Growth of the Program of All-Inclusive Care for the Elderly and the role of for-profit programs

Abstract

The Program of All-Inclusive Care for the Elderly (PACE) is a managed care program financed by capitated government payments that primarily serves adults aged 55 or older requiring nursing home level of care who are dual-eligible for Medicare and Medicaid. While PACE programs have historically been nonprofit entities, in 2016, a regulation change allowed for-profit PACE programs to help expand the program. We describe PACE program growth from 2010 to 2022. Both the number of PACE programs and enrollees grew from 2010 to 2022. Yet, after allowing for-profits to enter the market, the enrollment rate of growth slowed overall (13.4% vs 7.0%), though for-profit program enrollment grew more rapidly compared to nonprofit programs (13.2% vs 5.7%). Entry of new programs drove for-profit growth primarily. Despite the growth of for-profit programs, most enrollees continued to receive care from nonprofit programs (78%) by 2022. Allowing for-profit programs did not increase PACE enrollment rates overall. Given emerging evidence that for-profit ownership in other health care sectors may reduce quality compared to nonprofits, policymakers should carefully monitor care quality and patient outcomes in PACE as for-profit entities increase.