TALLAHASSEE: NEW CHANGES EXPECTED FOR NURSING HOME LAWSUITS

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TALLAHASSEE — A Nursing Home Bill designed to shield nursing home investors from lawsuits when their homes are accused of abuse and neglect is making its’ way to the Senate Floor.
The bill  would shield nursing home investors from lawsuits when their homes are accused of abuse and neglect. In exchange, it would give trial lawyers easier access to documents. Other Senate committees must still review the legislation, but it has strong support among House and Senate leaders.

The Miami Herald has followed this bill and written extensively on the matter.  They have also interviewed Senator John Thrasher who is sponsoring the bill.  œThis benefits elders as well as their loved ones.” He said shielding nursing homes from lawsuits provides them with œextra economic protection so they can stay in business, which is good for residents.  But Brian Lee, executive director of the Florida Family Care Association, who was the state’s elder-care ombudsman for eight years, said the bill was less about protecting elders and more about protecting profits.  œDoes keeping the industry viable mean protecting the people who cut back staff levels, who demand that their residents curb food costs and say they can only have one diaper per resident every eight hours? he said. œThat’s ridiculous.

The measure ends years of feuding between the Florida Health Care Association ” which represents nursing homes ” and the Florida Justice Association, which represents trial lawyers. Both The bill also has the support of AARP and the Florida Chamber of Commerce.  In the past, trial lawyers claimed the proposal to shield investors from liability would reward nursing homes for setting up shell companies to shield their owners from accountability, even though the investors were making budget decisions affecting the quality of care.

The new proposal, an amendment to a bill in the House by Rep. Matt Gaetz, R-Shalimar, would limit who can be sued to the nursing home’s owner and staff. If lawyers allege that passive directors played a direct role in residents’ care, they would have to get a judge’s approval to include them in the lawsuit. The bill also would make it more difficult for a plaintiff to collect punitive damages.

Trial lawyers defended their changed position by noting two provisions added to the bill this year. One would allow the state to revoke the license of a nursing home operator who refused to pay a damage award. The other would allow family members access to the medical records of the alleged victim without having to go to the expense of setting up a family trust. Those provisions guarantee a level of accountability not present in current law, said Paul Anderson, president of the Florida Justice Association. œWith that accountability, we gain adherence of greater or higher standards of care, he said.

The Miami Herald has also interviewed some of the players who will be affected by the bill. The Tampa-based law firm of Wilkes and McHugh, which specializes in nursing home litigation, vigorously opposes the measure, calling it a bailout for corporate nursing home chains.  œOn its face, this is really kind of a no-brainer, said Brecht Heuchen, lobbyist for Wilkes and McHugh. œWhy would passive investors be hauled into court for things they didn’t do?  He said that while the industry claims the private-equity firms that buy up nursing homes are passive, in reality they œcreate corporate structures to shield the assets, upstream the money and protect the real identify of the owners.œWhat the industry is saying is these people spend hundreds of million of dollars and just sit back and hang out, he said.  Wilkes’ model, which has been successfully employed in Florida and eight states where he has offices, is to not only target the owners and management companies ” which can often be shell companies that shield the assets of owners and investors ” but to target the investors, vendors and contractors, when he can show they have a role in the company’s decision-making. He also seeks large punitive damages.  In Polk County, where a nursing home shut down its management company after Wilkes sued, he won a $1 billion judgment in 2012 when the company didn’t put up a defense. In Pinellas County, a jury awarded $200 million to the family of a nursing home patient who died of neglect.   œThey keep putting companies in bankruptcy and transferring assets, and we follow the assets and now the courts are able to go up the ladder,” said Wilkes, 63.

The result, the industry says, is having a chilling effect on investment income into nursing homes in Florida ” at a time when older nursing homes want to update and retrofit in preparation for a surge in growth with the aging of baby boomers.   œHe’s been very effective at stopping the flow of money into Florida. People are scared,” said J. Emmett Reed, executive director of the Florida Health Care Association, which represents the industry. œWith the baby-boomers coming into Florida, we need more money for long term care, not less.

The bills, SB 670 and HB 569, advancing through the House and Senate, would stop Wilkes’ strategy in Florida by preventing œpassive investors from being named in a lawsuit unless a court determines they have had an active role.

œIt is impossible to completely hide all of your assets,” Reed said. œThis doesn’t make it any easier or harder to get sued as a direct care giver. This is simply protection for the passive investor.”

Read more here.

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