Title 42 › Chapter 7— SOCIAL SECURITY › Subchapter XIX— GRANTS TO STATES FOR MEDICAL ASSISTANCE PROGRAMS › § 1396u–4
States can choose to let PACE programs provide and be paid to deliver all Medicaid-covered care to enrolled older people. People do not have to be in Medicare Parts A or B to join. Enrollees get their covered care only through the PACE program, and the PACE provider is paid under a written PACE program agreement. Definitions: PACE program — a full-care program that meets the law’s rules; PACE provider — usually a public or private nonprofit (501(c)(3)) that has a PACE agreement (some waiver exceptions apply); PACE program agreement — the contract among the provider, the State, and the federal Secretary; PACE program eligible individual — someone 55 or older who needs the nursing-home level of care set by the State, lives in the program’s service area, and meets other agreed conditions; PACE protocol — the On Lok protocol as of April 14, 1995 (or a successor agreed with On Lok); trial period — the first 3 contract years; regulations — rules the Secretary issues under the law. A PACE provider must give comprehensive, integrated health and social services 24 hours a day. Care must cover all items normally covered under Medicaid (and Medicare when applicable) without limits on amount, duration, or scope and without deductibles, copays, or coinsurance, plus any extra services required by regulation. The program must help people transition to other care if they leave and must keep and share records and reports needed by the State and Secretary. The provider must have written quality assurance and patient-rights safeguards. States generally make prospective monthly capitation payments set in the PACE agreement. That capitation must be less than what the State would otherwise pay for the individuals and must be adjusted for enrollee frailty. Enrollment rules let people leave voluntarily at any time. A program may only disenroll someone for late premium payment (if there is one) or for disruptive or threatening behavior, and it generally may not drop someone for behavior caused by a physical or mental condition. The Secretary and the State will review new programs closely during the first 3 years, with onsite visits, financial and capacity checks, and public reporting of results. The Secretary can require fixes, withhold payments, or terminate agreements for cause. Limits include a cap of 40 PACE providers as of August 5, 1997, increasing by 20 each year thereafter, and up to 10 for-profit programs may operate by special waiver. An application for PACE status is treated as approved unless denied or more information is requested within 90 days (and then a second 90-day period applies).
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The Public Health and Welfare, Source: USLM XML via OLRC
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Citation
42 U.S.C. § 1396u–4
Title 42, The Public Health and Welfare
Last Updated
Apr 5, 2026
Release point: 119-73not60