Although many people might not have noticed it, the past ten years have seen everyone from lenders and employers to cellphone carriers and retailers inserting what are known as arbitration clauses into the boilerplate of their contracts.
What this essentially means is that if anyone with whom they’ve executed a contract — customers, patients, residents, etc. — decides to bring legal action, it cannot be pursued via the courts, but rather before purportedly neutral arbitrators who will listen to arguments, consider evidence, and render decisions that are typically binding on all parties.
While proponents argue that arbitration is more cost-effective and an altogether faster alternative to court, opponents have countered that the neutrality of arbitrators is sometimes suspect, and that the confidential nature and binding terms of the process masks wrongdoing and prevents parties from truly securing justice.
Interestingly enough, the Centers for Medicare and Medicaid Services, part of the Health and Human Services Department, issued a new rule last week that will greatly curtail the use of arbitration clauses in the nursing home industry.
What exactly does the CMS’ new rule dictate?
The new rule dictates that starting in November those nursing homes that receive federal funding from the CMS can no longer include arbitration clauses in the admissions contracts signed by new residents. Nursing homes with nearly 1.5 million residents would be affected by the new protections.
Why did the CMS make this decision?
The decision, the first major overhaul of agency rules concerning funding in over two decades, was undertaken out of growing concern that these arbitration clauses have prevented victims of nursing home abuse and their families from pursuing justice, and also served to bury larger discussions about the safety and quality of care being provided.
How is the new rule being received?
As you might imagine, supporters have lauded the decision by the CMS to restore the right of nursing home residents to have their claims heard in court, arguing that it will help expose patterns of wrongdoing — abuse, neglect, harassment — at problem facilities.
The nursing home industry, however, has roundly criticized the move, arguing that the costs of having to defend more lawsuits will ultimately be passed on to residents, and that the CMS’ decision is unnecessary and outside of its designated statutory authority.
It will be interesting to see the degree to which the CMS’ decision prompts much-needed change in certain nursing homes and whether it will be challenged in the courts.
In the meantime, if you believe that nursing home neglect or abuse is to blame for the serious injuries suffered by a loved one, consider speaking with an experienced legal professional to learn more about your options for seeking justice on their behalf.
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