Don’t ever underestimate the power of federal agencies to dramatically affect your lives. Congress obviously has awesome power too, but unelected people in powerful positions can do much harm also behind the cloak of regulations.
There is a process for adopting federal regulations. If a federal agency wants to adopt a regulation, it must go through a process set forth in federal law called the Administrative Procedure Act. This law allows federal agencies to adopt rules after a hearing process is undertaken, and after notice is given to all affected by the proposed rule. Interested parties have an opportunity to participate in rulemaking through submission of data, views or arguments. After consideration of relevant matter, the agency then adopts the rule, but parties aggrieved by the rule have the right to petition for the issuance, amendment or repeal of the rule.
Of course, unless you regularly read the Federal Register, you never are notified of proposed rules. The Federal Register is the official journal of the United States government. I assure you that there is no sports section or comics in this journal. It is full of notices and proposed rules. The U.S. Constitution requires that due process be given in this process, but this process is not intended for the average citizen to have access. Special interest groups and the regulators are the ones who control the process.
The U.S. Department of Health and Human Services (HHS) has adopted many regulations that affect provision of health care and insurance in this country. Insurance companies and various health care providers are constantly vigilant about regulations that affect their interests. Public interest groups do provide input that, but those groups are outnumbered by the powerful special interests.
Frankly, most lawyers have little contact with federal or state regulations. We rarely encounter the rules adopted by governmental agencies in our practices. This week, I became aware of a regulation that does affect my clients and I learned that the agency, in this case HHS, can choose to not follow a rule if it desires.
One of my clients was admitted to a nursing home in the fall of 2015. At the time of his admission, he signed various documents, most of which related to payment of the fees and charges for residing in the home. I encountered another document I had not seen before. It was an agreement in which my client had consented to have any legal dispute with the nursing home decided in arbitration. This means that my client was giving up his right under the Missouri and U.S. Constitution to a trial by jury.
While staying at this nursing home, he developed horrible pressure ulcers on his buttocks and heels. We contend that it happened because the nursing home did not take appropriate precautions to prevent pressure wounds and once they developed to keep them from getting worse. Ordinarily, we would file a lawsuit in the county in which he resided and pursue a claim for damages and have a jury decide whether the home was negligent and the amount of my client’s monetary damages.
However, he had to give this right to a trial by jury up to reside in the nursing home. I am confident that when he signed this agreement he had no idea that he would be mistreated by the employees of the nursing home and gave little thought to the arbitration agreement.
After I found this agreement in the mountain of records produced by the nursing home, I then undertook some research to see if this agreement was enforceable. My partners who handle employment cases see arbitration agreements regularly. If you looked at the fine print on almost any agreement you have with a creditor, you will see an arbitration provision. The assault on the constitutional right to trial by jury is pervasive. Some nursing homes have joined the assailants to your constitutional rights.
In my research, I discovered that HHS enacted a regulation that prohibits arbitration agreements as a condition of admission to a nursing home. I thought I had a clear path to protect my client’s rights. I was wrong because upon further research, I then learned that a federal judge in Mississippi had issued an injunction to keep HHS from enforcing this regulation. HHS appealed the judge’s ruling last year. However, HHS responded to the injunction with a memo in December of last year that stated that the Centers for Medicare & Medicaid Services (CMS) will not enforce the rule prohibiting skilled nursing facilities from using pre-dispute binding arbitration agreements while the court-ordered injunction is in place prohibiting enforcement of this provision. I can understand why the agency would not want to ignore or violate the terms of the injunction, but because the agency had decided to appeal the ruling granting the injunction, there was still hope. Hope springs eternal, doesn’t it? Not in this case.
The Trump administration has made no secret of its desire to assault the right to trial by jury, so when Mr. Trump took office in January of this year and appointed a new secretary of HHS, Tom Price (the same man who used taxpayer money to take $400,000 in charter flights and then resigned), directed the agency to dismiss the appeal and then asked the court to keep the injunction in place so HHS could change the rule. The rule is now as worthless as the paper on which it is written and so is your right to a jury trial if such an arbitration agreement is thrust upon your loved one as he or she enters a nursing home. I assure you that if you have a choice, you should choose a jury of your peers over an arbitrator who makes a living arbitrating cases. And politicians wonder why we don’t trust government.
-- Bob Buckley is an attorney in Independence, www.wagblaw.com. Email him at firstname.lastname@example.org