Assisted living facilities (ALF) have emerged as an elder-care alternative between the little-to-no care required for independent living residences, and the high level of care in skilled nursing homes. Due to the growing elderly population, ALFs have become very profitable investment vehicles. Many existing ALF chains are expanding, and corporations and trusts that traditionally have little or nothing to do with health care are looking to enter this growing market. Injecting the potential for significant profit into health care creates a natural tension — especially when profit may be increased by decreasing staff levels and competence. Litigation in this area is increasing.

Another likely factor contributing to the rise in ALF litigation is the absence of a uniform, specific regulatory structure. In the 1980s, the federal government created an overarching, very specific regulatory structure that applied to practically all skilled nursing home facilities. As a result, care universally improved, and the care delivered varies little even between states. However, for ALFs there are no overriding specific federal regulations, only more general state regulations leading to a potentially significant variation in care and services.

As stated in N.J.A.C. 8:36-5.1(d):

[t]he assisted living residence … shall be capable of providing nursing services to maintain residents, including residents who require nursing home level of care. However, the resident may be, but is not required to be moved from the facility or program if it is documented in the resident record that a higher level of care is required [emphasis added].

Essentially, ALFs can take and keep whom they wish, even residents requiring a nursing home level of care.

This large potential care range, due to no specific uniform regulatory structure, means that the services ALFs deliver can vary tremendously, even within the same county or city. The care levels range from basic apartments with occasional help with medications, meals and cleaning, to fully locked dementia wards with 24-hour close supervision and residents that are wheelchair or bed bound. Some ALFs are expanding their services into untraditional areas of increased acuity they cannot yet accommodate.

Families rarely understand this divergence in care levels, even when they are medical professionals. Most rely on the facility to make the determination as to whether or not the ALF can deliver the required care — i.e., they trust the facility. While doctors must clear a person for ALF admission, physicians typically have very limited, if any, interaction with the facility or individual care givers, have no participation in developing a plan of care for a resident, and do not attend care conferences regarding a resident. Like families, doctors also trust the facility and the ALF assessment for suitability. For doctors, there is also an additional pressure to do what the family thinks is best in a very difficult situation. In short, a doctor is unlikely to overturn a facility’s assessment and a family’s difficult and emotional decision.

These combined factors can create a dangerous environment. When residents do not receive adequate care and supervision, they can suffer falls, fractures leading to permanent immobility, brain injury, pressure ulcers and, frequently, death.

When these injuries occur, it is most important to hold the correct institutions and companies accountable. In this regard, it is important to note that these are not medical-malpractice cases. Individual defendants are rarely appropriate. These cases are mostly about management decisions, which lead to bad care that can seriously injure and kill people.??Corporate and regional offices typically determine staffing levels and competence, resident census goals, budget, marketing initiatives, capital expenditures and administration. These are where the failures are; seldom with individual care givers.

For this reason, filing suit solely against the physical facility may not be proper. Research is required into the corporate structure and ownership. This is where the decisions that lead to the poor care are made, and that is who should be held accountable.

There are three main themes. First, there is simple negligence. An otherwise good ALF with caring staff simply makes mistakes — albeit dangerous or fatal ones. These, however, are not the majority of cases.

Far more common is the second main theme: the facility accepted an individual that they never should have, based on the person’s acuity level. This is generally a function of an incompetent initial assessment, pressure to meet census goals or an inexplicable misunderstanding of the resident’s needs.

The third main theme, also common, is where a resident is initially a good fit for an ALF, but their condition degrades to a point where skilled nursing is far more appropriate, but the resident is not discharged. ALF residents are almost all private pay. Unlike a nursing home Medicaid resident, where involuntary discharge is difficult, ALF residents can typically be discharged by an agreed upon 30-day procedure. The facility is usually not required to keep them. This begs the question: if resident care and safety are primary concerns, why keep a resident when all the tools for care and safety are not present? They do so, arguably, to keep the beds filled.

