The American Health Care Association, a trade group representing most of the country’s nursing homes, filed a lawsuit last week against the U.S. government over a new rule regarding arbitration clauses in nursing home contracts.
Some context: last month, the Centers for Medicare & Medicaid Services (CMS) issued a final rule preventing the inclusion of arbitration clauses in long-term care facility contracts. Those clauses prevented residents from suing facilities.
[The original CMS press release can be read here.]
The rule — which goes farther than many observers expected — aims to bring new protections to consumers and facility residents, who would previously have had to turn to private arbitration to sort out claims of elder abuse and wrongful death.
The lawsuit questions CMS’ authority to issue such a rule, and asks the judge to delay implementation of the rule until the challenge is hashed out in court.
More on the lawsuit, from NPR:
The lawsuit filed Monday in Mississippi by the American Health Care Association calls the arbitration clause ban “arbitrary and capricious” and contests the authority of the Centers for Medicare & Medicaid Services, which drafted the rule, to regulate how nursing homes handle disputes. The suit asks a federal court at least to delay the ban from taking effect when the rest of the rules become law in November, while the court considers the industry group’s challenge.
The lawsuit also echoes comments made to NPR by an American Health Care Association spokesman in arguing that arbitration is “an equally fair — yet far simpler and less costly — means of seeking redress as compared to the complicated and slow-moving court system.”
“Long-term care facilities and their residents and residents’ families should not be deprived of the ability to choose arbitration, a valuable form of dispute resolution,” the suit states.
View the lawsuit, in full, here.
