Lawmakers hear testimony on nursing home arbitration clauses

By Chris Rizo | Jun 10, 2008

Gavin Gadberry

Rep. Linda S'nchez

Dr. William Hall

WASHINGTON (Legal Newsline)-Federal lawmakers heard Tuesday that binding arbitration clauses in nursing home contracts provide a fair and timely resolution of patient disputes.

Arbitration agreements are "a viable option" for long term care providers and their residents to resolve legal disputes, said attorney Gavin Gadberry, representing the American Health Care Association and the National Center for Assisted Living.

"Arbitration is less adversarial than traditional litigation, produces quicker results and has been determined to be both fair and appropriate by our courts," he told members of the House Judiciary's Subcommittee on Commercial and Administrative Law.

The 12-member panel is considering legislation introduced by committee chair Rep. Linda Sanchez, D-Calif., who said she recently placed her father in a nursing home.

"Unfortunately, this debate is colored by anecdotes and misinformation perpetuated by high-profile trial attorneys who traditionally oppose any effort to bring balance to the personal injury playing field, and who give too little consideration to the harmful consequences on the long term care industry that follow from the high transaction costs of traditional litigation and the resulting financial drain on the system," Gadberry said.

The legislation, outlined in H.R. 6126, would render invalid pre-dispute arbitration agreements between a long-term care facility and a resident or anyone acting on the resident's behalf.

"When legal concerns arise, we believe that fair and timely resolution -the kind that is often the product of arbitration - is in the best interest of both the consumers and their care providers," Gadberry said.

The bill-the Nursing Home Arbitration Act of 2008-is supported by AARP, which represents older Americans.

Dr. William Hall, a member of AARP's board of directors, told the committee that pre-dispute arbitration clauses in nursing home contracts are "harmful" to residents and their families.

"These arbitration clauses force a Hobson's choice --waive the right to seek redress in the courts or get care in another facility, assuming there is one in their area without an arbitration clause," the Rochester, N.Y., geriatrician said.

While the quality of care in nursing homes and other residential care centers has improved since the enactment of federal nursing home quality standards in the Omnibus Budget Reconciliation Act of 1987, he said "much more" needs to be done to improve patient care.

"Many facilities do provide high quality care, but there are also too many facilities that show significant quality deficiencies that can cause harm to residents on their annual inspections," Hall said.

Arbitration clauses, he said, unfairly take away residents' and families' legal options. What's more is that many nursing home admissions are made unexpectedly, after a crisis.

"Clearly, most people seeking nursing home admission are focusing on the quality and range of services available, and are not thinking about possible future disputes," Hall said.

"When they are presented with admissions contracts, they often do not know that an arbitration requirement is buried in the fine print of the multi-page document," he added.

From Legal Newsline: Reach reporter Chris Rizo by e-mail at chrisrizo@legalnewsline.com.

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