Late in the Obama Administration the Center for Medicare and Medicaid Services promulgated a regulation that provides that nursing homes will no longer receive federal funding if they use arbitration clauses in their contracts (arbitration clauses deny your access to jury trials). There is now unwelcome news in several press reports that the Trump Administration is looking to gut that rule.
The Trump Administration is About to Put Nursing Home Profits Ahead of Nursing Home Patients
Some of the most heart-wrenching stories of abuse, mistreatment and neglect you’re likely to hear involve nursing homes. As America’s baby boomers age, and nursing home populations continue to grow, big corporations have, not surprisingly, started to take note. In fact, the vast majority of nursing homes in the United States – 70%, according to the Centers for Disease Control and Prevention – are run by for-profit corporations, and an increasing number of homes are being snapped up by Wall Street investment firms.
And that, in turn, can often mean that high quality care takes a backseat to high profits.
Increasingly, these giant corporations are using forced arbitration clauses — contract terms that say that people cannot sue them, no matter what laws they break, and instead people harmed by illegal acts can only bring cases before private arbitrators who are generally beholden to the corporations. These clauses make it far harder for the victims of mistreatment to hold a facility accountable where there’s abuse or serious negligence, and they minimize the incentive to provide the highest quality of care. The secretive arbitration system also effectively lets homes sweep the facts about problems under the rug, so that the public and regulators never learn about widespread or egregious abuses.
That’s why, in 2016, the Centers for Medicare and Medicaid Services said nursing homes should no longer receive federal funding if they use arbitration clauses in their contracts. It was a commonsense proposal that would ensure families can hold nursing homes accountable for abuse and neglect. The government essentially said – and rightly so – that protecting desperately vulnerable people is more important than squeezing out an extra percentage of profit for hedge fund owners.
But that was 2016. Now, the Trump Administration appears to be gearing up to kill the proposal.
Senator Al Franken (D-MN), a fierce opponent of arbitration who has fought corporate lobbyists to protect Americans’ right to their day in court, said on Tuesday that “the Trump Administration is planning to lift the ban on nursing home arbitration clauses.”
So the White House, it appears, is ready to deliver another gift to hedge funds and banks – the corporate entities that increasingly control the nursing home industry – at the expense of the sick and elderly and their families.
It’s no wonder why corporate lobbyists working for the nursing home industry have made killing the CMS proposal a top priority: unlike the public court system (where trials are open to the public, press and regulators), nursing homes benefit enormously from the secretive system of arbitration, where the facts about abuses can be (and often are) buried. “Confidentiality” provisions – which really translate into gag orders – and non-transparent, non-public handling make it easier for systemic problems to stay hidden, and to continue.
If nursing homes are permitted to continue opting out of the civil justice system, we can expect to see lower levels of care, and higher numbers of preventable injuries and deaths. If they succeed in keeping families out of court, the potential savings to their bottom line are enormous when you consider that abuse is very widespread (according to the government’s own study). Public Justice, our national public interest law firm and advocacy organization, set forth an extensive factual and legal case in support of the CMS proposal, where a great deal more background is available.
Consider just a handful of the plaintiffs who were able to successfully challenge nursing homes in court:
- A 90-year-old woman allowed to languish with a festering pressure sore, acute appendicitis, and a urinary tract infection so severe it has entered her blood.
- A diabetic patient injected with the incorrect dose of insulin, sending them into hypoglycemic shock and causing brain damage.
- An 81-year-old man who was viciously beaten by a roommate who’d been involved in 30 assaults prior to moving in with the victim.
- An 87-year-old woman whose calls for help were ignored after she fell and broke her hip.
Had any of those patients been subject to an arbitration clause – as no doubt many future cases would be if the Administration folds to pressure from for-profit homes – they likely would have never had a chance to have their case heard by a jury.
Nursing homes have complete control over some of the most vulnerable and fragile people in the entire country: people who are gravely ill, who are often cognitively impaired in ways that make it hard for them to protect themselves, are completely at the mercy of these institutions.
Now, rather than working to give those patients some small measure of protection and security, the Trump Administration is poised to give them the shaft. It’s unconscionable back-pedaling that would leave millions with little recourse when they, or their loved ones, are mistreated or abused.