Binding Arbitration Clauses Prohibited by CMS starting in November

Arbitration clauses are often buried in the many pages of paperwork given to patients and families of those entering nursing homes. These clauses could come to an end due to a CMS ruling.

The rule prohibits what is known as a binding arbitration agreement, which could effectively mean that residents and their families sign away their right to a jury trial should something go wrong.

Nursing homes that receive Medicare payments must remove such clauses from their agreements by November. If they do not, they risk becoming ineligible for the federal reimbursements. The rule was published on September 28th by the Center for Medicare and Medicaid Services.

Russell McDaid, who is the president and CEO of Pennsylvania Health Care Association, said that he is disappointed with the ruling. He said that arbitration is a much faster, and less expensive process than a jury trial.

Supporters of the rule say that the process favors nursing homes. They have been through the process whereas families and residents have not. Families and residents will often hire lawyers even if the issue will never go to trial.

Another hoped-for effect of the new rule is to increase transparency in nursing homes. When cases go to arbitration, they are not often seen by the public. Proceedings are often secret, leaving those weighing nursing home choices in the dark about resident complaints handled through the arbitration process.

Even if residents and families do read the agreements and understand them, they often sign out of fear their loved ones will not receive care otherwise. The new rule says that families do not have to sign an arbitration agreement and the nursing home cannot deny them admission if they do not.

The rule affects only new contracts and not those already signed.

If you or a loved one has suffered abuse or neglect while staying in a nursing home, you may be entitled to compensation. Contact the law offices of Schenk Smith and let our experienced attorneys fight for you. Call us today.