Failure to Ensure Neutral, Mutually Agreed Arbitration Terms in Admission Agreements
Summary
Facility staff failed to ensure that binding arbitration agreements between the facility and residents or their representatives included language that a neutral arbitrator, agreed upon by both parties, would be selected and that the arbitration venue would be convenient to both parties. The facility’s most recent admission packet contained a Resident-Facility Binding Arbitration Agreement that required disputes related to services or health care to be resolved exclusively by binding arbitration and documented that by signing, parties waived their rights to have claims decided in court. However, the agreement did not contain any language stating that the arbitrator would be neutral and mutually agreed upon, nor that the location of arbitration would be convenient to both parties. For one resident with multiple sclerosis, muscle spasms, vitamin deficiencies, contracture, anemia, and weakness, the face sheet showed he was his own responsible party and an admission MDS documented intact cognition with a BIMS score of 14. A binding arbitration agreement was electronically signed by this resident and the Admissions Director. In a face-to-face interview, the resident stated he did not recall the Admissions staff explaining that a neutral arbitrator and a neutral location, selected by both parties, would be used if arbitration occurred. Another resident with dysphagia, hemiplegia and hemiparesis following cerebral infarction, a gastrostomy, type 2 diabetes mellitus, cognitive communication issues, generalized muscle weakness, and gout had an arbitration agreement signed by an emergency contact as the resident’s representative and the Admissions Director. The admission MDS showed a BIMS score of 0, while a later quarterly MDS showed a BIMS of 15. During a telephone interview, the emergency contact stated they did not remember admission staff explaining that they could select a neutral arbitrator and a neutral, convenient location for arbitration. A third resident with a left rib fracture, protein-calorie malnutrition, atrial fibrillation, systolic congestive heart failure, generalized muscle weakness, and a cognitive communication deficit was listed as her own responsible party, with multiple emergency contacts. The arbitration agreement was electronically signed by one emergency contact as the resident’s representative and by the Admissions Director, and the admission MDS showed intact cognition with a BIMS score of 15. In a face-to-face interview, this resident stated facility staff did not explain that both parties could choose a neutral arbitrator and a neutral location for arbitration. A fourth resident with hemiplegia affecting the right dominant side, a displaced fracture of the right clavicle, hematuria, generalized muscle weakness, adjustment disorder with mixed disturbance of emotions and conduct, and a cognitive communication deficit had a power of attorney as representative. The arbitration agreement was electronically signed by the representative and the Admissions Director, and the admission MDS showed a BIMS score of 14. In a telephone interview, the representative stated they did not recall anyone from Admissions explaining that a neutral arbitrator and neutral location would be selected by both parties. Interviews with residents, representatives, and emergency contacts who had signed arbitration agreements showed no evidence that staff explained these rights, and the Admissions Director acknowledged that the agreement lacked language regarding selection of the arbitrator and location for arbitration.
Penalty
Resources
Below are regulatory guidelines relevant to this citation:
Arbitration Agreement Missing Convenient Venue Requirement: The facility's arbitration agreement did not include a venue selection that was convenient to both parties, as required by CMS SOM Appendix PP and the federal regulation reviewed by surveyors. The deficiency applied to all residents who had signed an arbitration agreement, and the Administrator acknowledged that the agreement was missing this regulatory requirement.
The facility failed to ensure a neutral and fair arbitration process because its arbitration agreement did not show that both the resident and/or resident representative and the facility agreed on the arbitrator or the venue. Review of the agreement found no evidence that the venue would be convenient to both parties, and the NHA confirmed the language did not provide for mutual selection of a neutral arbitrator or venue.
Arbitration agreement language required use of a named lawyers association and allowed the facility to select an alternate arbitration service if that group could not serve, while venue was also selected by the facility. Three residents who signed the agreement said they did not remember it being explained, did not know what arbitration was, or did not know if they had signed a contract. The ADON/Admissions staff and Administrator stated they were unsure what would happen if a resident declined the listed arbitrator or found the venue inconvenient.
Arbitration agreements for two residents pre-selected JAMS, or if unavailable NAF, as the arbitration service, rather than providing a neutral and fair process with an agreed-upon arbitrator and venue. The SSD signed the facility representative section of both agreements and stated they had not received training on arbitration agreements and were unaware of the regulations governing them.
Arbitration Agreements Lacked Venue Selection Language: The facility failed to ensure arbitration agreements for three residents included a venue selection convenient to both parties. Record review showed the residents had significant medical conditions, and the DCM confirmed the agreements did not contain the required venue information. The ADMIN stated the form did not provide for venue selection and the facility had no P&P for arbitration agreements.
Arbitration Agreement Lacked Neutral Arbitrator Provision: A resident with multiple chronic conditions, including dementia, COPD, dysphagia, and HTN, had an arbitration agreement that did not explicitly state that a neutral arbitrator would be selected by both parties. During survey review, the resident could explain the purpose of the agreement but could not explain why it was resigned, and the AD confirmed the original agreement did not meet the required terms.
Arbitration Agreement Missing Convenient Venue Requirement
Penalty
Summary
The facility failed to ensure its arbitration agreement included the selection of a venue that is convenient to both parties, as required by CMS SOM Appendix PP and the federal regulation reviewed by surveyors. The deficiency applied to all residents in the facility who had signed an arbitration agreement. During the survey review, the Administrator stated on 6/24/26 at 4:15 PM that the arbitration agreement was missing the regulatory requirement for a convenient location of arbitration for both parties.
