On June 5, 2017, the Centers for Medicare & Medicaid Services (CMS) issued proposed revisions to arbitration agreement requirements for long-term care facilities (nursing homes) that eviscerates the protections proposed by the Reform of Requirements for Long-Term Care Facilities Final Rule (“Final Rule”) published on October 4, 2016 that listed the requirements nursing homes need to follow if they choose to ask residents to sign agreements for binding arbitration.
The new proposed rule “would remove provisions prohibiting binding pre-dispute arbitration and strengthen requirements regarding the transparency of arbitration agreements in LTC facilities.” CMS stated that “this proposal is consistent with our approach to eliminating unnecessary burden on providers.”
2016 Final Rule
The 2016 Final Rule requires that an agreement for post-dispute binding arbitration must be entered into by the resident voluntarily, that the parties must agree on the selection of a neutral arbitrator, and that the arbitral venue must be convenient to both parties. Under the 2016 Final Rule, an arbitration agreement could be signed by another individual only if allowed by the relevant state’s law, all of the other requirements in the section are met, and that individual had no interest in the facility. In addition, the Final Rule stated that a resident’s right to remain at the facility could not be contingent upon the resident or his or her representative signing an arbitration agreement. The arbitration agreement also could not contain any language that prohibited or discouraged the resident or anyone else from communicating with federal, state, or local officials, including but not limited to, federal and state surveyors, other federal and state health department employees, and representatives of the Office of the State Long-Term Care Ombudsman, in accordance with §483.10(k).
Perhaps most importantly, the 2016 Final Rule prohibited LTC facilities from entering into pre-dispute arbitration agreements, which prohibition was subsequently challenged in federal court as being in conflict with the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq.
CMS stated on June 5, 2017, ” we propose to remove the requirement at §483.70(n)(1) precluding facilities from entering into pre-dispute agreements for binding arbitration with any resident or resident’s representative, which we do not believe strikes the best balance between the advantages and disadvantages of pre-dispute arbitration. For the same reason, we also propose removing the prohibition at §483.70(n)(2)(iii) banning facilities from requiring that residents sign arbitration agreements as a condition of admission to a facility. And, we propose removing the provisions at §483.70(n)(2)(ii) regarding the terms of arbitration agreements.”
CMS justifies the proposed changes to the Final Rule by stating, “we believe that arbitration agreements are, in fact, advantageous to both providers and beneficiaries because they allow for the expeditious resolution of claims without the costs and expense of litigation … [a]n outright prohibition of arbitration agreements would significantly increase the cost of care, and would require facilities to divert scarce resources from the care of their residents to the defense of expensive litigation.”
The Proposed Revisions To The 2016 Final Rule Harm Residents And Their Families
The American Association for Justice (AAJ), which works to preserve the constitutional right to trial by jury and to make sure people have a fair chance to receive justice through the legal system when they are injured by the negligence or misconduct of others, issued a statement on June 5, 2017 in response to the proposed revisions to the 2016 Final Rule: “Today’s disappointing announcement signals to our nation’s seniors that their government is no longer working to protect them from abuse, fraud, and neglect. New agency leadership has instead chosen to sacrifice the well-being of the most vulnerable citizens to protect nursing home corporations from ever being held publicly accountable for wrongdoing, no matter how egregious. There is no justification for the new administration’s proposal to strip away the rights of seniors and encourage nursing home facilities to once again prioritize profit over care. The safety of our parents and grandparents is at stake. AAJ will continue to stand with America’s seniors in their fight to access justice through the courts.”
If you or a loved one suffered injuries (or worse) while a resident of a nursing home in the United States due to nursing home neglect, nursing home negligence, nursing home abuse, or resident on resident abuse, you should promptly contact a local nursing home claim attorney in your U.S. state who may investigate your nursing home claim for you and file a nursing home claim on your behalf, if appropriate.
Click here to visit our website to be connected with medical malpractice lawyers (nursing home claim lawyers) in your U.S. state who may assist you with your nursing home claim, or call us toll-free in the United States at 800-295-3959.
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