Nursing homes, administration reach deal over federal arbitration rule

Written on Sep 18, 2019

A federal rule that prohibits long-term care facilities from requiring residents to sign a binding arbitration agreement as a requirement for receiving care could be delayed for some nursing facilities, despite going into effect nationwide Sept. 16. 

The Department of Health and Human Services, which is home to Centers for Medicare & Medicaid Services, has agreed to delay the enforcement of the rule for the Northport Health Services and NWA Nursing Center until Dec. 31, 2019. Northport and NWA agreed to the rule delay on the condition that more than 80 facilities or their parent companies, based in several different states, be added as additional plaintiffs in the case. 

The pact was made Sept. 13 in the Western District of Arkansas but has yet to be ruled on. The two sides filed a joint motion for scheduling order, which proposes a schedule for resolving the lawsuit. 

“In light of that, the parties agree that resolving plaintiffs’ motion for a preliminary injunction or stay pending judicial review is unnecessary at this time,” court documents stated. 

The providers and regulators said they agreed on a schedule to give the court time to decide on the motions for summary judgment by the end of the year and that the schedule could be adjusted as needed before the stay ends.

The American Health Care Association reminded providers the rule is still in effect. In early September, Northport and NWA filed a lawsuit against the agencies over the amended arbitration rule. They asked the court to stay the effective date, which was Monday, Sept. 16, for the arbitration requirements and prohibit the administration from enforcing it. 

The providers claim the amended arbitration rule is in violation of the Federal Arbitration Act (FAA) and that neither CMS nor HHS has the “statutory authority” under the Medicare and Medicaid acts to regulate alternative dispute resolution.

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