NC Attorney General Acts to Protect Patients in Nursing Homes and Long-Term Care Contracts
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NC Attorney General Acts to Protect Patients in Nursing Homes and Long-Term Care Contracts

Attorney General Josh Stein argues that patients and their families should have the right to a day in court

August 8, 2017

North Carolina Attorney General Josh Stein is urging the Centers for Medicare and Medicaid Services (CMS) to maintain its rule prohibiting pre-dispute arbitration clauses in nursing home and other long-term care contracts.

What is pre-dispute arbitration?

A pre-dispute arbitration clause is an agreement made by parties in a contract before any issues or problems arise. The agreement mandates that any disputes that arise will be handled through binding arbitration, not in a court of law. Binding arbitration involves the submission of a dispute to a neutral party who hears the case and makes a decision.

In other words, if pre-dispute arbitration clauses are allowed and something goes wrong in a nursing home or long-term care facility, patients and their families would have no right to sue in court.

The rule

In October 2016, CMS issued its final rule, prohibiting the use of pre-dispute arbitration clauses. Later that month, the American Health Care Association and a group of affiliated nursing homes filed suit against the regulation and received a preliminary injunction against enforcing the rule.

Despite enjoining the rule, the judge called arbitration for nursing home residents "inefficient and wasteful" and suggested that CMS could have succeeded if it had included additional facts in the official record.

Reversing the rule

On June 7, 2017, instead of building that record, CMS proposed reversing the rule and allowing long-term care facilities to force their patients to arbitration, which is why Attorney General Stein says he is taking this action.

"The decision to move yourself or a family member into a nursing home or long-term care facility can be challenging and emotional," said Attorney General Stein. "If something goes wrong, you should have the right to your day in court. I urge CMS to maintain its rule, which protects some of the most vulnerable people in our communities."

Attorney General Stein's comment to CMS is also signed by attorneys general from California, Connecticut, Delaware, the District of Columbia, Hawaii, Illinois, Iowa, Maine, Maryland, Massachusetts, Minnesota, New York, Oregon, Pennsylvania, Vermont, and Washington.