Wednesday, October 26, 2016

AHCA Seeks Injunction Barring Implementation of Arbitration Rule

Drew Thies

The American Health Care Association continued its legal challenge with the Center for Medicare and Medicaid Services (CMS) this week, filing both a request for preliminary injunction and a supporting memo regarding the recent partial ban on arbitration in skilled nursing facilities.


The injunction would bar the Centers for Medicare and Medicaid Services (CMS) from implementing the final rule that bans arbitration agreements in skilled and nursing care facilities. The rule is currently set to go into effect on November 28.


The CMS final rule on the Requirements of Participation issued in late September barred SNF providers from offering residents voluntary, binding, pre-dispute arbitration agreements. The rule stipulates that arbitration agreements can only be entered into until after a dispute arises.


AHCA is suing CMS, saying the rule violates the Federal Arbitration Act (FAA) and exceeds HHS/CMS statutory authority under the Medicare and Medicaid Acts, neither of which vests the agencies with the power to regulate alternative dispute resolution procedures. Plaintiffs include AHCA, the Mississippi Health Care Association, Great Oaks Rehabilitation and Healthcare Center, Heritage House Nursing Center and the Pavilion at Creekwood.

The United States District Court for the Northern District of Mississippi will hear arguments related to the injunction on November 3 and a ruling is expected by November 7.

“A preliminary injunction is both appropriate and necessary in this situation,” said Mark Parkinson, AHCA President and CEO. “Delaying the implementation of this provision of the rule will allow the court time to examine the legality of the issue.”

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