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 Appeals Court Dismissal Allows SNFs to Continue to Use Pre-Dispute Arbitration

On June 2, the U.S. Court of Appeals for the Fifth Circuit in New Orleans issued an order dismissing the pending preliminary injunction hearing in the case of AHCA (American Health Care Association) v. Price, offering positive news for the long term care profession trade group and its members fighting against a ban on pre-dispute arbitration agreements in nursing facilities put in place by the Obama administration.

Originally named AHCA v Burwell to represent Health and Human Services (HHS) Secretary Sylvia Burwell, who was in office when the suit was filed, the latest court action comes ahead of the new HHS Secretary Tom Price’s decision on whether to continue the pre-dispute arbitration ban, which could come out in the next few weeks, according to long term care sources.  

At issue in AHCA v Price is whether HHS and the Centers for Medicare & Medicaid Services (CMS) in 2016 overstepped their statutory authority and violated the Federal Arbitration Act by banning pre-dispute arbitration deals in nursing facilities in the Medicare and Medicaid Programs; Reform of Requirements for Long-Term Care Facilities; Final Rule issued last Oct. 4.

The history of the case, in which AHCA is seeking both declaratory and injunctive relief, incudes a hearing that occurred on the preliminary injunction motion filed by AHCA to delay implementation of the ban on Nov. 3, 2016. 

A few days later on Nov. 7, 2016, U.S. District Court Judge Michael P. Mills for the Northern District of Mississippi granted AHCA’s preliminary injunction and stopped the Nov. 28, 2016, implementation date until the merits of the case were determined. 

During the waning days of the Obama administration, on Jan. 5, 2017, the federal government appealed the preliminary injunction to the U.S. Court of Appeals for the Fifth Circuit. Since the court today issued its dismissal, AHCA v. Price now goes back to the district court.
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