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Feds Ban Mandatory Arbitration Clauses for Nursing Homes

By Nick Verderame | September 29, 2016

In a big victory for nursing home patients and the Constitution, the federal government passed a new rule that prevents nursing homes from including arbitration clauses in their consumer contracts.  The new rule applies to every nursing home that accepts federal funding.  Companies, including nursing homes, often include arbitration clauses in their standard contract as a way to get leverage over consumers.  Companies prefer these clauses, which make arbitration mandatory and remove your right to a jury trial, because the nation’s largest arbitration providers generally favor large companies over consumers.  Therefore, companies that make you agree to arbitration, as opposed to jury trial, when you engage with them, are intentionally stacking the deck against consumers.  They know that their odds of winning a dispute are higher with an arbitrator than with a jury of your peers.

Whether mandatory arbitration clauses are permitted under the United States Constitution has long been a point of debate in the legal community.  The Seventh Amendment requires that civil claims allow for a jury trial.  “Corporate America” believes that individuals can “agree away” their rights.  However, many scholars correctly point out that requiring consumers to agree to arbitration is unconstitutional because they are not agreeing to waive jury trial – they are being forced to do so.  As a result, this new rule by the federal government is a big victory for consumers, as well as the Constitution.

Plattner Verderame, PC has been handling nursing home cases in front of arbitrators and juries for over three decades.  If you or a loved one has been mistreated while staying at a nursing home, you may be legally entitled to fair compensation.  Feel free to have us review your potential claim.  We are honest attorneys who spend our days helping honest clients.

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