rule prohibits long term care facilities that participate in medicare or medicaid but requiring new residents to agree to arbitrate any future disappearance and it requires such facilities provide special nations agree to special revocation terms and secure specialists and when offering residents the option to arbitrate if a state were to impose comparable conditions on the use of arbitration agreements that effort unquestionably would be preempted by the federal arbitration act indeed both the supreme court and multiple courts of appeals have squarely held that state was designed to impede or discourage efforts to enter into arbitration agreements are just as preempted a state laws that prohibit or constrain their force that they're here of course the disfavoring rule comes from a federal agency as a condition on the receipt of federal funds rather than from a state as a rule of general applicability but that doesn't alter the bottom line for the supreme court has also made emphatically clear most recently in  systems the federal agencies may not enact rules that conflict with the f a a d strong cooperation policy unless congress clearly and manifestly empowers them to do so congress has done that or some federal agencies but  bit about the preemptive scope of the f a a the f a a imposes what the supreme court has often described as essential an equal treatment or an equal footing all arbitration agreements have to be treated like any other type of contractual provision parties can enter into them on the same terms and they'll be forced on this and so whether a state is trying to say we won't for certain types of agreements or it's trying to say we we're going to make it harder for you to enter into arbitration agreements those efforts are going to be preempted by the f a a i think a good illustration of that is the doctor's associates case from about twenty years ago and where the supreme court long ago me clear that you can't have rules that make it harder to enter into agreements they are a state had a law that said it's perfectly fine to arbitrate to it to have arbitration agreements but if you want to have an agreement it has to be on the st page of a contract and underlined and in all capital letters and the munty and a supreme court upheld that provision by saying but we're not interfering with the right to arbitrate all the state is doing is ensuring that arbitration agreements are voluntarily entered into the supreme court now so this is this is the it's move their bid in the allowed to  to to bargain it's simply sure those those two if they single out arbitration agreements alone for saying you can't have a contract in an arbitration agreement  squarely preempted that was the kind of rule that the st circuit addressed in the connelly case that we discussed in our briefing it was that case i think is actually quite on point with what the what c m s is trying to do here that was a state agency that had said we're not going to prohibit arbitration agreements but we're going to say that a licensed securities or brokerage firm can't require parties to enter into them as a condition of contracting and if a if a party if  firm does so we can penalize them for using a contract of adhesion and what they tried to do in defending that rule is say look all we're doing is having conditions on entering into agreements and we're not even saying that the agreements aren't in forcible in court we're just saying we can penalize the brokerage firm if the brokerage firm violates that rule and the st circuit squarely rejected that argument and said look it's court is just completely contradictory to that equal treatment rule that the f a a establishes because it's singling out arbitration agreements and saying we're going to require something different and special to ensure that an arbitration agreement is on terry then we are required to ensure that any other contractual provision it's voluntary so the basic agreements and essentially presume that they are involuntary and less parties use special procedures highlight them in a special manner explain them in a manner get some sort of additional assent from the party that's agreeing to arbitrate that's exactly what this rule does and by its terms it is an arbitration only rule it doesn't apply to any other provision in in an admission agreement or a long term care facility it just says if you want to have  itration agreements you can't make them a condition of entry bring on a accepting a resident you have to explain them in a particular manner you have to stick your consent beyond the signature on the contract you have to have a arbitration agreement was entered that's valid right they can go ahead and arbitrate so bad countries look what exact language of the statute are you focusing on for these particular contracts case where the rule was you can have an arbitration agreement but some with the power of attorney can't enter into it for you and they argument that was made to try to defend that rule was this rule is not about the enforceability of an  have arbitration agreements it's just about what it takes to form them and the supreme court looking at the language of the statute and looking more broadly at the way the statutes been interpreted for decades said that the statute is not concerned merely with all you would have to do is say we're going to impose massive penalties if you enter into arbitration or impose additional taxes on the arbitration or or use all sorts of disincentives to essentially prevent parties from ever having arbitration agreements that state rule was that the brokerage firms that enter into these agreements they can still enforce the agreements no one saying they can force the agreement all the state was saying is we can impose a penalty on you know we could maybe take away your license to be a brokerage firm but you can still arbitrary and the st circuit said if anything that's worse than just not in forcing a particular arbitration agreement because you're basically saying well threaten your entire livelihood if you use arbitration in a manner that's inconsistent particularly in the context of that because we've been seeking injunctive relief and sought and received a stay from this d court in the context of the administrative proceeding many of the commenters who opposed the agency's rule here ex