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Overview of the Patient Centered Episode System (PACES)

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PACES is a set of episode definitions and a software application that operationalizes them by reading in insurance claims and administrative data and grouping them into episodes of care related to an individual. An earlier version of this tool was developed for the Center for Medicare and Medicaid Services (CMS) as part of the Affordable Care Act’s mandate to develop a public sector episode grouping tool. It has been significantly modified and updated to be used with commercial and Medicaid, as well as Medicare, claims data. PACES includes chronic condition, acute conditions/events, and procedural episodes of care that can be analyzed individually or integrated in a nested structure.

Strengths of PACES include:

  • Ability to handle overlapping complex chronic conditions

  • Patient-centered view with no double counting of costs

  • Visibility into over 800 chronic and acute conditions and procedures


Unlike stand-alone bundles (such as Medicare’s BPCI-A bundles and commercial procedural bundles) PACES allows providers to see the relationships between episodes, such as spine surgery for symptomatic spondylolisthesis versus for cancer. PACES also identifies sequelae or complications of care such as post-surgical infections or acute exacerbations of chronic conditions. Examining these relationships between episodes supports measures like surgical utilization rates or complication rates for cohorts of patients. Finally, PACES was designed to support team-based care models and allows end users to look at the number of clinicians involved in producing care based on their role (e.g., primary versus specialty care).

Limitations of PACES include:

  • It currently does not analyze prescription drug claims. We plan to add this capability by the end of 2023 

  • Our episode definitions have not yet been fully vetted by expert clinical panels. We plan to begin performing such vetting in 2024

Applications of PACES

PACES is a versatile tool that can help any payer or provider organization or data analytics/consulting firm find opportunities to improve the efficiency with which care is being delivered by identifying:

  • Low-value or duplicative services

  • Excess use of high-cost settings

  • Sequelae or complications of care

  • Missed opportunities to avoid acute exacerbations, or reduce the need for surgery


In addition, PACES allows insights into different types of provider organization within the delivery system including individual practitioners (e.g., NPI), clinician practices (e.g., TIN) or facilities (CCN).

PACES in Population Health

PACES can be particularly helpful for profiling the care provided by medical and surgical specialists, moving beyond individual bundles to look more broadly at a provider’s full book of business. Rather than assess an orthopedic surgery group’s performance on joint replacements alone, for example, PACES allows users to measure aggregate performance across a range of procedures such as knee arthroscopy, fracture repair and meniscus repair, that make up a majority of the work done by a particular surgical group. PACES also supports:

  • Comparison of internal specialists’ groups to community or national benchmarks 

  • Profiling specialist groups in your market to identify preferred referral partners

  • Managing cohorts of patients with similar episode profiles (e.g., heart failure, COPD, or diabetes) over time

  • Identifying and optimizing care teams

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