PACE Providers Shift Services Toward the Home Amid Nation’s Long-Term Care Overhaul
The COVID-19 pandemic has revealed a dire need to rethink how and where Americans age, most long-term care experts agree.
Investing in small-home senior living and “nursing homes without walls” are among the several innovative ideas that have been floated over the past year. Alternatively, some aging services stakeholders have simply called for a sweeping redirection of government funds away from facilities toward in-home care, something President Joe Biden is backing in his newly proposed “American Jobs Plan.”
There’s another way to reimagine long-term care in the U.S. that isn’t being talked about nearly enough, however: Programs of All-Inclusive Care for Elderly (PACE).
“I think we’re now in a situation across the country, as well as in Massachusetts, where PACE is being recognized as a significantly improved opportunity and alternative for health care delivery,” Dr. Rob Schreiber, vice president and medical director of Fallon Health’s Summit ElderCare, told Home Health Care News. “Specifically for those who are nursing home eligible and want to maintain their lives in the community.”
As of March 30, there were at least 138 PACE organizations operating 272 PACE centers in 30 states, serving roughly 55,000 participants combined, according to the National PACE Association.
Dr. Schreiber helps run Summit ElderCare, one of the largest programs of that bunch. Launched in 1995 as a subsidiary of the Worcester, Massachusetts-based health plan Fallon, Summit cares for nearly 1,200 PACE participants across five sites in the Bay State, plus one location in Buffalo, New York.
“PACE has been around for almost 50 years,” Schreiber said. “It’s still here, and it is one of the only validated models of care that has really been shown to improve quality, lower costs, improve quality of life and boost person-centered satisfaction. It checks all the boxes.”
Not every PACE operation is the same, but most work by melding center-based services with comprehensive in-home care. Summit, for example, coordinates services from social workers, nurses, rehab specialities and eight other disciplines.
“The key, the secret sauce to PACE is the interdisciplinary team,” Schreiber explained.
Moving toward the home
In its design, PACE was originally created as a way to keep people living healthy at home and out of long-term care facilities, which in turn cuts costs for the U.S. health care system. To be eligible for PACE, individuals must be 55 or over and in need of nursing home-level care, as certified by a physician.
PACE payers include Medicare and Medicaid as well as Medicare Advantage.
As Schreiber pointed out, the model itself has been around for decades. But it has never received more attention, partly due to the ongoing spotlight placed on nursing homes, which continue to recover after months of deadly COVID-19 outbreaks in 2020 and early 2021.
To avoid having its participants go to skilled nursing facilities (SNFs), Summit actually set up a field SNF, according to Schreiber.
“We knew that there would be people who ended up COVID positive but did not want to go to the hospital or skilled nursing facility,” he said. “Maybe that was not part of their goals, or maybe they did not want to go to a nursing home because they wouldn’t be able to be seen by their families. We needed to have an alternative, so we developed a temporary COVID-19 infirmary at our newest summit site in Worcester.”
In many ways, the ability to turn on a dime and launch an emergency-use SNF reflects one of the PACE model’s biggest strengths: its flexibility. Because PACE organizations house so many different services under one roof, they can promptly pivot when needed, adding to one offering while subtracting from another.
That’s exactly what CHA PACE did to best serve its communities during the public health emergency, its executive director, Jed Geyerhahn, told HHCN.
For starters, the Cambridge, Massachusetts-based CHA — a part of Cambridge Health Alliance, a hospital-based health system — closed its physical center and leaned into its already robust home-based care capabilities.
“We’ve always been more of a home care-based PACE program,” Geyerhahn said. “Most PACE programs are very center-based, bringing most of their participants or a good portion of their participants into the center. But space is such a premium in Cambridge and that metro area, there’s never been a lot of that center space here, so we’ve always provided a lot of home care.”
Established in 1996, CHA PACE serves more than 465 participants. Roughly 40% of its growth has come in the last five years alone.