claimed that this would have real cost both for facilities that presidents because realistically once you have a rule like this especially a provision that says you can't require arbitration as a condition of contracting in the st place practically you're going to realistically you're going to have a sensually in very little arbitration and that in return in turn it's going to increase litigation costs for facilities and it's also going to increase insurance costs for facilities because insurance policies are more expensive for facility that is subject more to risk of litigation than to risk arbitration d because arbitration is by design cheaper faster more efficient things that insurance insurance like and so all of that was put before the agency  explaining why this rule was not something you know just some you know the whole technicality but would have real costs and in addition it would have a problem in the specific problem in the context of medicare and medicaid that th facilities can't address those costs by raising their fees because these are controlled by medicare and medicaid so they're going to have to find other ways to pass on the inevitable costs of more litigation so all of that you know is a real lead to there being fewer facilities able to serve this operation is seems quite counter to c m s its mission but as a practical matter you know that's i think the agency knows that's just not going to happen because we're dealing in an area where the patient population that these facilities serve is predominately eligible d for d medicare and medicaid so facilities don't have the option to say we'll just stop participating those programs i mean the affidavits we put in the record here from the lead plaintiffs in this d case demonstrated that more than seventy percent of their funding comes from patients d whose care is paid for by medicare and medicaid the one i think i think it's important to to keep sight of in the government's argument that don't worry you'll still be able to enforce it remans whatever sort of a technical gallies of the argument that argument as a practical matter it's simply not true if there were an agreement arbitration agreement entered into and that was in violation of this will the resident would inform c m s and c m s would cite the facility for a violation it would impose a plan a correction and what it would require in the plan of correction is that the facility agreed not to enforce the arbitration as a practical matter these are not going to be enforceable arbitration agreements if they were entered into in violation ringback of this rule so i think at the end of the day i come back to the basic point that this is just a rule that by its terms is clear and manifest statement from congress to override the f a a and i again can certainly ask the government but i don't understand the government to be arguing that it even could satisfy their clear statement rule nor could i envision any such i mean because there just isn't anything in the medicare or medicaid statutes that says anything about the ability to restrict arbitration and i think that's particularly telling because you can compare those statutes to statutes like the consumer financial protection act or the f both of those agencies have explicit statutory authority to prohibit restrict or impose conditions on the use of arbitration agreements in certain circumstances by cheap or cheap counsel this is just me they do would you compare  encompassing obstacle pretty as a compass thing a principle of you can't have agreements i can't have rules that interfere with agreement so so we disagree with the reasoning of the decision that said if you think the context there is you know at least theoretically a little bit different because basically the government was sort of acting in it was closer to a market participant rule and you know when the government itself is is not acting in a regulatory capacity but when it directly contracting with a party the government is of course free to agree rather it wants to arbitrate or not but here we know the government you know the government's never claim that c m s is acting in a market participant capacity nor could it because this rule sweeps more broadly and it applies not just when a facility is is contracting with a resident who's care is paid for by medicare and medicaid it applies to all relations between a facility and a residence so even if a facility has residents who are paying for their own care when in medicaid or medicare nothing to do with it it still has to comply with this rule in order to remain eligible to participate in medicare and medicaid that means a clear exercise of regulatory authority in a way that you know to the extent this feels the need to distinguish the caps case is a way that the court could distinguish it but ultimate and we also think the cascades this could you address your o squarely was creating a conflict here the fact that there's a strong federal policy ought to interpret the law to inform how you interpret the general grant of authority that deals with health welfare and patient safety like what is being invoked here and traditionally that's and already that's been invoked by the agency to deal with things that quite directly deal with a patient's health safety and welfare things like the kind of treatment that's provided the way that facilities can you  decisions about the care and things that will be available to residents it's not used to step out and regulate the contractual relationships between parties and i do think here if you accept the agencies it's eerie of the scope of its power it was essentially require the court conclude that the agency has basically unlimited power to compel the still it is to accept residence under any terms the agency dictates congress has not done that in any context when it comes to participants in medicare and medicaid  there is a condition if you're dealing with with emergency care and you know urgency rooms have to go home as the congress is quite clearly not extended that will be on emergency care facilities so congress knows how to say that agencies have the ability to to your basically require a facility to accept a patient's i'm on terms dictated by a federal agency and hasn't done that here d so so we think there's an alter virus problem even you know even