be age 55 or older, live in a PACE service area, and be certified by the state as meeting nursing home level of care. There are currently 37 PACE organizations operating in 31 states.
- Core services included: Primary and specialist medical care, prescription drugs, hospital and emergency services, nursing care, home health aides for ADLs (Activities of Daily Living) and IADLs (Instrumental Activities of Daily Living), physical and occupational therapy, adult day center attendance (typically 2-3 days per week), meals, transportation, and respite care for family caregivers.
- Care coordination: A multidisciplinary team including physicians, nurses, social workers, and home health aides develops an individualized care plan. The team meets regularly to adjust services based on changing needs.
- Cost to participants: Most PACE participants pay no monthly premium beyond their existing Medicare Part B and Medicaid premiums. Co-pays are minimal or zero for covered services.
Key Differences From Traditional Medicare and Medicaid
- vs. Medicare alone: Traditional Medicare covers hospital and doctor visits but requires supplemental insurance or out-of-pocket spending for services like home health aides and adult day care. PACE includes these comprehensively.
- vs. Medicaid nursing home coverage: PACE keeps your loved one at home instead of institutionalizing them. States must enroll dual-eligible beneficiaries (those on both Medicare and Medicaid) at PACE if they meet clinical criteria and live in a service area.
- Respite care provision: PACE explicitly covers respite care, allowing family caregivers to take breaks without disrupting services. Many programs offer up to 14 days of respite annually.
Common Questions
Does PACE replace my parent's Medicare and Medicaid? No. PACE works with both programs. Medicare and Medicaid continue paying PACE organizations on your parent's behalf, but you won't receive separate Medicare or Medicaid bills for covered services.
What happens if my parent needs hospitalization? The PACE team arranges and coordinates all hospital care. There are no separate referrals needed, and the PACE organization manages transitions back to home-based care.
Can we leave PACE if we're unhappy? Yes. Participants can dis-enroll at any time with 30 days notice, returning to traditional Medicare and Medicaid coverage in their state.