Perspective: Expanding PACE Opportunities in Our Community

Huron Valley PACE, in Ypsilanti, Michigan, is a young PACE organization – we were established only 4 years ago. However, we’ve been moving quickly since the day we opened our doors. Most readers likely know that PACE is an acronym for Program of All-Inclusive Care for the Elderly, a tremendously innovative program that became federal law back in 1997. Today, we provide comprehensive, high-quality, person- and family-centered care, mostly to dually eligible beneficiaries 55 and older – but as the Executive Director of Huron Valley PACE, I can attest that we have larger ambitions.

Here’s how we plan to grow: In March, we broke ground on a new wing that will allow us to enroll an additional 120 participants next year. Today, we serve 162 participants. Beyond enrolling more dually eligible participants, we are tackling the challenge of identifying policy pathways and implementing changes that will allow us to expand to serve a Medicare-only population. With our country’s age wave steadily gathering momentum, we want to build our capacity to enroll seniors who are not Medicaid eligible – either because they do not require a nursing home level of care or because they are not financially eligible (less than $2,250 in gross monthly income and less than $2,000 in assets).

To do this work, we are partnering with Altarum in a project supported by a grant from the Michigan Health Endowment Fund to find innovative ways to expand availability and affordability of PACE services to more elders and people with disabilities in our local service area. In our work to date, we have identified a major barrier for enrollment of Medicare-only participants – the cost of prescription drug coverage. Here’s the dilemma: dually eligible participants have all of their Part D costs covered, but due to conflicting provisions in the original PACE statute and the 2003 law that established the Part D program, Medicare-only participants are now forced to pay exorbitantly high premiums for their drug coverage — $1099 per month in 2018 in our program. That compares to the average $45.15 for a local Part D Prescription Drug Plan (PDP).

To resolve the conflict – which arises because PACE prohibits payment of co-pays and deductibles, and the Part D law requires that co-pays and deductibles be paid to qualify for discounts during the “doughnut hole” coverage gap as well as for catastrophic coverage – Altarum and Huron Valley PACE crafted a PACE and Part D waiver that we have submitted to the Centers for Medicare and Medicaid Services (CMS). In developing a waiver package, we also worked with the actuarial firm Milliman, Inc., to develop a pricing strategy that would allow Medicare-only participants to pay us a premium that covers buying a market-based plan and also covers out-of-pocket copays, deductibles, and over-the-counter medications. The monthly amount would total about $320. We think this is a creative solution that would allow people to keep their Medicare Part D plan and remain enrolled in PACE. We are excited about having the support of the PACE Association of Michigan (PAM), the National PACE Association (NPA), and Representative Debbie Dingell for this waiver.

In 2011, CMS approved a similar waiver for Medicare-eligible veterans, so that they could receive their drug coverage from the VA’s very affordable, high-quality prescription drug coverage program. As of mid-May 2018, we are awaiting news from CMS about our ability to move forward and begin to offer this innovative, lower-cost prescription drug option.

Another exciting development in Michigan that will make PACE more available to frail older adults is a revision to Michigan’s Nursing Facility Transition (NFT) Program which will include PACE as an option for people moving out of nursing homes and back to the community. Much of the NFT work Michigan has done – and thousands of people have already been helped to move back to the community from a nursing home – has been under the federally enacted and funded Money Follows the Person (MFP) program. While the current version of the MFP program is expiring, federal policy makers and advocates are optimistic that a new version of MFP will be forthcoming. Including PACE as an option for people who want to move from nursing homes back to the community will provide a more complete and choice-based set of options for our elders and people with disabilities.

Finally, for people who would be served well in PACE but have a bit too much income to qualify for Medicaid, Huron Valley PACE and Altarum are working with national and state level experts on Medicaid policy to develop a pathway that would enable the participant and Medicaid to share in the costs. Currently, these individuals eventually have to use a nursing home, almost all of their income is paid to the nursing home, and Medicaid picks up the rest. The cost to Medicaid would be lower in PACE and the elderly person would keep living in his or her home much longer.

PACE has been successful in providing comprehensive, coordinated, customized, high quality social and medical care to some of our most vulnerable citizens. Huron Valley PACE is pleased to be a part of this work with Altarum to explore groundbreaking ways to make PACE more available and affordable for a broader array of people who need such support and care in our community. Once we blaze the trail, many other states and PACE programs can make PACE much more broadly available.

For information concerning PACE at the national level, visit the National PACE Association website