Healthcare Matters

   A Complimentary Newsletter From:

Barmak and Associates, LLC  

Managing Liability for Long Term Care and Health Care Providers

Volume 16, Issue 5                   ADVERTISEMENT                            May 2015

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In This Issue
Arbitration Agreements and Nursing Homes
Creating an Atmosphere of Acceptance: The Transgender Person in Long Term Care
David Barmak, Esq.
Gerald V. Burke, M.D., Esq. 
Jo Ann Halberstadter, Esq.
Jo Ann Halberstadter, Esq.

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Arbitration Agreements and Nursing Homes
By: Gerald V. Burke, M.D., Esq. 

Arbitration agreements are becoming progressively more popular in contract law in general and for admissions agreements to nursing homes in particular.  They have the potential to bring disputes to a resolution much more quickly, economically, and with a more predictable and fairer outcome than the traditional method of resorting to courts of law.  However, unless properly drafted, presented and executed, an agreement to arbitrate a dispute may not withstand a legal challenge.  In this article, I would like to discuss the factors that make an arbitration agreement desirable for the parties involved and then review the factors that go into an enforceable arbitration agreement that will lead to the successful resolution of an issue.

Arbitration agreements, particularly if they are binding, tend to permit issues to be settled much more quickly than going through the traditional process of a lawsuit.  The time and extent of discovery for determining the facts of the matter are not as long or extensive as in traditional litigation and the need for expensive expert witnesses is much more limited.  Also, the issue is presented to an arbitrator or panel of arbitrators who are knowledgeable and experienced with the issue in dispute.  This lends itself to a quicker, more just and equitable resolution of the issue.  This also has the tendency to resolve issues with a much more predictable outcome.  These are all factors beneficial to lowering payouts and insurance premiums.

Prior to 1925, the courts were very hostile toward arbitration agreements and rarely enforced them.  This caused Congress to enact the Federal Arbitration Act (FAA) in 1925.  This was intended to "overcome courts' refusal to enforce agreements to arbitrate" and to "place such agreements upon the same footing as other contracts."  (
Allied-Bruce Terminix Companies, Increase. V. Dobson, 513 U.S. 265, 270-71 (1995). The FAA was enacted pursuant to the power of Congress to regulate interstate commerce.  The FAA preempts any state law regarding enforcement of an arbitration agreement to the extent that a state law would be inconsistent with the FAA.  However, under the FAA, an arbitration agreement may be invalidated upon any grounds that exist at law or in equity for the revocation of any contract.

What would the grounds be that exist at law or in equity for the revocation of a contract?  Specifically, enforceability of an arbitration agreement can be challenged based on unconscionability and common-law principles germane to arbitration provisions, specifically including general contract defenses like duress in the execution of the agreement.

Unconscionability includes both procedural and substantive fairness and is a balance between the two.  The more substantively oppressive the arbitration provision, the less evidence of procedural unfairness is required by the court to consider the provision unconscionable and, thus, the arbitration agreement unenforceable.  Factors considered by a court in determining the substantive unconscionability include: 1) the reasonableness of the contract terms; 2) the purpose and effect of the terms; 3) the allocation of the risks between the parties; and 4) public policy concerns.

Procedural unconscionability involves the circumstances surrounding the bargaining process and the formation of the contract itself.  This takes into account: 1) the age, literacy, and sophistication levels of the parties; 2) unduly complex contract terms; 3) the adhesive nature of the contract (the relative power of the negotiating positions of the individual parties involved in the contract); 4) the manner in which the contract was formed; and 5) whether each party had a reasonable opportunity to understand the terms of the contract.

Specific tactics and guidelines to consider employing to maximize the chances of being able to enforce a nursing home arbitration provision in the admission agreement include the following:


1.      The individual signing the arbitration agreement must have the legal capacity to sign the agreement.  Frequently, a general power of attorney is required, not just a health care power of attorney.  Having an employee specifically discuss the arbitration agreement with the resident and their family is a wise policy.  There should be a specific sentence in the agreement that should be signed by the individuals involved acknowledging that they discussed the agreement and agreed upon the arbitration provision.  Also, it would help to indicate that the parties exchanged specific consideration (something of value is given to the party waiving their right to a jury trial) for the agreement to waive this right.


2.      The arbitration agreement should not be "buried" among boilerplate language in the contract.  It should be labeled and set off in its own paragraph, ideally as a separate attachment.


3.      Admission to the facility should not be made contingent upon signing the arbitration agreement.  This must be stated in the contract.  This is one way to help dispel the notion that the contract was entered into under circumstances of "duress".


