Centers for Medicare and Medicaid Services (CMS) under President Donald Trump will allow pre-dispute arbitration provisions in long-term care residency agreements, provided the arbitration provision meets certain requirements. This reverses the Oct. 7, 2016 final rule issued under President Barack Obama instructing CMS from withholding reimbursements to facilities that have pre-dispuste arbitration provisions in residency agreements. Several nursing homes sued for an injunction to stop CMS from enforcing that requirement. The United Stated District Court of Mississippi granted a preliminary injunction on Nov. 7, 2016, stopping the rule from going into effect.
CMS has now issued proposed revisions to the rule which focuses on transparency with the residents. The proposed rule is as follows:
- The prohibition on pre-dispute binding arbitration agreements is removed.
- All agreements for binding arbitration must be in plain language.
- If signing the agreement for binding arbitration is a condition of admission into the facility, the language of the agreement must be in plain writing and in the admissions contract.
- The agreement must be explained to the resident and his or her representative in a form and manner they understand, including that it must be in a language they understand.
- The resident must acknowledge that he or she understands the agreement.
- The agreement must not contain any language that prohibits or discourages the resident or anyone else from communicating with federal, state, or local officials, including federal and state surveyors, other federal or state health department employees, or representatives of the State Long-Term Care Ombudsman.
- If a facility resolves a dispute with a resident through arbitration, it must retain a copy of the signed agreement for binding arbitration and the arbitrator’s final decision so it can be inspected by CMS or its designee.
- The facility must post a notice regarding its use of binding arbitration in an area that is visible to both residents and visitors.
CMS will accept comments on the proposed rule until Aug. 7, 2017.