The Centers for Medicare and Medicaid Services (CMS) has finalized a rule that will ban nursing homes and long-term care facilities from requiring residents/patients to sign pre-dispute mandatory arbitration agreements as a condition for receiving federal money through Medicare and Medicaid. The rule is part of a 713-page document that revamps nursing home care standards, rules and regulations. It will be implemented in three phases, with the first phase set to go into effect on Nov. 28, 2016. Phase I includes the ban on pre-dispute arbitration clauses.

“The new rules and regulations will provide greater protections for persons who are in a nursing home, including the elderly and the disabled,” says Benjamin L. Locklar, a lawyer at Beasley Allen who works on litigation involving nursing home abuse and neglect. “Among the new requirements, nursing homes that receive government benefits to compensate for the care of its patients may no longer ‘enter into an agreement for binding arbitration.’ What this means is that a nursing home may not require a new resident or his or her family members to waive their Constitutional right to a trial by jury. No longer may long-term-care facilities force residents and their family members into binding arbitration as a result of the facility’s abuse or neglect that harms a patient. This is a badly needed change and it will result in better and safer care and treatment of nursing home residents.”

The new rule means that if a nursing home or long-term care facility wishes to receive Medicare and Medicaid benefits it can no longer require residents or their family members to sign binding arbitration agreements. They can no longer enforce arbitration agreements and prevent people from filing a lawsuit over medical negligence.

“Beasley Allen has been at the forefront of fighting arbitration for many years, and we are excited about the new rules and regulations of CMS,” Locklar says. “Beasley Allen will continue to aggressively pursue nursing home litigation on behalf of our clients, and now we are free to pursue these cases in the courts of this State.”

However, since the new regulation may not apply to existing arbitration agreements, Beasley Allen is encouraging people who have loved ones in nursing homes or long-term care facilities to notify the facility Administrator, in writing, that the arbitration provision is being rescinded on behalf of the resident/patient. If the nursing home refuses to accept the written rescission of the arbitration agreement, we encourage citizens to notify the Centers for Medicare and Medicaid Services that the respective nursing home is refusing to abide by the new regulations.

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