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Georgia Overturns Arbitration Clause in Nursing Home Contract
Arbitration clauses are one-sided, non-consensual agreements found in nursing home admission agreements (i.e. contracts) that waive a person’s right to a jury trial. They are a take-it or leave-it proposition in that a family either must sign the agreement or forgo skilled nursing home care for their loved one. Multiple studies have shown these agreements favor corporations such as nursing homes. Most arbitration agreements allow the nursing home to pick the arbitrator and because they are repeat clients of arbitration firms, the arbitrators favor the corporations over the families. There is a battle going on right now in every state and in the US legislature to prohibit arbitration agreements for this reason.
The Georgia Court of Appeals has slowly been issuing rulings that limit the use of arbitration agreements in nursing homes. Just last week, Georgia held an arbitration agreement contained in Life Care Center of Gwinnett’s admission paperwork was unenforceable. A daughter filed a wrongful death case against the Gwinnett nursing home after her mother “suffered a blow to the head and died from the resulting brain damage.” (The case does not state what caused the blow to the head, but such injuries are usually the result of falls or assaults). The daughter signed her mother into the nursing home under a “Durable Power of Attorney for Health Care.” The case turned on the scope of the power of attorney. The document conveyed power to make any and all decisions regarding health care, including medical treatment or procedures. The Georgia Court of Appeals scrutinized the Power of Attorney and concluded it only pertained to health care decisions and did not convey authority for “decisions related to the handling of potential contractual or negligence claims that might” happen.
David’s Comments: Arbitration agreements are appearing in a majority of nursing home admission paperwork in Georgia. It is usually the first issue a nursing home attorney must analyze - how to fight through the agreement and get their clients into court and out of arbitration. There are many techniques for doing this. This case illustrates how important it is to have a well drafted Power of Attorney if you are assuming the care and decision making ability for your loved one. You need to tell the attorney writing your Power of Attorney so specifically account for (i.e. exclude) the power to sign arbitration agreements or other decisions relating to your family member’s legal rights on negligence claims. You should also take comfort in the fact there is a bill called the “Arbitration Fairness Act of 2009″ (H.R. 1020) introduced by Rep. Hank Johnson (D-Georgia) that will outlaw the use of arbitration agreements in nursing home contracts. Finally, I have also posted a copy of the Georgia Court of Appeals decision to prohibit the use of the arbitration agreement at Life Care Center of Gwinnett if you want to read it for yourself.
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- Georgia Council on Aging
- Georgia Council of Community Ombudsmen
- Georgia Office of Regulatory Services: Long-Term Care
- Georgia's Long Term-Care Ombudsmen Program