After Florida deaths, Trump administration called out for making it harder to sue nursing homes

Arbitration clauses are rampant in the nursing home industry.

Eight people died at the Rehabilitation Center at Hollywood Hills in Hollywood, Florida, in the wake of Hurricane Irma. CREDIT: MediaPunch/IPX
Eight people died at the Rehabilitation Center at Hollywood Hills in Hollywood, Florida, in the wake of Hurricane Irma. CREDIT: MediaPunch/IPX

This week’s tragedy at a Florida nursing home, where eight people died in the wake of Hurricane Irma, brought to light how the Trump administration is aiming to make it harder for seniors and their families to hold nursing homes accountable.

Family members of the people who died at the Hollywood, Florida, nursing home are likely prohibited from filing lawsuits or taking legal action against the owner of the facility, since nursing homes routinely require residents to sign agreements that take away the resident’s right to sue the facility in a real court and instead shifts them into a privatized justice system.

President Barack Obama tried to limit the use of these types of arbitration agreements, but the Trump administration has since countered that the rule would impose “unnecessary or excessive costs on providers” of nursing home care and is in the process of rewriting the rule.

“I would estimate that 95 percent of nursing homes have an arbitration agreement,” said Paul Bland, executive director and senior attorney at Public Justice, a nonprofit law firm that represents clients contesting arbitration clauses. “Even if the family member dies as a result of an intentional [act], they would have to go to arbitration,” he told ThinkProgress.

Under arbitration, a nursing home and the family members hire a private judge — often selected by the company — and use a different set of rules that can be more restrictive than civil court. Studies show that awards to plaintiffs can be as much as 35 percent lower under arbitration versus lawsuits filed in civil court, NPR reported. Also, while civil court records are typically public, arbitration can often be secretive, allowing nursing homes with a pattern of abuse to hide their illegal practices from public scrutiny.

It is still too early to determine whether the residents at the Florida nursing home signed arbitration agreements. The 152-bed Rehabilitation Center at Hollywood Hills was acquired in 2015 by Larkin Community Hospital, a Miami-area network that includes hospitals, nursing homes, and assisted living facilities. The nursing home could not be reached for comment. The Larkin Community Hospital said it is not taking calls from the news media.

The eight residents who died at the nursing home were reportedly between the ages of 71 and 99. Six died from heat-related issues, and the cause of death for the other two is under investigation. Officials determined after an initial inquiry that the facility’s air conditioning system was not fully functional. The nursing home had reportedly been running on generators for three days after Irma knocked out power to the facility, located in Hollywood, Florida, about 20 miles north of Miami.

Florida state law requires nursing homes and assisted living facilities to have backup power systems. They must also have emergency and evacuation plans in place.

As recently as last year, the Rehabilitation Center at Hollywood Hills was cited for violations related to federal requirements about its backup power capabilities, STAT reported Wednesday. During a February 2016 visit, a federal inspector found the facility “failed to maintain the emergency generator to manufacture and code requirements,” according to records reviewed by STAT.

With nursing homes and assisted living facilities across the state still facing major problems as a result of widespread power outages, Sen. Bill Nelson (D-FL) said in a tweet that the head of the Veterans Administration has given the state authority “to move anyone in a nursing home without power into a VA hospital if necessary.”

Florida Gov. Rick Scott said in a statement that he is demanding answers on “how this tragic event took place.” The governor directed Florida’s Agency for Health Care Administration and the Department of Children and Families to work with local law enforcement to conduct an investigation. “If they find that anyone wasn’t acting in the best interests of their patients, we will hold them accountable to the fullest extent of the law,” Scott said.

It is still unknown why the air conditioning system at the nursing home stopped working and why officials at the Broward County facility did not call for help sooner. A family member of one of the facility’s residents said she and others repeatedly called Florida Power & Light about the lack of electricity at the facility but were ignored, the Washington Post reported.

The home’s administrator, Jorge Carballo, said in a statement that a transformer connected to the air-conditioning system experienced a “prolonged power failure,” prompting the staff to contact Florida Power & Light. As they were waiting for power restoration, staff members set up mobile cooling units and fans and tried to make sure residents were hydrated and comfortable, the New York Times reported.

A Florida Power & Light official said at a Wednesday press briefing that Broward County officials had not listed the nursing home as critical infrastructure in a hurricane planning meeting earlier this year. Such locations are prioritized for power restoration after a storm because of the services they provide to vulnerable people.

“Nursing homes are defined in the FPL guidance document as ‘non-critical, but play a decisive role in community recovery after a serious event.’ Hollywood Hills’ designation as ‘non-critical infrastructure’ was based on this definition,” Broward County said Wednesday in a statement.

Businesses have long preferred arbitration over court trials. Their push to expand the practice grew with the help of court decisions over the last three decades in employment and consumer contracts. These clauses force employees and customers into arbitration, which is often heavily weighted in the company’s favor.

In response to consumers losing access to the courts through the growing use of arbitration to settle disputes, the Obama administration issued a new rule that would have made it easier for nursing home residents to sue for negligence or abuse. Under the rules, Medicare and Medicaid would cut off payments to nursing homes that require new residents to sign forced arbitration agreements, a contract that takes away the resident’s right to sue the home in a real court and instead shunts them into a privatized justice system.

“The Obama administration rule was an incredibly important protection for vulnerable patients in nursing homes and their families,” Bland said. “There is significant body of evidence that shows when nursing homes are able to use arbitration clauses, significant problems in the homes never come to public light. So people just don’t know something has happened there.”

The Obama administration’s ban on nursing home arbitration agreements for new residents never took effect. The American Health Care Association, the main trade group for the nursing home industry, went to federal court and received a preliminary injunction preventing the rule from taking effect, NPR reported.

The Trump administration chose not to appeal the federal judge’s injunction, thereby preventing the Obama rule from taking effect. In June, the Trump administration published a proposed rule that will reinstate nursing homes’ ability to receive federal money even if they force seniors entering a nursing home into arbitration agreements.

“The new rule will return the legal situation to where it was before the Obama administration promulgated its rule, and there is a possibly the new rule could make things worse,” Bland said.

Under arbitration agreements, even if investigations conclude the nursing home broke state or federal laws by not providing adequate care to the residents, family members will not be permitted to file a lawsuit. “I’ve handled cases of rapes of elderly women at nursing homes and cases involving orderlies who murdered patients. I’ve seen those cases sent to arbitration,” Bland said.

The nursing home industry will justify their preference for arbitration by arguing that the industry is under attack by plaintiffs and juries and that arbitration is a way of reducing its liabilities, according to Bland.

“The nursing home industry, uniquely among corporate America, is out of the closet with the fact that the reason they use arbitration is because their patients will receive less in arbitration than they will in court on average,” Bland said. Other industries have claimed that arbitration is better because it is faster and fairer for the customer than a court case.

The Florida Health Care Association, which represents more than 4 in 5 nursing homes in the state, said it does not represent the Hollywood facility.

The first priority of nursing home facilities “is always the safety and well-being of every resident in their care,” the Florida Health Care Association said in a statement. “In the days prior to the storm and through today, we have been in regular communication with our facilities to help coordinate needs and ensure proper implementation of the emergency management plans each facility is required to have,” the association said. About 150 out of the 683 nursing homes in the state did not have full power services restored as of Wednesday.