PACE Center Development: Precision & Purpose in Highly Regulated Builds
"Longevity," "wellness," and "proactive health" are hot topics in the current lexicon of healthcare investment. They are often focused on helping younger, healthier populations optimize their well-being. But as Joseph Coughlin, founder of the MIT AgeLab, compellingly argues in The Longevity Economy we must look beyond outdated stereotypes of aging. There's an equally critical, and perhaps even more impactful, longevity play happening in communities across the country: the Program of All-Inclusive Care for the Elderly (PACE).
Imagine concierge medicine, but specifically designed for seniors who are nursing home eligible, yet have a fierce determination remain living independently in their homes and communities. That's the essence of PACE. These centers are vibrant, living hubs providing integrated, high-quality care that enables individuals with highly complex and frail health needs to live as comfortably and as long as possible outside of institutional settings.
However, translating this ambitious and compassionate care model into a physical building? That's where the journey diverges significantly from standard healthcare real estate, or even from building a typical wellness clinic. Because of the acuity of the participants it serves and the highly regulated environment in which it operates, PACE center development demands a unique approach, a level of precision, foresight, and specialized knowledge unlike almost any other build.
The Unique Demands of PACE Center Development
Building a PACE center requires engineering an environment that seamlessly supports a highly integrated care model for a specific population with diverse, intensive needs.
The Regulatory Labyrinth:
PACE centers operate under a rigorous framework of state and federal regulations (CMS, state licensing, specific facility standards). This framework is far more intricate than typical clinic builds. Every design choice, every square foot, must comply with a myriad of rules related to accessibility, patient flow, specific program spaces (e.g., day rooms, therapy gyms, dining areas), and life safety requirements unique to this vulnerable population. Missing a single detail can mean significant delays.
California, for example, has particularly stringent requirements, with PACE centers being licensed by the CDPH and CDA as Adult Day Health Care (ADHC) centers – a process that can take 12-18 months. This lengthy timeline needs precise synchronization with your real estate development schedule.
Designing for Dignity & Comprehensive Needs:
This involves meticulously planning for mobility challenges (wheelchairs, walkers), sensory impairments, fall prevention, and cognitive decline. The goal is to create a truly welcoming, non-institutional environment that fosters a sense of community and dignity, while simultaneously supporting a full spectrum of clinical, social, and rehabilitative services under one roof.
Think wide corridors, accessible bathrooms, quiet zones, and multi-purpose spaces. Physical environment requirements extend to maintaining appropriate lighting and sound levels for individuals with vision, hearing, and cognitive impairments, and strict policies for pest control and chemical handling.
Operational Flow for Complex Journeys:
PACE members often have complex care journeys within the center, moving between medical appointments, therapy sessions, meals, social activities, and transportation pick-up/drop-off. The physical layout must support these intricate transitions efficiently, minimizing confusion and maximizing safety for both members and the care team. This requires careful consideration of entry/exit points, reception flow, and specialized spaces for different types of therapies and activities, ensuring they are connected logically.
Strategic Pitfalls & Precision Solutions in PACE Development
Given these unique demands, certain strategic areas become even more critical in PACE center development:
Site Selection Nuances
Beyond standard market analysis (as discussed in my post, "Data-Driven Site Selection for Healthcare Startups" and "Qualitative Site Factors: Beyond Data for Clinic Success"), PACE site selection requires extreme precision. You need to be located strategically for member density, ensure ease of transportation access (including specialized vehicle drop-off zones), and navigate zoning regulations that can be tricky for facilities offering such a broad range of integrated services in one location. In Los Angeles County, for example, "Adult day care facilities" are explicitly prohibited in M-1 (Industrial) zones, making early zoning verification critical.
Assembling a PACE-Specific A-Team
You can't just hire a general healthcare architect or contractor. As discussed in my post, "Your A-Team for Healthcare Clinic Development," your project team – from the architect who understands PACE regulatory requirements and member flow, to the general contractor whose specific project team has experience building highly regulated, accessible spaces in your jurisdiction – must have direct PACE experience or demonstrable expertise in similarly complex builds for vulnerable populations. The Owner's Project Manager (OPM) also needs this specialized lens to orchestrate the unique demands.
