Analysis: PACE cuts institutionalization among older adults, needs more equitable access

This article was originally published on McKnights Long-Term Care News.

The federal Program of All-Inclusive Care for the Elderly (PACE) has demonstrated effectiveness in improving care coordination and reducing institutionalization among older adults but also requires improvements in equity and justice. That is according to a March policy analysis published in the Journal of Advanced Nursing.

“Through fully capitated financing and interdisciplinary service delivery, PACE enables older adults to remain at home, maintain autonomy, and receive coordinated, high-quality care,” authors said. “However, PACE’s transformative potential remains constrained by geographic inequities, exclusionary eligibility criteria, workforce instability and financing misalignments.”

The analysis, conducted between May and July 2025, used a dual-framework approach to examine PACE structure, implementation and outcomes across four policy levels: efficacy, effectiveness, equity and justice. Data was derived from peer-reviewed research, federal and state policy documents, organizational reports from the National PACE Association and advocacy groups, comparative analyses and international literature.

The analysis characterized the PACE program as promoting continuous nurse–patient interaction across care settings, which helps reduce care fragmentation associated with fee-for-service models. Additionally, participation in the program was linked to fewer hospitalizations and emergency department visits as well as longevity in the community before institutionalization.

Some shortcomings of PACE identified in the analysis include a limited geographic reach, racial and ethnic disparities in enrollment, exclusion of Medicare-only populations and persistent nursing workforce shortages. Authors note that the program serves about 56,000 participants as of 2024, which is less than 0.5% of potentially eligible older adults. They assert that the lack of universal long-term care in the United States contributes to this, where PACE access is contingent on dual eligibility and geographic availability.

Authors also highlight that PACE’s Medicare capitation rates average 20% more per beneficiary than comparable Medicare Advantage plans, suggesting concerns about resource allocation and efficiency. They point out that, by 2022, 78% of PACE enrollees remained in nonprofit PACE programs, which suggests that ownership diversification has not enhanced scalability.