CMS Approves New Program for Frail Elderly

August 14, 2002 - The U.S. Centers for Medicare & Medicaid Services (CMS), in cooperation with the Washington State Department of Social and Health Services, today approved a request by Providence ElderPlace-Seattle in Seattle, Wash., to become the third provider under a permanent program of comprehensive care that allows frail elderly people to live in their communities.

The Program of All-Inclusive Care for the Elderly (PACE) is an optional benefit under Medicare and Medicaid that focuses entirely on older people who are frail enough to meet their state's standards for nursing home care.  The program brings together all the medical and social services needed for someone who otherwise might be in a nursing home.

"PACE programs such as Providence ElderPlace-Seattle offer the care and services that many frail, older Americans need to live in their communities instead of nursing homes," Health and Human Services Secretary Tommy G. Thompson said.  "Under President Bush's New Freedom Initiative, we are working to help all Americans with disabilities live more independently and participate more fully in community life."

"We are pleased to have our third permanent PACE organization and it is our hope that more PACE participants will follow the lead of Providence ElderPlace-Seattle," CMS Administrator Tom Scully said.  "PACE gives frail people covered by Medicare or Medicaid the opportunity to live at home close to their loved ones, while also receiving the care they need.  Providence ElderPlace-Seattle has become a productive, ongoing effort that will now be reimbursed, on a permanent basis, by the two health care programs.  This is a result of the successful relationship forged between state and federal agencies, providers and foundations during the pilot project phase."

Providence ElderPlace-Seattle is operated by the Providence Health System.  The plan joined the PACE demonstration program in June 1998 and now serves about 144 beneficiaries with an average age of 78.  Most beneficiaries in the plan are eligible to receive services under both the Medicare and Medicaid programs.  The conversion to permanent status for Providence ElderPlace will occur Nov. 1.

PACE began as a demonstration project in San Francisco and currently has 25 sites in 15 states.  A regulation published Nov. 24, 1999, implemented legislation establishing PACE as a permanent part of the Medicare program and includes provisions that enable demonstration sites to convert to permanent status.

PACE is available only in states that have chosen to offer the program under Medicaid.  To be eligible for PACE, a person must be 55 or older, live in the service area of a PACE organization and be certified as eligible for nursing home care by an appropriate state agency.  Enrollment is voluntary, but once enrolled PACE becomes the sole source of services for Medicare and Medicaid beneficiaries who choose it.

PACE offers and manages all the medical, social and rehabilitative services enrollees need to preserve or restore their independence, to remain in their homes and communities, and to maintain their quality of life.

A team of doctors, nurses and other health professionals assesses the participant's needs, develops care plans and provides services for total care.  Generally, services are provided in an adult day health center setting, but may also include in-home and other referral services that enrollees may need, such as medical specialists, laboratory and other diagnostic services, and hospital care. If a participant needs to be placed in a nursing home, PACE provides that service and maintains care by regular evaluation and monitoring of the beneficiary's condition.

A PACE organization receives a fixed monthly payment per participant from Medicare and Medicaid.  The amounts are the same during the contract year, regardless of the services a participant may need. Persons enrolled in PACE may also have to pay a monthly premium, depending on their eligibility for Medicare and Medicaid.

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