FAIR Act Would Ban Arbitration Agreements in Maryland Nursing Homes

The U.S. House of Representatives recently introduced the Forced Arbitration Injustice Repeal Act, known as the FAIR Act, that would limit private arbitration agreements. The Act as proposed would prohibit companies from requiring workers and consumers to resolve legal disputes through arbitration. Proponents of the Act claim that forcing arbitration tricks consumers into agreeing to arbitration by using fine-print arbitration clauses and deprives them of their right to seek damages in court from a jury. The proposed legislation would include a ban on forced arbitration agreements for residents in Maryland nursing homes by prohibiting pre-dispute arbitration agreements in long-term care facility admission contracts. The Act was previously introduced in 2019 but did not become law.

In October 2016, the Obama administration banned the use of pre-dispute arbitration agreements in long-term care settings. However, a judge struck down the ban and prevented it from being enforced. The Trump administration later issued a new rule, which went into effect in September 2019. That rule reversed the previous ban on pre-dispute arbitration agreements in nursing facilities but required certain conditions to be met. The recently introduced legislation seeks to address the issue once again.

What Is Arbitration?

Arbitration is a private process in which the parties agree to have a private arbitrator decide the case instead of having the case decided by a court. Unlike mediation, an arbitrator can make a binding decision on the dispute. There can be advantages for some nursing home residents and their families, such as faster resolution. However, there are many disadvantages, particularly for plaintiffs. For example, monetary awards are often lower in arbitration and arbitration results also are generally secret, meaning that plaintiffs may not be able to disclose the outcome or the award, and hold defendants accountable publicly. There is also generally no right to an appeal.

Are Nursing Home Arbitration Agreements Common?

Yes, nursing home arbitration agreements are very common nowadays. Residents or their family members routinely sign arbitration agreements without even understanding what they are signing or what it actually means. Nursing homes favor such agreements because it is often less costly and results in better outcomes for the nursing homes. Yet, even in cases where a resident has signed an arbitration agreement, there are circumstances in which a signed arbitration agreement may not be valid or enforceable. An experienced nursing home attorney can evaluate an agreement and the surrounding circumstances to see if the agreement may be unenforceable.

Maryland Nursing Home Attorneys

The Maryland nursing home abuse and neglect attorneys at Lebowitz & Mzhen, LLC are willing and able to pursue all of the responsible parties for causing a resident’s injuries in a nursing home abuse or neglect case. Their nursing home attorneys have more than 20 years of combined experience in personal injury cases throughout Maryland and Washington, D.C., and know what it takes to build a successful case. They provide aggressive representation to Maryland nursing home residents who have suffered abuse or neglect. To set up a free consultation to discuss your case, contact Lebowitz & Mzhen by calling 1-800-654-1949 or by completing their online form.

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