by Mark Bauman | Jun 21, 2023 | Legal News, Nursing Home Litigation
In three recent Superior Court cases, binding arbitration agreements between nursing home facilities and their residents have been under scrutiny.
In Bair v. Manor Care of Elizabethtown, PA, LLC,[1] M. Sylvia Bair commenced a wrongful death and survival action as the Executrix of the Estate of Martha A. Edwards against Manor Care in which she alleged neglect and abuse of her mother during her stay in the facility, which ultimately caused her death. Manor Care filed preliminary objections to the complaint seeking to have the case referred to arbitration pursuant to a 2011 arbitration agreement executed by Ms. Bair on behalf of the decedent. Ms. Bair testified at her deposition that she completed admission paperwork on behalf of the decedent and the arbitration agreement was not explained to her. Ms. Bair further testified that she believed the arbitration agreement had to be signed to facilitate her mother’s admission to the facility. Ms. Bair signed the agreement on behalf of the decedent; however, no representative from Manor Care completed or signed the agreement on behalf of the facility. In denying Manor Care’s preliminary objections, the trial court looked to a 2009 arbitration agreement between the parties that was completed, signed, and dated. The court found that this was evidence that one could infer that Manor Care did not intend to be bound by the unsigned, undated arbitration agreement in 2011.
On appeal to the Superior Court, Manor Care argued that the lack of a signature by a facility representative does not render the arbitration agreement unenforceable. Ms. Bair argued that the parties did not agree on the material and necessary details of their bargain as there were blanks on the agreement that were intended to be filled in with the parties names and it was undated. Further, the fact that there was a line for the facility representative to sign and it was blank indicated that there was no mutual assent. The Superior Court agreed with the trial court and found that the arbitration agreement lacked essential terms such as the names of the contracting parties, the date of the agreement, and a brochure that was expressly made part of the agreement. By failing to sign the agreement, Manor Care did not consent to arbitrate any claims between it and Ms. Bair. Finally, the Superior Court found that the prior completed arbitration agreement was evidence that Manor Care typically consented to arbitration by completing the blanks and signing the agreement, which it did not do in 2011.
In Taylor v. Extendicare Health Facilities, Inc.,[2] the Executors of the Estate of Anna Marie Taylor brought a wrongful death and survival action alleging negligence in the care and treatment of the decedent while at Extendicare, which lead to her death. Extendicare filed preliminary objections to have the case moved to binding arbitration, which the trial court overruled finding that the arbitration agreement did not bind the wrongful death beneficiaries.
Extendicare appealed to the Superior Court and argued that since the decedent entered into an arbitration agreement, her beneficiaries were limited to claims that the decedent could have pursued during her lifetime and that all claims must be submitted to arbitration. The Superior Court found that a wrongful death action is a separate action belonging to the beneficiaries and therefore, an arbitration agreement not signed by the beneficiaries is not binding upon them. Thus, the wrongful death beneficiaries could pursue their claims in the Court of Common Pleas. Regarding the survival action, Extendicare argued that even if the wrongful death beneficiaries were not bound by the arbitration agreement, the Executors acting in the shoes of the decedent must be bound by the agreement. In ruling on this issue, the Superior Court looked to Pennsylvania Rule of Civil Procedure 213(e) and the wrongful death statute, which provide that wrongful death and survival actions shall be consolidated for trial to avoid a duplicative recovery.
Lastly, Extendicare argued that the Pennsylvania state law was preempted by the Federal Arbitration Act (FAA); however, the Superior Court agreed with the Executors and found that Pennsylvania Rule of Civil Procedure 213(e) was not intended to undermine the enforceability of arbitration agreements. In doing so, the Court found that there was nothing in the wrongful death statute or the FAA that precluded wrongful death and survival actions from “proceeding together in arbitration when all of the parties, including the wrongful death beneficiaries, agree to arbitrate.”[3] The ruling was further supported by Pennsylvania’s policy consideration regarding consolidating claims in order to avoid duplicative and inconsistent litigation.
The Superior Court affirmed the trial court’s ruling denying Extendicare’s preliminary objections to compel arbitration and stated that, “[i]n so holding, we are promoting one of the two primary objectives of arbitration, which is ‘to achieve streamlined proceedings and expeditious results.’”[4]
More recently, in Wisler v. Manor Care of Lancaster PA, LLC,[5] the Executors of the Estate of Herbert C. Wisler brought a negligence claim against the nursing home, which allegedly resulted in the decedent’s death. Manor Care filed preliminary objections to compel arbitration pursuant to an arbitration agreement entered into by the Executors. At the time that the agreement was signed, the decedent’s son identified himself as the decedent’s power of attorney; however, he did not produce a copy of the power of attorney and could not produce a copy at his deposition. Therefore, the trial court found that he lacked the authority to enter into the arbitration agreement in the first instance, and thus, was not bound by the agreement.
