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December 2013 Policy Study, Number 13-12


Iowans Want to Age in Place


The Program of All-Inclusive Care for the Elderly (PACE)



With every piece of legislation related to health care that is passed to control costs and expand or restrict services, there are both good and bad results. One of the “good” results is a product of the previously mentioned Balanced Budget Amendment of 1997: the “Program of All-Inclusive Care for the Elderly” (PACE).[58] Similar to managed-care plans that pay capitated rates to providers, PACE is a comprehensive program based on a systems approach to health care delivery that combines funding from both Medicaid and Medicare. PACE established a care model for the permanent organization of service delivery for Medicare and facilitated states’ ability to provide PACE services to eligible Medicaid patients – also referred to as dual eligibles. In order to participate in PACE, eligible individuals who also meet the nursing-home level of care criteria need only be 55 years of age or older.[59] An important feature of PACE is that for most of the patients who participate in it, they are able to remain in their homes and not be admitted to a nursing home because of the comprehensive nature of the services offered.


CMS reported that in 2009 there were 72 PACE programs in operation in 30 states.[60] In Iowa, there are currently only two PACE programs: Siouxland PACE located in Sioux City, Iowa, and Immanuel Pathways located in Council Bluffs, Iowa.[61] One of the stipulations of Medicaid to the states is that participation in PACE must be a covered Medicaid benefit prior to states contracting with PACE providers in their state. For dual eligibles in states with approval for the PACE program, it becomes the only source of covered services for dual eligibles that also choose to participate in the program. Operationally, PACE is structured around an inter-professional care team made up of both licensed professionals and unlicensed para-professional caregivers. The team is responsible for evaluating a patient’s care needs, developing a care plan for services, and ultimately delivering all identified services.[62] Similar to the patient-centered medical home (PCMH) model, covered services include both acute and primary health care services, HCBS, and, when indicated, even care in a nursing home.


Funding for covered services, in a capitated form, aids the promotion of this streamlined system of delivering care to patients. Unique to the PACE programs is that social and medical services are primarily provided in an adult-daycare setting with supplementation of HCBS as required for each patient.[63] CMS requires that PACE care plans include all the covered benefits of Medicare and Medicaid, as well as any other services that the team deems necessary for their patient.[64] Patients in the PACE program who require care after a terminal diagnosis will receive appropriate care within the PACE program’s services, but if they choose to pursue hospice services, then they also must volunteer to end their enrollment in PACE.[65]




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