The Trump administration on Tuesday released a final rule banning nursing homes from requiring residents to sign binding arbitration agreements as a condition for admission.
The final decision was a long time coming and a reversal of the agency's initial proposal, which sought to rescind an Obama-era regulation in response to immense pushback from nursing home stakeholders, including the American Health Care Association.
In the final rule, the CMS said it will allow nursing homes to use binding arbitration agreements, but the facilities must inform patients they aren't required to sign them in order to receive care. That must also be explicitly stated in the agreements themselves.
"We are still reviewing and evaluating the final rule but we applaud the CMS for allowing skilled nursing facilities to use pre-dispute arbitration agreements," Mark Parkinson, CEO of the American Health Care Association, said in a statement.
In addition, the CMS mandated that nursing homes explain the agreement to the resident "in a form and manner that he or she understands."
Nursing homes will also be prohibited from preventing residents or their families from communicating with state surveyors.
"This protects the resident and his or her representative from any undue influence by the long-term care facility to not discuss the circumstances surrounding a concern, complaint or grievance," the CMS said in a news release.
Finally, nursing homes must retain copies of signed binding arbitration for five years after the resolution of any dispute and those documents must be available for inspection upon request by the CMS, accrediting organizations or state surveyors.
"This will ensure that CMS will be able to obtain information on how the arbitration process is being used by long-term care facilities, and on the outcomes of the arbitrations for residents," the agency said.
The AHCA is concerned about the CMS "adding any conditions or administrative requirements when Congress has spoken on this topic, Parkinson said.
There were some proposals the agency didn't finalize. In addition to removing the use of "plain language" in arbitration agreements from the final rule, nursing homes will no longer have to post notices describing their arbitration policies for patients and families.
"We believe these proposed requirements are unnecessary due to other requirements finalized in this rule," the agency said.
