Program of All-Inclusive Care for the Elderly

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Program of All-inclusive Care for the Elderly (PACE) are programs, within the United States, that provides comprehensive health services for individuals age 55 and over who are sufficiently frail to be categorized as "nursing home eligible" by their state's Medicaid program. Services include primary and specialty medical care, nursing, social services, therapies (occupational, physical, speech, recreation, etc.), pharmaceuticals, day health center services, home care, health-related transportation, minor modification to the home to accommodate disabilities, and anything else the program determines is medically necessary to maximize a member's health.

How PACE works

PACE programs are health care providers which directly employ a comprehensive range of health care professionals (physicians, nurses, physical therapists, social workers, etc.) to provide care to frail older adults—they are reimbursed on a fixed per member per month rate (or capitation payment) and, in return for this fixed payment, they are responsible for providing all health services, even extending to transportation.

Because PACE programs enroll only the very frail and incapacitated, they are exactly the patient population for whom prevention and health promotion makes a difference. Most PACE patients have multiple diagnosis, with an average of over 7 diagnoses per member. Among the most common are cardiac problems, diabetes, hypertension, and vascular disease. PACE programs have strong incentives to help keep their members as healthy as possible—their patients, if left without care, are likely to require extensive acute and nursing home care, which are very expensive. So PACE programs tend to provide high levels of preventive services, such as very frequent check ups, exercise programs, dietary monitoring, programs to increase strength and balance, etc.

PACE programs organize their services in a "PACE Center". These Centers tend to have a Day Health Center, physician' offices, nursing, social services and rehabilitation services, along with administrative staff, all in one site. Members attend centers from rarely to 7 days a week, depending on their care plans. Care planning is done with the member, his or her care team, and appropriate family members; most members attend about 2 days per week.


PACE was developed by On Lok Senior Health Services, a not-for-profit organization launched in the early 1970s in the Chinatown-North Beach area of San Francisco. Through research and demonstration funding from the federal Administration on Aging, On Lok opened an adult day health center in 1972, modeled on the British day hospital program. In 1978, they expanded the model to include complete medical care and social support for the frail elderly and received federal waivers in 1979 that allowed reimbursement from Medicare for all outpatient health and health-related services. In 1980 inpatient services were added, including skilled nursing care and acute hospitalization. The Social Security Act amendments in 1983 provided that On Lok be given authority to test a risk-based financing system involving Medicare, Medicaid and private pay. Major grants from the Robert Wood Johnson Foundation, the John A. Hartford Foundation and the Retirement Research Foundation underwrote research and development activities to support this demonstration. Congress extended On Lok's waivers indefinitely (1985) and provided waivers for the replication of the model at 10 sites (1986). This support enabled On Lok to provide technical assistance to help new sites develop and to create a cross-site database to track performance. In 1990 the first replication sites received Medicare and Medicaid waivers as demonstration programs and the model became known as the "Program of All-inclusive Care for the Elderly" or PACE. The Balanced Budget Act of 1997 (P.L. 105-33, Section 4801-4804) established PACE as a permanent part of the Medicare program and an option under state Medicaid programs. Existing PACE demonstration programs became permanent PACE providers by 2003. The Deficit Reduction Act (DRA) of 2005 authorized a Rural PACE initiative and in 2006 the Centers for Medicare and Medicaid Services (CMS) announced 15 rural PACE grantees.

As of January 2015, there are 107 PACE programs operating in 32 states. The largest of these has more than 2,500 frail elderly enrollees, but most serve a few hundred on average.

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