The decision to move a loved one into a nursing home or assisted living facility can be a complicated and emotional one. Many factors go into making such a decision, and typically people are in a fragile state of mind when it comes time to actually do so. Unfortunately, this is also the time when nursing homes can try to take advantage of you by having you sign important legal documents, such as arbitration agreements, while concealing it as part of the normal admissions process.
Arbitration is a form of alternative dispute resolution whereby legal disputes are resolved outside of the court system. In arbitration, the two parties to the dispute choose a neutral third-party to hear the case and determine the outcome. Each side presents evidence and testimony, and the arbiter ultimately makes a ruling on the case. The decision of the arbiter is final and binding. Much of the process of arbitration proceeds just as a normal trial would; however, there is one significant difference. By agreeing to arbitration you waive your right to a jury trial. And because juries are typically more sympathetic to an injured patient than arbiters, monetary awards are often dramatically lower than those awarded by juries. This is not something that nursing home administrators inform patients of before they have them sign such agreements.
Nonetheless arbitration agreements are continually being slipped into the long list of forms presented to patients before they receive any treatment and regarded as just another part of the standard admissions process. Unfortunately, due to the typically dire circumstances attendant with admission to a nursing home, patients and their loved ones do not possess the requisite time or mental state to fully understand what they are signing. Thus, legal battles over the legality of arbitration agreements ensue.
Fortunately for the patients, there are a number of legal arguments which, if successful, will prevent the enforcement of these agreements. The first is the issue of unconscionability. If the court deems the agreement unconscionable, it means that the contract does not “conform to the dictates of conscience.” In other words, the agreement is so unreasonably unfair that the court will refuse to enforce it.
Another avenue of defense is the concept of “authority to sign.” Not just anyone is allowed to sign a contract on behalf of another person. However, nursing homes routinely have whoever accompanies the resident to the facility sign the paperwork, regardless of their relationship to the patient. This type of signature is not valid. Only a person specifically designated to make decisions regarding another’s legal choices can validly sign an arbitration agreement waiving the other’s right to a jury trial. Importantly, a person designated to make health care decisions of behalf of another is not also automatically empowered with the right to make decisions regarding arbitration. Seven state supreme courts agree that the decision to arbitrate is not a health care decision. Unfortunately, this has not stopped nursing home facilities from fighting to enforce their invalid agreements at the expense of the rights of their residents.