What Is PACE? And Why It Matters for Aging in Place

If you’re a caregiver, senior living operator, or healthcare professional, you’ve likely heard of PACE. But unless you work directly inside the model, it can feel like a confusing acronym floating in the alphabet soup of Medicare and Medicaid programs. Here’s what you need to know — and why it’s one of the most important programs in elder care today.

What Is the PACE Program?

PACE — the Program of All-Inclusive Care for the Elderly — is a Medicare and Medicaid benefit that provides comprehensive healthcare and social services to seniors aged 55 and older who are certified as nursing-home eligible but choose to remain in the community.

PACE organizations receive a monthly capitated payment from Medicare and Medicaid for each enrolled participant. In return, they assume full financial risk and responsibility for all of that participant’s care — medical, social, rehabilitative, and supportive.

The model has been operating since the 1990s and has consistently demonstrated better outcomes at lower cost than institutional care. Today, there are over 170 PACE programs operating in 32 states, serving more than 75,000 participants.

How PACE Works in Practice

Participants typically attend a PACE Day Health Center several days a week for medical care, therapy, meals, and social engagement — while living at home the rest of the time. An interdisciplinary team of physicians, nurses, social workers, therapists, and aides coordinates every aspect of care.

The key mechanic: PACE organizations profit when participants stay healthy and in the community — and absorb losses when hospitalizations, ER visits, or nursing facility stays occur. This is a complete inversion of fee-for-service medicine, where revenue increases with sickness.

Why PACE Is a Model Worth Understanding

For families, PACE means one coordinated team, one plan, and one goal: keep your loved one well and living at home as long as possible.

For operators and healthcare systems, PACE represents a proven capitation model that rewards prevention, coordination, and proactive intervention — not volume.

For technologists and solution providers, PACE creates a clear financial case for any tool that reduces hospitalizations, detects early warning signs, or reduces caregiver burden.

The PACE Capitation Problem — And How FutureCare Solves It

PACE organizations live and die by their ability to detect health changes early. A hospitalization that costs $15,000–$30,000 is already far more than the monthly capitation payment for a single participant. Even one preventable ER visit per participant per year moves the P&L meaningfully.

FutureCare was built precisely for this environment. By deploying passive behavioral monitoring in participants’ homes — no cameras, no wearables — FutureCare detects the subtle changes in daily patterns that precede hospitalizations: changes in sleep, movement, bathroom frequency, and activity level that don’t yet look like an emergency but absolutely signal one coming.

This isn’t reactive care. It’s predictive infrastructure built for a capitated world.

PACE + FutureCare: The Alignment

• Reduced hospitalizations: Early-warning behavioral data gives PACE teams time to intervene before a patient deteriorates to the point of requiring inpatient care.
• Fewer ER visits: Caregiver and clinical team notifications allow same-day interventions instead of 911 calls.
• Longer community tenure: Participants who stay home longer cost less, report better quality of life, and generate more stable capitation revenue.
• Documentation support: Objective behavioral trend data strengthens clinical documentation and supports care plan updates.

What Families Need to Know About PACE

If your loved one is 55 or older, eligible for nursing home level of care, and wants to stay at home — PACE may be available and fully covered by Medicare and Medicaid. Many families don’t know it exists. Many more don’t realize how comprehensive the benefit is.

Finding a PACE program near you is the first step. The National PACE Association maintains a searchable directory at npaonline.org. If a local PACE is enrolled, the entire coordinated care team comes with it — including, increasingly, technology partners like FutureCare.