Pennsylvania Superior Court’s Recent Decision Will Improve Nursing Home Care

More and more nursing homes are corporatizing the delivery of healthcare to increase profits. A trend for the past several years has been to insert an "arbitration clause" in their resident agreements.  By signing this agreement, the resident or his/her legal guardian are relinquishing their right for any potential claim, no matter how egregious the circumstances, to be heard by a jury.  The agreement strips away the people's voice and, in many circumstances, terminates a real opportunity to improve resident safety and quality of care.  By signing these agreements, the nursing home directs the flow of complaints to corporate-designed dispute systems, which serve their interests to the detriment of the resident, the resident's family and the community at large.

These corporate interest "alternative dispute" systems eliminate the best judicial system in the world where the people rule and the fact finder, most often, cannot be influenced by anything other than the facts and law of the case.  The checks and balances that our system of jurisprudence provides to facilitate truth and justice are not applicable in these settings.  And, as history has shown, not only does our civil justice system provide the best means in the world to compensate victims of abuse and neglect, but it is arguably the best driver of quality healthcare.

As the following examples show, the lives of countless seniors and many millions of dollars in future health care costs have been saved as a result of lawsuits.

·      A 78-year-old woman, admitted to a nursing home for short-term hip and wrist rehabilitation, died after suffering severe pressure sores, malnourishment and dehydration. As part of the settlement, the company changed its patient monitoring and care procedures in each of its 65 nursing homes.

·      A 72-year-old man contracted a bacterial infection from a fellow patient after undergoing knee replacement surgery; his leg lost all mobility. This lawsuit and similar cases caused health care facilities around the country to be more attentive to infection control.

·      A 63-year-old Alzheimer patient was strangled to death by the restraints in her bed rails while sleeping. As part of the settlement, the nursing home agreed to numerous operational reforms, while the bed rail manufacturer agreed to warn its customers about the dangers of entrapment.

·      A 79-year-old woman was crushed to death after a Home Depot forklift operator knocked lumber and other merchandise stacked several feet above her. After the case settled, Home Depot announced plans to change its merchandise-stacking policies.

·      A 79-year-old nursing home patient suffering from Alzheimer’s disease drowned in a bathtub after being left unattended. As a result of this lawsuit, the nursing home installed safety strips in bathtubs and exercised closer supervision of its elderly patients.

·      An 81-year-old woman died after taking the anti-arthritis drug Oraflex manufactured by Eli Lilly. As a result of this lawsuit, Lilly and its executives were held criminally responsible for mislabeling and failing to report fatal side effects and illnesses related to the drug.

·      An 80-year-old was legally blinded in her left eye when a twist-off aluminum cap blew off a plastic two-liter Diet 7-Up bottle and struck her in the eye. As a result of lawsuits, the company converted to using plastic pre-formed caps that greatly reduced the likelihood of caps blowing off and added a specific warning on the bottles.

Pennsylvania courts seemingly recognize the value of the civil justice system's ability to influence best nursing home practices.  In a victory for Pa. residents, the Pennsylvania Superior Court in Washburn v. Northern Health Facilities, Inc., et al., held that an arbitration agreement was not binding upon a plaintiff resident when his wife signed the agreement as her husband’s “designated legal representative,” because Mrs. Washburn did not have her husband’s power of attorney and had not been appointed his guardian.  The Washburn Court followed another recent Pa. Superior Court decision in Taylor v. Extendicare Health Facilities, Inc., wherein the Court held that an arbitration agreement signed by the resident decedent or his or her authorized representative was not binding upon non-signatory wrongful death beneficiaries, and they cannot be compelled to arbitration.  The Taylor Court also refused to severe the Survival Action from the Wrongful Death Action since the claims arising out of the same set of facts shall be consolidated.  Hopefully, Pa. courts will continue this trend to limit the utilization of these heavy-handed contracts.

In my opinion, any healthcare agreement attempting to limit consequences of wrongdoing presents a conflict of interest, particularly when a potential resident and his/her family members are in a vulnerable state in a desperate search for reasonable and necessary healthcare, is inappropriate.  Many times the resident and/or the resident's family have no choice, based in realty, to rebuke the nursing home's efforts to enforce the signing of the arbitration agreement.

The Center for Medicare Medicaid Services, acknowledging these concerns, has recently released proposed rules "to ensure that if a facility presents binding arbitration agreements to its residents that the agreements be explained to the residents and they acknowledge that they understand the agreement; the agreements be entered into voluntarily; and arbitration sessions be conducted by a neutral arbitrator in a location that is convenient to both parties."  Importantly, admission to the facility could not be contingent upon the resident or the resident representative signing a binding arbitration agreement. Moreover, the agreement could not prohibit or discourage the resident or anyone else from communicating with federal, state or local health care or health-related officials, including representatives of the Office of the State Long-Term Care Ombudsman.

While CMS is attempting to even the playing field between the corporate interests and the resident and resident’s family, some feel that forced arbitration agreements have no place in nursing home admissions.  The American Association for Justice is currently sponsoring a petition to encourage the federal government to ban arbitration agreements in nursing home admissions.  Click here for more information.

While investigating the best nursing homes for your loved one, you should inquire whether the nursing home forces residents to sign arbitration agreements.  If that is their policy, then your interests might be best served by researching other alternatives.  Others may consider contacting your state’s Department of Aging or Ombudsman to report the nursing home’s efforts to utilize its unequal bargaining power in having the resident or member of the resident’s family sign such an agreement under duress.