Federal Arbitration Regulations-F847 & F848

Arbitration agreements have historically been a topic of confusion in our state that would garner the attention every few years with surveyors and facilities. With Center for Medicare and Medicaid Service’s (CMS) implementation of the requirements outlined in F847 Entering Into Binding Arbitration Agreements and F848 Arbitrator/Venue Selection and Retention of Agreements, it has actually helped provide clarity for facilities and surveyors alike. There are some key concepts outlined in the F-tags and guidance provided by CMS.

First, if a facility chooses to ask a resident or his/her representative to enter into an arbitration agreement, the facility should utilize legal counsel in the development of and the facility’s policies and procedures around the agreements. The facility must comply with all of the requirements set forth in the F-tags. Some key concepts are outlined below; however, the information should be reviewed in its entirety to provide context and clarity to the requirements.

• An arbitration agreement cannot be a condition of admission or continuation of care. The agreement must explicitly state this.
• An arbitration agreement must be explained in a form, language, and manner that resident or his or her representative can understand.
• An agreement must provide for a neutral arbitrator and venue to be agreed upon by both parties.
• The resident, or his or her representative, must have the right to cancel the agreement within 30 days of signing.
• The agreement must not discourage the resident from communicating with federal, state, or local officials.

The intent of this requirement is to ensure that long-term care facilities inform residents or their representatives of the nature and implications of any proposed binding arbitration agreement and to inform their decision on whether or not to enter into such agreements. The requirements at F847 emphasize the residents’ or their representatives’ right to make informed decisions and choices about important aspects of residents’ health, safety, and welfare. Facilities may present residents or their representatives with the opportunity to utilize a binding arbitration agreement to resolve disputes at any time during a resident’s stay as long as the agreement complies with the regulations.

CMS directs surveyors to verify with the facility whether arbitration agreements are used to resolve disputes. If so, surveyors are to determine compliance with F847 through interviews of sampled residents, resident representatives, resident council/family council, Long-Term Care Ombudsman, facility staff; and record review, which includes reviewing the agreement and other relevant documentation. For facilities that offer arbitration agreements, there are a number of interview questions outlined in the guidance to assist surveyors in their investigation.

The companion requirements outlined in F848 expand on the process of actual arbitration, requiring the facility to ensure that an arbitration agreement provides for the selection of a neutral arbitrator agreed upon by both parties and that the agreement also provides for the selection of a venue that is convenient to both parties involved. If a dispute is settled by arbitration, a copy of the signed agreement and the arbitration award must be kept for five years and be available for inspection by CMS or its designee (such as the state survey agency).

CMS’s intent of the requirements under F848 is to ensure a neutral and fair arbitration process for the resident or his/her representative and that the facility and resident/representative agree on the selection of a neutral arbitrator with a venue that is convenient to both parties. Like F847, the Guidance provides clear interview questions that direct the surveyor in their investigation to determine facility compliance.

Facilities utilizing arbitration agreements need to ensure that all aspects are in compliance and should utilize a systematic review/process to evaluate their system. The CMS Critical Element Pathway for arbitration used by surveyors provides facilities with a road map to evaluate/audit their own system.

If you have questions, please call Elena Madrid at (360) 352-3304, extension 105, or email.