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US DHHS Removes Forced Arbitration Clauses from Nursing Home Contracts

US DHHS Removes Forced Arbitration Clauses from Nursing Home Contracts

If you have been particularly lucky in your life, as least in terms of encountering legal problems, you are probably not aware of the concept of forced arbitration. Put simply, it is a clause, often hidden, in many contracts that states if any lawsuit is brought against the contract’s controller for wrongdoing, it cannot go through litigation; instead, private arbitration will be used to reach a settlement amount.

For the most part, forced arbitration is not good. It takes the power of choice out of the hands of the plaintiff and moves case control to the defendant. Credit card companies are notorious for using forced arbitration clauses to save themselves big by avoiding class actions. In recent years, nursing homes have been in the spotlight for also using these clauses, but that might be coming to an end very soon.

Government Agency Disavows Forced Arbitration

The United States Department of Health and Human Services (DHHS) has recognized the one-sidedness of mandatory arbitration in nursing home contracts and has made a significant leap to undo them. Effective at the end of November 2016, nursing home facilities and assisted-living clinics will no longer be able to claim federal benefits or financial support if they have a forced arbitration clause in their resident contracts. Since many nursing homes cannot sustain themselves without federal assistance, this has essentially forced their own hand and done away with forced arbitration from coast-to-coast.

The change is anticipated to benefit senior citizens who feel as if their health and safety were jeopardized by forced arbitration. In the past, if there was a report of nursing home abuse that triggered a lawsuit, a nursing home with mandatory arbitration could not only hide the claim from the public but also from other residents. Effectively, the accountability of nursing homes was greatly diminished, opening opportunities for further negligence because there was little to no backlash or public outcry. With litigation becoming an option for injured, abused, or neglected residents to follow, trials can go to court, people will be more aware of problems, and verdicts can potentially award far more than arbitration would.

If you need to create a lawsuit after your elderly loved one was abused at a nursing home, contact Sette & Parnoff, PC at your earliest opportunity. Our Hamden nursing home abuse lawyers have more than 65 years of combined experience working some of the most complex injury cases in Connecticut. Call 203.285.3075 to schedule a free case evaluation – we even make house-calls!

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