BY: DON KEISTER and SERGEI SHVETZOFF
Mr. Keister is executive director, Providence ElderPlace-Portland, Portland,
OR. Mr. Shvetzoff is a principal, Health Dimensions Group, Minneapolis.
In Portland, OR, a Catholic-sponsored program provides health care and social
services "in place" to frail elderly people, thereby allowing them
to live outside nursing homes.
The program, Providence ElderPlace-Portland (PEP-Portland) is one of two PACE
sites operated by Providence Health System (PHS), Seattle, a Catholic health
ministry. (The other PHS PACE site is Providence ElderPlace-Seattle.)
The acronym PACE stands for "Program of All-inclusive Care for the Elderly.
PACE is a Medicare- and Medicaid-funded model program intended to allow frail
elderly people to remain in communities, instead of moving to nursing homes.
PACE services are provided at "sites." PACE sites are centered on
"adult day health centers," each of which has a clinic, physicians'
offices, physical and occupational therapy facilities, and other services. Working
from the center, an interdisciplinary PACE team provides and coordinates these
services on behalf of the site's members. Should a member require hospital
or long-term care, the team coordinates that as well.
PHS's leaders were attracted to the PACE philosophy of care because of
its emphasis on providing that care to the elderly in their home environments.
Today, there are 30 PACE sites in the United States. But in the late 1980s,
when PHS began planning PEP-Portland, On Lok SeniorHealth in San Francisco was
the only established PACE site in the nation.* Nevertheless, the Sisters of
Providence, PHS's sponsors, were willing to accept the risks involved in
launching a new program. Today, PEP-Portland offers a completely integrated,
community-based, long-term care program that is deeply valued by participants
and their families and reflects Catholic health care values.
* On Lok SeniorHealth was founded in the 1970s to provide
care for elderly residents of San Francisco's Chinatown. It has since become
the prototype for PACE-type programs throughout the nation.
A PACE for Portland
PEP-Portland began life as an adult day care program. Then, in the late 1980s,
PHS's leaders applied to what was then the Health Care Financing Administration†
to make the program a PACE demonstration site. Approval for this was obtained,
and by 1990 PEP-Portland had become fully capitated and thus responsible for
providing its members with the full range of Medicare and Medicaid services,
including hospital care and long-term care. In 2003, the program received federal
and state approval to move from demonstration-site status to become certified
by Medicare and Medicaid as a permanent provider.
† Now the Centers for Medicare & Medicaid Services.
PEP-Portland's designated service area covers all of Multnomah County.
It currently serves some 600 frail senior citizens at four adult day health
centers: Cully, Glendoveer, Laurelhurst, and Gresham (see Box).
Because PACE programs serve people who are eligible for nursing home care, their
overall demographic profile is similar to that for nursing home patients. PEP-Portland's
participants are 81 years old on average; 76 percent are female; they average
4.2 limitations on activities of daily living.
Two of PEP-Portland's locations — Glendoveer and Gresham — have
associated licensed housing programs, "residential care facilities"
or RCFs. Housing is increasingly integral to PEP-Portland's operations.
PEP-Portland provides care for about the same number of people as would five
120-bed nursing homes. "PACE offers superior care for the frail elderly
because of the coordination and integration of care," says Melinda Lee,
MD, PEP-Portland's medical director. "With its team approach, PACE
can come up with creative solutions to problems that might otherwise be unsolvable
due to bureaucracy."
Rose's Story
How does PEP-Portland work? Perhaps the best way to begin to explain is by telling
the story of a member.
This person, an elderly woman we will call Rose, entered PEP-Portland about
two years ago. She was then confused and depressed. Rose had spent her working
life as a maid and a waitress, besides raising a family. Following the death
of her husband, she had been living alone in a small Oregon town. Then, after
a period of decline, during which she fell and broke her shoulder, she moved
to the Portland area to be near her daughter.
