New arbitration rule doesn't have much of a silver lining
Any way you slice it, last week was a rough one for long-term care operators.
First, lawmakers at a House Ways and Means Committee hearing took turns insisting the federal government needs to monitor the billing practices of healthcare organizations more closely.
And as my colleague Elizabeth Newman reported Friday, the Centers for Medicare & Medicaid Services will add a few new curveballs to the survey system, beginning next year.
But what really sent shockwaves through the sector was a CMS final rule that puts an end to mandatory-arbitration clauses in admission agreements.
The industry's reaction was swift, predictable and unpleasant. Mark Parkinson, CEO of the American Health Care Association, said the provision is both unnecessary and outside the limits of CMS authority. Other organizations similarly questioned the agency's qualifications, and bemoaned the many millions of dollars providers stand to lose.
There's no way to sugarcoat this development: If you are a provider, the end of the mandatory arbitration agreements is not good news.
It would be foolish for me to argue that the prohibition will help the field. But there might be a bit of a silver lining in this very dark cloud.
Look, we all know long-term care operators provide needed services that are relatively speaking, quite a bargain. Yet for all the good care that is being delivered, the sector remains beset by a less-than-stellar reputation. At least when it comes to consumers, regulators and lawmakers.
We can argue until the proverbial cows come home whether the reputation is justified, but there really is no debating whether it exists.
The late novelist Nelson Algren once wrote that loving his hometown of Chicago was like loving a woman with a broken nose. In some ways, the same might be said of long-term care. For all the good it does, many people not affiliated with the field tend to have a visceral reaction when it is mentioned. Some of the anger is tied to the losses of aging. Some is tied to some of the industry's earlier indiscretions.
We all know the accusations: Nursing homes are warehouses for the elderly, they deliver poor care, they gouge the government and taxpayers, I wouldn't put my mother in one …
The list goes on.
A more recent accusation against the field is that arbitration clauses are little more than an attempt by operators to shirk responsibility for lousy care. I'm not saying the accusation is accurate or fair, but it would take amazing powers of deniability to not realize that's how quite a few people feel.
At a minimum, the end of arbitration clauses might help prevent a further erosion of the sector's reputation in the minds of many consumers, regulators and lawmakers.
Admittedly, that may not be much of a payoff. But all things considered, it may be the best that can be hoped for.