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Greg Webb
Greg Webb
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Nursing Homes Hiding The Keys to the Courthouse With Arbitration Clauses

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One of the more vulnerable times in our lives is when we, or a loved one, enter a nursing home. It is a time of high emotions and typically involves some precipitating event. In the middle of this stressful time you’re signing papers—reams of papers. And, without realizing the long-term implications, included in those papers is often an arbitration clause. That clause takes away the patient’s and her family’s rights to sue in a court of law for negligence of the home or its employees.

The arbitration clause requires that the matter be handled by an arbitrator (sometimes a retired judge or lawyer), who more often than not has done (or the company he/she works for has) numerous arbitration cases for the nursing home, the company that owns it, or the law firm representing it.  In other words, the arbitrator’s bread is buttered by the nursing home or its attorney(s).

I have written about the increasing use of arbitration by corporations as a way of avoiding responsibility and saving money. These clauses are now standard practice in credit card agreements, car purchases and myriad other places.  As corporations get into the nursing home business, arbitration clauses are popping up there.  It is worth noting that for-profit companies now own about 60% of nursing homes.  As our population ages, the business of elder care has the potential for huge profit. And, lots of heartache, because when profit is the ultimate goal, the health and well-being of individuals may slip down the priority list.

Imagine being told your 100-year-old mother is dead at the hands of her roommate, a woman with known behavioral and psychological problems. The roommate put a plastic bag over your mother’s head and left her to die. When you try to find out what happened you are not immediately given the whole truth. Then you discover that the arbitration clause, signed upon admission, prevents you from trying to hold the nursing home fully accountable – you cannot sue the nursing home in a court of law and have a jury decide the case.

This happened to the family of Elizabeth Barrow, a resident at a nursing home in Massachusetts.  Now, 6 years later, a state court will finally hear the case against the nursing home, after an arbitrator found for the nursing home without any explanation.  And, by the way, the arbitration firm had done over 400 arbitrations for the law firm representing the nursing home.  But, because the contract was signed by Mrs. Barrow’s son (as opposed to Mrs. Barrow, the resident), without a power of attorney, the Barrow’s have a technical argument allowing them to pursue a state court action, according to the judge hearing the case.  “It has become a crucial test of a legal strategy to prevent nursing homes across the country from requiring their residents to go to arbitration, where there is no judge or jury and the proceedings are hidden from public scrutiny.” (www.NYTimes.com, 2/22/16)

“Between 2010 and 2014, hundreds of cases of elder abuse, neglect and wrongful death ended up in arbitration,” according to an examination by The New York Times of 25,000 arbitration records and interviews with arbitrators, judges and plaintiffs.   (www.NYTimes.com, 2/22/16)  What that means, in simple terms, is that any wrongdoing was dealt with quietly—using arbitrators who often work repeatedly for the same corporation—without the public learning about the incident. And, most often, justice, as we know it, is not being served.

In essence, any of us may be preparing to send a grandmother or grandfather to a nursing home nearby that has seen multiple medical malpractice or negligence incidents that were quietly swept under the rug.  We will have no idea of the nursing home’s actual history for providing quality care to its residents. Arbitration clauses exist only to protect the profits and “good names” of those homes and/or corporations. The use of arbitration clauses in nursing home contracts, with elderly patients in the end stages of life and families vulnerable and often desperate to have their loved one cared for, is a way to hide the keys to the courthouse, and ultimately to prevent the nursing home from being  held fully responsible and accountable.  Arbitration also allows for any wrongdoings to more easily be kept private, because lawsuits are public records.

Recently, officials in 16 states and the District of Columbia urged the federal government to deny Medicaid and Medicare money to nursing homes that use the clauses.  Notwithstanding the law in your state, as a consumer, if you find yourself searching for a nursing home for your parent or grandparent, be aware of an arbitration provision in the contract.  Search for it and attempt to negotiate it out of the contract.  If you live in an area with choices, look elsewhere for a nursing home without such a provision.  Hopefully, you will never need the keys to the courthouse, but if you do, you will be thankful you are not bound by an unfair and biased arbitration clause.

Click here for more on unfair arbitration clauses or here.


1 Comment

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  1. jc says:
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    Mandatory arbitration clauses would be a great thing in medical malpractice lawsuits. Cases could be adjudicated quickly. No more fighting a 10 year lawsuit because a patient did not get an aspirin, like I had to go thru.