On appeal to the Superior Court, Manor Care argued that the decedent’s son was bound by the arbitration agreement as he entered the agreement in his capacity as the power of attorney. The Superior Court found that Manor Care held the burden of proving that an agency relationship existed between the decedent and the decedent’s son, whether it be express or apparent. Moreover, Manor Care had “a duty to ascertain the nature and extent of the written power of attorney.”[6] In failing to establish either express or apparent agency of the decedent’s son at the time of signing the arbitration agreement, the court held that Manor Care could not compel arbitration in accordance with the agreement. In doing so, the Superior Court unequivocally stated that, “our decision should encourage parties seeking an agreement to arbitrate to ascertain the source of an agent’s authority before allowing the agent to sign an arbitration agreement on the principal’s behalf.”[7]
It is yet to be determined whether the issue of enforceability of binding arbitration agreements between residents and nursing homes will be heard by the Pennsylvania Supreme Court. Nonetheless, the recent case law has clarified the requirements of a nursing home when executing arbitration agreements with residents or residents’ family members.
[1] 108 A.3d 94 (Pa. Super. Ct. 2015) (distinguished by Thi of Pa. at Mountainview, LLC v. McLaughlin ex rel. McLaughlin, 2015 WL 2106105).
[2] 113 A.3d 317 (Pa. Super. Ct. 2015) (distinguished by Golden Gate National Senior Care, LLC v. Beavens, 2015 WL 5000886).
[3] Id. at 325.
[4] Id. at 328 (citing AT & T Mobility LLC v. Concepcion, 563 U.S. 333 (2011)).
[5] No. 1226 MDA 2014, 2015 WL 5215963 (Pa. Super. Ct. 2015).
[6] Id. at 4.
[7] Id. at 7.
by Mark Bauman | Jun 21, 2023 | Legal News, Medical Malpractice
The Honorable Kim R. Gibson of the United States District Court for the Western District of Pennsylvania recently granted a plaintiffs’ motion in limine to preclude the defendant from submitting calculations of future life care costs that were based on the Affordable Care Act.
In Welker v. Carnevale,[1] the plaintiff-mother alleged that the defendant obstetrician and hospital improperly administered the drug Pitocin while she was in labor, resulting in serious and permanent neurological disabilities to her son. The plaintiffs sought to preclude the defendants’ experts from presenting calculations for future life care costs based upon the Affordable Care Act, arguing that such evidence is barred by the collateral source rule.
The collateral source rule provides that a claimant’s recovery should not be offset merely because coverage for the injury was provided by a collateral source, such as insurance. The defendants, however, argued that the Affordable Care Act was not insurance and that the Pennsylvania Supreme Court would hold that such calculations were proper in accordance with its holding in Moorhead v. Crozer Chester Med. Ctr., 765 A2d 786 (Pa. 2001). Moorhead held that a plaintiff’s recovery for past medical bills was limited to the amount actually paid by collateral sources. Thus, the plaintiff’s economic damages in that case were limited to $12,167.40, the amount that Medicare and insurance had paid to settle the $108,668.31 medical bill.
Judge Gibson was unpersuaded by the defendants’ position. He noted that several trial courts had considered this issue and held that calculations relating to the Affordable Care Act are barred by the collateral source rule.[2] Even though the Affordable Care Act is not literally insurance, the insurance it governs is still health insurance. Furthermore, the holding in Moorhead simply reduced the amount recoverable to the amount paid by the collateral source. Thus, Judge Gibson found its holding contrary to the defendants’ position because it held that the plaintiff may still recover damages paid by a collateral source. Finally, Judge Gibson noted that current events cast into doubt the continued existence of the Affordable Care Act, and this uncertainty further weighed against allowing it in calculations for future damages.
[1] U.S.D.C. W.D.Pa., 3:14-CV-149, Memorandum Opinion filed January 13, 2017.
[2] Citing Bernheisel v. Mikaya, No. 3:13-CV-01496, 2016 WL 4211897, at *4 (M.D. Pa. Aug. 9, 2016); Cordes v. United States, No. 2:13CV547, 2015 WL 10986360 (W.D. Pa. Nov. 20, 2015); Deeds v. Univ. of Pennsylvania Med. Ctr., 110 A.3d 1009, 1013, reargument denied (Apr. 7, 2015), appeal dismissed sub nom. Deeds ex rel. Renzulli v. Univ. of Pennsylvania Med. Ctr., 128 A.3d 764 (Pa. Super. Ct. 2015).
by Mark Bauman | Jun 20, 2023 | Legal News, Nursing Home Litigation
In a case of first impression, Philadelphia County Court of Common Pleas Judge Mark I. Bernstein held that a survivorship action, brought in conjunction with a wrongful death claim, must be sent to arbitration pursuant to the federal preemption doctrine.
