The Coumbus Dispatch had an article about Trump’s decision to side with the nursing home industry over the vulnerable residents in their care.  Trump has reversed a ban on forced arbitration hidden in nursing home admission contracts.  When the ban is withdrawn, nursing homes will require residents to sign pre-dispute mandatory arbitration agreements before they are provided the care they need.

Consumer advocates, experts, and critics say Trump’s proposal favors nursing homes because residents and their families have unequal bargaining power. They often don’t have time to “shop around” for deals because of the limited number of homes with available beds and the tight time frames to make arrangements for care.  Unlike a court process involving a judge or jury, arbitration usually allows the nursing home to select the arbitrator, a power that is laid out in the nursing home’s contract terms, and the proceedings are conducted in private and kept secret. Arbitration agreements also can set limits on the damages a party can recover. Appeals are not allowed.

The Des Moines Register reported that Iowa’s Republican Senators have been silent as to their position on Trump’s plan to support unfair mandatory arbitration clauses against nursing home residents.  Despite claiming to support vulnerable adults access to courts and protect their constitutional right to a jury trial, neither has joined colleagues in the Senate who are attempting to prevent care facilities from limiting residents’ right to sue for abuse and neglect.

Last year, the federal Centers for Medicare and Medicaid Services notified all nursing homes that receive federal funding a new rule was being proposed to prevent them from including unfair mandatory arbitration clauses in their admissions contracts with residents. The rule would specifically prohibit the “the use of pre-dispute binding arbitration agreements” in care facilities funded by Medicare and Medicaid.

Advocates for consumers, seniors and the disabled have protested CMS’ about-face, arguing that arbitrators, often paid for by the industry itself, tend to side with industry.

Rob Weissman, president of the advocacy group Public Citizen, told the Los Angeles Times the switch to allow forced arbitration was “a heartless and vile act.”

On Aug. 7, 31 U.S. senators, all Democrats, wrote to CMS Administrator Seema Verma and said forced arbitration agreements “stack the deck against residents and their families who face a wide range of potential harms, including physical abuse and neglect, sexual assault and even wrongful death at the hands of those working in and managing long-term care facilities.

 “These clauses prevent many of our country’s most vulnerable individuals from seeking justice in a court of law, and instead funnel all types of legal claims, no matter how egregious, into a privatized dispute resolution system that is often biased toward the nursing home.”

Mandatory-arbitration clauses that prevent consumers from suing for poor quality service has ignited a fierce public debate.  Consumer advocates say they aren’t opposed to arbitration as a voluntary option, but residents shouldn’t be required to relinquish their right to sue to gain access to health care that’s paid for with public money through Medicare and Medicaid.

“The worst time for a vulnerable person or his or her family to decide the means to resolve future disputes is when the contract is being presented at the often-urgent time he or she is being admitted to a nursing home, a time of particular physical and/or emotional stress,” the attorneys general wrote.

“The practice of executing arbitration contracts during the nursing home admissions process raises valid concerns on a public policy level,” Judge Michael P. Mills of the U.S. District Court in Oxford, Miss., wrote, noting that “many residents and their relatives are ‘at wit’s end’ and prepared to sign anything to gain admission.”

Thirty-six advocacy groups, including the National Consumer Voice for Quality Long-Term Care, National Organization for Women and The Arc of the United States have also sent a letter to CMS encouraging adoption of the proposed rule.

NPR had a story on Trump’s reckless decision to side with industry over nursing home residents making it almost impossible for nursing home residents to get their day in court.

Trump is allowing nursing homes to require residents sign arbitration agreements as a condition for getting nursing home care.  “That means that no jury will ever hear his case. The parties hire a private judge and use a different set of rules that can be more restrictive than civil court. Studies also show that awards to plaintiffs can be as much as 35 percent lower.”