Arbitration Agreement Lacked Neutral Arbitrator and Venue Provisions
Penalty
Summary
The facility failed to ensure a neutral and fair arbitration process by not ensuring that both the resident and/or resident representative and the facility agreed on the selection of an arbitrator and venue. Review of the facility's arbitration agreement showed that it lacked evidence addressing whether the selected venue would be convenient to both the resident and/or resident representative and the facility. During an interview, the Nursing Home Administrator confirmed that the arbitration agreement language did not provide for selection of a neutral arbitrator agreed upon by both parties and did not provide for selection of a venue convenient to both parties.
Arbitration Agreement Lacked Neutral Arbitrator Choice and Convenient Venue
Penalty
Summary
The facility failed to ensure that the arbitration agreement signed by 3 of 3 residents reviewed provided for the selection of a neutral arbitrator agreed upon by both parties and a venue convenient to both parties when a dispute arose. Review of the facility’s arbitration agreement showed that disputes would be administered by a named lawyers association under its rules, and if that association was unable or unwilling to serve, the facility would select an alternative neutral arbitration service within 30 days. The agreement also stated that arbitration would be conducted at a site selected by the facility, either at the facility or somewhere within a reasonable distance of the facility that was convenient for both the facility and the resident. Resident #111 had an admission date of 4/29/26 and signed the arbitration agreement on 5/1/26; during an interview on 5/5/26, she verified her signature but said she did not remember signing the contract or anyone discussing the arbitration agreement with her, and she asked whether it was for discharge from the facility. Resident #115, admitted on 4/30/26, also signed the agreement on 5/1/26 and stated on 5/5/26 that he did not remember anyone discussing arbitration with him, did not know what it was, and did not remember signing the contract. Resident #107, admitted on 4/29/26, signed the agreement on 5/1/26 and stated on 5/6/26 that she did not know if she signed a contract, did not know what an arbitration agreement was, and said no one had explained it to her. The Admissions Director stated that she and her assistant handled contract signing and explained that the arbitration agreement was optional, but she did not know what would happen if a resident declined the listed arbitration company or if the proposed location was not convenient. The Administrator stated the agreement was specific to using the listed lawyers association as the arbitrator, that she was not sure what would happen if the resident did not agree to that choice, and that the agreement offered the resident no choice.
Arbitration Agreements Pre-Determined the Arbitrator
Penalty
Summary
The facility failed to ensure that binding arbitration agreements did not pre-determine the arbitrator for arbitration proceedings for 2 of 2 sampled residents whose arbitration agreements were reviewed. The arbitration documents for both residents stated that the parties intended Judicial Arbitration and Mediation Services, Inc. (JAMS), or its successor, to serve as the Arbitration Service, and if JAMS was unable or unwilling to serve, the National Arbitration Forum (NAF), or its successor, would serve as the Arbitration Service. Both documents showed the resident's name printed in the resident representative section of the admission agreement signature page, and the SSD signed in the facility representative area. On interview, the SSD stated on 04/22/26 at 8:37 a.m. that they had not received training in arbitration agreements and oversaw them because they were part of the admission paperwork reviewed with new residents. The SSD stated they were unaware of the particulars of the regulations that covered the arbitration agreements. The DON identified that 65 residents resided in the facility.
Arbitration Agreements Lacked Venue Selection Language
Penalty
Summary
The facility failed to ensure that arbitration agreements provided a selection of a venue convenient to both the facility and the resident for three sampled residents. During interview and record review, Resident 27’s admission record and H&P showed admission with diagnoses including chronic respiratory failure, deletion of chromosome 1p36, and Tetralogy of Fallot; Resident 47’s H&P showed admission with diagnoses including chronic lung disease, recurrent pneumonias, and gross developmental delay; and Resident 51’s admission record and H&P showed admission with diagnoses including chronic respiratory failure, cerebral palsy, and spastic quadriplegia. During a concurrent interview and record review with the Director of Case Management, the arbitration agreements for Residents 27, 47, and 51 were reviewed and each was found not to include information regarding the selection of a venue convenient to both parties. The Director of Case Management confirmed that the binding arbitration agreements for all three residents did not have this information and stated there should have been. During a later interview, the Administrator stated the arbitration agreement form did not provide for the selection of a venue convenient to both parties and that the facility did not have a policy and procedure for arbitration agreements.
Arbitration Agreement Lacked Neutral Arbitrator Provision
Penalty
Summary
The facility Arbitration Agreement failed to explicitly state that the agreement provided for the selection of a neutral arbitrator agreed upon by both parties for one resident reviewed for arbitration agreements. Resident #73 was admitted with multiple diagnoses including atherosclerotic heart disease, polyneuropathy, insomnia, contracture of the left elbow, lack of coordination, muscle weakness, dementia, abnormal posture, COPD, dysphagia, hypertension, cognitive communication deficit, alcohol abuse, gastro-esophageal reflux, and chronic hepatitis. The most recent MDS showed a BIMS score of 15, indicating the resident was cognitively intact at the time of the assessment. During the survey, the resident explained the purpose of the facility arbitration agreement but was not willing to review the signed agreement from admission or the later agreement signed again by the resident. The resident could not explain why the arbitration agreement was resigned. Review of the original agreement signed on admission showed that it did not provide for the selection of a neutral arbitrator agreed upon by both parties. The AD confirmed that the agreement did not meet the requirements and stated that the resident was asked to sign a new arbitration agreement after this issue was identified during the survey process.
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