Injunction Blocks New CMS Arb Ban

The implementation of a new rule prohibiting federal funds for nursing homes that enter binding arbitration agreements with residents has been blocked by U.S. District Court Judge Michael P. Mills of the Northern District of Mississippi, who found in granting a preliminary injunction that the Centers for Medicare & Medicaid Services (CMS) did not have authority to enact the mandate without statutory authority. In an order sympathetic to residents and their families, he opined the rule by CMS, an agency under Health and Human Services (HHS), did appear to be based on “sound public policy.” However, the court was unwilling to play a role in countenancing the incremental “creep” of federal agency authority beyond that envisioned by the U.S. Constitution. CMS essentially barred any nursing home or assisted living facility that receives federal funding from requiring that its residents resolve any disputes in arbitration, instead of in court. It is the most significant overhaul of the agency’s rules governing federal funding of long-term care facilities in more than two decades. The nursing home industry has said that arbitration offers a less costly alternative to court. Allowing more lawsuits, the industry has said, could drive up costs and force some homes to close. The order states, “This court believes that Congress might reasonably consider this inefficiency, as well as the extreme stress many nursing home residents and their families are under during the admissions process, as sufficient reason to decide that arbitration and the nursing home admissions process do not belong together.” See order here-- http://bit.ly/2gd06oL or http://bit.ly/2fOYdvi