Over the past decade, arbitration clauses have become increasingly common. Look closely at your cellphone service contract, credit card contract or student loan agreement, and you are likely to discover that you have given up your right to seek redress in court in the event of a dispute. Nursing homes have also embraced these clauses. The ethics of mandatory arbitration for nursing home patients is even more questionable than in other contexts, because elderly patients may not be able to understand that they are surrendering this important right.
Recently in Massachusetts, an elderly nursing home patient was murdered by her 97-year-old roommate after a disagreement over moving a nightstand so that the decedent could make her way to the bathroom. The decedent’s son sought to hold the nursing home accountable, only to discover the nursing home contract forced any dispute into private arbitration.
The patient’s son has questioned whether the arbitration process could really be objective. The arbitration firm, who ultimately resolved this dispute, had previously handled over 400 arbitrations for the law firm representing the nursing home. Because the arbitration firm draws such a substantial amount of business from the nursing home, it would appear they might have a reason to resolve cases in their favor. In this case, the firm ruled in the nursing home’s favor, without providing any basis for their ruling. The arbitrator’s “opinion” consisted of a single check mark indicating that the nursing home had not been negligent in its care of the late patient.
Despite these issues, judges have consistently upheld mandatory arbitration clauses, even where the individuals who signed the contracts did not understand what rights they were forfeiting. However, lawmakers are becoming increasingly concerned because the private nature of arbitration proceedings can shield the public from patterns of wrongdoing in nursing homes. Recently, lawmakers in 16 states have urged the federal government to deny Medicaid and Medicare funding to nursing homes that use mandatory arbitration clauses.
In this case, the patient’s son challenged the validity of the arbitration clause in his mother’s nursing home contract on grounds that he signed the admissions papers on her behalf, but did not have the authority to bind her to arbitration. A judge found in his favor. Appeals courts across the country are following suit and throwing out nursing home contracts signed by family members of residents.
Philadelphia Business Lawyers at Sidkoff, Pincus & Green Represent Businesses and Individuals in Contract Disputes
If you have a contract dispute, or are being sued for breach of contract, the experienced Philadelphia contract lawyers at Sidkoff, Pincus & Green can help. With offices conveniently located in Philadelphia, we represent clients throughout Pennsylvania and South Jersey. Call us at 215-574-0600 or contact us online today.