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September 9, 2008

Diverse Coalition of Senior, Caregiver, Taxpayer Advocacy Groups Join to Oppose New Legislation

Washington, DC – Warning the Fairness in Nursing Home Arbitration Act (S.2838) hurts U.S. seniors in addition to establishing “a dangerous precedent for the entire U.S. business community by eliminating the reasonable, intelligent use of arbitration agreements,” a diverse coalition of senior, caregiver,  taxpayer and business advocacy organizations have coalesced to sign a joint letter to U.S. Senators stipulating the need to uphold the right of every consumer to voluntarily arbitrate legal disputes.

The text of the letter is as follows:

Dear Senators Leahy and Specter,

As our collective intent is to protect consumer choice, preserve quality health care, and promote the most efficient, effective use of Americans’ tax dollars, we, the undersigned organizations, urge you to oppose The Fairness in Nursing Home Arbitration Act (S. 2838) and other bills that would eliminate or significantly limit the use of arbitration as a viable and voluntary option for resolving legal disputes.

We believe S. 2838 which is being taken up by the Senate Judiciary Committee, would establish a dangerous precedent for the entire U.S. business community by eliminating the reasonable, intelligent use of arbitration agreements.

Specifically, S. 2838 would effectively eliminate the use of pre-dispute arbitration agreements by nursing facilities, assisted living communities and all housing service providers nationwide — even if the patient, resident or their family wishes to enter into such an agreement. The inherent right of every consumer to voluntarily arbitrate disputes should not be restricted.

We also believe that S. 2838 would weaken the Federal Arbitration Act (FAA), which has been in place for more than 80 years. The FAA appropriately recognizes the strong national interest in disputes being resolved in a forum other than the courts when both parties choose to do so.

Some have asserted that arbitration agreements unfairly require that patients and residents sacrifice legal rights simply to obtain care and services.  In fact, courts consistently have invalidated arbitration agreements that were coercive, lacked adequate consumer protections such as disclosure and rescission provisions, and unfair to consumers. 

Arbitration also has several advantages over traditional litigation:

  • It is less adversarial and time consuming than traditional litigation;
  • Consumers typically resolve claims more quickly than through the courts, allowing more timely compensation to plaintiffs;
  • In the health care environment, medical evidence can be taken into consideration when resolving disputes; 
  • Resources that would otherwise be devoted to expensive litigation can be appropriately directed toward patient and resident care; and 
  • In a substantial majority of arbitration cases, claimants receive compensation. 

For these and other reasons, we believe arbitration has been shown to result in the just and timely resolution of legal disputes, plays a critical role in protecting the nation’s health care system, and is in the best interest of patients, residents, families, and taxpayers.  We also believe strongly that within the health sector, providers should continue to be prohibited from requiring patients and residents to agree to arbitration as a condition of admission.

On the basis of protecting sound public policy that benefits consumers and our nation’s health care system in many important ways, we ask you to oppose the Fairness in Nursing Home Arbitration Act (S. 2838), and thank you for considering the interests of the vast majority of Americans over the interests of a very few.

Sincerely,

Alliance for Quality Nursing Home Care
American Assisted Living Nurses Association
American Association for Long Term Care Nursing
American Association of Nurse Assessment Coordinators
American Association of Nurse Executives
American College of Health Care Administrators
American Health Care Association
The American Insurance Association
American Seniors Housing Association
Assisted Living Federation of America
Evangelical Lutheran Good Samaritan Society
National Association of Health Care Assistants
National Association for the Support of Long Term Care
National Center for Assisted Living
National Taxpayers Union
The U.S. Chamber of Commerce
The U.S. Chamber Institute for Legal Reform

Lisa Rickard, president of the U.S. Chamber Institute for Legal Reform (ILR), said, “As part of their lobbying efforts to expand lawsuits, the special interest plaintiffs’ lawyer lobby has launched a full-out assault to eliminate arbitration as a quick, fair, and efficient option for millions of American consumers. The Fairness in Nursing Home Arbitration Act is just the latest in a string of trial lawyer earmarks designed to erase the 80-year-old arbitration system in favor of more lawsuits – and more fees for trial lawyers – at the expense of the average consumer.”

“This new legislation ostensibly helping seniors has drawn an unusually diverse, broad cross section of opposition because it not only undermines seniors’ care needs, it restricts consumers’ ability to exercise free choice,” stated Bruce Yarwood, President and CEO of AHCA.

Pete Sepp, the National Taxpayer Union’s (NTU) Vice-President for Policy and Communications, summed the bill up this way: "This legislation is a dream for trial lawyers and a debacle for consumers. Our civil justice system costs taxpayers billions to administer, and costs the economy much more in deadweight losses. Congress should be encouraging, rather than restricting, options to help lower those costs, and arbitration should be high on the list."

Alan Rosenbloom, President of the Alliance for Quality Nursing Home Care, warned, “This bill establishes bad precedent on many levels, and is premised upon the flawed presumption that disputes between parties can only be resolved in a court of law.”

Executive Director of the National Center for Assisted Living, David Kyllo, said, “The genuine protection of residents and their rights involves allowing them to exercise freedom of choice and the ability to pursue all options in resolving legal disputes – not limiting choice.”

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