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Court rules SNF can enforce arbitration contracts

LTC Liability Monitor, June 16, 2004

A Florida appeals court upheld contracts requiring residents to settle disputes with their SNFs through binding arbitration, according to the Miami Daily Business Review. The ruling came in a lawsuit brought by the family of a man who died a week after breaking his leg at Sunrise Health and Rehabilitation Center in Sunrise, FL. The family had signed an agreement during admission to use arbitration, rather than the courts, to settle any disputes.

The appeals court said it could not refuse to enforce a valid agreement-but it did not entirely settle the matter. Instead, the court returned the case to the circuit court to determine whether the contract was either inherently unfair or signed under pressure and without understanding, the newspaper reported.

The ruling comes as SNFs seek to shield themselves from hefty jury verdicts, the newspaper reported. The costs of lawsuits and liability insurance for SNFs have skyrocketed, according to a press release from the American Health Care Association. The average liability costs per SNF bed increased from $310 in 1992 to $2,290 in 2003, according to the press release. Go to http://www.ahca.org and click on "Long Term Care General Liability and Professional Liability: 2004 Actuarial Analysis" to read the report.

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