On July 18, 2019, the Centers for Medicare & Medicaid Services (CMS) issued a final rule repealing the agency’s ban on the use of pre-dispute arbitration agreements in the long-term care (LTC) setting.¹ This final rule follows CMS’s proposed rule, issued on June 8, 2017, reversing course on CMS’s initial ban on pre-dispute, binding arbitration agreements in October 2016.² (See CMS Reverses Course in Pre-Dispute Arbitration Agreement Ban for additional background and analysis on the June 8, 2017, proposed rule.)

As you may recall, CMS’s proposed rule offered to eliminate entirely the prohibition on pre-dispute binding arbitration agreements and provided no limitations on the use of arbitration agreements as a condition of admission (or continuing admission) to a LTC facility, provided certain “transparency” requirements were met. CMS received over 1,000 comments in response to the proposed rule and, in turn, delivered a final rule that makes concessions for both the proponents of a ban on pre-dispute arbitration agreements and the opponents seeking to preserve the legal right of the LTC facilities to freely contract with their residents. CMS explained in the final rule: “Although we are not finalizing a prohibition on pre-dispute, binding arbitration agreements, we believe that the requirements we are finalizing in this rule will provide the protections residents and their representatives will need to avoid being compelled to arbitrate disputes with LTC facilities without voluntarily and knowingly choosing to do so.”³Continue Reading CMS Issues Final Rule Repealing the Prohibition on the Use of Pre-Dispute Binding Arbitration Agreements