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Beware of Nursing Home Admissions “Agreement”

April 26, 2017

By Eric G. Marttila

Most families have faced, or will have to face at some point, the difficult decision to place an elderly loved one in a nursing home or long-term care facility.  As hard as it is to believe, when this happens, we all need to be aware that some such facilities — as part of the admission process — attempt to take away our loved ones’ constitutional rights to justice by having them (or their legal representatives) sign an “alternative dispute resolution” agreement.

As we have discussed before, when our loved ones are admitted to a nursing home or long-term care facility, we have the right to expect that they will receive the quality of care and protection which they are promised and to which they are entitled. Regrettably, however, there are too many times where they do not.  As a direct consequence of a breach of the duty of care, some of our loved ones experience serious injuries – and even death. When this occurs, and tangible harm results, those facilities who have been entrusted with their care must be held accountable for all harms and losses that result.

Although such facilities can, and should, be held legally responsible for any harms and losses which are caused to the loved ones they have undertaken to protect, some seek to avoid or minimize that responsibility by having our loved ones (or their legal representatives) sign an agreement, even before the admission takes place, to have all subsequent disputes decided by arbitration — rather than in a court of law by a judge or a jury of peers, as guaranteed by the Seventh Amendment to the United States Constitution.

There are various justifications offered as to why these facilities seek to have any and all disputes decided by arbitration – such as the alleged “speed, efficiency and cost-effectiveness” of the arbitration process — but the basic truth is that such a forum unreasonably favors them.  First, the arbitration process, as opposed to trial in a court of law, is much more likely to cause the proceedings – as well as the underlying failures of responsibility which made them necessary – to remain secret and hidden from public view.  Furthermore, by ensuring that all such disputes are heard through an arbitration process – and oftentimes by even dictating the particular arbitration service to be used – the facilities become familiar players before the deciding arbitrators, offering repeat business.  As a result, these arbitrators and/or services may be less inclined to hammer these facilities with the types of decisions and awards which are justified under the circumstances.

Trust me, when our loved ones or their legal representatives unwittingly sign an “alternative dispute resolution” or arbitration agreement, these facilities and their lawyers will seek to enforce them if a lawsuit is filed – because they know that it is to their distinct advantage to do so.  As previously indicated, we are currently representing the surviving children of a resident loved one who suffered an untoward, and entirely preventable, fall leading to his death.  One of his children was later permitted to bring a claim for his wrongful death, and a lawsuit was filed. However, it was then discovered that, as part of the original admission process, the daughter who had been granted “power of attorney” was presented with a stack of papers several inches thick and essentially directed to “sign here” — one of which documents was entitled “Alternative Dispute Resolution Agreement.”

The sad truth is that this loving daughter who was simply trying to facilitate her father’s admission to the facility was not offered the opportunity to, and did not, read through the so-called “Agreement” before signing it; was not informed that she had the right to seek advice of counsel before signing it; did not know that signing it was not a condition of her father’s admission, and, actually, believed that she had to sign the document as a condition of admission. In fact, the document was presented to her with an “X” next to where it was to be signed, and she felt pressured into signing the documents without delay. Furthermore, this highly educated representative did not even know what “Alternative Dispute Resolution” meant; did not know anything about the alleged “speed, efficiency, and cost-effectiveness” of the arbitration process; and did not know that she was being asked to give up  (and certainly would not have willingly given up) her father’s constitutional rights.

These facts notwithstanding, the facility and its lawyers are now vigorously attempting to enforce the so-called “Agreement” and to deny the family its day in court. It should be noted that The United States Arbitration Act, more commonly referred to as the “Federal Arbitration Act” (or “FAA”), is an act of Congress that provides for judicial facilitation of private dispute resolution through compulsory and binding arbitration.  Significantly, the FAA provides that arbitration agreements “shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity . . .” and establishes a “liberal policy of requiring arbitration agreements.”  As a result, the United States Supreme Court has repeatedly mandated that both state and federal courts must enforce the FAA with respect to all arbitration agreements – and, thus,  enforce the “agreement” of the parties to arbitrate.  Interestingly, while the Pennsylvania Supreme Court has acknowledged that “the contract formation process that attends nursing facility admission can be a crisis-driven, stress-laden event involving the superior bargaining power of one party over the other,” it has held that it is nonetheless bound by the FAA.

Although there are various legal challenges available to the enforceability of a so-called contract — such as fraud, mistake, duress, undue influence or unconscionability – one who has signed such an “agreement” faces an uphill battle to obtain relief from its terms.  Therefore, great caution should be exercised before signing any documents in connection with admission to a nursing home or long-term care facility.  We would encourage those involved to never sign away another’s constitutional right to a jury trial, and to be sure to consult with an attorney before signing any such admission “agreements.”

If you have any questions about nursing home admissions agreements, please contact Eric G. Marttila at 215-345-8888 or via email at emarttila@highswartz.com.

The information above is general: we recommend that you consult an attorney regarding your specific circumstances.  The content of this information is not meant to be considered as legal advice or a substitute for legal representation.

About the Author: Eric Marttila

Eric Marttila joined High Swartz in 2016 as a result of its merger with McNamara, Bolla & Panzer, a firm he joined in 2012. He focuses his practice in Bucks County and Montgomery County on personal injury, civil litigation, workers’ compensation, and has extensive experience with work-related disability issues, including those arising under the Heart and Lung Act and Act 632/534.

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