The Centers for Medicare and Medicaid Services has issued new rules prohibiting nursing homes from requiring patients to agree to arbitrate any legal claims against the nursing home at any time before a dispute arises or as a condition of admission. (Courtesy photo)

Problematic nursing home arbitration clauses

This week, I want to discuss important federal regulatory changes that will affect millions of elderly dependent adults who are residing in nursing homes. Many of these adults, or their children, have unwittingly signed away their constitutional rights to resolution of their grievances by a civil jury selected from their communities instead of agreeing to binding arbitration: a process that favors businesses over consumers.

Last month, the Centers for Medicare and Medicaid Services issued new rules prohibiting nursing homes, which receive federal funds through Medicare or Medicaid, from requiring patients to agree to arbitrate any legal claims against the nursing home at any time before a dispute arises or as a condition of admission. CMS is a federal agency within the U.S. Department of Health and Human Services.

CMS provides financial support for nearly 1.5 million residents in more than 15,000 long-term care facilities that participate in Medicare and Medicaid programs. CMS Director Kate Goodrich and acting CMS administrator Andy Slavitt explained, “These changes are an integral part of CMS’ commitment to transform our health system to deliver better quality care and spend our health care dollars in a smarter way, setting high standards for quality and safety in long-term care facilities.”

This groundbreaking rule was implemented after the diligent efforts of the American Association of Justice, a volunteer association of trial lawyers on which I serve as a board member. The need for such predispute regulations comes in response to the widespread adoption of arbitration clauses in nursing homes and other consumer settings. These clauses are hidden in many nursing home admissions documents. They can also be found in the fine print of cellular phone contracts, credit cards, bank accounts, insurance contracts, gym memberships, rental agreements, car loans and even in your Amazon, Groupon and Netflix accounts. You can even be legally bound to forced arbitration by signing a contract or clicking “I agree” on a website. Even after the rules imposed by CMS, you may still see arbitration clauses in nursing homes that are not contracted with CMS.

California has long recognized that arbitration clauses inure benefit to the corporation. In California, a nursing home cannot require applicants or residents to sign an arbitration agreement as a condition of admission or for medical treatment. As a lawyer who handles elder abuse and neglect cases I strongly urge you not to sign any arbitration clauses. They benefit the nursing homes and corporations which own them to the detriment of the patients and their families.

In addition to the regulations, which attempt to eliminate arbitration clauses from CMS funded nursing homes, the new regulations help improve patient centered care, patient safety and the quality of the care provided. New regulations expand food, medical treatment and personnel requirements for long-term care facilities. Importantly, nursing home must now provide “nourishing, palatable” food for residents and develop a specific care plan for each resident within 48 hours of their admission to a CMS-funded facility.

The new CMS rules take effect on Nov. 28, 2016. The new rules provided by the U.S. Department of Health and Human Services’ Centers for Medicare and Medicaid Services will prevent countless of numbers our most vulnerable members of society from unwittingly giving up their fundamental right to a fair and impartial jury in exchange for a corporate arbitration process that favors the repeat players: the nursing homes.

If you are considering nursing home care, or a loved one is already in care, contact my office for a free book I have written on elder and dependent physical and financial abuse and neglect.

Christopher B. Dolan is owner of the Dolan Law Firm. Email questions to

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