PACE Program: A Powerful Tool for Staying Home; But the Rules Are Changing Fast

If you or a loved one wants to stay home and get the care you need as you age, the PACE program, the Program of All-Inclusive Care for the Elderly, has long been one of the best tools available. It provides comprehensive medical care, personal care, and social services, all coordinated through a local PACE center, while allowing participants to continue living in their own homes.

For years, PACE was also more accessible than nursing home Medicaid in one important way: it did not impose the same strict financial penalties and look-back rules. That is changing, and changing quickly. If PACE is on your radar , or a family member's, now is the time to get guidance.

The 5-Year Look-Back Applies to PACE

Historically, the 5-year look-back period applied to people applying for MassHealth to pay for long-term care in a nursing home. The look-back means that MassHealth reviews five years' worth of your financial records to determine whether any assets were gifted, transferred, or sold for less than fair market value. If impermissible transfers are found, MassHealth will impose a penalty period, a period of time during which you are not eligible for benefits, even if you otherwise qualify.

PACE applicants were largely exempt from this scrutiny. Unfortunatley, this is over. MassHealth has been implementing a 5-year look-back and transfer penalty rules for new PACE applicants. This is a significant shift that catches many families completely off guard, especially if they made gifts to children or grandchildren in recent years.

Spousal Assets Are Now Being Counted for PACE

Another major change: MassHealth is applying the same spousal asset rules to PACE that have long applied to nursing home Medicaid. Previously, the assets of a community spouse, the husband or wife living at home, were not counted when determining a PACE applicant's eligibility. This has changed.

Under the new rules, MassHealth will look at both spouses' assets when evaluating a PACE application. This can dramatically affect eligibility for couples who have saved carefully over a lifetime. Existing PACE members are not immediately subject to these new spousal rules during routine eligibility reviews. But for new applicants, the landscape looks very different from what it did even a year ago.

Why PACE Is Still Worth Exploring

Despite these changes, PACE remains one of the most valuable programs available for seniors who want to stay in their own homes. It provides services that Medicare simply does not cover, personal care aides, transportation, adult day health services, and a fully coordinated medical team. For the right person, it can be life-changing.

The key is planning ahead. The same Medicaid planning strategies that have helped families protect assets for nursing home eligibility, including certain types of trusts, permitted transfers, and spend-down planning, can also be applied to PACE planning now that the look-back rules are aligned.

Don't Navigate This Alone

If PACE is something you are considering, please don't wait. The rules have shifted substantially, and what worked for a neighbor or friend a few years ago may not apply today. An elder law attorney can review your financial picture, identify potential issues before you apply, and help you take advantage of every legal planning tool available.

At Senior Solutions, we have been helping Greater Boston families navigate MassHealth for over 25 years. We know these programs well, and we will make sure you understand your options.

Senior Solutions, Attorneys at Law, is an Estate Planning and Elder Law firm serving the Greater Boston, Massachusetts area since 2001. We are ready to help you with Medicaid Planning, Estate Planning, Probate, Guardianship & Conservatorships, Special Needs Trusts, and Fiduciary Services. We are here to help. Please call our office at 617-489-5900 or schedule a brief consultation (offered to new clients) by clicking the button below:

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