Rights To A Jury Trial: Arbitration Agreements In Hospital Admission Forms



When you or your loved one requires medical care, it is a stressful and emotional time. Even if not an emergency situation, it is not uncommon to experience panic, anxiety and fear. These feelings are further amplified if you are serving as a legal representative for your loved one who is unconscious or incapacitated.

As a patient or representative, part of the process will undoubtedly involve filling out hospital admission forms. These forms can be lengthy, time consuming and in times of stress and anxiety, you may rush to complete. Think back to the last time you filled out forms in a hospital or doctor’s office. How carefully did you read what you were signing? Could you have unknowingly signed away your or your loved one’s right to a jury trial in the event that the hospital negligently caused injury?

They are called arbitration clauses. If you are unfamiliar, arbitration is a form of alternative dispute resolution whereby the party forgoes the right to go to court and present their case before a judge and jury. Rather, a private (hopefully independent) third-party, called an arbitrator, presides over the case. In some instances, a panel may hear the case. Whether heard by a single arbitrator or a panel, the decision is usually binding. Some arbitration agreements may even allow the facility to choose who the arbitrator is. As a result, there is an incentive for the arbitrator to side with the hospital (or insurance company) to ensure that he or she will be used again in the future.  

It is important for both the patient and their advocate to know and understand each and every document they sign, or risk waiving important rights. Prior to Michigan’s medical malpractice tort reform in 1994, Michigan hospitals could include binding arbitration clauses in their contracts for medical services or admission documents before treatment. While the agreement to arbitrate could be revoked, the time period to do so was short – 60 days – and had to be in writing.

On April 1, 1994, Michigan adopted tort reform legislation, which included MCL 600.2912g. MCL 600.2912g provides that potential parties to a malpractice action may agree, in writing, to binding arbitration, but only after notice of the claim is given, and if the total damages are $75,000 or less (the parties can agree in writing to a total amount of damages greater than the $75,000 limit set by the law). The statute also requires that a single arbitrator, chosen by an agreement of all the parties, conduct the proceedings. MCL 600.2912g(3)(a).

Not all states are the same, however. States like California, Georgia, Colorado and Illinois, among others, allow for arbitration clauses in hospital admission agreements. While medical treatment cannot be conditioned upon the signing of the arbitration clause, many patients and their guardians sign these agreements without fully reading them or understanding their legal effect. And while most states allow for a time period to revoke the arbitration agreement, if you don't know you have signed it, how will you know you need to revoke it? In many cases, prospective plaintiffs will not consult an attorney for a medical malpractice action, thus discovering the arbitration agreement, until the time period to revoke has passed. 

Arbitration clauses have proliferated over the last 10 years as companies have added them to tens of millions of contracts for things as diverse as cellphone service, credit cards and student loans. Nursing homes in particular have embraced the clauses, which are often buried in complex contracts that are difficult to navigate, especially for elderly people with dwindling mental acuity or their relatives, who can be emotionally vulnerable when admitting a parent to a home.
— New York Times (http://nyti.ms/1Q92l6E)

The good news is that many states are invalidating these clauses. In Barrow v Dartmouth House Nursing Home, Inc., the Massachusetts Court of Appeals recently held that an arbitration agreement signed by an elderly resident’s son was unenforceable after the resident was beaten and strangled by her roommate who had a history of mental disorder. The appellate court decided that as a healthcare proxy, the son lacked the authority to bind his mother to the agreement.

Before the appellate court voided the arbitration agreement, however, the parties were required to submit to arbitration, at which point the plaintiff’s attorneys discovered that the arbitration firm selected had previously handled 400 arbitrations for the law firm representing the nursing home. Unsurprisingly, the arbitrator ruled in favor of the nursing home and did so without issuing a written opinion explaining the decision. Instead, the arbitrator issued a single check mark on a form indicating that the nursing home had not been negligent.

While some states have nullified arbitration clauses, many have not. A recent New York Times Article which profiles the Burrow case, also outlines a Mississippi circuit court case, wherein the court upheld an arbitration clause in a nursing home admission agreement despite the fact that the man who signed it could not read, write or even sign his name. One hospital in New Jersey even tried to include a binding arbitration clause in an invoice for a request for medical records.

Perhaps the simple question patients should ask themselves before willingly signing an arbitration clause is: why would the hospital request that I waive my right to a jury trial if it didn’t in some way benefit the hospital? Why would the patient want to voluntarily limit their legal options upon admission without realistically being able to consult an attorney?

While Michigan law requires that the agreement to arbitrate be voluntary and after the notice of the claim is given, those seeking medical treatment should carefully read all forms and documents prior to signing them, and if necessary, consult an attorney. Moreover, if you ever seek medical treatment in a different state, know that these arbitration clauses exist. If you see such a clause, cross it out and tell the hospital’s administration staff that you do not agree to that portion of the document. Spend a few extra minutes reading these forms. There may come a day when you are thankful you did.  

Metro Detroit Injury Lawyers is a Bloomfield Hills, Michigan based personal injury firm, who aggressively fight on behalf of their clients to get every dollar of compensation they deserve. Call us today for your free consultation and evaluation of your case.