The U.S. Department of Health and Human Services Centers for Medicare & Medicaid Services (CMS) issued its final rule on September 19, 2016 that prohibits nursing homes in the United States that participate in the Medicare and Medicaid programs from entering into binding pre-dispute arbitration agreements with residents or their representatives, and further prohibits nursing homes (long-term care facilities) from requiring nursing home residents to sign an arbitration agreement as a condition of admission to the nursing home.
The new federal rule, which is effective on November 28, 2016, states in §483.70:
(n) Binding arbitration agreements. (1) A facility must not enter into a pre-dispute agreement for binding arbitration with any resident or resident’s representative nor require that a resident sign an arbitration agreement as a condition of admission to the LTC facility.
(2) If, after a dispute between the facility and a resident arises, and a facility chooses to ask a resident or his or her representative to enter into an agreement for binding arbitration, the facility must comply with all of the requirements in this section. (i) The facility must ensure that: (A) The agreement is explained to the resident and their representative in a form and manner that he or she understands, including in a language the resident and their representative understands, and (B) The resident acknowledges that he or she understands the agreement. (ii) The agreement must: (A) Be entered into by the resident voluntarily. (B) Provide for the selection of a neutral arbitrator agreed upon by both parties. (C) Provide for selection of a venue convenient to both parties. (iii) A resident’s continuing right to remain in the facility must not be contingent upon the resident or the resident’s representative signing a binding arbitration agreement. (iv) The agreement must not contain any language that prohibits or discourages the resident or anyone else from communicating with federal, state, or local officials, including but not limited to, federal and state surveyors, other federal or state health department employees, and representatives of the Office of the State Long-Term Care Ombudsman, in accordance with §483.10(k). (v) The agreement may be signed by another individual if: (A) Allowed by state law; (B) All of the requirements in this section are met; and (C) That individual has no interest in the facility. (vi) When the facility and a resident resolve a dispute with arbitration, a copy of the signed agreement for binding arbitration and the arbitrator’s final decision must be retained by the facility for 5 years and be available for inspection upon request by CMS or its designee.
Source (see page 689)
In discussing the reasons for promulgating the new rule prohibiting nursing home pre-dispute arbitration agreements, CMS stated, “we are convinced that requiring residents to sign pre-dispute arbitration agreements is fundamentally unfair because, among other things, it is almost impossible for residents or their decision-makers to give fully informed and voluntary consent to arbitration before a dispute has arisen. We believe that LTC residents should have a right to access the court system if a dispute with a facility arises, and that any agreement to arbitrate a claim should be knowing and voluntary … there is significant evidence that pre-dispute arbitration agreements have a deleterious impact on the quality of care for Medicare and Medicaid patients, which clearly warrants our regulatory response … Given the unique circumstances of the LTC admissions process, coupled with the clear interest that Medicare and Medicaid have in protecting beneficiaries, a prohibition on the use of pre-dispute arbitration agreements is not by its nature outside the permissible realm of conditions a facility must meet if it wishes to receive payment under the Medicare and Medicaid programs.”
Source (see page 399)
If you or a loved one suffered injury, or worse, while a resident of a nursing home in the United States due to nursing home neglect, nursing home negligence, or nursing home abuse, you should promptly find a local nursing home claim lawyer in your U.S. state who may investigate your possible nursing home claim for you and file a nursing home claim on your behalf, if appropriate.
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