Three Funders Pool Efforts to Allow Older Americans to Age in Place
By Wendy Paris
November 1, 2022
One indisputable takeaway from COVID: A nursing home is not a great place to be during a pandemic.
The death rate in nursing homes during the pandemic was horrifying, and the loneliness and isolation due to visitor restrictions created ripple effects of misery throughout family systems. Even now, more than half of nursing home residents remain behind on boosters, and as a report by the AARP Public Policy Institute found, “COVID transmission in nursing homes remains significantly elevated.”
Boy, it sure would be nice if there were a way to keep older adults who need nursing-home-level care in their own homes, wouldn’t it? Perhaps with a wraparound team of service providers working together to meet their various needs?
There is such an option, as it turns out, PACE — Program of All-Inclusive Care for the Elderly. This comprehensive, community-based care model is a proven success that has been part of Medicare for a couple decades. The first PACE center, On Lok, started in San Francisco’s Chinese community in 1971 and still operates today.
There are, however, two big problems with PACE. Too few providers; too few enrollees.
Now, a collaborative of funders aims to increase enrollment. The Harry and Jeanette Weinberg Foundation, the John A. Hartford Foundation (JAHF), and West Health have combined forces and funding to ramp up PACE, giving a combined $3.5 million over the past handful of years, as well as individual gifts. This includes $1.5 million in 2022 for what they’re calling “PACE 200K,” a plan to enroll 200,000 more people by 2028. They plan to reach this goal in three ways: by scaling up current operators to serve more people, helping open new centers, and expanding the population served.
“We bring different perspectives, knowledge and experiences. Together, those act as a force multiplier,” said Rani Snyder, vice president, program, at JAHF. “The partnership is an important part. It’s not just about the money.”
Well, it’s also about the money. It’s an expensive proposition to start a new PACE site, and it takes two to three years before it can support itself. This is where philanthropy can, and should, step in. Foundations have the time and resources to look at the big picture, to weather uncertainty, and to make mistakes. As each of these funders told me, they hope that other foundations will see their efforts to amplify PACE and join them.
Stay home; we’ll come to you
Here’s how PACE works: A provider receives a monthly fee to handle all-inclusive care — covering all Medicare and Medicaid supports, prescription drugs and other services required by people unable to manage all their activities of daily living alone. This other assistance might include transportation, a home health aid, a social worker, meals, nutritional counseling, occupational therapy, physical therapy, maybe a ramp to get over the front stoop. PACE basically “follows” enrollees wherever they go, from the doctor to the hospital, from home to the local PACE site.
Each PACE site has a medical clinic, a place for social activities and meals, and occupational and physical therapy. The PACE center is also where the program’s signature team of providers meets. This team is one secret to PACE’s success. Each client is served by a robust team of assorted professionals, and each team cares for about 120 to 150 older adults, meeting daily to discuss their clients and compare notes. This high-touch, communication-rich style means that someone will likely connect with every enrollee, every day. If a nurse, dietician, occupational therapist or perhaps a driver notices a problem, that person can share the news with the team right away.
PACE showed its worth during COVID, reporting death rates a third lower than those in nursing homes. Participants also have fewer visits to emergency rooms and fewer hospitalizations than people not enrolled in PACE. Quite apart from pandemic risks, surveys find that Americans overwhelmingly say they want to stay in their homes as they age.
It’s a unique interdisciplinary model, not just another healthcare provider or health plan. “That’s why it’s so successful,” said Peter Fitzgerald, executive vice president for policy and strategy at the National PACE Association. “It’s the program I want my parents in. It’s the program I want to be in.”
Still, PACE’s uniqueness may have inhibited its growth. “I think it’s why we haven’t always seen state and federal policymakers give it the attention it could use. They don’t quite know what to do with it,” said Fitzgerald.
So much support, so few enrollees
Of the 10 million to 12 million older adults in the U.S. who need nursing-home-level care, only 62,000 are enrolled in one of the 273 PACE centers operating in 33 states, including California, Texas, Florida and New York. Fifteen of these states have only one PACE program. If you require nursing-home-level care and live far from a center or in one of the other 17 states, including Nevada, Arizona, Maine or Vermont, you’re likely heading to an institution.
