Failure to Clearly Explain and Obtain Informed Choice on Binding Arbitration Agreements
Penalty
Summary
The deficiency involves the facility’s failure to clearly explain its binding arbitration agreement and to ensure residents and their responsible parties understood that signing was optional and not a condition of admission or services. The arbitration document stated that it was not a precondition to admission and could be rescinded within 30 days, but the form only provided a single signature line for the resident or responsible party, with no clear way to indicate acceptance or declination of arbitration. For one cognitively intact resident, the arbitration agreement was signed and stamped “accept,” yet the resident later stated that although he understood the general meaning of arbitration, he did not agree to binding arbitration when he signed the admission documents. Another resident with severe cognitive impairment had an arbitration agreement signed by a responsible party, which was also stamped “accept.” The responsible party reported receiving the agreement by email with very small font, did not recall any person explaining it, and believed there was only an option to sign and return it with other admission documents, with no way to accept or decline arbitration; he stated he did not intend to agree to binding arbitration. A third resident with moderate cognitive impairment signed an arbitration agreement that was stamped “accept” and later reported not knowing that signing was optional or that it placed him into a binding arbitration agreement, and stated he did not want to agree to binding arbitration. The Admissions Coordinator reported that all arbitration agreements were completed electronically on a tablet as part of the admission packet, that she was trained to have all residents sign the arbitration form and stamp it “accept” to show it had been read and explained, and that the form did not specify that the “accept” stamp was only to acknowledge explanation rather than agreement to binding arbitration.
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