David Y. Ige

HONOLULU – Attorney General Doug Chin and Executive Director of the Office of Consumer Protection Steve Levins announced today that Hawaii, together with 16 additional states, submitted comments to the Centers for Medicare and Medicaid Services (CMS), recommending that CMS maintain its rule that prohibits pre-dispute arbitration clauses in nursing home and other long-term care contracts.

Attorney General Chin said, “The current rule protects Hawaii’s elderly from being taken advantage of by predatory long-term care schemes. The government should protect the elderly and not take away their legal rights.”

In 2015, Hawaii and 15 other states submitted comments to CMS in support of a proposed regulation to bar such pre-dispute arbitration clauses in long-term care contracts. The comments noted that, “Pre-dispute binding arbitration agreements in general can be procedurally unfair to consumers, and can jeopardize one of the fundamental rights of Americans; the right to be heard and seek judicial redress for our claims. This is especially true when consumers are making the difficult decisions regarding the long-term care of loved ones.”

In October 2016, CMS issued its final rule, prohibiting the use of pre-dispute arbitration clauses in such agreements. CMS specifically cited the comments of the Attorneys General in support. On October 17, 2016, the American Health Care Association and a group of affiliated nursing homes filed suit against the regulation in the Northern District of Mississippi, which issued a preliminary injunction against enforcing the prohibition on pre-dispute arbitration clauses. On June 8, 2017, CMS proposed reversing the rule and removing the prohibition on pre-dispute arbitration clauses in long-term care contracts.

The comments filed today urge CMS to maintain the prohibition for the reasons set forth when it issued the regulation. The States’ comments state that, “We believe that the prohibition on pre-dispute arbitration clauses provides an important protection for the consumers of our States at a time when consumers are undertaking a difficult and emotional decision.”

Attorney General Chin and Executive Director Levins were joined by the attorneys general of California, Connecticut, Delaware, the District of Columbia, Illinois, Iowa, Maine, Maryland, Massachusetts, Minnesota, New York, North Carolina, Oregon, Pennsylvania, Vermont and Washington in filing today’s comments.

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For more information, contact:

Joshua A. Wisch
Special Assistant to the Attorney General
Phone: (808) 586-1284
Email: [email protected]
Web: https://ag.hawaii.gov
Twitter: @ATGHIgov