PACE Program vs. Home Care
Eligibility, costs, and which one fits. A complete guide to what PACE covers, who qualifies, how costs work, and when a home care agency is the better fit.
Published May 28, 2026 · 8 min read · By Cal Nesvig, AveeCare
Key Takeaways
Interactive Tool
PACE Eligibility Quick-Check
Answer 4 questions. Get an eligibility estimate.
1Is the person age 55 or older?
2Has a doctor said they need nursing-home-level care?
3Do they have Medicare, Medicaid, or both?
4Do they want to keep living at home (not in a facility)?
What is the PACE program?
PACE is a Medicare-and-Medicaid-funded managed-care program that replaces all other Medicare and Medicaid benefits, delivering care through a single interdisciplinary team.
PACE defined
PACE (Program of All-Inclusive Care for the Elderly) was authorized as a permanent Medicare and Medicaid benefit in 42 U.S.C. § 1894. Federal regulations governing PACE operations are codified at 42 CFR Part 460.
AveeCare operates licensed home care agencies across all 50 states, including the roughly 20 states where PACE program availability is limited or absent.
Who qualifies for PACE?
PACE requires four criteria: age 55 or older, nursing-home-eligible care needs, residence in a PACE service area, and safe ability to live in the community.
Age 55 or older
PACE is restricted to adults age 55 and above by federal statute.
Nursing-home-eligible
State Medicaid must certify the person needs nursing-facility-level care.
Lives in a PACE service area
A PACE program must operate in the county or service region where the person lives.
Safe to live in the community
The IDT must determine the person can be safely cared for outside a facility.
Nursing-home-eligible does not mean moving to a facility
The designation means care needs meet the threshold a state uses to authorize nursing facility placement. PACE's entire purpose is to meet those needs at home instead.
IDT (Interdisciplinary Team) defined
An IDT is the group of physicians, nurses, social workers, physical therapists, and other specialists who design and coordinate every PACE enrollee's individualized care plan -- as required by 42 CFR Part 460.
For clients who are under 55, outside a PACE service area, or above the Medicaid income threshold, AveeCare's home care platform supports private pay, long-term care insurance, and Medicare billing.
What services does PACE include?
PACE is required by federal regulation to provide all medically necessary care, including primary care, adult day services, transportation, prescriptions, and in-home personal care.
Primary and specialty medical care
All physician visits, specialist referrals, and hospital care coordinated through PACE.
Adult day health center
Daily or weekly structured programming at a PACE-operated day center.
Transportation
Door-to-door transport to and from the PACE adult day center and medical appointments.
Prescription drugs
All medications prescribed by the PACE IDT, covered at no cost to dual-eligible enrollees.
In-home personal care
Home health aide and homemaker services provided in the enrollee's residence.
PT, OT, mental health, dental, vision
Full therapy and ancillary services required by the enrollee's care plan.
No benefit cap under federal law
42 CFR Part 460 requires PACE organizations to provide all medically necessary services with no benefit cap and no prior authorization requirement for enrolled members.
How is PACE different from a home care agency?
PACE is a closed managed-care program that replaces all Medicare and Medicaid benefits; a home care agency delivers specific services billed separately to each payer.
| Dimension | PACE | Home Care Agency | HCBS Medicaid Waiver |
|---|---|---|---|
| Eligibility age | 55 and older | Any age | Varies by state waiver |
| Payer model | Capitated: one monthly payment covers all care | Fee-for-service per visit billed to payer | State waiver pays per authorized unit |
| Service scope | All medical and supportive care bundled | Specific services per care plan | Personal care and IADL support only |
| Care setting | Day center plus home | Home only | Home and community |
| Enrollment | PACE organization via IDT assessment | Agency intake, physician order | Medicaid waiver application via case manager |
| Who coordinates care | PACE IDT (all disciplines in one team) | Agency care coordinator + separate physicians | Medicaid case manager plus agency |
For discharge planners and agency operators
Refer to PACE when the client is dual-eligible, age 55+, and inside a PACE service area. When any condition is missing, a home care agency is the next step. See the HCBS case manager and service authorization guide for waiver referral workflows.
AveeCare is a licensed home care agency platform and the right tool when a client does not qualify for or cannot access a PACE program. See also: HCBS Medicaid waiver programs for clients who qualify for waiver-funded home care without PACE, and Medicaid home care services overview for the full payer-side picture.
How much does PACE cost?
PACE cost depends on payer status: dual-eligible enrollees pay nothing, Medicare-only enrollees pay a monthly premium, and Medicaid-only enrollees may owe small copays.
| Payer situation | Monthly premium | Drug costs | Out-of-pocket |
|---|---|---|---|
| Dual-eligible (Medicare + Medicaid) | $0 | $0 | $0 |
| Medicare only (no Medicaid) | Up to local Medicare Advantage benchmark (typically $600-$1,600/mo per CMS) | Covered by PACE premium | Premium only |
| Medicaid only (no Medicare) | $0 premium | Covered by Medicaid capitated rate | Small copays may apply for some services |
PACE costs less than a nursing facility for Medicaid
KFF 2023 LTSS spending data shows the average annual Medicaid cost per PACE enrollee is lower than Medicaid nursing facility cost in most states where both options are available.