apart from the f a a problem but here i do think that analysis is informed by the f a a and that their statement d rule that says if you want to get into the business of trying to deter parties from entering into arbitration agreements or controlling the manner in which they do s the revoke ability and enforceability of arbitration agreement fact the supreme court's principle that you need equal treatment or that you cannot single out arbitration agreements also only have to do with them deliberately revoke a bil stability of arbitration and say i want to be very clear that what plaintiffs are asking for in this case is an extension of the federal arbitration act in a way that the supreme court has never endorsed which is to invalidate another federal court the already based on the federal arbitration act that is something where the supreme court has said in waffle house for example that the pro arbitration goal of the federal arbitration act do not require another federal agency to relinquish statutory authority and then there's no it was sent in which this case in which this a just rule requires nursing homes to have their arbitration agreement invalidated on enforced or revoked nursing homes in this context following the two million one thousand regulations they can enter into arbitration agreement they can have arbitration and they can ask their patients to enter into arbitration agreement and they can have their medicare and medicaid funding to go along with it they have both of those things the only thing that the nursing home where the only two things that in nursing home cannot do under the two thousand and nineteen regulation is one that cannot leverage a patient need for imminent care to say now you need to sign an arbitration agreement before i give you this point about in a little bit more detail too about singling out arbitration agreements like i said there's no sort of textual basis other than the sort of the liturgy and force ability and to revoke ability of arbitration agreement and something has to single to those concepts and in fact we know that to be the case because if it were that any rule that specifies arbitration is invalid then a host of supreme court decisions would be incorrect those include for they were in the supreme court blasted f c c rules that to protect statutory rights in the face of arbitration all of those cases would simply be incorrect under plaintiffs theory because all  arbitration and in fact what's really quite anomalous about their area of even basic requirements such as having nursing homes keep paperwork for five years has arbitrary paperwork for five years go about continue to enter into arbitration and continue to receive their medicare and medicaid funding and a similar word to the government says we to the plant  are impacted by the change so that you know i i'm not sure that i want to answer this in two ways that you know in so far as your honor is concerned about what the potential economic impact and what this sort of potential reliance interests about informing patients about their choice that they can enter into arbitration is  the government in the context of the two thousand and fifteen regulation they said look this entire comprehensive scheme of performing nursing home reform regulations doesn't have substantial economic impact and  very extensive i can i make analysis spare the two thousand and nineteen regulations rolled back some of those regulatory requirements necessarily has even less than economic impact and i just really can't see w where if you follow this rule the only things you need to do is you have to get the tell a patient that you know here is that arbitration agreement you can sign on to it if you want to just like any other business in the world when they give arbitration agreement to somebody they tell them you know like here is agree and agreement and you can sign onto it that's not somehow an onerous business impact the other point i do want to make on that score is so they say your honor is sort of concerned about whether or not there is kind of specific benefit and specific downside to help and safety that are sort of measurable and empirical h h as solicited views from a broad act of organization i mean there's organizations that are you would characterize as pro arbitration like the american arbitration association or the american bar association and there are organizations that are there to oversee the nursing homes like persons who are charged with that responsibility under the statute and none of them have want to have anything to do with this type of practice that the plaintiffs are proposing here and that's very very good reason your honor you pointed out like issues of time track season you know we don't have come out and said all of these are contract of adhesion and that would be a state by state determination of whether under state law something is a contract the basic problem that a true gas is trying to resolve and that's a policy of whether patients should be in that type of situation at all that's fundamentally something where a judge s wants to be more protective there's our you know there's regulations against what it you know requiring donations and contractual clauses there's regulations against waiving property loss or waiving your statutory right as part of those contractual clauses that reached this particular issue regarding arbitration because numerous time and tutors again from of the broad spectrum of organisations said look there is a problem going on today and just doesn't go out there and kind of invent problems that are happening in the world commenters to the agency they say look we know this is happening we know there are mandatory arbitration agreements happening where individuals come into nursing homes where they don't have a choice about whether they really are in that nursing home or not where they might not be lucid where that might be the only nursing home in a geographic area and all the sudden you're given a choice whether to accept health care or whether sign an arbitration agreement and h h s said that's just not a choice you should put one of our patients and do especially if you're going to accept medicare and medicaid funding so in that sense that's why  has focused on this issue it's not because you know somebody in a back room thought arbitration