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Nursing Homes Barred from Requiring Arbitration
The Centers for Medicare and Medicaid Services (CMS) recently struck a blow for justice by barring nursing homes from forcing their residents or family members to sign forced arbitration agreements. As a result, any facility that receives federal funding will no longer be able to force residents to resolve disputes in arbitration rather than in court.
What is Forced Arbitration?
Forced arbitration is typically a clause buried deep within a contract that states the recipient of service or product will give up the right to file a lawsuit in court against the provider. This type of clause can be found in just about any sort of service contract, such as a cell phone agreement or a car lease.
Nursing homes typically use these kinds of clauses before admitting a resident. As a result, residents and family members must agree to arbitration rather than having their dispute heard in a court of law. Residents are basically giving up their constitutional right to a jury trial because they need the help of a nursing home facility.
There are many horrific examples of families denied justice due to forced arbitration clauses. According to a report in The New York Times, in May of 2014 a woman suffering from Alzheimer’s was raped twice in two days by fellow residents at a California nursing home. Even though a state investigation found that the home failed to protect the resident, efforts to hold the facility accountable in a court of law were blocked due to the clause. The family of the woman eventually gave up and chose to settle.
What’s particularly insidious about arbitration is the fact that the arbitrator will typically have some sort of association with the service provider. Nursing homes, for example, will usually use the same arbitrator while the aggrieved party will only use it once, leading to a built-in bias. Even when a plaintiff wins, the award is typically much lower than it would have been through a court.
In addition, arbitration costs are typically split evenly between the two sides, stacking the deck even more in the favor of the service provider. A nursing home will usually be able to easily afford the costs, while the plaintiff will usually not.
Justice is Served
But this will no longer be the case when it comes to nursing homes. Thanks to the CMS decision, elderly people across the country will once again have their right to a day in court.