The Florida Senate
BILL ANALYSIS AND FISCAL IMPACT STATEMENT
(This document is based on the provisions contained in the legislation as of the latest date listed below.)
Prepared By: The Professional Staff of the Committee on Appropriations
BILL: CS/CS/SB 1242
INTRODUCER: Appropriations Committee (Recommended by Appropriations Subcommittee on Health
and Human Services); Health Policy Committee; and Senator Book
SUBJECT: Program of All-Inclusive Care for the Elderly
DATE: April 20, 2021 REVISED:
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. Smith Brown HP Fav/CS
2. McKnight Kidd AHS Recommend: Fav/CS
3. McKnight Sadberry AP Fav/CS
Please see Section IX. for Additional Information:
COMMITTEE SUBSTITUTE - Substantial Changes
I. Summary:
CS/CS/SB 1242 codifies the Program of All-Inclusive Care for the Elderly (PACE) in
section 430.84, Florida Statutes. The bill:
 Establishes a statutory process for the review, approval, and oversight of future and current
PACE organizations.
 Authorizes the Agency for Health Care Administration (AHCA), in consultation with the
Department of Elder Affairs (DOEA), to approve entities that have submitted the required
application and data to the federal Centers for Medicare and Medicaid Services (CMS) as
PACE organizations pursuant to federal regulations.
 Requires all PACE organizations to meet specific quality and performance standards
established by the federal CMS and the AHCA.
 Requires the AHCA to provide oversight and monitoring of Florida’s PACE program and
organizations.
 Exempts all PACE organizations from the requirements of ch. 641, F.S., which regulates
health maintenance organizations, prepaid health clinics, and other health care service
programs.
The bill has no fiscal impact on state revenues or expenditures. See Section V of this analysis.
The bill takes effect on July 1, 2021.
BILL: CS/CS/SB 1242 Page 2
II. Present Situation:
Medicaid
Medicaid is the health care safety net for low-income Floridians. Medicaid is a partnership
between the federal and state governments where the federal government establishes the
structure for the program and pays a share of the cost. Each state operates its own Medicaid
program under a state plan that must be approved by the federal Centers for Medicare and
Medicaid Services (CMS). The plan outlines current Medicaid eligibility standards, policies, and
reimbursement methodologies.
To qualify for nursing home care under Medicaid, both an individual’s income and assets are
reviewed. Additionally, a personal needs allowance is applied as part of the eligibility
determination process.1 The current standard income limit in Florida for institutional care or
services under the home and community based services waiver is $2,382 for an individual and
$4,764 for a couple. There is also an asset limit for either category of $2,000 for an individual or
$3,000 for a couple.2
In Florida, the Medicaid program is administered by the Agency for Health Care Administration
(AHCA). The AHCA, however, delegates certain functions to other state agencies, including the
Department of Children and Families (DCF), the Agency for Persons with Disabilities (APD),
and the Department of Elder Affairs (DOEA). The AHCA has overall responsibility for the
program and qualifies providers, sets payment levels, and pays for services.
The DOEA assesses Medicaid recipients to determine if they require nursing home level of care.
Specifically, the DOEA determines whether an individual requires or is at imminent risk of
nursing home placement as evidenced by the need for medical observation throughout a 24-hour
period and requires:
 Medically complex care to be performed on a daily basis under the direct supervision of a
health professional because of mental or physical incapacitation;
 Care to be performed on a daily basis under the supervision of a health professional because
of mental or physical incapacitation; or
 Limited care to be performed on a daily basis under the supervision of a health professional
because of mild mental or physical incapacitation.3
Floridians who need nursing home care, but do not qualify for Medicaid, must pay from their
own funds or through insurance.
1
The personal needs allowance (PNA) of an individual is defined as that portion of an individual’s income that is protected to
meet the individual’s personal needs while in an institution. See Department of Children and Families (DCF), Glossary
(Chapter 4600) “Personal Needs Allowance,” p. 19, available at
http://www.dcf.state.fl.us/programs/access/docs/esspolicymanual/4600.pdf (last visited Mar. 16, 2021).
2
DCF, SSI-Related Program-Financial Eligibility Standards: Apr. 1, 2021, available at
https://www.myflfamilies.com/service-programs/access/docs/esspolicymanual/a_09.pdf (last visited Mar. 16, 2021).
3
Section 409.985, F.S.
BILL: CS/CS/SB 1242 Page 3
Long-Term Care Managed Care
In 2011, Statewide Medicaid Managed Care (SMMC) was established,4 requiring both Medicaid
Long-Term Care (LTC) services and Managed Medical Assistance (MMA) services to be
provided through managed care plans.
