Can a Healthcare Surrogate Bind a Patient to Nursing Home Arbitration in Mississippi?
Arbitration agreements are common components of admission paperwork for assisted living facilities, long-term-healthcare facilities, and skilled-nursing facilities. Often, admission paperwork, inclusive of any arbitration agreement or clauses, is executed by a healthcare surrogate spouse, family member, or other designated third-party on behalf of a resident prior to admission to a facility.
Arbitration clauses often intersect with nursing home negligence claims in medical malpractice defense.
The Manhattan v. Hawkins Holding: When Surrogates Can (and Can’t) Bind Arbitration
In the recent matter of Manhattan Nursing and Rehabilitation Center, LLC v. Verna Hawkins, the Supreme Court of Mississippi addressed whether a wife had the authority to bind her husband to an arbitration agreement as part of his admissions paperwork prior to his admission to a long-term-healthcare facility.
In that case, the husband was admitted into a long-term-healthcare facility for memory-related diseases. His wife executed all admission paperwork on the husband’s behalf, including an arbitration agreement that provided, “all claims, disputes, and controversies of any kind between the parties arising out of or relating in any way to the admission agreement or any service or health care provided by [provider] to the resident shall be resolved exclusively by binding arbitration.”
The husband was transferred to a hospital during his residency at the long-term-healthcare facility due to decreased level of consciousness. He subsequently died as a result Alzheimer’s-type dementia. His wife filed suit, individually and on behalf of the husband’s wrongful death beneficiaries, against the long-term-care facility and two of its nurses, alleging the husband had suffered a series of neglect at the facility.
The long-term-healthcare facility had filed a motion to compel arbitration in the trial court, which denied the facility’s motion.
On timely appeal by the facility, the Supreme Court of Mississippi analyzed the validity of the motion to compel arbitration under the Federal Arbitration Act using a two-pronged inquiry: (1) whether a valid arbitration agreement existed; and (2) whether the parties dispute was within the scope of the arbitration agreement.
Mississippi’s Surrogate Decision‑Making Statute: What Counts as a ‘Health‑Care Decision’?
To bind her husband to arbitration, the Manhattan Court declared that the wife required some level of legal authority to execute the agreement on the husband’s behalf. Legal authority was difficult to establish as the husband did not have a power of attorney, a healthcare directive, a guardianship, or a conservatorship.
Thus, the only means through which the wife could bind her husband to the arbitration agreement was as a healthcare surrogate as defined by statute:
A surrogate may make a health-care decision for a patient who is an adult or emancipated minor if the patient has been determined by the primary care physician to lack capacity and not agent or guardian has been appointed or the agent or guardian is not reasonably available.
Miss. Code Ann. § 41-41-211(1) (emphasis added).
The Manhattan Court also found that a designated healthcare surrogate could only make “healthcare decisions” on behalf of a patient, or those “regarding the individual’s healthcare.” If the decision is not one pertaining to the patient or resident’s healthcare, then it cannot be defined as a healthcare decision and likely not binding under the statute.
In other words, existence of the wife’s legal authority to bind the husband to arbitration as a surrogate hanged on whether the husband lacked capacity at the time the agreement was executed and whether the arbitration agreement was an essential part of consideration for the receipt of healthcare.
Evidence conflicted as to whether the husband’s primary care physician determined any lack of capacity prior to his admission at the long-term-healthcare facility. More importantly, and regardless of the whether the husband lacked capacity, the parties did not dispute that execution of the arbitration agreement was not a condition of the husband’s admission to the facility or to receive care at the facility.
The Manhattan Court accordingly found that the wife lacked authority to enter into the agreement, making the arbitration agreement invalid and unenforceable.
Implications for Long‑Term Care Facilities
Long-term-care facilities, as well as assisted living facilities and skilled-nursing facilities, should take note of the Manhattan ruling because it drastically affects the validity of arbitration agreements in Mississippi’s healthcare industry. The Supreme Court of Mississippi lays out in stark detail when an arbitration agreement in these circumstances will be binding and when it will not.
If a resident/patient has not been deemed by a primary care physician to lack capacity, then a third-party likely cannot be defined as a healthcare surrogate to act on that resident/patient’s behalf. In any event, for a decision to be binding under Miss. Code Ann. § 41-41-211(1), it must be one related to the patient’s healthcare (i.e., it must be an essential consideration in order for the patient to be admitted and receive healthcare).
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