The underlying case of Lipshutz v. St. Monica Manor involved an elderly woman who was hospitalized following a stroke. Given the cognitive injuries she sustained, she was subsequently transferred to the defendant nursing home. At that time, the plaintiff, the resident’s only living daughter and attorney-in-fact, executed an admission agreement which contained a mandatory arbitration clause. Under the terms of the arbitration clause, any survivorship action brought on behalf of the resident had to be handled out of court in an arbitration setting. Thereafter, the resident died in the nursing home, and her daughter filed suit in the Philadelphia County Court of Common Pleas, setting forth claims sounding in wrongful death and survival. Counsel for the nursing home then moved to bifurcate the claims and move the survival action into arbitration, pursuant to the plaintiff’s arbitration agreement.
Notwithstanding the fact that the Pennsylvania Rules of Civil Procedure require claims for wrongful death and survival to be litigated together, Judge Bernstein held that in the presence of the arbitration agreement, Pennsylvania state law was preempted by the Federal Arbitration Act. As such, he noted that “[w]ere this court to order both the wrongful death claim and survival actions to remain in court, the decedent’s arbitration agreement, valid through her daughter’s signature, would be nullified. Such nullification is pre-empted by the FAA and recent United States Supreme Court interpretations.” According to Judge Bernstein, such interpretations included the recent case of Marmet Health Care Center v. Brown, 132 S. Ct. 1201 (2012), wherein the United States Supreme Court held that nursing home arbitration agreements were entitled to the same protection and enforcement as any other contract, and that no exception may be made for wrongful death or survival claims arising from care rendered in these facilities.
While the Federal Arbitration Act required the plaintiff’s survival action to be removed to arbitration, Judge Bernstein noted that the plaintiff could still pursue her right in court, as well as the rights of other beneficiaries, under a claim for wrongful death.
by Mark Bauman | Jun 20, 2023 | Legal News, Medical Malpractice
The Philadelphia County Court of Common Pleas recently issued an opinion in support of its order transferring a medical malpractice case to Berks County, holding that sending test results “does not rise to the level of rendering healthcare services” that would make Philadelphia County the proper venue for this case.
In Wentzel v. Cammarano, III, DO, et al.,[1] the plaintiff-mother alleged that she received prenatal care at Reading Hospital, and an ultrasound taken there led to an emergency caesarian section delivery at Reading Hospital. The baby continued having respiratory problems after birth, however, and Reading Hospital sent the baby’s echocardiogram test results to St. Christopher’s Hospital for Children in Philadelphia for interpretation. The complaint alleged that the echocardiogram tests showed pulmonary hypertension and heart valve insufficiency, conditions that would require immediate attention. The plaintiffs alleged that St. Christopher’s, and the interpreting physician there, delayed in sending the results of the test back to Reading Hospital, causing further delay of treatment.
Additionally, the plaintiffs alleged that the infant suffered a broken rib at either Reading Hospital or St. Christopher’s. The complaint, however, did not allege a claim for medical professional liability regarding the infant’s care received at St. Christopher’s during the infant’s admission, nor did the complaint allege that the echocardiogram was misread.
Accordingly, Judge Arnold New found that the allegation against St. Christopher’s regarding the broken rib was speculative. Judge New noted that the complaint alleged that St. Christopher’s negligence occurred prior to the infant’s admission there, and that any allegations of professional negligence were stated for the first time in plaintiffs’ response to preliminary objections. As such, the complaint’s only allegations against St. Christopher’s amounted to transmitting test results, which is not rendering healthcare services for purposes of establishing venue. The opinion cites to Cohen v. Furin, 946 A.2d 125, (Pa.Super. 2008) and Bilotti-Kerrick v. St. Luke’s Hospital, 873 A.2d 828 (Pa.Super. 2005), both of which held that a doctor’s telephone call was insufficient to establish venue in the advising doctor’s county. Judge New found that transmitting test results was even further removed from these cases since the question was one of timing, not advice. Transmittal of test results was an administrative function rather than a provision of healthcare services. Accordingly, he entered an order transferring this matter to Berks County, where Reading Hospital is located.
The plaintiffs appealed this order, and Judge New issued the opinion in accordance with Pennsylvania Rule of Appellate Procedure 1925.
