Recently Enacted Medicare Regulations Ban the Use of Nursing Home Arbitration Agreements

In a vast majority of nursing home contracts, one can expect to find a provision calling for arbitration as a means of binding dispute resolution. However, on September 28, 2016, the Center for Medicare and Medicaid Services enacted a new rule prohibiting the use of arbitration clauses in nursing-home contracts which require patients and their families to settle any disputes over care through arbitration rather than through the court system. The rule was published officially on October 4th and goes into effect November 28th, 2016. To be subject to this new Rule, the facility must be receiving federal funding from Medicare or Medicaid.

To be more exact, the Rule mandates that long-term care facilities (a/k/a nursing homes) are precluded from entering into agreements with patients which call for mandatory resolution through arbitration. Under the new rule, a facility may not require a resident or a resident’s representative to sign an arbitration agreement as a condition of admission to the facility.

It is worth noting that this Rule does not prevent a patient and facility from entering into a binding arbitration agreement after a dispute arises, just that it cannot be a part of the admission agreement or a condition of entry. Additionally, this new Rule does not impact nursing home agreements entered into by a patient and facility prior to November 28, 2016. Those agreements, and any provisions mandating pre-dispute arbitration, are not affected by this Rule.

The team of attorneys at Howland, Hess, Guinan, Torpey, Cassidy & O’Connell, LLP are well-versed in the area of Elder Law and have extensive experience in representing both patients and facilities in legal disputes involving nursing homes. If you have any questions about the information in this article or are interested in getting more specific information regarding the impact of these changes to the law, the attorneys at Howland Hess O’Connell are available to assist you today. Call for a free consultation at (215)-947-6240 or contact us online to schedule a meeting.

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