Federal Regulations Ban Nursing Home Forced Arbitration Clauses: Major Victory for Patients & Families

Readers of this blog know that I carry a special torch for nursing home residents in general, and for victims of Massachusetts nursing home neglect or abuse in particular.  Of the several types of legal wrongs that can bring me to my feet, elder abuse and nursing home patient neglect are among the strongest.

On August 1 2016, I posted that the federal Centers for Medicare Services (CMS) was conducting hearings on changing an especially onerous and unconscionable provision (clause) that is presently in almost all nursing home contracts and long term care facility contracts.  That provision is known as a ‘pre-dispute arbitration clause,’ and what is essentially did was to force families and patients who entered nursing homes and long-term care facilities, to agree in writing to this clause, or the patient would not be admitted to the facility.  It’s also referred to as “nursing home forced arbitration.” What did this clause – often referred to as a “hammer clause” – mean?  It required – on day one, long before any dispute about care of the patient even arose – that the matter be submitted to forced arbitration – instead of the matter being decided in court.

Arbitration is a “private system of justice,” involving pre-selected “neutrals” (usually somehow connected to the nursing home industry,) to “hear” a dispute involving patient care, and render a binding, private decision.  These decisions, as you could have guessed, almost always favored the nursing home.

This requirement effectively shut the doors to the court system for neglected, abused, or injured nursing home patients, forcing them to agree to an arbitrator’s decision in the matter.  And why did these facilities want (demand) this contract “hammer clause”?  Because they knew that they could prevent a jury from ever hearing the case, which to them is horrific (reason:  Everyone on a jury has a parent, grandparent, a relative somewhere – or even a spouse – who has dealt with a nursing home or long term care facility.  They’ve seen what can go on inside these places.) Nursing homes also knew that any arbitrators would be chosen from a list that would doubtless favor the facility.

They constructed their own private “justice system” – and worse, because the decisions were just that – private – no one could ever learn just how one-sided these collective decisions were.  Awful, no?  Making matters worse, this was an industry-wide practice, meaning that if either the prospective patient or his/her family members objected to this provision, there wasn’t much that they could do about it:  Almost every nursing home, long-term care facility or rehabilitation facility had these clauses in their contracts.

As a Brookline, Massachusetts nursing home patient neglect lawyer, I’ve seen far too many nursing home patients subjected to neglect and mistreatment than I can tell you here.  But believe me, the cases aren’t limited to only Brookline – they come from all over Massachusetts.  And the facts that make them up can be sickening.

In my August 1 2016 post on this topic, I asked readers to reach out the CMS and urge them to ban these nursing home pre-dispute arbitration clauses.

The great news:  It worked!  The CMS has enacted a new regulation that bans nursing homes and long term care facilities from using these awful clauses.  As of November 1 2016, all nursing homes that receive federal funds (Medicare and/or Medicaid funds) can no longer require forced arbitration:  That means about 90% of all Massachusetts nursing homes, and about the same percentage amount across America.  The rule was enacted after 16 states, the District of Columbia, and thousands of families urged the federalgovernment to cease funding nursing homes that use these clauses.  Thank God they did.  This decision restores a fundamental right of millions of elderly Americans: Their day in court.  Here’s a link to a New York Times story on this crucial development.

As a Massachusetts elder abuse attorney, I can’t tell you how great this news is.  Now, because of the advocacy of plaintiffs’ trial lawyers, the American Association for Justice (formerly the American Trial Lawyers Association,) and concerned families across the U.S., nursing homes will now have to face a jury if they neglect, abuse or injure a sick or elderly nursing home patient.

Imagine the outrageousness of that.