On June 5, 2017, the Centers for Medicare & Medicaid Services (CMS) published a proposed change to its October 4, 2016 rule (42 CFR 483) which effectively banned the use of pre-dispute arbitration agreements in nursing homes that participate in the medicare/medicaid programs. As we reported earlier this week, CMS had voluntarily dismissed its appeal in federal court wherein the American Health Care Association (and others) were awarded a preliminary injunction that prevented the enforcement of CMS’ new rule that banned pre-dispute arbitration agreements. The new proposed rule requires that nursing homes explain the arbitration process and the agreement itself to their residents (or resident’s representative), and that the arbitration agreements must be in “plain language.” The arbitration agreement must not contain language that discourages the resident or anyone else from contacting any governmental authorities. In addition, the proposed rule requires nursing homes to maintain copies of any arbitration decisions for a period of 5 years for potential inspection by CMS. Finally, the proposed rule mandates that nursing homes post a notice in a conspicuous place that publishes the facility’s policy on use of arbitration agreements. It is important to note that this proposed CMS rule makes it permissible for nursing homes to require the signing of an arbitration agreement as a condition of admission to the facility. If you are a nursing home operator, it is imperative that you consult with your attorney regarding the use of arbitration agreements as a prerequisite to admission to the facility to address this proposed CMS rule vis-à-vis the law of a particular state.
There is a 60-day window for the public to make comments on this rule: Proposed Revisions
For CMS’ summary of the proposed rule, please click the following link: CMS Fact Sheet