Timeline & Budget Precision
In PACE, go-live dates are tied to operational readiness for a specific, vulnerable population, not just building completion. Missing deadlines due to unforeseen construction issues or delayed licensing mean not only burning cash but also delaying access to critical care. Rigorous upfront planning, robust contingency (for your contingency plans!), and strategic communication with all partners are vital to hitting these non-negotiable dates. My post, "The True Cost of Scaling: Beyond Construction Budgets in Healthcare Real Estate," delves into managing these financial realities.
Tailored Technology Integration
Technology in a PACE center must support not just clinical charting, but seamless communication across diverse care teams, efficient scheduling for multiple services, and often, telehealth capabilities integrated into social spaces or therapy rooms. Planning for robust, accessible, and compliant IT infrastructure from day one is critical to empowering staff and enhancing member engagement with their care plan. My post, "The Ripple Effect: How Early Real Estate & Design Decisions Shape Long-Term Success," explores how these early tech decisions create lasting impact.
Operational Integration & Infection Control
The facility must support stringent operational protocols. This includes robust infection control plans, requiring easily cleanable, non-porous surfaces, appropriate ventilation (potentially specialized HVAC filtration), and designated areas for safe handling/disposal of biohazardous waste. Sufficient handwashing stations and proper storage/disposal of chemicals and biohazardous waste are critical. Staff medical clearance processes are also a key operational consideration impacting physical space needs.
Navigating California's Hyper-Regulated Landscape:
California presents a unique, favorable landscape for PACE programs, offering high reimbursement rates and generally not imposing hard caps on enrollment or exclusive territories (unlike some other states). However, this comes with a significantly higher regulatory bar for development and a more rigorous application process.
Unique PACE Licensing: Unlike other programs, PACE centers are licensed directly and uniquely as PACE programs. Their application includes waivers from having to secure separate Adult Day Health Care (ADHC), Primary Care Clinic (PCC), and home health-specific licensures. This integrated licensing process, while streamlined in intent, is still lengthy and highly complex, demanding precise synchronization with your real estate timeline to avoid significant carrying costs.
Building Code Stringency: The California Building Code (Title 24) often exceeds federal minimums. PACE centers will likely be classified as Institutional Group I-2.1 (Healthcare Facilities, Outpatient), imposing significantly more stringent requirements for fire safety, egress, structural integrity (especially seismic in California), and comprehensive accessibility. This classification is a fundamental design and cost driver. Specifics like minimum clear floor area for exam rooms and patient spaces are mandated.
CALGreen Standards: California's mandatory green building standards (CALGreen, Title 24, Part 11) apply, regulating energy, water, materials, and indoor environmental quality, requiring integration from early design.
Local Health Department Oversight: In areas like Los Angeles County, the Department of Public Health (DPH) conducts detailed plan reviews for health facilities. Early engagement is essential to integrate local health and environmental requirements (e.g., waste management, ventilation) into the design, preventing costly redesigns.
PACE Program Application Stages and Timelines:
The journey to becoming an approved PACE provider in California is multi-staged and can take 12-24 months for full state and federal approval. Understanding these phases and synchronizing them with your real estate timeline is crucial.
Letter of Intent (LOI) Submission: This is the initial formal communication to the California Department of Health Care Services (DHCS) of an entity's intent to submit a new PACE application or an expansion proposal. Existing PACE organizations also submit LOIs for new centers or expansions in existing service areas.
Initial Review: Following the LOI, the entity submits required PACE application components for an initial state (DHCS) review.
Full Review: This stage involves concurrent review of the full application by both DHCS and the Centers for Medicare & Medicaid Services (CMS).
Approval & Attestation (90 Days): Upon successful review, the application is approved by DHCS for the submitted quarter, and DHCS releases initial application attestation.
Mastering PACE center development is about embracing its unique complexities with precision and purpose. It’s an incredibly rewarding challenge because when done right, these centers don't just provide care; they become vital community anchors, transforming lives and expanding access for those who need it most.
What's one unique challenge you've encountered (or anticipate) when thinking about the physical development of a PACE center or similarly complex, highly regulated healthcare facility? Share your insights in the comments!