The answer to my own question, after that 112-86 spanking by the Rockets, is "not yet, but close."
I say that because there's still plenty of time for the Pacers to steer the ship back in the right direction after they just suffered their third straight defeat for the first time this season. At the moment, the most concerning thing is now the fact that the Pacers have lost three consecutive games — it's the way they've been losing. Sloppy basketball, lack of effort, "no zip", as David West put it.
There were signs during the unimpressive five game winning streak they scrapped together against tankers and bottom-dwellers. The league's No. 1 defense was falling to pieces and the sporadic offense was becoming stagnant, predictable offense. Paul George was doing well until he hurt himself. Roy Hibbert hasn't even looked like a starting center in the NBA, let alone an All-Star. Lance Stephenson is reverting to "bad Lance" all too often, trying to overdribble defenses to sleep. And George Hill continues to be switch between passive and aggressive, often at the wrong times. Only David West has tried to remain in beast mode, but you can tell even he is frustrated from the number of uncharacteristic mistakes he has been piling up.
As for the bench, it's the same old story. CJ Watson is hurt (elbow). Luis Scola looks really old. Evan Turner is still finding his groove. Ian Mahinmi is playing above his ability, which is not saying much. Andrew Bynum hasn't touched the playing surface. When your most consistent bench player is Rasual Butler, you know you're in trouble.
But look, most teams go through stretches like this during the course of a long season, and it's better that this is happening to the Pacers now than at the end of the season. They still have 20 games left to fix things and get themselves back into the unbeatable form they were at the start of the season, just in time for the playoffs.
However, there must be a sense of urgency, if not looming panic, as the team has made it clear all along how much the No. 1 seed would mean to them. And let's face it, the Pacers realistically need home court advantage to unseat the Heat in the East. Right now they are still 1.5 games ahead of the Heat, but have the same number of losses. The Pacers have only barely held on because the Heat have lost two in a row themselves, though against much better opposition (Rockets and Spurs) on the road.
The Pacers might soon have more losses than the Heat because their next game is against Dallas, which thrashed the Pacers at home just before the All-Star break and have been playing well as of late. Take solace in the fact that the Pacers will likely figure out their problems soon and get out of this slump. But the scary thing is that by the time they do it the first seed might have already sailed.