On July 18, 2019, the Centers for Medicare and Medicaid Services (CMS) published a long-anticipated final rule allowing nursing home operators to include a pre-dispute binding arbitration clause in resident admission agreements. The following outlines requirements under the new rule for facilities participating in Medicare and Medicaid. This final rule goes into effect on September 16, 2019. If a facility chooses to ask a resident, or a resident’s representative, to sign an agreement for binding arbitration, the facility must:
- Explicitly inform the resident, or representative, of his or her right not to sign the agreement as a condition of admission to, or as a requirement to continue to receive care, at the facility.
- Ensure that the agreement is explained to the resident, or representative, in a form and manner that s/he understands, including in a language the resident or representative understands and the resident or representative must acknowledge s/he understands the agreement.
- Provide for the selection of a neutral arbitrator agreed upon by both parties, and in a venue that is convenient for both parties.
- Explicitly grant the resident or representative the right to rescind the agreement within 30 calendar days of signing it.
- Retain copies of the signed agreement for binding arbitration and the arbitrator’s final decision for 5 years after resolving any dispute.
- Ensure the agreement does not contain any language that prohibits or discourages the resident or anyone else from communicating with federal, state or local officials.
To be compliant with the final rule, facilities should consider reviewing any pre-dispute arbitration agreements and modifying as necessary. If you are interested in including an arbitration clause or amending your current admission agreement, please feel free to contact me for more information.