Long-Term Care Managed Care plans participating in SMMC are required to provide minimum
benefits that include nursing home care as well as home and community based services. The
minimum benefits include:
 Nursing home care;
 Services provided in assisted living facilities;
 Hospice;
 Adult day care;
 Medical equipment and supplies, including incontinence supplies;
 Personal care;
 Home accessibility adaptation;
 Behavior management;
 Home delivered meals;
 Case management;
 Therapies, including physical, respiratory, speech, and occupational;
 Intermittent and skilled nursing;
 Medication administration;
 Medication management;
 Nutritional assessment and risk reduction;
 Caregiver training;
 Respite care;
 Transportation; and
 Personal emergency response system.
Program of All-Inclusive Care for the Elderly
The Program of All-Inclusive Care for the Elderly (PACE) is a capitated benefit model
authorized by the federal Balanced Budget Act of 1997 (BBA)5 that features a comprehensive
service delivery system and integrated federal Medicare and state Medicaid financing
mechanism. The model was developed to address the needs of long-term care clients, providers,
and payers.
The PACE operates as a three-way agreement between the federal government, the state
administering agency, and a PACE organization. In Florida, the PACE is a Florida Medicaid
LTC managed care plan option providing comprehensive long-term and acute care services
which support Medicaid and Medicare enrollees who would otherwise qualify for Medicaid
nursing facility services.6
4
Chapter 2011-134, Laws of Fla.
5
Specifically, services under the PACE are authorized under Section 1905(a)(26) of the Social Security Act.
6
Department of Elder Affairs (DOEA) and Agency for Health Care Administration (AHCA), Program of All-Inclusive Care
for the Elderly and Statewide Medicaid Managed Care Long-term Care Program Comparison Report (January 14, 2014),
BILL: CS/CS/SB 1242 Page 4
The BBA established the PACE model of care as a permanent entity within the Medicare
program and enabled states to provide PACE services to Medicaid beneficiaries as an optional
state plan service without a Medicaid waiver.
The federal government established the PACE organization requirements and application
process; however, the state is responsible for oversight of the application process, which includes
reviewing the initial application and providing an on-site readiness review before a PACE
organization can be authorized to serve participants. An approved PACE organization must sign
a contract with the federal CMS and the state Medicaid agency, the AHCA.
The PACE is administered by the DOEA in consultation with the AHCA. The DOEA oversees
the contracted PACE organizations but is not a party to the contract between the federal CMS,
the AHCA, and the PACE organizations.7 The DOEA, the AHCA, and the federal CMS must
approve any applications for new PACE organizations if expansion is authorized by the
Legislature through the necessary appropriation of the state matching funds.
PACE Organizations
A PACE organization is a private not-for-profit 501(c)(3) organization, for-profit private or
public entity that is primarily engaged in providing PACE services and must also:
 Have a governing board that includes participant representation;
 Be able to provide the complete service package regardless of frequency or duration of
services;
 Have a physical site and staff to provide primary care, social services, restorative therapies,
personal care and supportive services, nutritional counseling, recreational therapy, and meals;
 Have a defined service area;
 Have safeguards against conflicts of interest;
 Have demonstrated fiscal soundness;
 Have a formal participant bill of rights; and
 Have a process to address grievances and appeals.8
Eligibility and Benefits
To be eligible for PACE, an individual must:
 Be 55 years of age or older;
 Live within the defined service area of the PACE Center;
 Meet medical eligibility requirements as determined by a Comprehensive Assessment and
Review of Long-Term Care Services (CARES);9
available at https://ahca.myflorida.com/Medicaid/recent_presentations/PACE_Evaluation_2014.pdf (last visited Mar. 31,
2021).
7
Id.
8
HHS, Centers for Medicare and Medicaid Services, CMS Manual System: Pub. 100-11 Programs of All-Inclusive Care for
the Elderly (PACE) Manual (issued June 9, 2011), available at https://www.cms.gov/Regulations-and-
Guidance/Guidance/Manuals/Downloads/pace111c01.pdf (last visited Mar. 31, 2021).
9
Comprehensive Assessment and Review for Long-Term Care Services (CARES) is Florida’s federally mandated pre-
admission screening program for nursing home applicants. Federal law mandates that the CARES Program perform an
assessment or review of each individual who requests Medicaid reimbursement for nursing facility placement, or who seeks
BILL: CS/CS/SB 1242 Page 5
 Be able to live safely in the community; and
 Be dually eligible for Medicaid and Medicare, or Medicaid only. There is also a private pay
option with PACE, however this is not regulated by the State.10
By federal law, the first three contract years for a PACE organization are considered a trial
period, and the PACE organization is subject to annual reviews to ensure compliance.11 Review
of the PACE organization may continue after the trial period by the Secretary or the
administering state agency as appropriate, depending upon the PACE organization’s
performance and compliance with requirements and regulations.
