As the long-term care industry continues to wrestle with the fallout from the coronavirus pandemic, another storm is brewing over whether to grant providers immunity from liability lawsuits stemming from the outbreak.
Industry groups and some legal experts in favor of immunity argue that the unprecedented nature of the pandemic has placed undue strains on operations and bottom lines, all while communities work to maintain high quality levels of care and safety for residents.
Senior advocacy groups and other legal experts contend that immunity for providers is an overreach, leaving families of residents will little legal recourse to hold operators accountable for cases of legitimate neglect and abuse.
The push for immunity is uniting politicians on both sides of the political aisle, at the state and federal level. Several states have granted immunity to health care groups and providers at the state level through executive order including Georgia, Illinois, Michigan and Arizona. New York and New Jersey passed legislation last month shielding providers from lawsuits related to the pandemic, and the Ohio House of Representatives passed immunity legislation this week, which will be voted on by the Senate.
The debate also rages at the federal level and has a champion in Senate Majority Leader Mitch McConnell (R – Kentucky), who vows that immunity will be tied to any new Covid-19 relief legislation. And it is here where the debate is moving fast, American Seniors Housing Association (ASHA) President David Schless told Senior Housing News.
“Republicans have made it fairly clear that they will hold firm to including liability protections for American businesses. I think there are members of the Democratic Party that also have in recent days made statements that would suggest that there’s an interest in … including protections as well,” he said.
Insurance marketplaces frozen
One of the arguments in favor of immunity is that Covid-19 lawsuits will add fuel to an industry already reeling from rising insurance costs due to an elevated risk environment. This is driven in part by attorneys targeting vulnerable operators in markets favorable to litigation, Hanson Bridgett Partner Paul Gordon told SHN. Gordon is ASHA’s legal counsel.
The fear is that litigation is going to happen despite providers’ best efforts to reduce resident and staff exposure to the coronavirus. Notably, the ability to transmit the virus asymptomatically adds an unknown variable to a heightened risk environment. Gordon is hearing anecdotal reports that insurance carriers will not cover Covid-19 claims.
“If there’s a prospect of these communities and their staffs not being able to get liability coverage from an insurance company, then everyone’s at risk, and you can’t really do business without having insurance. There is a risk of going out of business at the end of the day, and that’s very concerning,” he said.
Carriers were leaving the liability insurance marketplace prior to Covid-19, and those that remained have increased their premiums, corresponding to higher expenses for providers.
With the country still in the pandemic’s grip, the marketplace is now frozen, Inlight Insurance Services of Oklahoma President Michael Spaan told SHN. Based in Oklahoma City, Inlight provides insurance and risk management services across a range of industries including health care and long-term care.
“When Covid-19 hit, it totally hardened the market. Carriers put moratoriums on new business, shrinking the market for capital as carriers looked at long-term care as one of the largest risks. Most carriers are addressing the pandemic with some form of limited coverage or exclusion,” he said.
While coronavirus outbreaks have occurred across the care continuum, nursing homes have been hurt the hardest. As of June 1, 40,600 Covid-19 deaths in the U.S. have been tied to nursing homes, and one-third of the country’s deaths have been in long-term care facilities including nursing homes, assisted living and memory care facilities, rehabilitation centers, and retirement communities.
A need for ‘breathing room’
The states that have enacted immunity for long-term care providers — whether through permanent legislation or executive orders — have some wiggle room for plaintiffs to file liability lawsuits.
In New York, immunity protects providers from litigation stemming from staffing or resource shortages such as safety equipment or personal protective equipment (PPE). It does not extend to cases of gross negligence, abuse or willful misconduct. Illinois’ executive order has a similar provision.
In Arizona, conversely, immunity protections in the executive order signed by Governor Doug Ducey, which expires on June 30, do not extend to good faith presumptions for individual caregivers or volunteers at a community.
This is the foundational debate for and against immunity, Shook, Hardy & Bacon LLP Partner Matt Keenan told SHN. The historic, unprecedented nature of Covid-19 calls for a matching response — one that he argues has solid bipartisan support.
“The vast majority of these [executive orders] are not talking about blanket immunity. The parties will have an opportunity to make their case the suits can be filed, but the evidentiary standard is one that reflects the unique circumstance of a disease that was not capable of being diagnosed in asymptomatic patients,” he said. “Even when the tests became available, in some cases, they weren’t reliable and in some [other] cases, PPE was not accessible. So it is a highly unusual set of circumstances that have come together where even the best owners saw infections.”
Plaintiffs attorneys and senior advocates counter that the evidentiary standard remains the same, and should play out in a court setting if it comes to that, Nesenoff & Miltenberg LLP Managing Partner Andrew Miltenberg.
Already, some senior living providers are facing lawsuits related to Covid-19, and Miltenberg is involved in a particularly high-profile action brought by E-Street Band guitarist Nils Lofgren.
Lofgren’s mother-in-law, Patricia Landers, resided in a New Jersey assisted living and memory care facility operated by Brentwood, Tennessee-based Brookdale Senior Living (NYSE: BKD). She repeatedly eloped from the facility, including once in early April; a week after that elopement, she tested positive for Covid-19, the suit states. The legal complaint claims that Landers contracting Covid-19 was part of a larger pattern of neglect.
Brookdale Senior Living declined to discuss the specifics of the suit, but the company’s public relations manager, Heather Hunter, shared a statement with SHN.
“Brookdale’s top priority is the health and safety of our residents, patients, and associates and we continue to take steps to help ensure our communities and associates have the appropriate support in response to the Covid-19 pandemic,” she wrote.
Even with the unique pressures applied to the industry by the pandemic, Lofgren’s attorney Miltenberg believes that allowing immunity for Covid-19 lawsuits will set a precedent by which providers will return to governments seeking immunity for other extenuating circumstances, which would be detrimental to the industry in the long-term.
“How can they do that and not set a precedent whereby they start to look for immunity for other types of situations as they occur?” he said.
The push for immunity at the federal level by ASHA and other industry groups is being countered by seniors advocacy organization AARP, which sent a letter to Senate Judiciary Committee Chairman Lindsey Graham (R – South Carolina) and ranking member, Senator Dianne Feinstein (D – California), last month, urging the Senate to reject granting immunity related to Covid-19.
AARP believes that residents and their families should maintain their right to seek legal redress to hold facilities accountable when residents are harmed, neglected or abused, Senior Legislative Representative Rhonda Richards told SHN.
“While some circumstances may be beyond [a] facility’s control, it’s essential that long-term care providers — as well as health care providers, more broadly — remain responsible for any negligent actions that failed to protect the health and lives of residents,” she said.
AARP believes that the industry as a whole has risen to meet the challenge of caring for seniors during this time, and the last thing a plaintiff wants to do is file a lawsuit. Its efforts in the Senate are intended to preserve that right, should a situation need a legal solution.
“At this time of limited oversight and accountability and the horrific death tolls, it’s not a time for Congress to strip away the rights and protections of residents. [Providers] should know that they’ll continue to be held accountable for the required level of quality care and that they remain responsible for any negligent actions that failed to protect the health and lives of their residents,” Richards said.
While this is a complex issue given the high stakes and unprecedented circumstances of the pandemic, more clarity should be coming soon as Congress hashes out the details of the next Covid-19 relief package, ASHA’s Schless believes.
“As this plays out over the next 30 to 45 days, I think this will be a key issue,” he said.
Editor’s Note: A previous version of this story incorrectly stated that Patricia Landers was deceased. We regret the error.