4.      There should be a limited opt-out provision, permitting the resident the ability to revoke the agreement within a certain number of days.


5.      Neither the admission agreement nor the arbitration agreement should contain limitations or caps on emotional, consequential, or punitive damages as multiple courts have invalidated arbitration agreements because of such language.


6.      Arbitration provisions should contain the basic elements of a contract (offer, acceptance and consideration), and be labeled and identified in a conspicuous manner (as opposed to appearing in the middle of contract provisions, or as in a boilerplate).  Also, the language should be in boldface letters and titles and all capitalized letters.


A well-crafted and properly presented binding arbitration agreement can be a very beneficial document for all parties involved.  Both the resident and the nursing home experience a relatively quick, equitable, and fair resolution of an issue without the poorly controlled expenses of litigation.  However, poorly crafted and presented, an agreement to arbitrate is not worth the paper that is written upon.  This must be a contractual agreement that is entered into by all involved parties willingly and with full knowledge of the implications and restrictions that the agreement imposes upon them.  An arbitration agreement carefully crafted by a healthcare attorney can be invaluable to a nursing home in dispute resolution.


If you have questions regarding this article, please contact Gerald V. Burke, MD.,Esq. at or by telephone at (609) 454-5351.



Creating an Atmosphere of Acceptance: The Transgender Person in Long Term Care

By: Jo Ann Halberstadter, Esq. 

It is difficult to determine the number of transgender people in this country who are 65 or older.  However, recent estimates suggest that there are at least 1.5 million Lesbian, Gay, Bisexual, Transgender (LGBT) people in the U.S. today who are 65 and older, and this population will double by the year 2030. (See, many long term care providers still do not address the unique realities and needs of transgender older adults, leaving them at risk for isolation, neglect and discrimination.


Consider the following excerpt from an article written by Daniel Redman for Aging Today, the bimonthly newspaper of the American Society on Aging at


Phyllis Frye is a long-time lawyer and a judge in Houston. She is also a prominent transgender activist. To transition from male to female-her true gender identity-she underwent several medical procedures and takes estrogen. In Phyllis's life, she chooses where and how she lives without fear. Looking to her future, she is adamant she would not feel safe living in a nursing home.


Transgender elders are afraid of long-term-care facilities. As Frye puts it, "A secret fear of all transgender people, surgical or not, is to grow old and be psychologically abused, day after day, by the staff of a nursing home." Transgender elders are afraid staff members will refuse to let them live consistent with their gender identity, deny them appropriate medical care (such as hormone therapy), violate their privacy and leave them vulnerable to harassment and mistreatment.


Most elderly people are reluctant and fearful about moving to a nursing home and losing their independence and dignity.  For a transgender elderly person, that fear is compounded by the fear that they will be denied their hormone therapy and forced to live in their original sex.  They are also afraid that they will be ridiculed or harassed by both staff and residents, receive less than adequate care, including physician administered medical care, or that they will be forced to "hide" their true sexual identity. 


A long term care provider should put in place the following measures to help insure that transgender residents feel welcome and respected:


1.      Develop a nondiscrimination policy that specifically guards against discrimination based on gender identity and sexual orientation;


2.      Provide LGBT (Lesbian, Gay, Bi & Transgender) training to all CNA's and other personnel such as is mandated by law in California and twelve other states;


3.      Make sure that common areas contain literature and other items of interest dealing with issues affecting LGBT persons such as a rainbow flag and pamphlets addressing issues facing the aging LGBT community.


4.      Create or designate unisex or single-stall restrooms;


5.      Provide self-help/support groups for LGBT residents.  Provide opportunity for the group to express concerns regarding LGBT issues or stigma within the facility.


6.      Ensure that visitation policies are implemented in a fair, nondiscriminatory manner;


7.      Use neutral and inclusive language in interviews and when talking with all residents.  Ask the resident what pronoun they prefer;


8.      Listen to and reflect residents' choice of language when describing their own sexual orientation and how the resident refers to his/her relationship or partner;


9.      Provide information and guidance on specific health concerns affecting LGBT persons;


10.   Stay current and knowledgeable on issues affecting LGBT persons and available resources.



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


Barmak and Associates, LLC      


Our law firm provides integrated regulatory, transactional, employment and litigation/advocacy services to healthcare organizations.


Representative Clients: 

Entities:  Skilled nursing facilities; Home health agencies; Hospice agencies; Hospitals.


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Litigation/Advocacy: Contracts; Employment; Fiduciary issues; Commercial leases; Payment (Managed Care Organizations; Medicare; Medicaid); Guardianship; Professional and facility licensing; Healthcare regulatory; Fraud and privacy issues.
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