Monday, July 29, 2019
CMS issued their final rule on the use of pre-dispute arbitration clauses in nursing home contracts, CMS Rules Put Patients First Updating Requirements for Arbitration Agreements and New Regulations That Put Patients Over Paperwork.
The rule, published in 84 Fed. Reg. 34718 on July 16, 2019, amends 42 C.F.R. 483.70(n):
483.70 Administration. * * * * * (n) Binding arbitration agreements. If 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. (1) The facility must not require any resident or his or her representative to sign an agreement for binding arbitration as a condition of admission to, or as a requirement to continue to receive care at, the facility and must explicitly inform the resident or his or her representative of his or her right not to sign the agreement as a condition of admission to, or as a requirement to continue to receive care at, the facility. (2) The facility must ensure that: (i) The agreement is explained to the resident and his or her representative in a form and manner that he or she understands, including in a language the resident and his or her representative understands; (ii) The resident or his or her representative acknowledges that he or she understands the agreement;(iii) The agreement provides for the selection of a neutral arbitrator agreed upon by both parties; and (iv) The agreement provides for the selection of a venue that is convenient to both parties. (3) The agreement must explicitly grant the resident or his or her representative the right to rescind the agreement within 30 calendar days of signing it. (4) The agreement must explicitly state that neither the resident nor his or her representative is required to sign an agreement for binding arbitration as a condition of admission to, or as a requirement to continue to receive care at, the facility. (5) The agreement may 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). (6) When the facility and a resident resolve a dispute through 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 after the resolution of that dispute on and be available for inspection upon request by CMS or its designee. * * *
and is effective September 16, 2019. The ABA Commission on Law & Aging published an article about the changes: Our New Nursing Home Arbitration Mandate: Educate, Educate, Educate
The recent rule by the Centers for Medicare and Medicaid Advocacy (CMS) permitting nursing homes to enter into pre-dispute, binding agreements with residents or their representatives was deeply disappointing to resident advocacy groups, including the ABA and its Commission on Law and Aging, which advocated strongly for a full ban on nursing home arbitration agreements.
Like many groups, we do not believe that the time of admission to a nursing home is appropriate for informed decision-making about such agreements. Nursing home admission is usually a time of crisis for individuals and their families; the resident is in an impaired condition, the choice of nursing homes may be severely limited, and the resident and family have no idea of the kind of dispute that might be bound by an arbitration clause in the future. There are advantages and disadvantages to arbitration, but it is only after a dispute arises that those pros and cons can be fully weighed, and an informed and voluntary decision can be made.
The author of the article, Charles Sabatino, executive director of the Commission, describes the role of elder law attorneys as "educate residents, their families, and the public more emphatically about these agreements and advise them not to sign these at admission or at any time before a dispute arises." He notes the good part of the change in the rule: "its mandate that arbitration agreements must not be used as a condition of admission to, or as a requirement for, a resident to continue to receive care at the facility. Moreover, the facility must explicitly inform residents or their representatives of the right to not sign the agreement as a condition of admission, or as a requirement, to continue to receive care at the facility. And the arbitration agreement itself must expressly state the same."
What is important about the new rule? Several things, according to Mr. Sabatino, including the ban on agreeing to arbitration as a condition of admission, a 30 day right of rescission, the requirement that the facility explain the contract in a way that is understandable to the resident or representative, and that the contract can't "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."
So, stay tuned.... let's see how this works.