The first time my cousin Marilyn went from the hospital into a nursing home, I discovered that if something happened, we had little recourse. The contract the facility required me, as the person responsible for her, to sign included the fine print detail that if their treatment hurt her in any way, we would have no recourse in the courts. Binding arbitration would settle all complaints.

Of course, I hoped they would treat her well but this made me incredibly uncomfortable. It certainly didn’t seem like the greatest place and I pushed to get her out of there and back to the assisted living facility where she lived as soon as possible.

Many other families did not have that good fortune and found their ability to hold nursing homes accountable limited by binding arbitration. They could not sue. 

Finally, that changed. The Centers for Medicaid and Medicare Services (CMS), the federal agency that sets the rules for nursing homes, stepped up and created a new rule it calls “Protecting Residents’ Rights.” It will affect the 1.5 million people in more than 15,000 long-term care facilities. 

Protecting Residents’ Rights

Here’s what the Centers for Medicaid and Medicare Services said:

“Our final rule will prohibit the use of pre-dispute binding arbitration agreements. This means that facilities may not require residents to sign pre-dispute arbitration agreements as a condition of admission to that long-term care facility.

Facilities and residents will still be able to use arbitration on a voluntary basis at the time a dispute arises.

Even then, these agreements will need to be clearly explained to residents, including the understanding that these arbitration agreements are voluntary, and that these agreements should not prevent or discourage residents and families from talking to authorities about quality of care concerns.”