Last month we discussed the general changes in the legal environment for nursing homes that have made them such desirable targets for plaintiff's lawyers. In particular, we noted that the difficulty in successful plaintiff litigation on behalf of residents dropped dramatically when this litigation was no longer prosecuted under the legal tort of negligence. Instead, any violation of the patient's state or Federal Bill of Rights can result in a lawsuit from or on behalf of a resident.

This makes a thorough knowledge of both the Federal and applicable state Resident's Bill of Rights for nursing home residents the first priority in the reduction of lawsuits. Identifying violations and quickly correcting them with a strong program of both remediation and surveillance to avoid future violations is a top priority. Frequently, these will be measures that the nursing home is already evaluating in order to maintain their federal certification.   Compliance with the F-Tag list and its regulatory groups for nursing homes will help to eliminate these problems.  However, there are specific issues that plaintiff's lawyers rely on in identifying cases that they will pursue.

Angry family members are the main source of clients for the nursing home plaintiff's attorney.  Family members may visit the resident either infrequently or daily.  In either case, they frequently carry strong feelings of guilt over the fact that it was necessary for them to put their loved one in a nursing home, even though it was physician recommended.  Also, the choice of nursing home is often made quickly and under stressful situations, not providing the family with what they would consider sufficient time to adequately evaluate a nursing home. If the family then perceives that care at the home was substandard, that will frequently compound their guilt. Unresponsive staff and administrators at the facility are frequently the final impetus to convert family members from allies in the care of their loved one to adversaries.   The nursing home staff and administration must constantly be looking for opportunities to build the resident's and the family's confidence and respect in them.  This will be based on the compassion and quality of care that both the resident and all the visitors experience. Open lines of communication with empathetic listening to observations and complaints from the resident and family members to the nursing home staff and administration followed by genuine attempts to correct the issue goes a long way toward building the trust and faith that keeps everyone on the same team.  Failure to achieve this results in fertile ground for lawsuits.

Specific areas of interest to a plaintiff 'attorney when interviewing angry family members are instances of perceived indignities or bad acts experienced by the resident.  Examples would include: 1) Sitting in bodily waste for extended periods of time; 2) Dirty or missing clothing; 3) Missing or stolen possessions; 4) Ignored requests for care; 5) Knowledge of falls or pressure sores; 6) Lack of turning or repositioning of bed ridden residents or those with impaired mobility; 7) Missed treatments, therapies and medications (relatives generally know exactly what treatments and therapies their loved one is to receive and watch carefully to make sure that they receive them.  They will deem care substandard when one or more are missed).  

Other red flags for family members include their loved one developing a skin problem, missing meals and/or water, experiencing significant weight loss without an explanation, is improperly restrained, either by physical or medical means, or experiences verbal or physical abuse.  Any one or a combination of these issues will make the situation ripe for a lawsuit.  They are also all violations of the Resident Bill of Rights and, as such, provide a cause of action to file suit.

Clinical outcomes that will be linked with neglect and serve as the trigger to file a lawsuit include injuries precipitated by progressive failures or omissions of care.  Examples would be stage III or IV decubitus ulcers, infected decubitus ulcers, severe dehydration, severe protein-calorie malnutrition, septic shock, gangrene and aspiration pneumonia.  Any injuries precipitated by medication errors, either in prescribing or administration, or injuries precipitated by untoward events such as strangulation, drowning, scalding, "wandering-off" cases (particularly when the resident suffer serious injury or death as a result), falls and fractures, rape or sexual assault and physical abuse.

When the plaintiff's lawyer obtains a copy of the resident's records, which can occur either before or after a lawsuit is filed, a meticulous attorney will seek violations of the F-Tag list.  All of these are violations of the Resident's Bill of Rights in one form or another and can serve as a cause of action to initiate a lawsuit.  The bigger the list of infractions, the easier it is for the plaintiff's attorney to reap a financial reward.

Finally, the attorney will go to the Federal and state databases to evaluate how well the nursing home has complied with the federal and state regulations.  Infractions in this area only serve to strengthen the plaintiff's case.

At this point, suit is filed and the conclusion is frequently a settlement.  Because of the lower threshold burden of proof that the plaintiff's attorney must carry and the potential for severe financial penalties if the litigation is lost, insurance companies are loathe to take the chance of litigating a case to a verdict.  The plaintiff's attorney is well aware of this and is well rewarded financially without the work and risk of trial.  He simply goes out and repeats the process.

