House measure would outlaw nursing home arbitration clauses

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Nursing home operators would be unable to subject residents and prospective residents to binding arbitration clauses under a bill introduced Thursday afternoon in the U.S. House. When a companion bill was introduced in the Senate in April, consumer groups enthusiastically praised it and provider advocates roundly criticized it.

"This legislation will not prohibit arbitration. Instead, it will simply ensure that residents have the choice whether to arbitrate a dispute after it has arisen," said bill co-sponsor Rep. Linda Sanchez (D-CA), whose father recently entered a nursing facility.

Sanchez said hosting three recent hearings on the Federal Arbitration Act as the chairwoman of the Subcommittee on Commercial and Administrative Law helped form her opinions on the topic. "The long term care industry is one stark example where businesses draft take-it-or-leave-it admission agreements for prospective residents that include pre-dispute, mandatory arbitration clauses."

AARP, the Alzheimer's Association and the National Senior Citizen's Law Center are among the groups who have come out in support of "The Fairness in Nursing Home Arbitration Act of 2008." The American Health Care Association, which strongly criticized the Senate bill of the same name, is expected to be among the provider groups against it.