Nursing homes and assisted living facilities in the U.S. have faced increasing criticism for shoddy care and bad business practices. At the same time, many of these facilities have begun using contractual language that explicitly prohibits residents or their loved ones from filing lawsuits when things go wrong. Now dozens of senators are calling on the Trump administration to rethink its decision to let this practice continue.
A quick catch-up for those coming to this story late: America’s nursing homes have been adding forced arbitration clauses to their residents’ contracts in recent years. These clauses allow the nursing home operator to force any legal challenge out of the court system and into private arbitration. More importantly, these clauses almost always bar similarly wronged residents (or their families) from joining together in a class action, even in arbitration.
This is particularly troublesome in the elder-care world, as many nursing home residents are on fixed incomes, so it may be cost-prohibitive to even try to mount a successful arbitration case on one’s own.
In 2016, the Centers for Medicare & Medicaid Services (CMS) unveiled an overhaul to its regulations for long-term care (LTC) facilities. Included in that massive update was a new rule stating that any LTC facility that wanted to accept Medicaid or Medicare money would have to stop using forced arbitration going forward. Existing contracts would not be affected.
Here is where we are required to point out the irony of the LTC industry filing a lawsuit to preserve its authority to prevent its customers from filing lawsuits.
Then in June, after the Trump administration abandoned the legal fight with AHCA over the anti-arbitration rule, the new folks at CMS announced their intention to formally roll back the regulation.
The new CMS plan attempts to paint a pro-consumer face on this revision by saying that the even-newer rule will require that nursing home patients be told up-front about arbitration clauses and that they be provided with a clear explanation of what they are signing away.
But as we pointed out in June, this does nothing to add any consumer choice to the matter. The resident must still either take the agreement or leave it, and hope to find an LTC facility somewhere that actually appreciates the Sixth and Seventh Amendments.
This morning, a group of 31 senators wrote to CMS Administrator Seema Verma, calling on the agency and the Trump administration to rethink its position.
“Forced arbitration clauses in nursing home agreements stack the deck against residents and their families who face a wide range of potential harms, including physical abuse and neglect, sexual assault, and even wrongful death at the hands of those working in and managing long-term care facilities,” reads the letter [PDF]. “These clauses prevent many of our country’s most vulnerable individuals from seeking justice in a court of law, and instead funnel all types of legal claims, no matter how egregious, into a privatized dispute resolution system that is often biased toward the nursing home. As a result, victims and their families are frequently denied any accountability for clear instances of wrongdoing.”
The letter includes the story of a nursing home resident in Alabama whose family accused the home of failing to properly supervise their mother’s medication. Toxicology reports showed that the resident, who’d had dementia, had more than 20 times the recommended dosage of her diabetes medication in her system when she died. The family tried to hold the nursing home accountable, but the case never saw a day in court because the facility was able to force it into arbitration.
The senators also point out that, because arbitration is often confidential and the results of hearings are not part of the public record, LTC facilities may be getting away with widespread Medicare and Medicaid fraud.
“The current CMS proposal, issued by President Trump’s administration, to roll back this critical protection once again places residents’ health and safety at significant risk, and leaves potential residents and their families in the dark about facilities’ past negligence and abuse,” argue the senators. “The current proposal would also override existing state law protections aimed at protecting nursing home residents from the enforcement of one-sided contracts more broadly.”
The letter was led by Sens. Al Franken (MN) and Ron Wyden (OR). Also signing were Richard Blumenthal (CT), Patrick Leahy (VT), Dick Durbin (IL), Sheldon Whitehouse (RI), Sherrod Brown (OH), Ed Markey (MA), Tammy Baldwin (WI), Tom Udall (NM), Brian Schatz (HI), Jeanne Shaheen (NH), Mazie Hirono (HI), Christopher Coons (DE), Jack Reed (RI), Maggie Hassan (NH), Elizabeth Warren (MA), Debbie Stabenow (MI), Bob Casey (PA), Catherine Cortez Masto (NV), Cory Booker (NJ), Bernie Sanders (VT), Kamala Harris (CA), Chris Van Hollen (MD), Tim Kaine (VA), Patty Murray (WA), Robert Menendez (NM), Tammy Duckworth (IL), Jeff Merkley (OR), Kirsten Gillibrand (NY), and Gary Peters (MI).