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October 24, 2016

UPDATE: Nursing Facilities Sue HHS to Block Ban on Pre-Dispute Binding Arbitration Agreements

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A group of nursing homes, led by the American Health Care Association (“AHCA”) which represents over 13,000 non-profit and for-profit nursing facilities, filed suit this week in U.S. District Court to block the implementation of a new Medicare and Medicaid rule prohibiting long term care facilities from entering into pre-dispute binding arbitration agreements with residents or their representatives. In its suit, the plaintiff group asks the Court to invalidate the new rule, arguing that the ban on pre-dispute binding arbitration violates the Federal Arbitration Act (“FAA”). The plaintiffs also contend that the Department of Health and Human Services (“HHS”) lacks the statutory authority under the Medicaid and Medicare Acts to adopt a rule that regulates alternative dispute resolution procedures such as the use of arbitration. (Read the complaint: here.)

Since the new rule will be effective November 28, 2016, the plaintiffs have requested the Court to block implementation of the ban while the case is under judicial review. The Court is expected to render a decision before the ban goes into effect on November 28th. We will keep you posted on that decision.

Read our previous alert on this subject: HHS Prohibits Long-Term Care Facilities from Using Pre-Dispute Binding Arbitration Agreements

About the Authors

Andrew Levine

Andrew Levine is a partner and head of the firm's regulatory practice. He provides regulatory guidance, business and corporate legal services, as well as strategic advice to healthcare clients. You can find him on Google+ and LinkedIn.

Crystal Bloom

Crystal Bloom is a partner and a senior healthcare regulatory attorney in Donoghue Barrett & Singal's Health Law group. She provides state and federal regulatory guidance and corporate legal services to healthcare providers. You can find her on LinkedIn.

Adelita Orefice

Adelita Orefice is an attorney in Donoghue Barrett & Singal’s Providence office where she focuses on healthcare and corporate law.

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