Pre-dispute Arbitration Takes Another Hit
A new regulation promulgated by the Department of Health and Human Services’ Centers for Medicare and Medicaid Services bans federally funded long term care facilities, i.e. nursing homes, from using pre-dispute binding arbitration agreements. Pre-dispute arbitration clauses have heretofore been common provisions in nursing home residency agreements.
The new regulation provides for the withholding of federal funds from nursing homes that require residents to sign mandatory arbitration agreements at the time of admission. The rights of residents to sue nursing homes in court are thereby preserved and protected.
An estimated 15,000 skilled nursing facilities are expected to be affected by the new regulation. This regulation continues the groundswell of opposition to the use of mandatory predispute arbitration in a variety of commercial settings.