Key takeaways:
The Program of All-Inclusive Care for the Elderly (PACE) replaces conventional Medicare and Medicaid plans with a bundle of services that allow people who need nursing-home-level care to remain in their residences.
Participants receive comprehensive medical care plus prescription medications, help at home, and day center services. And most don’t pay anything for the program.
Currently, 33 states and the District of Columbia have PACE programs. Participants must live in a PACE service area.
The Program of All-Inclusive Care for the Elderly (PACE) is an innovative service that allows frail, older adults with complex medical needs to live in their communities and “age in place” for as long as possible. PACE programs help delay or prevent enrollees from moving to long-term care facilities, though about 5% of PACE participants live in nursing homes.
PACE programs typically offer coverage for comprehensive healthcare and in-home support without charging monthly premiums or leaving participants with out-of-pocket costs. The average PACE participant is in their mid-to-late 70s and has multiple, chronic medical conditions. About 90% of PACE participants are dually eligible for Medicare and Medicaid, while almost half have been diagnosed with dementia.
What is PACE?
PACE is short for the Program of All-Inclusive Care for the Elderly. It’s called LIFE, or Living Independence for the Elderly, in a few parts of the country, such as Pennsylvania.
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The program typically provides coverage for people who qualify for (and may be enrolled in) both Medicare and Medicaid and need nursing home care, but want to stay in their homes. PACE offers not only medical care but also an array of other services.
Once enrolled, PACE becomes your only healthcare plan. It provides care for everything Medicare and/or Medicaid covers, plus lots of extra benefits. PACE benefits typically include:
Adult day care
Emergency services
Hospital care
In-home care
Laboratory/X-ray services
Meals
Medical specialist visits
Nursing home care
Nutritional counseling
Prescription medications
Preventive care
Primary care
Recreational therapy
Social services
Social work counseling
Transportation
If you have PACE and you make a long-term or permanent transition to a nursing home, you may have to pay for some of the costs, depending on your income.
Another alternative for people who are dually eligible for Medicare and Medicaid is a Medicare Advantage special needs plan.
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How does PACE work?
The model for PACE goes back to 1971 when a dentist and a social worker in San Francisco founded On Lok Senior Health Services to help their clients in Chinatown-North Beach age in place. “On lok” means “peaceful, happy abode” in Cantonese.
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The comprehensive care provided by PACE mirrors the care provided by quality nursing homes. Once enrolled, you typically spend 1 to 5 days a week at a PACE day center where you can:
Eat with peers
See your primary care providers
Participate in physical therapy, occupational therapy, and psychotherapy
Play games
Do crafts
At the day center, you can take care of your healthcare needs while enjoying recreation and social opportunities that make life pleasant. Not only does this time away from home reduce isolation, but it also gives family caregivers a break.
On days when you don’t go to the center, a home health aide can come by to help you with bathing, dressing, and other types of personal care. You may also receive meal deliveries to your home. As part of the program, you may qualify for help with home modifications that improve your safety, such as grab bars or ramps.
PACE provides you with transportation to the day center as well as to appointments for services such as podiatry and dental care. Depending on the healthcare professional, you may receive care in a medical office, at the day center, or at home.
For more than 90% of PACE participants, the program allows them to remain in their communities for up to 4 years with a good quality of life.
Is PACE a Medicare or Medicaid program?
In many cases, PACE is paid for by both Medicare and Medicaid. As mentioned earlier, about 90% of people enrolled in PACE are eligible for both Medicare and Medicaid. Though, there are some who are only enrolled in Medicaid or self-pay for services.
Who is eligible for PACE?
To qualify for PACE, you must meet the following requirements:
Age 55 or older
Live in the service area of a PACE program
Eligible for nursing home care (as determined by your state)
Able to live safely at home with help from PACE
For many people, having no PACE program in their area is the biggest barrier to enrolling. It’s also important to note that a nearby PACE program may have a waitlist for enrollment.
PACE participants can leave the program at any time.
How much does PACE cost?
PACE provides carefully managed care to enrollees. So state Medicaid programs typically save money when enrollees, who most often have lower incomes, are PACE participants.
There are two main ways that PACE controls costs:
Participants only see PACE-contracted doctors and other healthcare professionals.
Participants receive prescribed medications through PACE. You can’t have a separate Part D prescription medication plan.
Unless you are one of the few PACE participants who self-pays for the program, your Medicaid and/or Medicare plan covers your care. This means you aren’t responsible for any deductibles or copays or coinsurance.
How many PACE programs are there in the U.S.?
At publication, there were more than 160 PACE programs operating in 33 states and the District of Columbia. PACE serves more than 75,000 people nationwide, according to the National PACE Association (NPA).
