Appeal sought after ruling on arbitration clauses

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Liability costs climb for long-term care, analysis finds
Liability costs climb for long-term care, analysis finds

Plaintiffs in a negligent death lawsuit are asking the Texas Supreme Court to reconsider its recent ruling giving providers more leeway in forcing arbitration over alleged negligent care. Legal observers say the ruling could have a chilling effect on consumers while possibly paving the way for more standard arbitration language in resident agreements.

The family of patient Elisa Zapata sued Fredericksburg Care Company in 2013 after she died. The plaintiffs argued that a provision of the Texas Medical Liability Act mandated that healthcare arbitration agreements be in 10-point boldface type and contain explicit consumer warnings, according to Bloomberg News services.

The nursing home operator asked a lower court to uphold the federal law-based arbitration clause it had with Zapata before her death. Instead, the court held for the family, citing a 1944 law, the McCarran-Ferguson Act, which it said did not allow state arbitration agreements to be preempted by federal law, according to published reports.

In its March 6 ruling, however, the state high court held that the Federal Arbitration Act does preempt state law requiring consumer healthcare arbitration agreements to be conspicuous in appearance.

Texas chapters of the American Board of Trial Advocates argued at press time that because very few patients are able to “appreciate the effect of a pre-dispute arbitration clause,” the court “effectively sanctioned the unknowing waiver of Texas consumers' constitutional right to a jury trial.”

One attorney for Haynes Boone, a large nationwide legal practice, noted recently that the Supreme Court decision could make it easier for Texas hospitals, physicians, nursing home operators and other healthcare providers to include standard arbitration clauses into their pre-treatment agreements.”