Over 75 consumer groups have formed a coalition to prevent the Centers for Medicare & Medicare Services (CMS) from stripping away certain rights from nursing home residents and their families.
According to current rules, nursing homes that accept Medicare or Medicaid funds are prohibited from including language in their resident contracts that states disputes must be settled by a third party, rather than a court. The rules prevent residents of the facilities and / or their families, from filing claims of abuse, neglect or sexual assault against facilities.
A CMS proposal to do away with that rule is being challenged. More than 75 consumer, health and advocacy groups have formed the Fair Arbitration Now (FAN) Coalition, intending to stop CMS from reversing a rule they claim is critical to protect the elderly.
Remington Gregg, counsel for civil justice and consumer rights at Public Citizen, said the contractual provisions create an unequal balance of power, giving the nursing home an advantage over its elderly patients and their advocates.
“We’re talking about everything you may have a problem with – abuse, neglect, sexual assault, a wide variety of things – they are now saying you are waiving your right to full justice,” Gregg said.
CMS said it decided to reconsider the rule after the American Health Care Association (AHCA) and a group of nursing homes sued CMS and the Department of Health and Human Services in October. They said the rule violated the Federal Arbitration Act, that the agencies had overstepped their statutory authority in issuing the law, and that Congress had repeatedly rejected legislation to invalidate arbitration agreements.
Last November, a federal district court judge in Mississippi issued an order temporarily blocking the rule from taking effect. In June, the judge agreed to a joint request pause the case, while CMS revises the rule.
CMS is set to propose new requirements that say nursing homes must write the arbitration agreements in plain language, explain the agreement to the prospective resident/representative, and that residents would be required to acknowledge they understand the agreement.
The rule change is backed by the U.S. Chamber of Commerce, who says restricting arbitration raises the cost of nursing home care, and may make it expensive and difficult to resolve disputes.
“Many plaintiffs’ claims are too small to justify paying a lawyer to handle the matter and, in any event, most people do not have the resources to do so,” the chamber reportedly said.
The AHCA agrees that arbitration is faster and cheaper than litigation, and points out that there’s no limit on the monetary award that residents can receive, according to a fact sheet it distributed outlining its position.
In response to the proposed changes, the AARP, which is part of the FAN Coalition, says that it also believes “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.” However, “the regulations still need to be for the benefit of Medicare and Medicaid nursing facility residents and not to their detriment.”
Public comments about the move are due Monday, and Carolina Fortin-Garcia, a CMS spokesperson, said the agency will respond to them when it issues the final rule.
According to Gregg, opponents of the changes are considering legal action if CMS decides to allow arbitration agreements in nursing home contracts.
“Any agency action must meet a high bar for ensuring the action taken isn’t arbitrary and capricious,” he said.
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