We posted a blog relating to arbitration agreements – their validity, and their benefits and challenges. Arbitration agreements can be a useful tool for resolving disputes. They can also create a wall preventing resolution in situations best left to the determination of a jury. Many argue that pre-dispute arbitration agreements are unjust; because, how could one know what troubles lay ahead and the related rights they would be relinquishing? Others argue that arbitration is a cost effective and less burdensome alternative to court proceedings.

Long-term care (LTC) facilities frequently use arbitration clauses as a standard part of the admissions process. Whether a mandatory agreement for arbitration is legal is an issue in flux at the moment. Currently, the Centers for Medicare and Medicaid Services honor a ban on mandatory arbitration agreements, while the Supreme Court has found that valid arbitration agreements are upheld under the Federal Arbitration Act. Valid arbitration agreements require the bound parties to willingly and competently sign in agreement, or to have an authorized agent sign on their behalf. The parties must also understand what rights they are giving up.

“Understanding” Arbitration Agreements

Arbitration agreements are a touchy subject in any context, but particularly so in the emotionally charged, often distressed, situations surrounding entry into a long-term care (LTC) facility.

Anyone attempting to keep up with the flip-flop of positions on permitting or prohibiting arbitration clauses in LTC contracts is likely suffering from a severe case of whiplash. In the last three years, the validity of arbitration clauses has gone from silent, to prohibited, and soon they could become lawful. The future of LTC resident care hangs in the balance.

The Paradox

The executive branch’s position on arbitration clauses in LTC contracts has made a 180-degree turn in recent years. In 2016, the Centers for Medicare & Medicaid Services (CMS) banned pre-dispute arbitration agreements. In 2017, CMS issued proposed revisions eliminating the arbitration prohibition.

Folks with dementia who have to be moved from one environment to another can sometimes experience stress and anxiety, termed “transfer trauma.”  The extent of the transfer trauma can vary among individuals.  For some, it can be brief, mild, or non-existent.  In others, the trauma is extensive and intense.  The more extreme cases usually involve someone with early stages of dementia who is moving from the long-time family home into a new environment.