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New Ruling: Forced Arbitration in Nursing Homes


Forced Arbitration in Nursing Homes

Recently, a ruling was made that bans any nursing home that receives federal funding from mandating that its residents resolve disputes in arbitration, instead of in court. Arbitration is the use of an arbitrator (an independent person or body officially appointed) to settle a dispute. The ruling affects about 1.5 million residents currently residing in nursing homes and it promises to deliver several major new protections.

It has not been uncommon for there to be clauses hidden in the fine print of a nursing home admissions contract that has allowed concerns about safety and quality of care to be hidden from public view. This previous system has aided the nursing home industry in reducing legal cost, but many nursing home residents’ families have been blocked from getting the justice that they deserve.

Leading the Charge

Sixteen states and the District of Columbia led the charge in getting this new ruling and urged the government to cut off funding to nursing homes that used these clauses. They argued that arbitration kept prospective residents and their families in the dark about patterns of wrongdoing.

An agency under Health and Human Services, The Centers for Medicare and Medicaid Services, made the ruling and restored a fundamental right, a day in court, to millions of elderly people across the United States. The ruling is the most significant overhaul of the agency’s rules about federal funding for long-term care facilities in over 20 years. Rulings made by consumer agencies do not require congressional approval. Rulings are able to be challenged in court, but if challenges are not presented, the ruling should go into effect in November.

Nursing homes opposing the ruling have said that arbitration is much more cost effective option compared to court. If more lawsuits are allowed, costs will most likely go up and force some homes to close.

Nursing homes are not the only industry affected by arbitration clauses. Cell phone contracts, student loans and employment agreements have also been affected.

Legal Counsel

If you or a loved one has been affected by an arbitration clause, it’s important to contact a lawyer immediately. Every person deserves their chance to be heard in court, and Buzzell, Welsh & Hill wants to help you make the most of your opportunity. We offer free consultations and are happy to answer any questions that you have. Call us today!

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