We Must Have the Lawyers, We Must Go to Court

Judging by the flurry of committee action, looks like there will be a congressional vote this year on at least one anti-arbitration bill. The Senate Judiciary Committee today is marking up S.2838, Fairness in Nursing Home Arbitration Act, which would vitiate arbitration provisions in nursing home contracts.

On Tuesday, the House Judiciary Subcommittee on Commercial and Administrative Law reported out three anti-arbitration bills, including the House version of the nursing home legislation, H.R. 6126. The Naderific group, Public Citizen, issued a news release praising the action as an “important step toward protecting American consumers from companies that would take away their access to the courts.”

The bill attacking arbitration in nursing home contracts is the wedge legislation that the plaintiffs’ bar wants to employ to overturn arbitration in all sorts of contracts. They want to bring back the good old days of always going to court, no matter whether the client’s interest is being served.

You remember those good old days? Here’s a reminder from Kelley Rice-Schild, testifying in June on behalf of the American Health Care Association and National Center for Assisted Living. Rice-Schild is executive director of the Floridean Nursing & Rehabilitation Center:

In the late 1990’s, the long term care profession was subject to excessive liability costs, which were exacerbated by an increasingly litigious environment. As a result, operators of nursing facilities and assisted living residences were forced into making difficult decisions including potential closure or divestiture of facilities, and corporate restructuring. In addition to pursuing state and national tort reform legislative initiatives to enable facilities to continue to operate and provide essential long term care services in a difficult environment, the profession sought alternatives to traditional litigation including arbitration. This trend was especially true in states such as Arkansas, Texas, and my home state of Florida, where state laws fostered an exponential growth in the number of claims filed against long term care providers – even those with a history of providing the highest quality care.

As a result, there was an explosion in the cost of obtaining insurance to protect operators from the risks associated with a tort environment that often encouraged unsubstantiated claims against long term care providers. This trend included significant advertising – including highway billboards – to encourage consumers to sue their long term care provider. Even following the passage of tort reform legislation in Florida in 2001, insurance is not widely available and for most operators unaffordable, which forced several companies to no longer provide care and services to the frail elderly in my home-state.

Ah, the good old days — except for residents of long-term care facilities or their families.



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