In addition to the NPA PACE locator tool, Medicare offers a more up-to-date PACE plan finder with state-by-state listings that indicate whether the programs are for people with Medicare only or those who have Medicare and Medicaid.
The 17 states that do not have PACE programs at the time of publication are:
Alaska
Arizona
Connecticut
Georgia
Hawaii
Idaho
Maine
Minnesota
Mississippi
Montana
Nevada
New Hampshire
South Dakota
Utah
Vermont
West Virginia
Wyoming
There are no PACE programs in Guam, Puerto Rico, or any other U.S. territories.
Benefits and disadvantages of PACE
The biggest benefit of PACE is having a personalized care plan that enables the vast majority of enrollees to live in their own homes.
Multiple studies have confirmed that PACE is not only cost-effective, but is also associated with:
Lower hospitalization rates
Shorter hospital stays
Reduced caregiver burden
Higher quality of life
PACE also embraces technology. Enrollees have access to telehealth and a service called GrandPad, which lets them connect remotely to family members and PACE caregivers.
But PACE isn’t the ideal program for everybody. There are downsides, including:
You must receive care from the healthcare professionals and caregivers selected by your PACE program.
The program is geographically limited. If you don’t live in an area served by PACE, you won’t qualify.
If you don’t qualify for Medicaid and you transition to a nursing home long term, you could be charged monthly premiums to cover the Medicaid long-term care benefit. These premiums are $4,000 to $5,000 a month, on average. You will also need to pay the premiums for your Medicare Part D plan.
If you want to use the hospice benefit from Medicare or Medicaid, you have to disenroll from PACE.
If you don’t qualify for Medicaid and have to pay premiums for long-term care, the costs can be significant. Even if you aren’t presently eligible for Medicaid, you may be able to qualify with a Medicaid spend down.
Frequently asked questions
The easiest way to find out if there’s a PACE program in your area is to use Medicare’s PACE plan finder, which lists programs by state. You can also find information such as a program’s website, phone number, and hours. The tool also indicates whether a program is for people with Medicare only or those who have Medicare and Medicaid.
The NPA offers a list of eligibility criteria for PACE. You can also contact a PACE program in your area, your state Medicaid office, or Medicare to find out if you qualify. To reach Medicare, call 1-800-633-4227.
Yes, but if you have Medicare only or intend to self-pay, you will be financially responsible for long-term care premiums.
The easiest way to find out if there’s a PACE program in your area is to use Medicare’s PACE plan finder, which lists programs by state. You can also find information such as a program’s website, phone number, and hours. The tool also indicates whether a program is for people with Medicare only or those who have Medicare and Medicaid.
The NPA offers a list of eligibility criteria for PACE. You can also contact a PACE program in your area, your state Medicaid office, or Medicare to find out if you qualify. To reach Medicare, call 1-800-633-4227.
Yes, but if you have Medicare only or intend to self-pay, you will be financially responsible for long-term care premiums.
The bottom line
At a time when nursing home care is prohibitively expensive for many people, the Program of All-Inclusive Care for the Elderly (PACE) offers an alternative that allows vulnerable people to stay in their homes as they age. PACE does this by offering an array of medical and social services to support the needs of participants. These benefits include primary and specialty healthcare services, as well as transportation, recreation, and nutrition services.
The programs provide cost-effective care that saves individuals and families, as well as states, money. Even if you self-pay because you don’t qualify for Medicaid, PACE is typically more affordable than the normal cost of long-term care. If you enroll, you must use PACE-contracted providers and services.
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References
American Council on Aging. (2024). PACE programs as an alternative to nursing homes for Medicaid beneficiaries.
Cambridge Health Alliance. (2021). CHA PACE enrollment agreement.
Hostetter, M., et al. (2016). Aging gracefully: The PACE approach to caring for frail elders in the community. The Commonwealth Fund.
LifeCircles. (2022). What sets PACE apart.
Medicare.gov. (n.d.). PACE.
Medicaid.gov. (n.d.). Program of All-Inclusive Care for the Elderly.
Medicaid.gov. (n.d.). Program of All-Inclusive Care for the Elderly benefits.
National PACE Association. (n.d.). Eligibility requirements.
National PACE Association. (n.d.). Interactive map of potential PACE-eligible populations.
National PACE Association. (n.d.). PACE history.
National PACE Association. (n.d.). What is PACE care?
Pennsylvania Department of Human Services. (n.d.). LIFE (Living Independence for the Elderly).
Pennsylvania LIFE Provider Alliance. (n.d.). About LIFE.
Williams, C. T., et al. (2023). Program all inclusive care of the elderly (PACE). StatPearls.