“We didn’t have to get people used to the idea of providing care in the community, because that’s already what they were doing,” Geyerhahn said. “And likewise, [our staff members] were all equipped with laptops and phones, because they primarily provided care in the community already.”
The future of PACE
In light of the model’s successes in the midst of the pandemic, PACE is positioned to gain participants as more older adults and their family members look to avoid the traditional nursing home.
Overall, participants enrolled in PACE were at one-third the risk of nursing home residents for contracting COVID-19, statistics from the National PACE Association suggest.
But PACE is similarly set up to be an alternative to long-term care in-home care, which can be costly when home health aide or nursing services are needed on a 24/7 basis. That’s particularly true as organizations follow CHA’s playbook by rebalancing the PACE model toward home-based care.
Summit ElderCare kept its center open for a small number of participants who couldn’t go without an intensive level of care, but it too invested more resources into home-based care.
“We knew in March, when the outbreak started, that much of the care was going to have to be done in the home,” Schreiber said. “Overnight — and I would say this happened with almost every PACE organization in the country — we had to go from a site-based model of care to a home-based model of care.”
“Flipping the switch” was made possible with the assistance of technology, he added.
“Telehealth became a model of visits, again literally overnight,” Schreiber said. “Thankfully, many of our providers and teams had iPhones. So we did a lot of FaceTiming. But we were also able to use other types of modalities, in terms of telehealth.”
PACE hasn’t always been supported on a federal level, but that is starting to change. In fact, a recently published budget report from the House Appropriations Committee obtained by HHCN identifies PACE as a major priority.
“The Committee acknowledges the important role of [PACE] in the lives of over 52,000 participants, by allowing these highly medically complex Medicare or Medicaid beneficiaries to live at home, instead of in a nursing facility,” the report states. “The Committee urges CMS to move forward expeditiously on PACE-specific pilots, authorized by the PACE Innovation Act of 2015, specifically testing the innovative, comprehensive, integrated and fully risk-bearing PACE model of care with new Medicare or Medicaid beneficiaries.”
The for-profit model
The PACE model has historically been nonprofit in nature, as federal restrictions on for-profit PACE providers existed until 2015. With those barriers to entry lifted, an increasing number of for-profit operators are starting to pop up.
There are now five total for-profit PACE providers across the U.S., financial filings reveal. The Denver-based InnovAge (Nasdaq: INNV) — the largest PACE organization currently up and running, by a far — leads that group.
InnovAge, which officially went public in early march, has about 1,900 employees. It serves 6,600 seniors in Colorado, New Mexico, California, Pennsylvania and Virginia.
“I think the IPO is notable in a couple ways,” InnovAge CEO Maureen Hewitt previously told HHCN. “One is that it increases capital. And the second piece has to do with awareness. I mean, this program has been around for many years, and now is the time for PACE to really be that household word for the alternative to nursing home care for that for that patient, and I think this is really going to help.”
InnovAge is twice the size of its closest PACE-focused competitor and more than 30 times larger than the typical PACE operator, according to the company.
Similar to its peers, InnovAge strives to improve participants’ health outcomes and lower health care spending by leveraging an expansive network of services. Its interdisciplinary care teams include a primary care provider, a home care coordinator, a personal care attendant, a driver, a dietician and others.
InnovAge’s referral sources are likewise expansive, with participants coming from hospitals, nursing homes and assisted living facilities, in addition to the community at large.
“If you think about what PACE does and what we provide, we’re really a strong alternative to nursing home care,” Hewitt said.
From 2016 to 2020, InnovAge grew its participant numbers from 3,100 to 6,400. During that same time, the company’s revenue increased from $233 million to $567 million.
As Innovage continues to build on that momentum, even more for-profit programs will likely try to set up shop, backed by payers and private equity interests alike.
Nonprofit organizations like Summit are also well-positioned for future growth.
“From  to now, we’ve grown substantially,” Schreiber said. “Our goal is to continue to grow pretty aggressively over the next several years.”