That’s why 17 state attorneys general and 31 members of the Senate have urged the Trump administration not to adopt the proposed rule. Arbitration procedures are generally more secretive than civil court. So they’re not just bad for the plaintiff, they’re also bad for everyone else whose victimization could’ve been stopped if they’d have known that this was a bad facility.

The New York Times published an editorial explaining how arbitration is a “rigged” system.  “Arbitration and class action waiver clauses effectively immunize companies from illegal and fraudulent conduct. Virtually every sizable company has such clauses.”

“There are several reasons that companies have these provisions: 1) arbitrations are almost impossible for customers to pursue because they are too expensive (class actions allow costs to be shared over thousands of wronged individuals); 2) arbitrations do not allow discovery of the institution’s internal records (as lawsuits do); 3) arbitrations are often required to be held in a city far from the wronged party; and 4) the arbitrators tend to favor the institutions, which can offer them repeat business. This is a perfect example of what many have called a system rigged against the average person.”

Congress (Democrats and Republicans alike) could not find the gumption to act on the proposed Arbitration Fairness Act, first introduced in 2009, which would have outlawed such provisions in consumer and employment contracts. Finally, years later the Consumer Financial Protection Bureau adopted a rule that would achieve some of that goal, and now the Republicans in Congress are trying to undo that rule before it goes into effect.

Until and unless wrongdoers know that they face the risk of having to actually answer to those they wrong, they will never change their conduct.


AARP’s statement on forced arbitration:

Often lurking in the fine print of nursing home contracts is a binding arbitration clause that has serious implications for unsuspecting consumers. Now the federal government plans to give facilities free rein to require residents to agree to such clauses, giving up the right to take their grievances to court.

The Trump administration plans to allow mandatory binding arbitration clauses to be a part of any admission contract for every long-term care facility that accepts federal money. Because nursing homes get federal Medicaid or Medicare funding for virtually all of their residents, that’s pretty much all of them.

Consumer groups say mandatory arbitration clauses stack the deck against nursing home residents, preying on them at a time fraught with anxiety when they and their families are grappling with a serious illness or trying to find a long-term care solution. The consumer groups have been fighting against such clauses for years.

Once consumers sign on the dotted line, they give up the right to sue the facility, no matter what the grievance is — sexual abuse, neglect, mismanaged medication, even wrongful death.

Instead, complaints would be handled through negotiations with an arbitrator — not a judge or a jury. Whatever the outcome, the nursing home resident would have to accept it, with only the most limited right to appeal. Such proceedings are conducted in private with a cloak of secrecy that protects potential offenders from the public exposure that might force them to change their ways.

Advocates, including AARP, thought they had successfully beaten back mandatory arbitration clauses when the Obama administration issued a regulation that prohibited long-term care facilities from forcing residents to sign them before any dispute arose. That regulation was scheduled to take effect in November 2016, but it was delayed after the nursing home industry challenged it in federal court.

The Centers for Medicare and Medicaid Services (CMS) has reversed the Obama administration policy and issued a proposal that would allow facilities to require the arbitration clause as a condition of admission. In addition, the new proposal would make a bad situation even worse, advocates say, by overriding state laws that protect nursing home residents from lopsided arbitration agreements.

AARP has expressed grave concerns over this about-face. “We are alarmed that CMS’ decision to remove provisions prohibiting binding pre-dispute arbitration will very likely have dangerous and harmful impacts on nursing facility residents, as well as their families,” David Certner, AARP legislative counsel and legislative policy director, said in a letter to CMS Administrator Seema Verma.

Senators also are pushing back against the CMS rule. “With Medicare and Medicaid spending over $82 billion on nursing home care in 2015, prospective residents, their families, and the public deserve greater accountability and transparency from these facilities, not less,” said 31 Democratic senators in a letter to Verma.

The nursing home industry insists that arbitration saves money and time for residents who have complaints. Yet when it comes to cost, residents usually have to pay their lawyer and a share of the arbitrator’s fees.

