PACE program vs nursing home: keep a parent at home in 2026

Most families assume the choice is binary: keep mum or dad at home with patchwork help, or admit them to a nursing home. The Program of All-Inclusive Care for the Elderly, known everywhere as PACE, is the third option that almost no one hears about until a hospital discharge planner mentions it on the way out the door. PACE is a fully integrated Medicare and Medicaid program that bundles primary care, specialists, prescriptions, an adult day center, transportation, home care and, when needed, a nursing home bed into one team and one monthly capitated payment. The person enrolling has to be sick enough that the state would certify them for a nursing home today, yet stable enough to keep living at home with PACE support. For the right family, it delays placement by years and costs the household nothing when the participant has Medicaid. This guide explains how PACE actually works in 2026, who it suits, what it costs, where it falls short, and how to find your local program before a crisis forces a faster decision.

What PACE actually is

PACE is a permanent benefit inside Medicare and a state plan option inside Medicaid, jointly administered by the Centers for Medicare and Medicaid Services and the participant's state Medicaid agency. The model started as a community clinic in San Francisco's Chinatown in the 1970s and was written into permanent federal law by the Balanced Budget Act of 1997. The core promise is integration: one interdisciplinary team of at least 11 disciplines, including a primary care physician, a registered nurse, a social worker, a physical therapist, an occupational therapist, a recreational therapist, a dietitian, a home care coordinator, a personal care attendant, a driver and the center manager, plans and delivers every service the participant needs. The team meets to discuss each participant regularly, and the same team follows the person whether they are at home, in the day center, in the hospital or in a short stay at a nursing home. The model is built around an adult day health center where most participants go several days a week for medical visits, therapy, meals, social time and supervised activity, with PACE provided transportation in each direction.

Who qualifies in 2026

Four boxes must be checked. The person must be 55 or older, the federal age floor that has not changed since 1997. They must live inside the geographic service area of a PACE organization, which is defined by zip code and varies by state. They must be assessed and certified by the state as needing a nursing home level of care, which usually means meaningful help with at least two or three activities of daily living, cognitive impairment, or a complex medical condition that requires skilled oversight. And they must be able to live safely in the community at the time of enrollment, with the PACE wrap of services in place. There is no income test to enroll, but the funding source depends on the participant's existing coverage. Dual eligibles, meaning people enrolled in both Medicare and Medicaid, pay nothing out of pocket. Medicare only participants pay a monthly premium that covers the Medicaid portion of the capitated rate, which in 2026 runs roughly $4,500 to $5,500 a month depending on the state and the PACE organization. Private pay, meaning no Medicare and no Medicaid, is technically allowed and is priced at the combined Medicare plus Medicaid capitated rate, which is rarely a sensible purchase compared with long-term care insurance.

What PACE covers, and what it does not

The covered list is unusually broad. Inside PACE: all primary and specialist medical care, all prescription drugs on the PACE formulary with no separate Part D plan, hospital stays, emergency room visits, the adult day health center, social work, recreational and nutritional services, all therapies, durable medical equipment, dental, vision, hearing aids, podiatry, home health and personal care hours, and a nursing home bed when the team decides one is needed. Transportation to and from the day center and to outside specialist appointments is included. End of life and hospice support is delivered by the PACE team rather than handed off to a separate hospice provider. The trade-off is the closed network. Participants must use PACE physicians and the PACE preferred specialist and hospital network, and going outside the network without prior team approval can mean paying the bill personally. Choosing PACE generally means giving up an existing primary care physician unless that physician is already part of the PACE panel, which is the single most common reason families decline enrollment after the intake visit.

How PACE compares with a nursing home placement

Both options serve the same population, people the state has already certified as nursing home eligible, and that is the cleanest way to think about the comparison. A nursing home delivers 24 hour care in one building, takes over the housing and food costs, and concentrates the medical, social and personal care services on site. PACE delivers the same set of services but spreads them across the participant's home, the day center, the hospital and, when needed, a contracted nursing home, with one team coordinating the whole picture. The clinical evidence on the comparison is consistent. PACE participants have lower hospitalisation rates than matched nursing home residents, lower 30 day readmission rates, lower emergency department use, and significantly delayed entry into permanent nursing home placement, with the median PACE participant remaining in the community for several years after enrollment. The National PACE Association publishes the annual outcomes summary, and the underlying methodology is reviewed in independent research from the Commonwealth Fund. The cost picture is also worth understanding. The federal Medicaid PACE rate is set as a percentage of the cost the state would otherwise have paid for that participant in a nursing home, usually in the range of 90 to 95 percent. For the family, the meaningful number is the out of pocket figure, and for a Medicaid enrollee that figure is zero in both PACE and a Medicaid certified nursing home. The deciding question is rarely cost. It is whether the home environment, the caregiver capacity and the participant's preferences favour staying home or moving to a building.