No deductibles, copayments, coinsurance, or other cost-sharing can be charged by a PACE
organization. No other limits relating to amount, duration, or scope of services that might
otherwise apply in Medicaid are permitted.12 The PACE enrollee must accept the PACE center
physician as his or her new Medicare primary care physician, if enrolled in Medicare.13
Quality of Care Requirements
Each PACE organization is required to develop, implement, maintain, and evaluate an effective
data-driven Quality Assurance and Performance Improvement (QAPI) program. The program
must incorporate all aspects of the PACE organization’s operations, which allows for the
identification of areas that need performance improvement. The organization’s written QAPI
plan must be reviewed by the PACE organization’s governing body at least annually. At a
minimum, the plan should address the following areas:
 Utilization of services in the PACE organization, especially in key services;
 Participant and caregiver satisfaction with services;
 Data collected during patient assessments to determine if individual and organizational-level
outcomes were achieved within a specified time period;
 Effectiveness and safety of direct and contracted services delivered to participants; and
 Outcomes in the organization’s non-clinical areas.14
to receive home and community-based services through Medicaid waivers like Familial Dysautonomia Waiver, and
Statewide Medicaid Managed Care Long-Term Care Program. Any person or family member can initiate a CARES
assessment by applying for the Medicaid Institutional Care Program (ICP). Assessments are completed at no cost to the
clients and are performed by a registered nurse and/or assessor. DOEA, Comprehensive Assessment and Review for Long-
Term Care Services (CARES), available at http://elderaffairs.state.fl.us/doea/cares.php (last visited Mar. 31, 2021).
10
DOEA, Program of All-Inclusive Care for the Elderly (PACE), available at http://elderaffairs.state.fl.us/doea/pace.php
(last visited Mar. 31. 2021).
11
See 42 U.S.C. s. 1395eee(e)(4)(A) (2020).
12
HHS, Centers for Medicare and Medicaid Services, CMS Manual System: Pub. 100-11 Programs of All-Inclusive Care for
the Elderly (PACE) Manual (issued June 9, 2011), available at https://www.cms.gov/Regulations-and-
Guidance/Guidance/Manuals/Downloads/pace111c01.pdf (last visited Mar. 31, 2021).
13
DOEA and AHCA, Program of All-Inclusive Care for the Elderly and Statewide Medicaid Managed Care Long-term Care
Program Comparison Report (January 14, 2014), available at
https://ahca.myflorida.com/Medicaid/recent_presentations/PACE_Evaluation_2014.pdf (last visited Mar. 31, 2021).
14
Id.
BILL: CS/CS/SB 1242 Page 6
Florida PACE
The original Florida PACE project was authorized in 1998,15 under the administration of the
DOEA operating in consultation with the AHCA.16 Florida’s first PACE organization, located in
Miami-Dade County, began serving enrollees in February 2003 with a total of 150 slots. Since
then, the Legislature has approved additional slots either as part of the General Appropriations
Act (GAA) or general law.
In 2011, administrative responsibility for the PACE was moved from the DOEA to the AHCA as
part of the expansion of Medicaid managed care into the SMMC program.17 Participation by the
PACE in the SMMC program is not subject to the procurement requirements or regional plan
number limits normally applicable to SMMC plans. Instead, PACE plans may continue to
provide services to individuals at such levels and enrollment caps as authorized by the GAA.18
The current approval process for a new PACE project authorized by the Legislature requires any
entity interested in becoming a PACE organization to submit a comprehensive PACE application
to the AHCA, which sets forth details about the adult day care center, staffing, provider network,
financial solvency and pro forma financial projections, and policies and procedures, among other
elements. The application is similar in detail to the provider applications submitted by managed
care plans seeking to provide medical care to Medicaid recipients. PACE providers operating in
the same geographic region must establish that there is adequate demand for services so that each
provider will be viable. The application requires that documentation be submitted demonstrating
that PACE providers in the same geographic region are not competing for the same potential
enrollees.
The AHCA and the DOEA review the application and, when the entity has satisfied all
requirements, conduct an on-site survey of the entity’s readiness to serve PACE enrollees. Once
all requirements are met, including full licensure of the PACE center, staffing for key positions,
and signed provider network contracts, the AHCA certifies to the federal CMS that the PACE
site is ready. At that time, the federal CMS reviews the application and readiness certification
and, if all requirements are satisfied, executes a three-way agreement with the PACE provider
and the AHCA. The PACE provider may then begin enrolling members, subject to an
appropriation to fu