[1] Wentzel v. Cammarano, III, DO, et al., Philadelphia County Court of Common Pleas, No. 1508-4185, filed August 18, 2016.
by Mark Bauman | Jun 19, 2023 | Legal News, Nursing Home Litigation
In an opinion issued on November 21, 2012, the Pennsylvania Supreme Court held that a nursing home and affiliated entities are subject to potential direct liability for negligence, where the requisite resident-entity relationship exists to establish that the entity owes the resident a duty of care. Scampone v. Highland Park Care Center, LLC, No. 16 WAP 2011 (Pa. 2012)(Opinion by Castille, C.J.).
In the underlying case, plaintiff, Richard Scampone, as executor of the estate of Madeline Scampone, asserted claims of negligence under the Survival Act and of wrongful death alleging theories of corporate negligence and vicarious liability against defendants, Highland Park Care Center, LLC, a nursing home; and Grane Healthcare, the corporation providing management services to Highland Park, including periodic visits from nursing consultants, in-house training of nursing and administrative staff, assistance with regulatory compliance, and assistance in formulating policies and procedures. Testimony presented at trial established that during Ms. Scampone’s residency at Highland Park, there was limited personnel to accomplish all of the tasks required by her care plan which resulted in a failure of the staff to provide sufficient water and medication, track the daily activities and report changes in her condition, and to follow doctors’ directions. These failures caused dehydration and permitted a recurring urinary tract infection to progress, affecting Ms. Scampone’s heart and leading to an acute myocardial infarction and related death.
After the conclusion of plaintiff’s evidence at trial, the trial court granted a motion for compulsory nonsuit on the claim of corporate negligence against Grane Healthcare, but permitted the same claim against Highland Park to go to the jury. The jury returned a verdict in favor of the Scampone estate, finding Highland Park directly and vicariously liable for negligence. Following trial, both parties appealed to the Superior Court which affirmed in part, holding that the trial court properly allowed the claim of corporate negligence as to Highland Park. However, the Superior Court reversed the trial court’s improper nonsuit against Grane Healthcare. Thus, the Superior Court found that the plaintiffs should have been permitted to proceed with corporate negligence theories against both defendants and, therefore, remanded the case back to the trial court for a new trial. As a result, Grane Healthcare and Highland Park filed petitions for allowance of appeal to the Supreme Court. The Supreme Court affirmed, in full, the decision of the Superior Court.
In the opinion, the Court addressed the issues of categorical exemption from negligence liability of nursing homes and related entities, as well as claims regarding the specific duties of care of those entities. In so doing, the Court explained the difference between direct corporate liability and vicarious liability, noting that “a plaintiff may proceed against a defendant on theories of direct and vicarious liability, asserted either concomitantly or alternately. Liability for negligent injury is direct when the plaintiff seeks to hold the defendant responsible for harm the defendant caused by the breach of a duty owing directly to the plaintiff.” (citation omitted). On the other hand, under a theory of vicarious liability, a corporation “assumes the risk of its individual agents’ negligence.” (citations omitted). The Court then embarked on a detailed analysis of the history of corporate negligence in Pennsylvania, including its initial application to hospitals in Thompson v. Nason Hospital, 527 Pa. 330, 591 A.2d 703 (1991) and its subsequent “extended” application to HMOs and medical professional corporations in Shannon v. McNulty, 718 A.2d 828 (Pa. Super. 1998) and Hyrcza v. West Penn Allegheny Health Sys., 978 A.2d 961 (Pa. Super 2009), respectively.
In its examination of Pennsylvania case law, the Supreme Court rejected the argument that Thompson and its progeny categorically exempt nursing homes and affiliated entities from corporate negligence liability simply because that prior decisional law was addressed in the particular context of hospitals, HMOs and medical professional corporations. Rather, the Court noted that categorical exemptions exist only pursuant to legislative mandate, a privilege not bestowed upon nursing homes or similar entities.
The Court further rejected the former analysis employed in Thompson and its progeny, which focused on the question of “whether the entity providing medical care had assumed the role of a comprehensive health center responsible for arranging and coordinating the total healthcare of its patients.” (citations omitted). Instead, the Court instructed that the proper inquiry requires a broader, case-by-case analysis of whether the corporate defendant owes a duty of care to the plaintiff pursuant to the following five factors set forth in the post-Thompson case of Althaus v. Cohen, 756 A.2d 1166, 1169 (Pa. 2000): (1) the relationship between the parties; (2) the social utility of the actor’s conduct; (3) the nature of the risk imposed and foreseeabilty of the harm incurred; (4) the consequences of imposing a duty upon the actor; and (5) the overall public interest in the proposed solution. Thus, while the distinctions between a hospital and a nursing home may be relevant to a trial court’s ultimate determination of whether a duty exists, there no longer exists any viable argument for categorical exemption of an entity from potential liability for corporate negligence.
