New Laws on Arbitration Agreements May Affect Victims of Nursing Home Neglect

Most people would probably agree that a stack full of complicated legal documents is always daunting, regardless of the circumstances. But for new nursing home patients, there is a lot of extra stress. When an older person moves into a nursing home, they might be sick or recovering from surgery. Right after moving into a nursing home, these people need care and rest, not the stress of complex legal agreements. However, important documents are often thrust upon them shortly after arrival — and could have a huge impact on their future.

What is an Arbitration Agreement?

One of the papers that people often sign after entering a nursing home is an arbitration agreement. This can be its own separate contract, or it may be a clause in a larger contract. In an arbitration agreement, both parties agree to settle any disputes outside of a court. This doesn’t necessarily prevent one party from suing the other. Instead, it means that issues are solved via an arbitrator, an independent person who settles the case. Essentially, an arbitration agreement prevents a case from going to trial.

While it can be nice to avoid going through the hassle of a trial, arbitration agreements can cause issues. Take this example from a New York nursing home, as reported by NRP: after being admitted to a nursing home to recover from an injury, a 60-year-old, who had been taking a pain-relieving opioid, was asked to sign an arbitration agreement shortly after his arrival. He signed it, but later developed an intestinal infection. After the nursing home neglected to address his condition, the man had to call 911 for himself. As a result of the delay, he had a sizable portion of his colon removed, and now experiences permanent damage.

How Arbitration Agreements Affect Victims

Clearly, the nursing home’s negligence played a role, making this a potential case of medical malpractice or nursing home neglect. But since the man signed an arbitration agreement, he can’t bring his case to court. As a result, the settlement he receives for his suffering will likely be insufficient or very small. According to a study by the American Health Care Association, the settlements for plaintiffs during private arbitrations are around 35% less than the settlements from trials. Additionally, since the arbitration is private, the neglect of the nursing home might never be brought to light. This might prevent others in similar situations from speaking up and finding their own justice and compensation.

Under previous regulations, it was slightly easier for victims to bring their case to court. However, a newly proposed rule could change that. The changes, proposed by the Centers for Medicaid and Medicare Services, aim to “strengthen transparency in the arbitration process, reduce unnecessary provider burden and support residents’ rights to make informed decisions about important aspects of their health care.”

The Proposed Changes

Some key provisions include:

  • All agreements for binding arbitration must be in plain language
  • The resident must acknowledge that they understand the agreement
  • The nursing home facility must post a notice regarding its use of binding arbitration in an area that is visible to both residents and visitors

These new provisions address some good points. After all, it is very important that residents understand what they are signing, and nursing homes should fully and accurately explain the contract. However, critics of arbitration believe it isn’t doing enough. By still requiring arbitration agreements, they believe that the changes still prevent victims from receiving proper compensation or justice. Additionally, nursing home patients could be denied admission to nursing homes if they do not sign the agreements, which can be dangerous for people who are ailing, injured, or in need of care. Supporters of arbitration, on the other hand, believe that it makes the process more effective, and ensures that victims find compensation in a timely manner.

Protecting Nursing Home Residents

Regardless of opinion, everyone should acknowledge that nursing home abuse is an issue. 1 in 10 Americans over the age of 60 experiences some kind of abuse or neglect. This is because social isolation and mental impairment can make elderly people particularly vulnerable. Hopefully, as the debate over arbitration agreements continues, everyone keeps the needs of older Americans in mind, and works to do what is best for the victims of nursing home neglect.


The attorneys at Perenich, Caulfield, Avril & Noyes represent those involved in car accidents, motorcycle accidents, bicycle accidents, pedestrian accidents, and other types of personal injury matters. Our firm is one of the oldest personal injury law firms in Tampa Bay. There are no attorneys’ fees or costs unless we prevail for you. Call our office 24 hours a day at 727-796-8282 or simply click here to schedule a free case consultation.


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