The Centers for Medicare and Medicaid Services (“CMS”) recently issued a final rule banning the use of binding pre-dispute arbitration agreements by nursing homes that accept Medicare and Medicaid patients. Such arbitration clauses are typically found in the admissions agreements between a new resident (or their family) and the nursing home, but are very often overlooked. The result of this new rule is that families who have an issue with a nursing home regarding care, abuse, and the like, can now sue in court to have their case heard versus having to go through a binding arbitration process.
The original proposed rule only required nursing homes to explain the arbitration agreement to new residents and obtain an acknowledgement that they understood. The final rule is the result of many comments on the proposed rule that favored an outright ban on such arbitration agreements. The nursing home industry has stated that the arbitration agreements have kept costs down and the new rule will undoubtedly increase costs and force closures of some facilities. Moreover, there is an argument that CMS has overstepped its authority in issuing such a rule and we may see the nursing home industry fight the implementation of the rule currently scheduled to take effect on November 28th. The new rule will only apply to future admissions agreements and not to existing contracts, but stay tuned to see whether a battle erupts between the nursing home industry and CMS. #elderlaw #elderabuse #nursinghome #arbitrationbanned @bgnthebgn