Capitated rate defined
A capitated rate is a fixed monthly payment per enrollee paid jointly by Medicare and Medicaid to the PACE organization, covering all services regardless of actual usage. Enrollees receive no surprise bills.
Managing home care clients who don't qualify for PACE?
AveeCare supports Medicaid waiver billing, private pay, and native EVV in all 50 states at $6 per active client per month.
See AveeCare pricingWhere is PACE available?
As of 2025, PACE operates in approximately 31 states through roughly 175 programs, meaning about 20 states have limited or no PACE coverage.
PACE is not available in every state
Before recommending PACE, confirm a program exists in the client's county. Use the NPA PACE Finder at npaonline.org to search by ZIP code or state.
States with active PACE programs (as of 2025)
AveeCare serves home care agencies in all 50 states, including the states where PACE program gaps leave families without a managed-care alternative. Use the NPA PACE Finder at npaonline.org to check availability before referral.
Is PACE a good fit for someone with dementia?
PACE is well-suited for dementia because it bundles adult day programming, caregiver respite, medication management, and behavioral health, all coordinated by a single interdisciplinary team.
Dementia is among the most common diagnoses in the PACE-eligible population. The adult day center model provides structured cognitive stimulation and supervision that reduces behavioral symptoms and caregiver burden in ways a purely home-based model cannot replicate.
Clinical evidence: PACE and cognitive decline
A 2022 NIH-funded scoping review found PACE enrollees showed improvement in ADL scores and lower hospitalization rates compared to non-PACE Medicaid beneficiaries with similar diagnoses. Arku et al., PMC8938794.
For dementia clients in areas without PACE, AveeCare supports dementia-specific care plan templates, eMAR, and caregiver documentation. See the dementia care at home guide for clinical documentation guidance.
How do you apply for PACE?
To enroll in PACE, locate a local program via npaonline.org, complete an IDT eligibility assessment, confirm payer enrollment, and sign the enrollment agreement.
Find your local PACE program
Use the NPA PACE Finder at npaonline.org to search by ZIP code. Confirm the program serves your county, since PACE service areas are geographically defined and not interchangeable.
Contact the PACE organization
Call or visit the PACE organization to request an intake meeting. Bring the prospective enrollee's Medicare and Medicaid ID numbers and a current physician summary.
Complete the IDT eligibility assessment
The PACE interdisciplinary team evaluates care needs, payer status, and whether the person can be safely managed outside a nursing facility. This typically takes one to two visits. A qualified geriatric care manager can help prepare for this assessment -- see our guide on what is a geriatric care manager.
Confirm payer enrollment
Active Medicare Part A and Part B enrollment (or Medicaid enrollment) must be confirmed within the PACE service area. A PACE enrollment coordinator will assist with verification.
Sign the PACE enrollment agreement
Enrollment paperwork designates the PACE organization as the exclusive manager of all Medicare and Medicaid benefits. Any existing Medicare Advantage or Medicaid managed care plans are disenrolled at this step.
Receive your disenrollment rights notice
Federal law under 42 CFR Part 460 requires PACE to provide written notice that the enrollee may leave the program at any time with 30 days written notice and return to standard fee-for-service coverage.
Disenrollment is always an option
PACE enrollees can leave the program at any time with 30 days written notice and immediately return to standard Medicare and Medicaid fee-for-service coverage with no penalty. This right is guaranteed under 42 CFR Part 460.
If an IDT assessment finds a client does not qualify for PACE, AveeCare supports fast intake from referral transitions including EVV setup, care plan, and payer onboarding. See also: what is a geriatric care manager for IDT assessment preparation guidance.
Frequently asked questions
Common questions about the PACE program, costs, and comparison with home care.
Sources
- 1.CMS PACE Overview (medicaid.gov)
- 2.PACE (medicare.gov)
- 3.National PACE Association: What is PACE / PACE by the Numbers
- 4.NPA PACE Finder
- 5.Arku et al. 2022, PACE versus Other Programs (PMC8938794)
- 6.42 CFR Part 460, Federal PACE Regulations
- 7.42 U.S.C. Section 1894, Statutory Authority for PACE
- 8.KFF, Medicaid Home and Community-Based Services Enrollment and Spending 2023
About the Author
Cal Nesvig is a Founding Partner at AveeCare, a home care software platform serving agencies across all 50 states. Cal writes on Medicaid policy, home care operations, and long-term care program comparisons.
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Across every payer type and all 50 states. Medicaid waiver billing, private pay, native EVV -- starting at $6 per active client per month.