Insurance Money Management

Worried Medicare Won’t Cover All Your Costs? PACE Might Help

By  Elizabeth Blessing

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One of the biggest Medicare myths is that the program covers long-term nursing care. But that’s not the case. Medicare only pays for short-term stays in a skilled nursing facility (SNF). If this has you worried, then PACE might offer you hope.

As we discussed in our article, “How the cost of long-term care could derail your retirement dreams,” long-term care in a nursing home is extraordinarily expensive. Since Medicare does not pay for long-term care, people who are faced with living in a nursing home frequently struggle to pay for the cost. Unless you have long-term care insurance (which itself can be expensive and sometimes difficult to obtain), you may end up having to pay for your nursing home services out-of-pocket. 

Some people are forced to use up all their retirement savings and sell their assets to pay for their long-term care. And with the average cost of nursing home care in the U.S. coming in at an astonishing $7,441 per month for a semi-private room, it doesn’t take long for some people to exhaust their retirement savings.

And this is where PACE is a godsend for some people. PACE stands for Program of All-Inclusive Care for the Elderly. It’s a U.S. government program that helps frail seniors age in place in their own homes as opposed to having to go to an expensive nursing home to receive their care. PACE is a Medicaid and Medicare program.

For those who qualify, the benefits of PACE are many:

  • You can continue to live in the comfort and familiarity of your own home and community.
  • Care providers come to your home to provide you with the assistance you need to live safely at home. This might include help with activities of daily living, such as assistance with bathing, toileting, dressing, food preparation and household chores.
  • You’ll have a team of care providers who will coordinate your healthcare services. Your team might include your personal physician, physical therapist, occupational therapist, nutritionist, social worker, home health aide, and driver to take you to and from your medical appointments.
  • You might have access to an adult day care center, where you’ll receive some of your medical care along with an opportunity to socialize with other seniors and participate in a variety of community activities.
  • Depending on your income and resources, you could receive PACE services for free. 

Why is there a need for a program like PACE?

PACE was founded back in the 1970s by a San Francisco public health dentist, Dr. William Gee, and a social worker, Marie-Louise Ansak. They realized the nursing home model of care was costly and often did not meet the psychological and emotional needs of seniors. They found many seniors dreaded the idea of leaving their homes to live in a nursing home. Seniors worried they would become disconnected and forgotten, no longer a part of their families or communities.

Gee and Ansak founded PACE on the idea they could bring the healthcare services that some frail seniors needed right to the homes they lived in, preventing or delaying as long as possible the need for long-term care in a nursing home. The goal was to allow seniors to “age in place,” a model of care that many believe also provides seniors with an overall better health outcome. 

PACE is now available in 31 states. There are a total of 122 regional PACE programs that provide services to seniors living in their districts. 

Who qualifies to receive services from PACE?

You’ll need to be at least 55 years or older and live in a region where PACE services are provided. Before joining, you’ll need to be certified by the state in which you live. Each state has its own certification process. In general, you’ll need to be able to show you need nursing home-level care, but you could live safely in your own home with assistance from PACE.

Where can I find more information about PACE?

For more information, visit Medicare’s PACE website. To find out if there is a PACE program near where you live, visit Medicare’s PACE plan search tool.

Did you find this article useful? We’d love to hear your feedback and comments in the section below!

Disclaimer: The information in this article is not intended to encourage any lifestyle changes without careful consideration and consultation with a qualified professional. This article is for reference purposes only, is generic in nature, is not intended as individual advice and is not financial or legal advice.

2 replies on “Worried Medicare Won’t Cover All Your Costs? PACE Might Help”

Great article, @eblessing. I believe in-home solutions for seniors will increasingly be seen as a compelling alternative to assisted living facilities, especially given growing investment and continued innovation in technology and services focused on this demographic.

Thanks for the comment, Brian! I agree in-home care is a wonderful option for seniors and I’m hopeful more public and private organizations will create services around this model of care. One of my favorite stories regarding the founding of PACE is the name Dr. William Gee and Marie-Louise Ansak initially gave their nonprofit: “On Lok.” This Cantonese phrase means “peaceful, happy abode.” I think we would all like our golden years to be spent in such a place!

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