Among other consumer disadvantages AARP has identified:

  • Consumers may have to travel far to attend arbitration proceedings.
  • The facility that imposed arbitration in the contract may be allowed to also choose the arbitrator.
  • Arbitrators are not required to issue written decisions.
  • Grounds for appealing an arbitrator’s decision are extremely limited.

More than 1,000 comments were filed with CMS about this proposed regulation, most opposing the rule. CMS has not indicated how long it will take to review the comments and when a final regulation might be issued.

The National Law Review had an article about the American Bar Association’s views on forced arbitration in nursing home admission contracts.  “In a recent letter, the American Bar Association (ABA) advocates for the Centers for Medicare and Medicaid Services (CMS) to retain its current rule prohibiting long-term care facilities from entering into binding arbitration agreements with residents until after a dispute arises. In the letter sent to CMS administrator Seema Verma, the ABA writes that implementing the proposed rule would harm residents’ rights and interests.”

The ABA takes the position that the current rule follows the recent United States Supreme Court interpretation of the Federal Arbitration Act in Kindred Nursing Centers v. Clark.  The ABA states that while Kindred prohibits singling out arbitration agreements for disfavored treatment, the Supreme Court did not single out arbitration agreements for favored treatment. Trump is proposing to implement a “total embrace of mandatory pre-dispute arbitration provisions” in nursing home admissions contracts, wrote Thomas M. Susman, director of the ABA’s Governmental Affairs Office.

The North Carolina Health News reported that CMS wants to regulate clauses in nursing home contracts known as pre-dispute mandatory arbitration agreements.

The Trump administration wants to not only reverse the ban, but proposes to prohibit any bans on the practice from being written into any statutes.  “The issue is that [pre-dispute arbitration agreements] are being required before any dispute has happened,” said Lori Smetanka, head of The National Consumer Voice for Quality Long-Term Care.

“When a consumer signs admission papers for themselves or a loved one into a nursing home, these clauses are often present amongst the dozens of pages of legalese in the contract. Such provisions eliminate the opportunity for a consumer who ends up in conflict with a nursing home to go to court.”

When neglect or abuse occurs, the victim only has the option for confidential arbitration, most often with an arbitrator retained by the nursing home company.

North Carolina Attorney General Josh Stein told NC Health News: “It’s fundamental in the U.S. that if a person has been harmed through the mistreatment or neglect of another that they can have their day in court. That’s what the original CMS rule provided and it’s what the new CMS rule undermines.”

The Huffington Post had an article from Robyn Grant, Director of Public Policy and Advocacy, The National Consumer Voice for Quality Long-Term Care.

Last month, the federal government signaled its intention to roll back protections critical to the health, safety and welfare of vulnerable nursing home residents. The rule they want to eliminate bans the use of pre-dispute arbitration agreements. These agreements require older adults, people with disabilities and their families to waive their rights to the judicial system before a dispute even arises. Then, any dispute, even abuse or neglect, and regardless of how egregiously they’ve been harmed, is forced into secretive arbitration proceedings.

Typical nursing home claims involve injuries such as pressure sores that lead to infection; amputated limbs; suffocation on bedrails and other restraints; choking;; sexual assault; renal failure and other conditions caused by dehydration; malnutrition; severe burns; gangrene; and painful, immobilizing muscle and joint problems resulting from long-term inactivity. All of these are avoidable conditions that are the result of negligence or even willful misconduct by long-term care facilities.

These forced arbitration agreements are presented to prospective residents and their families during the admission process, an extremely difficult and stressful time. Individuals typically feel compelled to sign because they are under extreme pressure to be admitted and the implied message is they must agree or be refused care. To make matters worse, under the recent government proposal, this message would no longer be implied. Nursing homes could refuse admission to a resident whose family, acting on their behalf, is unwilling to sign away their rights. This holds residents hostage – they must agree to give up their rights in order to have essential care and a place to live.

