The Trump administration is poised toÂ undo rulesÂ issued by the Obama administration last year to protect seniors from a common tactic used by businesses to shield themselves from consequences for illegal conduct.
Under these rules, issued last September, Medicare and Medicaid would cut off payments to nursing homes that require new residents toÂ sign forced arbitration agreements, a contract which strips individuals of their ability to sue in a real court and diverts the case to a privatized arbitration system.
But last month, the Trump administration published a proposed rule which will reinstate nursing homesâ€™ ability to receive federal money even if they force seniors into arbitration agreements.
Forced arbitration can prevent even the most egregious cases from ever reaching a judge. According to the New York Times, a 94 year-old nursing home resident â€śwho died from a head wound that had been left to fester, was ordered to go to arbitration.â€ť In another case, the family of a woman who suffered â€śtwo spine fractures from serious falls, a large, infected ulcer on her heel that prevented her from walking, incontinence from not being able to get to the bathroom, receding gums from poor hygiene assistance, and a dramatic weigh loss from not being given her dentures,â€ť was also sent to an arbitrator after they sued the womanâ€™s nursing home alleging neglect.
Moreover, as law professor and health policy expert Nicholas Bagley notes, arbitration tends â€śtoÂ favor the repeat players who hire themâ€”companies, not consumers.â€ť Several studies have found that forced arbitration typically produces worse outcomes for consumers and workers. An Economic Policy Institute study of employment cases, for example, found that employees areÂ less likely to prevail before an arbitrator, and that they typically receive less money if they do prevail.
The Obama-era rules were never allowed to take effect. Shortly after the regulations were announced, a George W. Bush-appointed judge in Mississippi issued aÂ decision blocking the ruleâ€”although Judge Michael Mills did caveat his order by stating that â€śthis case places this court in the undesirable position of preliminarily enjoining a Rule which it believes to be based upon sound public policy.â€ť
Important parts of Millsâ€™ opinion rely on dubious reasoning. At one point, for example, he cites a doctrine limiting the federal governmentâ€™s power to use threats of lost funding against state governments in order to impose similar limits on federal efforts to encourage good behavior by private actors.
But letâ€™s be honest. If the Trump administration wasnâ€™t preparing to end the Obama-era rule, conservatives on the Supreme Court most likely would have done so themselves.
Prior to Justice Antonin Scaliaâ€™s death, the Supreme Courtâ€™s Republican majority took such a sweeping and expansive view of companiesâ€™ power to use forced arbitration that it is likely the Obama administrationâ€™s rules would have been struck down in a 5â€“4 decision. Now that Neil Gorsuch occupies Scaliaâ€™s seat, Republicans once again have the majority they need to shield arbitration agreements.
In the alternative universe where the winner of the popular vote in the 2016 presidential election was inaugurated last January, Justice Merrick Garland was likely to provide the fifth vote to uphold the Obama-era rule. But we do not live in that universe. And neither do the many elderly nursing home residents who will be worse off thanks to the Trump administration.
This article was originally published at ThinkProgress on July 6, 2017. Reprinted with permission.
About the Author: Ian Millhiser isÂ a senior fellow at the Center for American Progress and the editor of ThinkProgress Justice. He received his JD from Duke University and clerked for Judge Eric L. Clay of the United States Court of Appeals for the Sixth Circuit. His writings have appeared in a diversity of publications, including the New York Times, the Guardian, the Nation, the American Prospect and the Yale Law & Policy Review.