When PACE is the right call

PACE tends to be the better choice in a recognisable pattern. The participant has multiple chronic conditions that need frequent medical attention but is medically stable between events. There is a willing primary caregiver in the home, even part time, who would rather not become a 24 hour aide. The home itself is reasonably safe with minor modifications, such as a grab bar, a stair rail and a working medical alert. The participant has a clear preference to stay in familiar surroundings, has lived in the home for many years, or has a spouse who would be left behind by a placement. The local PACE organization has capacity and a day center within a reasonable transportation distance, usually under 60 minutes by PACE van. Cognitive impairment by itself is not a disqualifier, and PACE programs handle moderate dementia well because the day center provides supervision during the most demanding hours of the day. Severe behavioural symptoms, wandering risk that cannot be managed at home, or a caregiver who has already burned out are the patterns where a memory care or skilled nursing placement is usually the safer call. Our companion guides on memory care versus nursing home, the signs it is time for a nursing home and the 2026 admission playbook walk through the placement side of the same decision.

When a nursing home still wins

PACE is not the right answer for every nursing home eligible senior. Some patterns push the decision toward placement. The participant lives alone and has no caregiver willing or able to be present in the evenings or overnight. The home cannot be made safe at any reasonable cost, for example a fourth floor walk up with no elevator. The participant needs more skilled nursing hours per day than the PACE home care budget can support, which usually shows up as a clinical recommendation for 12 to 24 hour aide coverage. The participant has unstable behavioural symptoms, an active substance use disorder, or a psychiatric condition that the PACE team cannot manage in a community setting. Or the family simply lives at a distance and cannot oversee a home setup. In any of these cases the nursing home is delivering the same package of services PACE would, just inside a building with full time supervision, and the right move is to do the placement well rather than try to bend PACE around a setup it was not designed for. Our 12 red flags families spot in the first 10 minutes of a tour is the tour guide we recommend for that path, and the cost section covers the line items families miss most often.

What the application actually looks like

The application process takes roughly four to eight weeks from first call to first day, and it follows the same shape at almost every PACE organization. Step one is the intake call, which screens for age, address and basic eligibility and books a no cost home visit. Step two is the home visit, where a PACE nurse and a social worker meet the participant and the caregiver, walk the home, and complete an initial health and safety assessment. Step three is the level of care determination, which is filed with the state Medicaid agency or its assessment contractor, and which usually takes two to four weeks. Step four is the enrollment visit at the PACE center, where the participant meets the interdisciplinary team, signs the enrollment agreement, picks a primary care physician from the PACE panel and schedules the first day at the center. Disenrollment, which is the question every family asks at the kitchen table, is voluntary at any time and takes effect the first day of the following month. Original Medicare and any prior Medicare Advantage plan can be re-enrolled in the same window, which is the safety net that makes the decision lower stakes than it first appears. The state PACE program contacts list and the official enrollee bill of rights are maintained by CMS and are worth printing for the home visit.

How to find your local PACE program

There are 187 PACE organizations operating across 33 states and the District of Columbia in 2026, with new sites opening in Florida, Texas, North Carolina and Georgia in the last 18 months. The fastest way to find the one closest to a parent's address is the official PACE finder maintained by Medicare.gov and the participating program list at the National PACE Association. Call the local program directly. The intake line is usually answered the same day, and the home visit can usually be booked within two weeks. Bring a current medication list, a list of current physicians and specialists, the past two hospital discharge summaries if any, and the participant's Medicare and Medicaid cards to the home visit. If the participant is on a Medicare Advantage plan, ask the PACE intake nurse how the transition works in your state, because the Advantage plan must be disenrolled before PACE coverage starts and the timing matters for any prescriptions and appointments already on the calendar. The Eldercare Locator operated by the federal Administration for Community Living can also connect families to the local Area Agency on Aging, which often co-locates PACE intake and Medicaid waiver intake in the same office and is a useful single point of contact when a household is still mapping every option.

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