Notably, if a resident wants to stay in a facility against an ALF’s recommendation, a "managed risk agreement" should be accomplished in accordance with N.J.A.C. 8:36-5.18. Basically, this document, signed by the resident or power-of-attorney (POA), sets forth the risks and facility limitations. These documents are rarely executed and should be inquired about in depositions.

Knowing who to depose is important. ALFs are structured similarly. At the top is the administrator or executive director, charged with running the facility. Despite this responsibility, the administrator does not need a medical background, and some are disturbingly unknowledgeable about medical issues. This individual will have the most interaction with, and knowledge of, the corporate office for future corporate deposition notices. They can testify to their autonomy, which at times may be very little. An administrator may also get a bonus for meeting census goals.

Next is the wellness director. This is the top clinical person. This individual is a registered nurse (RN), who typically works a normal day shift, and oversees staff, incident reports and investigations when something goes wrong.

There is also usually a marketing director, who is responsible for outreach to hospitals and doctors, as well as initially meeting families and assisting with the transition to the ALF. They are also typically involved with corporate meetings regarding census, and can testify to those interactions and pressures.

Lastly, there are the nurses and nurse aides. These individuals are the most involved with residents. Importantly, many of these individuals have also worked in nursing homes. Depending on your theme, one can use them to compare the profile of traditional nursing home residents with those of the ALF. Also, there are conditions generally only appropriate for nursing homes that they may see — e.g., pressure ulcers, continuous oxygen, fulltime IVs, etc.

It is important to note that ALFs are not required to have an RN present around the clock. RNs are usually only present during the day shift. Some facilities are almost exclusively staffed with licensed practical nurses (LPN), not RNs. LPNs, typically paid less, have a limited scope of responsibilities that is primarily data collection. The ALF practitioner may find LPNs harmfully acting outside the scope of their responsibilities.

Some facilities also use certified medication aides (CMA). These are nurse aides that take a course and can give medications. CMAs may not understand specific medication contraindications or how to spot adverse advents.

Predispute mandatory arbitration is something new. Arbitration clauses in ALF admissions agreements used to be unenforceable under N.J.S.A. 30:13-8.1. This is likely due to the fact that admission to long-term care can be extremely emotional and difficult. Arbitration clauses are complex and hard to understand. They are often slipped into a long admission document. The admission documents are not presented as opening negotiations, but as something required to sign for admission on the date of admission. Many times, marketing directors flip to the signature lines. Arbitration clauses prey on the fact that it is difficult enough to make the decision to place a loved one in long-term care, but the last thing anyone in that position wants to believe is that something terrible will happen as a result of their decision. These agreements are not car purchases or apartment lease negotiations. The notion that arbitration clauses are read, understood, appreciated and "agreed to" is questionable at best.

Nevertheless, arbitration clauses are now enforceable after Estate of Anna Ruszala v. Brookdale Living Communities, 415 N.J. Super. 272 (App. Div. 2010). Briefly, the court in Ruszala held the Federal Arbitration Act trumped N.J.S.A. 30:13-8.1, and arbitration clauses are enforceable although certain limitations on discovery and damages are not permissible. A companion case to Ruszala was remanded for discovery on issues surrounding the contract formation.

Many people are admitted to ALFs with the POA signing the admission agreement. Unfortunately, many POA documents, even ones drafted by attorneys, unnecessarily grant the power to bind to arbitration. The reason is unclear, since arbitration is generally not required for admission, and it is difficult to envision a scenario where mandatory arbitration is beneficial to a plaintiff. It seems problematic when a POA grants the unnecessary ability to bind an estate and a family from bringing a claim in court when a person is catastrophically injured or killed.

These clauses should be vigorously contested and are certainly defeatable on several grounds. However, they are an unnecessary hurdle to litigation and require the proper preparation.

ALF litigation is on the rise, and there is no indication that this trend is likely to reverse. However, understanding how to properly handle these complex claims is important to protecting your client’s rights. •