Arbitration stacks the deck against residents. The contracts typically allow the nursing home to select the arbitrator, the state in which the arbitration will occur and the rules for the arbitration process. There is a strong incentive for arbitrators to find in favor of the facility since this can assure them of repeat business. As a result, residents often lack meaningful ability to hold the nursing home accountable for mistreatment and harm.

Nursing facilities insert pre-dispute arbitration clauses in their contracts to ensure that they will never be held publicly responsible for their actions, and to limit any penalties imposed for wrongdoing. Arbitration proceedings are held behind closed doors and are confidential. The public, including those looking for a nursing home – will never know the nursing home’s full track record ― no matter how bad ― because it is hidden. Arbitration shields poor performing facilities from the negative impact on their reputation, public opinion and pressure that could serve as a deterrent to substandard care.

The U.S. Census Bureau estimates that by 2030, one in every five U.S. residents will be 65 years or older; almost half of these Americans are likely to spend some time in a nursing home. We must stand together to protect the rights and care of frail, at-risk nursing home residents. More Americans must lend their voices to this cause. Tell our policymakers to reinstate the ban on mandatory pre-dispute arbitration agreements that protect nursing homes, but not those entrusted to their care.


The Times Leader reported that several Attorney Generals are banding together to protect vulnerable seniors from the Trump Administration’s reversal on banning forced arbitration onto unsuspecting nursing home residents.

Pennsylvania Attorney General Josh Shapiro and 16 other Attorneys General sent comments to the Center for Medicare and Medicaid Services, recommending that CMS keep in place a rule that prohibits pre-dispute arbitration clauses in nursing home and long-term care contracts. Pre-dispute arbitration clauses require seniors to waive their constitutional rights to go to court to resolve any dispute with a nursing home.

In the comments sent Monday to CMS, the attorneys general state:

Pre-dispute binding arbitration agreements in general can be procedurally unfair to consumers, and can jeopardize one of the fundamental rights of Americans; the right to be heard and seek judicial redress for our claims. This is especially true when consumers are making the difficult decisions regarding the long-term care of loved ones. The contractual provisions may be neither voluntary nor readily understandable for most consumers.”

“I have the responsibility of protecting our most vulnerable citizens, including seniors living in long-term nursing care facilities,” Shapiro said in a news release. “If we allow nursing homes to include pre-dispute arbitration clauses in admission contracts, our seniors will have less access to the courts and to justice. I won’t stand by while seniors lose their rights.”


Commons Dreams had an article expressing disbelief with Trump’s plan to force nursing home residents into arbitration instead of protecting their constitutional right to a jury trial.

Rep. Ted Lieu asked “Why does Trump hate grandmothers?” as he decried a proposal from the administration that would prevent abused or mistreated seniors in nursing homes from getting their day in court, jeopardizing their health and safety.

Fellow lawmakers as well as patient and consumer advocacy groups like Public Citizen, said the effort to roll back protections from some of society’s most vulnerable people is just part of “a disturbing trend of the Trump administration attempting to reverse critical protections against forced arbitration,” which prevents individuals or groups of people from filing lawsuits or seeking damages for fraud, abuse, neglect, medical malpractice and other forms of wrongdoing.

“Forced arbitration clauses in nursing home agreements stack the deck against residents and their families who face a wide range of potential harms, including physical abuse and neglect, sexual assault, and even wrongful death at the hands of those working in and managing long-term care facilities,” the letter (pdf) states. “These clauses prevent many of our country’s most vulnerable individuals from seeking justice in a court of law, and instead funnel all types of legal claims, no matter how egregious, into a privatized dispute resolution system that is often biased toward the nursing home. As a result, victims and their families are frequently denied any accountability for clear instances of wrongdoing.

Lauren Saunders, associate director of the National Consumer Law Center, said “Everyone should be outraged that the Administration is proposing to strip legal rights from fragile seniors and their families during the incredibly stressful time when a loved one is entering a nursing home.”