Failure to Ensure Resident Capacity for Binding Arbitration Agreements
Penalty
Summary
The facility failed to ensure that residents had the capacity to understand the terms of a binding arbitration agreement prior to signing. Specifically, two residents with severe cognitive impairment, as indicated by their Brief Interview for Mental Status (BIMS) scores of four and zero, respectively, were allowed to sign binding arbitration agreements. Both residents had significant medical histories, including intellectual disabilities, diabetes mellitus, chronic kidney disease, dementia, and major depressive disorder, and their Minimum Data Set (MDS) assessments confirmed severe cognitive impairment at the time the agreements were signed. Review of facility documents, resident clinical records, and staff interviews confirmed that the facility did not verify the residents' capacity to comprehend the agreements. The Admission Director acknowledged that the facility failed to ensure the residents understood the terms of the binding arbitration agreements, resulting in the deficiency for two of the three residents reviewed.