An investor lawsuit against publicly held Programs of All-Inclusive Care for the Elderly provider InnovAge reverberated through the long-term care industry this week, but industry experts said the lawsuit is not a black eye for the PACE model.
“PACE continues to be among the best integrated care approaches available for older adults with very high needs who are living in the community,” Anne Tumlinson, CEO of long term care advisory firm ATI Advisory, told McKnight’s Home Care Daily Pulse. “With rapid growth in frail older adults living at home, we need much more private and public investment in integrated care delivery models, regardless of tax status and capital structure.”
Shawn Bloom, president and CEO of the National PACE Association, echoed Tumlinson’s assessment in an email to McKnight’s Home Care Daily Pulse. Bloom said PACE programs that focus specifically on the individual needs of Medicare and Medicaid dual eligibles have very successful track records.
“It is the only model of care for older Americans that aligns the clinical incentives with the financial incentives, providing strong incentives to effectively manage the care needs of enrollees,” Bloom said. “Therefore, to the extent the focus is on meeting the quality of life, supportive services and primary needs of each enrollee, emergency room visitors, expensive hospital stays and nursing home placements are avoided.”
Investors who filed suit against Denver-based InnovAge earlier this week claimed the company put rapid enrollment for profit ahead of the healthcare needs of seniors enrolled in its PACE program.
“This approach harmed patients and did so at the expense of investors that believed InnovAge could deliver on its promise of quality care in a model capable of expansion,” plaintiffs’ attorney Julie Goldsmith Reiser, partner at Cohen Milstein Sellers & Toll, said in a statement.
The lawsuit follows actions taken by federal and state regulators just months after InnovAge went public in March of 2021. The Centers for Medicare & Medicaid Services suspended enrollment of new members in InnovAge’s PACE programs in Colorado and Sacramento, California following an audit late last year, claiming the company was not providing enrollees medically necessary services. Colorado Attorney General Phil Weiser also launched a separate investigation into the company.
An InnovAge spokeswoman told McKnight’s Home Care Daily Pulse Thursday the company would not comment on the shareholder lawsuit. However, she did address the CMS audit and enrollment suspensions.
“The health and well-being of our participants is our top priority and we continue to actively work with regulatory agencies to ensure we fully address any audit findings,” Sarah Rasmussen, InnovAge communications director, said in an email.
PACE is a 50-year-old care model that allows Medicare and Medicaid dual eligible seniors, who qualify for skilled nursing, to remain in their homes and communities. PACE programs provide medical care, meals, and socialization at centers, in addition to some in-home services. The program is relatively small, with only about 60,000 seniors enrolled in PACE across 31 states.
Mollie Gurian, vice president of home based and HCBS policy for LeadingAge, told McKnight’s Home Care Daily Pulse PACE has helped many seniors successfully age in place, but efforts to expand enrollment should always be done responsibly.
“The challenge for all of us — providers, policymakers and taxpayers — is ensuring that the success and quality care PACE offers can be replicated on a sufficiently large scale to ensure that older adults and families can access care when and where they need it,” Gurian said.