Magical Outcomes: The Case for Launching PACE

This article was originally published on Hospice News.

Programs for All-Inclusive Care of the Elderly (PACE) are extremely challenging to establish. Nevertheless, more hospices are other health care providers are investing in the model due to the positive outcomes participants are seeing.

The Medicare Advantage and health care provider SCAN Group, parent company of SCAN Health Plan, operates the PACE organization myPlace Health. SCAN Group incubated myPlace Health since its inception, initially in partnership with Commonwealth Care Alliance (CCA). Last Spring, SCAN bought out CCA to assume total ownership of the PACE company. The company now operates two PACE programs based in California.

Hospice News caught up with Robert Pottharst, CEO of myPlace Health, to discuss the benefits of the PACE model and what it takes to establish a program.

What does it take to set up a PACE program?

Of all of the complex care, integrated care, value-based care models I’ve ever worked in, this has been by far the toughest.

Securing a PACE contract from a state is difficult or sometimes impossible. It depends on the state, and is often highly competitive with a whole host of different players.

Second is capital intensity. You’re looking at multiple millions, upwards of $10 million, if you want to go bigger, just to launch a single market. And then the actual site development and construction is highly complex. It’s rare to find something that’s truly PACE ready.

If you can get past all of those, you’ve got a next set of challenges. One is growth. It is difficult to find and engage PACE eligibles because of the strict eligibility criteria and a population that, right now, generally, has no reason to trust the system. PACE, typically, is in competition with the insurers, the Medicare Advantage and Medicaid managed care plans, also the providers, usually primary care if they delete their [primary care provider (PCP)] to join you.

Next, you’re up against high regulatory complexity. It’s arguably one of the most regulatory complex models in U.S. health care. Then, there is the operational complexity of running what is like several businesses at once. You’re a health plan; you’re a medical group; you’re an adult day center; you’re a transport agency; you’re a home care agency, and any of the other things you tack on. And all of those have to be working in unison. On top of that, you’re managing the total cost of care risk for a very clinically and socially complex disabled population, which is just super hard.

So, if you get all of that right, that’s just one market, and there’s additional complexity executing this model with consistent success across different markets and geographies. So, that’s what’s hard about this. It’s literally all the things, and it comes down to people, technology, culture and workflow. The hurdles aren’t insurmountable, but in order to be able to do this over and over, over time, it takes some true missionaries who are in this really to change lives, not to just make a buck at the end of the day.

If it’s so difficult, why are people doing it?

Because the outcomes are magical. When this all works together, it is one of the best shining examples of value-based care in all health care. This is the “OG” of value-based care. It was value-based care before there was even a term. So, when it all works together, it is a step towards change in health outcomes, quality and experience for these people who are some of the most vulnerable in our society. The halo effect extends to their families and the communities, too. So, it’s worth it. It is totally worth it.

You said the process for getting a contract with the state is highly competitive. Is there kind of a boom happening in the PACE space right now, or what’s that market like?

There’s growth in existing contracts, but we still don’t have PACE available in every state. I think it’s 34 to 35 states today that offer PACE. But even in those states that have PACE, it doesn’t mean it’s statewide. Take a state like Texas, which should have a massive PACE opportunity. They only have it in El Paso and Lubbock and Amarillo. None of the big cities.

California just passed a two-year moratorium on new PACE applications. So, we’re up against the bottleneck here with the states that ultimately control the pace of growth. One would think that you would want to enroll as many [beneficiaries] in PACE as possible, given the cost benefit to the state, but the complexity of the programs presents a challenge.

What’s unique about the SCAN model when it comes to PACE?

The way we’ve integrated with SCAN Health Plan, their MA plan, is quite unique. PACE is essentially an HMO, [with] any of the capabilities that come with building a specialized HMO around PACE. We have tons of expertise to pull from. We’re able to develop networks around their preferred partners. We’re able to go to market with our community-based organization partners together as well. So, there’s actually quite a lot of synergy if done right.

The second thrust is the clinical model itself. When we launched myPlace Health, we saw an opportunity to modernize the PACE model. It’s been around for 40 years, but we found that some of the more modern and proven advancements in geriatrics aren’t uniformly included in PACE programs nationwide. This includes the way we integrate behavioral health, the way we integrate clinical pharmacy, the way we’ve developed workflow and culture that is truly proactive, value-based care. These are things that we’ve kind of imported from other parts of the industry into our clinical model.

What services do your PACE participants receive? You’ve mentioned a few of them.

We have primary care. So, first off, all of the coverages that you would receive in your MA or Medicaid health plan are covered. So, we have a network of specialists, you name it. Next, we offer physical and occupational therapy, behavioral health on site, a whole host of adult day programming, including the transportation to and from the center and to the clinic, as well as the activities that come with the day center. We have social work and dietitians as a big part of this, not only food delivered in the center, but also at home. So, a ton under the hood, and a bunch contracted with us as well.

Does the PACE program provide any kind of palliative care?

We do, in fact. So, if you think of the discipline of palliative care and the type of services that are provided under a Medicare palliative care benefit, we provide all those services. We serve people all the way through the end of life.

Advance care directives and advanced care planning are a major component of our onboarding and ongoing conversations.

How similar is your end-of-life care to the traditional hospice model? Is it delivered in the home? How different are the two?

In some cases, it can be quite the same. We even contract with and also have our own palliative care trained staff. But it anchors back to what matters most to the participant. What matters most to them is receiving services in the home with their family. We anchor on that. If there are other issues where they want to be more aggressive about treatment in an institutional setting, that’s what we try to do. But it is anchored back to what matters most to them.