The Centers for Medicare and Medicaid Services has said it will block nursing homes from federal funding should they use pre-dispute binding arbitration agreements. What this means is nursing homes in Tennessee can no longer force their patients and families to sign away their rights to sue in court before being admitted into the facility. Nearly all nursing homes are federally funded in some way or another, so this agreement could likely have a massive impact on the industry as a whole.
Prior to this ruling being made, it has been commonplace for elderly individuals and families to have to agree to private arbitration over the United States legal system. This meant elderly people, who are being cared for in federally funded nursing homes, may have been prevented from seeking legal damages as a result of neglect, recklessness, endangerment or wrongful death. Currently, these arbitration contracts have helped the nursing home industry reduce legal costs and total cumulative damages as well as prevent tarnished reputations and long lasting repercussions.
Unfortunately, elderly are often desperate for care and shelter and will be quick to sign something even if they don’t understand what is being noted in the contract. When certain people have attempted to seek legal assistance for a dispute, the arbitration has held up as a legally binding contract; thereby affecting some of the most vulnerable Americans. For all new contracts between nursing homes and residents, this arbitration clause cannot be included.