About 90% of enrollees are low-income, eligible for both Medicare and Medicaid. This is only 3% of the 2 million low-income older adults who need long-term services and support. But far fewer middle-income adults use PACE. This points to another big issue hobbling expansion: Current policy makes PACE too expensive for most people above the Medicaid cutoff to join. It was designed for everyone who needs long-term care, but it costs roughly $5,000 to $7,000-plus per month to participate if you’re not eligible for Medicaid; the drug plan accounts for about $1,000 of that.
Finally, there are other ineligible people who could benefit, such as younger people with disabilities or early onset Alzheimer’s.
About 50 new PACE organizations are slated to come online by 2023. The funding collaborative has identified 187 additional communities that could use a new PACE organization or an expanded one. They are combining strengths to create what they hope will be a synergistic superpower, enabling this third round of funding to make PACE more of a household name.
Philanthropy paves the way for expansion
The John A. Hartford Foundation has a long-standing interest in and knowledge about scaling and spreading best practices — and a long commitment to PACE. Between 1983 and 2008, this aging-focused foundation supported On Lok and the National PACE Association (NPA) with $4.7 million across several grants to demonstrate the model’s effectiveness and support its replication at other sites. JAHF also gave a grant in 2007 to help support 14 rural PACE providers, allowing them to receive federal funds. For this round of funding, JAHF is deploying its expertise in the scaling and spread of care models to grow existing sites and bring new programs to life.
The Weinberg Foundation mostly does place-based funding focused on addressing poverty, including of older adults, in Baltimore, Chicago, New York City, San Francisco, northeastern Pennsylvania, Hawaiʻi and Israel. It has distributed more than $2.7 billion in grants since 1990. Among other actions, HJWF builds housing and makes capital grants. Since 2017, HJWF has provided money to build 20 PACE centers across the country and to fund the gap between opening the program and generating enough revenue from clients to pay for it. For PACE 200K, HJWF will continue with its capital investment role, such as by providing funding to enable nonprofits to build second sites without having to wait for the first to be profitable. “By us funding it, they’ll start a second building sooner, which will increase access,” said Earl Millett, managing director of HJWF.
West Health, a relatively new player in the health and aging landscape, focuses on studying, developing and advancing affordable, accessible healthcare for older adults that enables people to successfully age in place.
In 2019, West Health funded the creation of a new site in a former Department of Motor Vehicles building in San Diego, now called the Gary & Mary West PACE Center. The goal was to serve the local community and offer a chance for the foundation and funding collaborative to experience first-hand the challenges of starting a new site. “We had to chase the ghosts of inefficiency out of there,” said Jon Zifferblatt, chief strategy officer and executive vice president of West Health. It opened “right in the teeth of the pandemic,” said Zifferblatt, but now it’s up and running well, if often noisily. “It seems half the time I go there, there’s a mariachi band playing. Maybe we should put them on the interdisciplinary team.”
With this round of joint funding, West Health is interested in driving innovation and developing data and creating conversation to push past policy blocks that make PACE unaffordable to middle-income clients. Also, while PACE was cutting-edge when it was created, “you need to keep investing to remain at this efficient frontier of delivering quality healthcare and value,” said Zifferblatt. “We’ve continued to invest to advance the state of the art.”
Learning by doing
Another driver for West Health’s continued funding is that PACE is a sustainable model, a program that pretty quickly can pay for itself. The San Diego site, for example, is already “cash positive,” said Zifferblatt. “Plenty of investments won’t do that. Some will always require philanthropic support. Having a mix like this allows us to do more with the funds we have.”
Zifferblatt said West Health has invested in PACE in part because of the chance to be in the same milieu as other funders and organizations that share its concerns. “It really has been an opportunity to learn at one of the premier models of integrating care for older adults. The learning has been tremendous. Any investment, whether to sustain, scale or initiate, is also an investment to learn.”