When Rose joined the PACE program, she was living in a non-PACE residential
care facility. After extensive discussions with her family, a PEP-Portland PACE
team developed a plan to allow her to live more safely in an apartment in an
RCF. The team's occupational therapists conducted a home safety screen
to remove fall risks from the apartment. Physical therapists helped Rose build
up her strength during twice-weekly visits to the center. The team developed
a preventive care plan that would meet all of Rose's needs, as well as
a medication review.
Rose lived safely in her apartment for the next year and a half, until she
fell again, fracturing a hip. At that time, her PACE team suggested that she
might do better in an adult foster home, with closer supervision. (In Oregon,
an adult foster home is a home-like licensed care location that can provide
care for no more than five elderly people; an RCF can provide care for more
than five.) Although Rose was in a nice RCF, she seemed a bit overwhelmed by
its large size. But the team bowed to family desires to keep her in residential
care, though it did put additional safety measures in place.
Rose was hospitalized with another hip fracture five months later. Following
discharge and a short nursing home stay, she was, with both her agreement and
that of her family, placed in an adult foster home.
Now, with the closer supervision of a caregiver who has only five residents
in this adult foster home, Rose is flourishing once again. The transition to
her new home was initially confusing to her, but the confusion quickly cleared,
thanks to the coordination provided by her PACE team. The team ensures that
Rose receives nutritious meals and is well cared for physically. She receives
medical care and recreational activities at the adult day health center. Her
goal, Rose says, is "to stay as good as I am now." Hearing this pleases
her family and the entire PACE team.
PACE Is Popular in Oregon
Oregonians like to have choices, which is also a core PACE value. Oregon pioneered
the movement toward home-and-community-based care for the frail elderly by becoming
the first state to receive a home-and-community-based Medicare waiver. Under
the waiver, the state received federal funding for projects aimed at improving
the quality of and access to health care for the elderly. Oregon tries to serve
as many frail elderly as possible in community settings, and, unlike other states,
places no limits on the number of eligible elderly involved.
Oregon's waiver program serves the eligible frail elderly by providing
them with in-home nursing, personal care and housekeeping services, adult day
services, and assisted-living services. The availability of waiver funding has
encouraged the rapid growth in the state of adult foster care homes and RCFs
as alternatives to nursing homes.
PACE is considered the most comprehensive home-and-community-based program
available to frail seniors. When PEP-Portland began serving nursing home-eligible
senior citizens in 1990, the provision of community-based care was not new.
PEP-Portland found a niche among the plethora of home and community-based options
available to Medicaid beneficiaries needing long-term care services. PEP-Portland
has grown steadily, from a census of 182 in 1993 to its current census of nearly
600.
PEP-Portland Is Integral to PHS
Providing community based long-term care services has always been integral to
PHS's mission, vision, and core values. PEP-Portland's initial application
for Medicare funding was developed by Sr. Karin Dufault, SP, who was then in
charge of the system's geriatrics and oncology programs (she is now PHS's
vice president for mission leadership). "I saw the development of a PACE
program as the opportunity for our system to create a shared goal for our interdisciplinary
care teams to focus on creating a supportive environment at home for the frail
elderly rather than continuing to focus on either acute care or nursing home
care," Sr. Karin says.
At Providence Health System, all new programs and program expansions, including
PACE, must have business plans that are, first, based on the system's mission
and core values, and, second, have the promise of sustainability. PEP-Portland's
management team contributes to PHS's overall financial success and has
access to its capital resources for growth and expansion. Once PEP-Portland's
managers could demonstrate that both the Glendoveer site and the proposed Gresham
site supported the system's mission and core values and were viable over
the long run, PHS was willing to provide the capital needed to purchase the
former and to construct the latter.
PHS brings to PEP-Portland (and to PEP-Seattle) an array of resources that
would not typically be available to a PACE program, particularly state-of-the-art
information systems. For example, the system recently installed an electronic
medical record system called Logician, which was then modified to meet the specific
needs of the PACE program. Logician enables team members in various settings
to access a member's medical record at any time of day or night. Few PACE
programs have access to these sophisticated resources.
