PACE Program: All-Inclusive Care for Elderly Adults Explained

The Program of All-Inclusive Care for the Elderly (PACE) is one of the most comprehensive care options available to older Americans — yet it remains underutilized largely because few families know it exists. For eligible participants, PACE can cover virtually all health and long-term care needs, including adult day services, at little or no out-of-pocket cost.

What Is PACE?

PACE is a federally-authorized Medicare and Medicaid program that provides all-inclusive, coordinated care to frail older adults who would otherwise qualify for nursing home care. Instead of attending a nursing home, PACE participants receive the full spectrum of care they need in the community — primarily through a PACE center (which functions as an adult day program), supplemented by home care and specialist referrals as needed.

PACE organizations take on full financial and clinical responsibility for their participants. Because they receive a fixed monthly payment (capitation) from Medicare and Medicaid rather than billing fee-for-service, they have a strong incentive to keep participants healthy and out of the hospital.

The model originated in San Francisco's Chinatown in the 1970s as On Lok Senior Health Services, demonstrating that comprehensive community-based care could maintain frail elders in the community and delay or prevent nursing home placement. Congress authorized PACE as a permanent Medicare benefit in 1997. As of 2026, more than 170 PACE organizations operate in 32 states.

How PACE Differs from Standard Adult Day Care

Standard adult day care is one service. PACE is a complete care system that happens to use an adult day center as its hub. Key differences:

All-inclusive: PACE covers everything — adult day services, primary care, specialty physician visits, hospital care, home care, emergency services, prescription medications, dental, vision, hearing, social work, transportation, and more. There are no copays or deductibles for most PACE services.
Interdisciplinary team: An PACE interdisciplinary team — including a primary care physician, nurse, social worker, physical therapist, occupational therapist, dietitian, and home care coordinator — develops and manages a unified care plan for each participant.
No separate billing: Participants do not navigate separate Medicare and Medicaid claims. PACE manages the entire care experience.
24/7 care responsibility: The PACE organization is responsible for the participant's care around the clock, including after-hours and emergency care coordination.

What Services Are Included?

PACE covers a remarkably broad range of services, all coordinated under one program:

Adult day health care services (the core of the program)
Primary and preventive care (on-site physicians and nurse practitioners)
Specialty physician services and hospital care
Prescription medications
Physical, occupational, and speech therapy
Home health care and personal care aides
Emergency medical care
Nursing home care when temporarily needed
Laboratory, radiology, and other diagnostic services
Dental, vision, and hearing services
Transportation to the PACE center and medical appointments
Social work services and caregiver support
Meals (at the center and sometimes at home)

Who Is Eligible for PACE?

To enroll in PACE, a person must meet all of the following criteria:

Age 55 or older
Live in a PACE service area — each PACE organization serves a defined geographic service area, typically one to several counties
Be certified to need nursing home-level of care — as determined by a state assessment (this does not mean the person is in a nursing home, only that they have significant functional limitations that would qualify them for one)
Be able to live safely in the community with the support PACE provides at enrollment

Most PACE participants are dually eligible for both Medicare and Medicaid, in which case Medicaid covers the cost entirely. Participants who have Medicare but not Medicaid pay a monthly premium (set by the PACE organization) for the Medicaid-covered services; those with neither Medicare nor Medicaid may still enroll and pay privately.

Cost: What Participants Pay

For participants who are eligible for both Medicare and Medicaid (dual eligibles):

Dual eligible (Medicare + Medicaid): No monthly premiums, no copays, no deductibles for any PACE services. The program is entirely covered by Medicare and Medicaid payments to the PACE organization.

Medicare only (no Medicaid): Monthly premium for the Medicaid portion of services. The amount varies by PACE organization and state.

Because PACE covers medications, hospital care, home health, and specialty visits in addition to adult day services, the all-in value of PACE significantly exceeds standard adult day care for participants with complex care needs.

Pros and Cons of PACE

Advantages

Comprehensive, coordinated care under one program
No separate billing or insurance navigation
All medications, specialists, and hospital care included
Strong focus on keeping participants out of nursing homes
Dedicated interdisciplinary care team

Limitations

Only available in specific service areas — not everywhere
All care must go through the PACE organization (less freedom to choose providers)
Requires willingness to attend the PACE center regularly
May involve switching from existing physicians

How to Find a PACE Center

The National PACE Association maintains a directory of all PACE programs at npaonline.org. You can also search at medicare.gov/care-compare under the PACE tab, or call 1-800-MEDICARE.

PACE programs are available in major cities and surrounding areas in states including California, New York, Florida, Pennsylvania, and many others. If there is no PACE organization in your area, the combination of Medicaid-covered adult day care and other HCBS waiver services may provide a similar level of support.

For families whose loved one does not qualify for PACE or lives outside a service area, standard adult day care combined with Medicaid HCBS benefits is often the best alternative. See our guide on how to pay for adult day care for a full overview of funding options.