This discussion represents a standard approach used by plaintiff's attorneys in pursuing a lawsuit against a nursing home.  The earlier in this cascade of events the process can be interrupted, the better for the nursing home.  While implementing changes that will encourage better, more effective communications between administrators, staff, residents and families and then moving to implicate changes and improvements indicated by this feedback can be difficult, a nursing home can proactively, significantly limit it's exposure to resident lawsuits.  Closing the door of the nursing home to the legal wolves will result in both many fewer lawsuits and also serve to further improve the experience of the residents and staff as well.

If you have questions regarding resident's rights law suits, please contact Gerald V. Burke, MD.,Esq. at gburke@barmak.com or by telephone at (609) 454-5351.

In October 2014, the U.S. Department of Labor sued HPR Medical Services, a Virginia Beach home health care provider, for denying overtime pay to its nurses who worked more than 40 hours per week.  The suit alleged that HPR Medical Services improperly labeled its nurses as independent contractors in order to deny overtime payment and other benefits to which all "employees" are entitled.

Similar lawsuits are on the rise in every state.  In a recent news release regarding the settlement of a five year federal investigation dealing with the misclassification of construction workers, the U.S. Secretary of Labor stated that "hiding behind deceptive legal partnerships to reduce wages owed to employees is wrong."  The Secretary of Labor further pledged to "combat schemes like these with every enforcement tool we have, including partnering with other federal and state agencies to ensure that workers are not misclassified".  See U.S. Department of Labor News Release at http://www.dol.gov/opa/media/press/whd/WHD20150518.htm.

In the above-referenced Department of Labor investigation, the employer-contractors required their construction workers to become owners of limited liability companies in order to avoid paying overtime, workers compensation, and other benefits and rights owed to employees under federal and state laws. 

Consider also the recent NJ Supreme Court decision in In Sam Hargrove, et.al. v. Sleepy's, LLC. In that case, drivers for Sleepy's filed a lawsuit alleging they had suffered unlawful financial harm as a result of Sleepy's classification of them as independent contractors, as opposed to employees, even though they signed an "Independent Drive Agreement" at the commencement of their working relationship with Sleepy's.  In determining the correct standard or test to apply when determining "employee status", the NJ Supreme Court held that an individual is an employee unless an employer can show that: (1) the employer neither exercised control over the worker, nor had the ability to exercise control in terms of the completion of the work; (2) the services provided were either outside the usual course of business or performed outside of all the places of business of the enterprise; and (3) the individual has a profession that will plainly persist despite termination of the challenged relationship. Failure to satisfy any one of these three criteria results in an "employment" classification.

In determining whether a worker is an employee or independent contractor, courts generally look at: 1) whether the work performed is an integral part of the employer's business; 2) whether the worker exercises managerial skills, such as hiring or purchasing, that directly impact on the worker's profit or loss; 3) whether the worker makes a relative business investment in facilities and equipment (usually needs to be more than the purchase of tools necessary to complete the job); 4) whether the worker takes initiative to operate as an independent business as opposed to being economically dependent on the employer; 5) the permanency of the worker's relationship (although this may be industry-norm dependent); and 6) the nature and degree of control by the employer.  For court decisions, see Fuentes v. Macy's West Stores Inc., No. 2:14-cv-00790 (C. D. Cal. Mar. 16, 2015) which can be accessed online at http://falveylaw.com/assets/pdf/macys-eletto/2015-03-16-Order-For-Preliminary-Approva-Of-Class-Action-Settlement-Setting-Of-A-Final-Approval-Hearing-And-Approval-Of-Notice-00015102xD4D2C.pdf and Keller v. Miri Microsystems LLC, No. 14-1430 (6th Cir. Mar. 26, 2015) which can be accessed online at http://scholar.google.com/scholar_case?case=13054973230457371773&hl=en&as_sdt=6&as_vis=1&oi=scholarr

State and federal government have a vested interest in pursuing actions against employers who misclassify employees as independent contractors.  In addition to circumventing a worker's right to fair pay, overtime and workers' compensation insurance, such misclassification deprives government of tax revenue and unfairly affects the competitive advantage of businesses who abide by the law.  Thus, to date, the U.S. Department of Labor has Memoranda of Understanding with twenty states, including Connecticut, New Hampshire, Maryland, Massachusetts, and New York (not PA or NJ) through which it works with state agencies to combat misclassification.

Although hiring an independent contractor for certain functions can be a valid and wise business decision, it would behoove all employers to first apply the six-step test outlined above in order to avoid a future lawsuit alleging misclassification and failure to abide by the federal Fair Labor Standards Act.

If you have any questions regarding this article, please contact Jo Ann Halberstadter, Esq. at jhalberstadter@barmak.com or call (609)-454-5351.