PEP-Portland Is Financially Viable
PEP-Portland achieved break-even status from operations in 1995 and has maintained
a consistent margin of profitability since then. In 2003, PEP-Portland achieved
a margin of 3.7 percent (average revenue per member was $3,851, as against expenses
of $3,707). PEP-Portland's leaders have found that placing members in the
setting most appropriate for them is the key to cost management.
Expenses per member have remained stable. Labor expenses and housing account
for 65 percent of total expenses; inpatient expenses, including both hospital
inpatient and nursing-home care, generally are 6 or 7 percent. In 2003, housing
represented 40 percent of per-member expenses. Surprisingly, the spending associated
with inpatient care and nursing home care is controlled in well-managed PACE
programs.
Given PEP-Portland's history of financial success, it has developed and
implemented operational and strategic approaches that are unique to its program
and differentiates it from other PACE programs. Most PEP-Portland members live
in supportive housing settings; few are permanently placed in nursing homes.
Supportive housing enables PACE members to continue living in the community.
The room-and-board component of housing is paid by the member, and the various
health and social services are paid for by the PACE program. Nationally, about
a third of all PACE participants live alone, a third live with family or friends,
and a third live in a congregate housing setting.
PEP-Portland is unique among PACE programs in that 95 percent of its members
live in adult foster care settings or RCFs. In addition to PEP-Portland's
two RCFs, the program also contracts with approximately 200 other adult foster
care programs, assisted living programs, and RCFs in Multnomah County; the residents
of these facilities are transported to and from the adult day health centers
in handicapped-accessible PEP-Portland vans.
The majority of PEP-Portland members are referred by housing providers, who
see at first hand the benefit to the frail elderly of allowing them to continue
living in the community. In 2003, 44 percent of those who enrolled as members
in PEP-Portland were referred from such providers.
Relatively few PEP-Portland members require hospitalization. Most fully capitated
PACE programs experience hospital utilization in the range of 2,000-3,000 days
per thousand enrollees per year (as compared to about 4,000 days per thousand
enrollees for all Medicare beneficiaries). In 2003, PEP-Portland had a hospital
utilization rate of about 1,100 days per thousand enrollees in 2003 — the
lowest rate of any PACE program in the nation. Although it is true that western
states have a traditionally lower hospital use rate than those in other parts
of the country, PEP-Portland's low rate also reflects the success of the
PACE model of care. As Lee puts it, "We don't instantly think 'hospital'
because we know we can use skilled nursing facilities to temporarily deliver
a higher level of care."
PEP-Portland has attracted private pay patients. At any given time, about 88
percent of all PACE enrollees are "dual eligibles" — their care
is funded by both Medicare and Medicaid. However, about 25 percent of PEP-Portland's
members pay privately for the Medicaid portion when they enroll in the program.
Over time, about 50 percent of these members become Medicaid-eligible once they
have depleted their private assets.
PEP-Portland recently experienced a crisis when Oregon, facing a severe budget
shortfall, reduced Medicaid eligibility. Given this experience, PEP-Portland
is now seeking to ease the risk of future possible Medicaid reductions by enrolling
more private pay members. Toward this end, it is developing strategies to increase
referrals from assisted-living facilities serving private pay residents.
Strategies for Future Growth
Over the past 15 years, PEP-Portland has become an important care option for
frail elderly in the Portland area. Today, it seeks to bring PACE to new communities
and populations, in part through collaboration with other not-for-profit organizations.
PEP-Portland is, for example, developing a partnership with the Marie Smith
Center, an adult day care that primarily serves North Portland's African-American
community. The Marie Smith Center, sponsored by Volunteers of America-Oregon,
is seeing a declining census. PEP-Portland, on the other hand, has historically
served a population that is 89 percent white and has not been successful in
attempts to attract significant enrollment from the North Portland area. The
leaders of PEP-Portland and the Marie Smith Center recently signed an agreement
under which the former would bring clinic services to the latter.
