Earlier this year, the Centers for Medicare and Medicaid Services (CMS) issued a new rule that nursing homes that include binding arbitration clauses in their contracts will not be eligible for federal funding. In a recent development, the American Health Care Association (AHCA) – a non-profit group formed to advance the interests of the nursing home industry – filed a lawsuit in an attempt to block the newly announced rule.
According to one news report covering the recently filed case, the AHCA and several other nursing home advocacy groups claim that the CMS and the Department of Human Services overstepped their legal mandate in creating the rule. The groups seek to have the rule removed so that nursing homes that implement binding arbitration clauses can once again receive federal funding.
Nursing home advocates claim that arbitration benefits residents and their families because it enables the inexpensive resolution of claims. By some estimates, arbitration can reduce the cost of litigation for nursing homes by 30-35%. By decreasing the costs associated with defending a claim, the argument goes, nursing homes are more willing to offer fair settlement terms to injured residents and their families.
Maryland Nursing Home Lawyer Blog