is a terrible thing it's because numerous people came gauges and said this is actually a real world problem that needs some type of fix fix here just to be clear is i think a really reasonable which is you can go ahead you can use arbitration you can explain to nursing home patients all the great benefits of arbitration those patients inside voluntarily to arbitration and at the end of the day you can have those agreements enforced in court but the only thing you can't do is two things which are you know to turn that crucial emissions process you can't just kind of say you can't be part of our nursing home you can't get any sort of care now because you're not going to sign this arbitration agreement and the nd thing you can't do is you can't   you know regulatory provisions the district court found all of them to be completely valid and of course that this court doesn't agree with that proposition i think the proper thing to do is to remember the district courts kind of parse out which of these operate together which of these can be pulled apart from one another but i will say there are kind of the two buckets which is one is the couple from the admissions process the signing of arbitration agreements and the nd is to  plan of correction and require nursing homes to kind of invalidate on a case by case basis individual arbitration agreement there is no support in that and any document like with  there's no support in the record that would require nursing homes to invalidate specific arbitration agreement and i actually think that's a really helpful example from our perspective and you know just explain why in their reply brief they cite to this case called murphy oil which went up with the epic system and in murphy oil you had a case where the n l r b was requiring employers to invalidate and to rescind individual arbitration agreements that's not what's happening here nursing homes can continue to have their arbitration agreements and even if they violate this rule the secretary has said repeatedly those at arbitration agreements are still valid and in force of all what's not happening here is c m s going in and having nursing homes and out of a specific arbitration circumstances you know i would say that nursing homes that violate one regulatory provision that's often not the only one that they're violating but you know what happens if c m s goes and then they kind of do an inspection and they look and they say you know what are the different types of things that you're following not following they have nursing homes and that a planned about what they're going to do in order to be better going forward if they continue to violate that plan and they continue to rule restricts might not lose their medicaid funding on that basis along yeah i think it would have to be really a case by case assessment and these things of and still have these provisions yeah i would hate to predict any given case but let me just give you one example which is take for instance and there's a home said i want to keep my arbitration paperwork around for four years and no five years you know maybe it's a violation of the regulation is h h s going to cancel all medicare funding on that basis in fact if you just need to find an immediate harm to health and safety before it sort of terminates somebody from the medicare program is it going to have some sort of penalty like maybe it would maybe it wouldn't but there's a whole broad spectrum the types of violations you might have in this type of circumstance and i would really just hate to predict what those are but i do think it latches on to a key point which is that still isn't invalidating revoking or not enforcing a particular arbitration let's say the nursing home you know very simple forgot to tell one patient that they couldn't sign they could choose not to sign an arbitration agreement that doesn't automatically very vocal or cause  there could be cut i mean i through that and i don't want to you know diminish that awful if there could be consequences for medicare and medically i really don't you know mean to diminish that but there could be consequences but that's not to say that you know their prediction is nursing homes can't do any arbitration or nursing homes lose all of their medicare medicaid funding i don't think it's that black and white at all and it's not that black and white for any other regulatory provision that c m the federal arbitration act completely consistently the supreme court has said the mode of analysis here and this is an ethics systems where they said we actually don't find a conflict and we've never found a conflict between two federal arbitration agreement you can go about your business and also you can have medicare and medicaid funding i mean those are completely consistent propositions it's a completely consistent proposition to ban in force and have a that was the holding of epic systems the n l r b there said that if it should have chevron deference to interpreted statutory mandate under the n r a to allow it to impose different rules in the context of labor relations because the  mandate in the context of labor relations the way the supreme court has all the professed common clicked there was by saying when two statutes could be read in such a manner that one intrudes on the the veba to the policy of the f a a we resolve the conflict in favor of the f a a unless there is a clear statement saying the n l r b can have anti arbitration rules or restrict arbitration the f a a trumps that's the same principle were a lot going on here unless there's a clear statement in invalid that's not the point the argue the principle that the supreme court has repeatedly articulated is when you single out arbitration for specially disfavor treatment and the supreme court is that the validated provisions that are virtually identical to what we're talking about here say it's fine to have arbitration as long as you do x y and z when entering into arbitration agreements the whole thrust of all of these cases most recently gendered nursing d is that the way to determine whether agreements to arbitra voluntary is by applying ordinary state contract laws like the dress doctrine the unconscious billeted doctrine so the policy judgment here has already been made by congress and congress says unless you have a violation of generally