The prospective partners are now awaiting approval by the Centers for Medicare
& Medicaid Services (CMS). Assuming that those approvals are forthcoming,
PACE services will be offered in the Marie Smith Center late this year. "The
Marie Smith Center already has an established presence serving the African American
community in North Portland," notes Lynn Schemmer-Valleau, director of
senior services, Volunteers of America-Portland. "We welcome the opportunity
to partner with Providence ElderPlace-Portland to bring PACE services to this
community." Oregon has approved the partnership; CMS approval was anticipated
in late 2004.
Bringing PACE to rural communities is the next challenge for advocates of PACE
programs. The leaders of PEP-Portland and those of the Providence Benedictine
Nursing Center in Mount Angel, OR, are currently discussing launching PACE in
that rural community. Such PACE sites are difficult to organize because rural
populations tend to be smaller and more widely dispersed than those in urban
areas. Nevertheless, PEP-Portland's leaders hope that collaboration between
two Catholic-sponsored organizations can help make PACE a reality in rural Oregon.
PEP-Portland's leaders are also working to improve the effectiveness of
its marketing in Portland itself. The program currently has a "capture
rate" of about 25 percent of eligible referrals. For 2004, they set a 27
percent "capture rate" as the goal.
An Example for Others?
As PEP-Portland's experience demonstrates, PACE can be a financially sustainable
program that contributes to — and even enhances — a health care system's
financial performance, while, at the same time, offering a program of care that
fulfills Catholic health care values. Other Catholic systems may want to follow
PHS's example and sponsor their own PACE sites. Or, if sponsorship is not
an option, they might consider collaborating with another organization to develop
a program.
Given PACE's record of success, Catholic-sponsored long-term care organizations
might ask themselves why they have not yet sponsored a PACE program. As Sr.
Karin says, "I am so proud to have been part of creating a program that
has achieved success across multiple sites and states and continues to grow.
PACE is a program that pays rich dividends to the elderly who receive the care,
the team that delivers the care, and the system that sponsors the program. My
message to other health systems is that it can be done."
The Providence ElderPlace Mission
Providence ElderPlace is sponsored by Providence Health System. ElderPlace
provides comprehensive health care and social services to the frail elderly
to assist them in living independently within the community. We strive to serve
compassionately and in responsible stewardship each participant as a unique
individual who deserves respect, dignity, and the right of choice.
PACE Basics
Programs of All-inclusive Care for the Elderly (PACE) serve people with long-term
care needs by providing them with access to the entire continuum of health care
services, including preventive, primary, acute, and long-term care services.
Each PACE site is centered on what is called an "adult day health center."
In the center are a clinic, physicians' offices, physical therapy and occupational
therapy facilities, and other services. Working from the center, an interdisciplinary
team provides and coordinates these services for the site's members. Should
a member require hospital care or long-term care, the team coordinates that
as well.
The PACE model allows for great flexibility for both the member and providers.
Providers receive capitated payments to cover all member needs, including services
not generally paid for by Medicare and Medicaid.
Providence ElderPlace-Portland Locations
At present, PEP-Portland has four locations.
- Cully is an adult day health center with an associated 42-bed housing
program (residential health care facilities). Cully has an enrollment capacity
of 150 members. Currently it has 138 members.
- Gresham, which opened in 2003, is the newest adult day health center.
It has an enrollment capacity of 350 and a current enrollment of 193.
- Glendoveer is an adult day health center with a 102-bed housing program.
It has an enrollment capacity of 102 and a current enrollment of 88.
- Laurelhurst, PEP-Portland's original location, is an adult day
health center with an enrollment capacity of 160 and a current enrollment
of 149.
Copyright © 2004 by the Catholic Health Association of the United States
For reprint permission, contact Betty Crosby or call (314) 253-3477.