Op-Ed

Nursing-home fine print takes away families’ rights

TNS

We all sign it: pages and pages of fine print that comes with just about any credit card, cell phone or online service. Sometimes it’s not even a signature, you just click “I agree.”

But what have you agreed to?

A recent three-part investigation in the New York Times shone a light on just what you’re signing, and it’s worrisome. Specifically, these days you’re often signing a “forced arbitration” clause, which says that if you have a dispute with the company, you’ve forfeited your constitutional right to take it to court. Instead, you can only take your case to a private arbitrator, someone usually picked by the company.

It’s not like having your day in court.

For instance, the Times told the story of Roberta Powers, an 83-year-old Alabama woman who lived in a nursing home. She suffered from dementia, so she required careful care to ensure her safety.

One day Powers’ son arrived for a visit and found her alone and unresponsive. She died a day later; an autopsy revealed that she had more than 20 times the allowed dose of a diabetes medication in her bloodstream.

It should have never happened. Powers’ children wanted answers, and they filed a lawsuit against the nursing home. But the nursing home pointed out that when the family had signed the admissions documents, the papers included a forced-arbitration clause.

The case went to an arbitrator, who ruled in favor of the nursing home.

The fine print can also forbid consumers from joining together in a class-action lawsuit against a company that has cheated thousands of customers. Those suits are important because an individual can’t possibly take on a big company when, for example, they are only seeking $50 that the company may have overcharged them. With a class action, thousands of people can be compensated, and companies that would seek to cheat consumers are deterred from doing it again.

Without that threat, there’s little deterrence — bad news for consumers.

The Consumer Financial Protection Bureau, the agency created in the wake of the financial meltdown, has studied forced arbitration, finding this year that, “In cases where credit-card issuers with an arbitration clause were sued in a class action, the companies invoked the arbitration clause to block class actions 65 percent of the time.”

The good news is that something can be done. Last month, the CFPB announced the outlines of a plan that would forbid banks, credit-card companies, and other financial institutions from taking away consumers’ ability to join others in a class-action suit against them. The big banks have already started fighting the plan, but the agency’s effort is quite reasonable — and needs to become a reality.

And a second federal agency, the Centers for Medicare and Medicaid Services, could tackle the problem in nursing homes. The agency is updating rules for most nursing homes in the country and has recognized public concern on the issue.

To be clear, arbitration can have benefits as an alternative dispute resolution. But voluntary arbitration is very different from forced arbitration. If a family member has been harmed at a nursing home, for instance, you can make a voluntary choice to arbitrate and have a say in how an arbitration should happen. But you shouldn’t be forced or fooled into signing an agreement that forfeits your right to a jury trial before a dispute has even occurred. That’s what the Centers for Medicare and Medicaid Services should forbid at nursing homes.

Whether you’re signing a loved one into a nursing home or just signing up for Netflix, you shouldn’t have to give your legal rights away. In fact, it says something quite troubling about a company if they’re not willing to be held accountable.

Most of the time, the consumer doesn’t have a choice. Just try finding a cell-phone company today that doesn’t use forced arbitration, for example, and you’ll be out of luck, because all of the major providers do.

The big corporations probably aren’t going to give up this get-out-of-jail card they’ve discovered. It’s going to have to be taken away from them. That’s what consumers need.

Julie Braman Kane is a partner at Colson Hicks Eidson in Coral Gables and president elect of the American Association for Justice.

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