A BILL TO BE ENTITLED
AN ACT regulating arbitration agreements between residents and certain long‑term care facilities by prohibiting pre‑dispute binding arbitration agreements and establishing standards for post‑dispute binding arbitration agreements.
The General Assembly of North Carolina enacts:
SECTION 1.  Part 1 of Article 6 of Chapter 131E of the General Statutes is amended by adding a new section to read:
"§ 131E‑114.10.  Regulation of pre‑dispute and post‑dispute arbitration agreements in long‑term care facilities.
(a)	Definitions. – As used in this section, the following definitions apply:
(1)	Long‑term care facility. – All of the following:
a.	A skilled nursing facility as defined in 42 C.F.R. § 1819.
b.	A facility licensed under this Part that is subject to 10A NCAC 13D.
c.	A nursing facility as defined in 42 C.F.R. § 1919.
d.	A facility licensed under Part 1 of Article 1 of Chapter 131D of the General Statutes that is subject to 10A NCAC 13F.
(2)	Pre‑dispute binding arbitration agreement. – An agreement between the facility and a resident or the resident's representative to use binding arbitration to resolve a dispute between the parties, which is entered into before a dispute arises between parties.
(3)	Post‑dispute binding arbitration agreement. – An agreement between the facility and a resident or the resident's representative to use binding arbitration to resolve a dispute between the parties, which is entered into after a dispute arises between the parties.
(b)	Pre‑Dispute Binding Arbitration Agreements Prohibited. – A long‑term care facility shall not enter into a pre‑dispute binding arbitration agreement with any resident or the resident's representative or require that a resident or the resident's representative sign a pre‑dispute arbitration agreement as a condition of admission to the facility.
(c)	Post‑Dispute Binding Arbitration Agreements Allowed. – After a dispute between a long‑term care facility and a resident arises, the facility may request the resident or the resident's representative to enter into a post‑dispute binding arbitration agreement if all of the following requirements are met:
(1)	The long‑term care facility explains the agreement to the resident and the resident's representative in a form and manner that the resident and the resident's representative understand, including in a language that the resident and the resident's representative understand.
(2)	The resident acknowledges that he or she understands the agreement.
(3)	The agreement satisfies all of the following criteria:
a.	Is entered into by the resident voluntarily.
b.	Provides for the selection of a neutral arbitrator agreed upon by both parties.
c.	Provides for selection of a venue convenient to both parties.
d.	Does not contain any language that prohibits or discourages the resident or any other person from communicating with federal, State, or local officials, including federal and State surveyors, other federal or State health department employees, and representatives of the Department of Health and Human Services and the State Office of Long‑Term Care Ombudsman.
(d)	Residents' Rights Not Conditioned Upon Agreement to Arbitrate. – A resident's continuing right to remain in a long‑term care facility is not contingent upon the resident or the resident's representative signing a binding arbitration agreement.
(e)	Individuals Authorized to Sign Arbitration Agreements on Behalf of Residents. – An individual other than the resident of a long‑term care facility may sign a binding arbitration agreement on behalf of a resident if all of the following requirements are met:
(1)	Such signature is otherwise allowed by State law.
(2)	All of the requirements of this section are met.
(3)	The individual signing the agreement on behalf of the resident has no interest in the facility.
(f)	Facility Must Retain Copies of Arbitration Agreements. – For at least five years from the date a long‑term care facility and a resident resolve a dispute with binding arbitration, the facility shall retain on its premises and have available for inspection upon request of the federal Centers for Medicare and Medicaid Services or the Department a copy of the signed binding arbitration agreement and the final decision of the arbitrator."
SECTION 2.  This act is effective when it becomes law and applies to binding arbitration agreements entered into by residents of long‑term care facilities, as defined in G.S. 131E‑114.10, as enacted by this act, on or after that date.