Right to a Jury Trial
American nursing homes have fought long and hard for the power to hijack a resident’s right to sue them. The U.S. Chamber of Commerce keeps a running scorecard of lawmakers’ positions on arbitration. Lobbyists said that they will issue “credit” to members of Congress who fight the popular Forced Arbitration Injustice Repeal Act. The FAIR Act would prohibit forced arbitration of employment, consumer, antitrust, or civil rights disputes. Consumer advocates, experts, and resident families all support the FAIR Act.
Recently, the 8th U.S. Circuit Court of Appeals approved a CMS regulation that allows nursing homes to use mandatory pre-suit arbitration agreements. However, the agreement cannot be a condition or a prerequisite for admission. The regulation will allow residents to rescind an arbitration agreement within 30 days of signing.
The lawsuit alleged CMS did not have the power or authority to enforce the regulation. However, the government did not violate federal arbitration laws when it sought to limit arbitration agreements between nursing operators and residents. The Court rejected frivolous arguments made from the nursing home industry. The profitable industry claimed the regulation was “just as unlawful” as the previous one that banned arbitration.
The Oct. 1 opinion holds:
“In our view, it is reasonable for CMS to conclude that regulating the use of arbitration agreements in LTC facilities furthers the health, safety, and well-being of residents, particularly during the critical stage when a resident is first admitted to a facility. Congress gave HHS the power to develop standards for the qualification of LTC facility administrators, to establish criteria for the administration of LTC facilities, and to specify data to be collected by LTC facilities.”
This is an important decision because it confirms that CMS has the power and authority to establish clinical and administrative standards for nursing homes that get Medicare or Medicaid. Hopefully, a new CMS regulation will prohibit mandatory pre-suit arbitration agreements hidden in the admission paperwork.