NCHR Letter to CMS on Arbitration Agreement in Long-Term Care Facilities

Seema Verma
Centers for Medicare and Medicaid Services (CMS)
Department of Health and Human Services
Hubert H. Humphrey Building
Room 445-G
2000 Independence Avenue, S.W.
Washington D.C. 20201

Re:  Medicare and Medicaid Programs
        Revision of Requirement for Long-Term Care Facilities; Arbitration
        RIN 0938-AT18

 Dear Administrator Verma:

The National Center for Health Research (NCHR) is a non-profit organization which utilizes research to inform public health policy and legislation, and also advocates for patients and consumers.  We help lead an informal coalition of approximately twenty public health and non-profit organizations which represent millions of patients and consumers.  NCHR frequently is involved with issues concerning the health and well-being of seniors and the elderly.  Our Director of Health Policy was previously focused on nursing home issues while on the senior staff of the Senate Special Committee on Aging and at the U.S. Department of Health and Human Services (HHS).

Based on our extensive knowledge of nursing home residents and their families, we write to express our strong opposition to the proposed regulatory revision concerning nursing home facilities and consumer arbitration agreement.  We respectfully urge the agency to withdraw it.

The existing regulation allows a nursing facility to use a binding arbitration agreement only if the agreement was signed after the occurrence date of the incident in dispute.  The proposed regulation, in contrast, would allow a nursing facility to obtain a resident’s signature long before the relevant issue occurs—in most cases, during admission to the facility.  More worrisome, the proposed regulation would authorize a facility to require a pre-dispute binding arbitration agreement as a condition of admission.

It is unconscionable that nursing home residents and their loved ones would need to waive their legal rights when they sign admissions contracts to enter nursing homes.  Forced arbitration clauses block nursing home patients from their legal rights, instead requiring them to use secretive arbitration proceedings where decisions are often made by firms that have been selected by the nursing home management.  Seniors and their families would have no right to appeal the arbitration decision.

I’m sure that we all agree that admitting a loved one to a nursing home is an emotional and stressful experience, and residents and family members often do not fully understand all the information in the lengthy documents they must sign. Even if they read these documents carefully, they are unlikely to comprehend the rights they would surrender by signing a forced arbitration contract.  And, of course, there may not be other nursing homes to consider.  Forced arbitration contracts put our most vulnerable citizens at even greater risk of harm and financial loss.

CMS did the right thing last year by stopping this harmful practice of forced arbitration and we strongly urge CMS to continue to enforce the existing requirement rather than changing it.