Lawmakers take aim at arbitration pacts

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U.S. Sen. Mel Martinez (R-FL)
U.S. Sen. Mel Martinez (R-FL)
A new Senate bill seeks to eliminate providers' ability to bind residents to pre-dispute arbitration agreements.

The bill does not target all arbitration clauses, just those that are sought before admission. Sens. Herb Kohl (D-WI) and Mel Martinez (R-FL) proposed the measure, “The Fairness in Nursing Home Arbitration Act,” on April 8.

Provider groups have increasingly sought advanced arbitration agreements recently. They lashed out against the proposal, claiming the binding clauses lead to lower overall costs and allow caregivers to devote more resources to core tasks.

Forced arbitration critics, however, claim it often takes advantage of individuals or family members ill-equipped to fully understand the consequences of their actions at what is usually a stressful time.

“Forcing a family to choose between quality care and forgoing their rights within the judicial system is unfair and beyond the scope of the intent of arbitration laws,” Martinez said.  “This effort restores the original intent and tells families that they don't have to sign away their rights in order to access quality care.”

State courts have delivered mixed verdicts on arbitration agreement challenges.