How Nursing Home Arbitration Agreements Affect Your Right to Sue

You made one of the hardest decisions of your life when you placed your loved one in a nursing home. Maybe they needed more care than you could provide at home. Maybe their health was declining, and you knew they needed professional help around the clock. Whatever the reason, you need to know how nursing home arbitration agreements affect your right to sue.

When nursing homes betray that trust through neglect or abuse, they often use arbitration agreements as a shield against accountability.

These documents are designed to protect nursing homes from court proceedings by forcing you to settle disputes with a private arbitrator instead of a judge and jury.

What Is a Nursing Home Arbitration Agreement?

An arbitration agreement is a legal contract where both parties agree to resolve any future disputes through private arbitration instead of the court system.

These agreements are almost always presented during the stressful admission process when families are focused on care needs, not legal details.

Most arbitration agreements include:

• A waiver of your right to a jury trial
• Procedures for selecting an arbitrator
• Limitations on what evidence can be presented
• Restrictions on your ability to appeal the decision
• Requirements for confidentiality
• Details about who pays the costs

In nursing homes, these agreements typically state that any claims—including those involving personal injury or wrongful death—must go through arbitration rather than public courts.

How Bad Nursing Homes Hide Behind Arbitration

How Does It Affect Residents and Families?

For nursing home residents and their families, arbitration often means:

Reduced Compensation

Studies show that arbitration typically results in lower damage awards compared to court cases.

Limited Evidence Gathering

Court cases allow for extensive discovery—the legal process where both sides exchange information. Arbitration typically limits this process, making it harder to obtain internal documents, staffing records, or other evidence that might show a pattern of negligence.

Privacy That Protects Wrongdoers

The confidential nature of arbitration means that even if your loved one suffers serious harm due to negligence, other families won’t learn about it through public court records. This privacy can shield repeat offenders from public accountability.

Potential Bias

Some arbitration agreements allow the nursing home to select the arbitrator or use arbitration companies they work with regularly. This arrangement raises concerns about potential bias, as arbitrators may favor the party that provides repeat business.

How Arbitration Differs From Court Proceedings

When you take a case to court, your dispute becomes part of the public record. Trials involve juries of your peers, and the proceedings follow established rules of evidence and procedure.

The differences are significant:

• Private proceedings: Unlike court cases, arbitration happens behind closed doors with no public record.
• No jury: Instead of a jury of community members, one or more arbitrators (often lawyers or retired judges) make the decision.
• Limited discovery: The evidence-gathering process is typically more restricted than in court.
• Fewer appeals options: It’s very difficult to overturn an arbitrator’s decision, even if it seems unfair.
• Confidential outcomes: The results are usually kept private, meaning other families won’t learn about problems at the facility.

Arbitration strips away these protections and replaces them with a process that often favors nursing homes.

Are Nursing Home Arbitration Agreements Enforceable in Tennessee?

Yes—with some important exceptions. Tennessee courts generally enforce arbitration agreements, but they can be challenged under specific circumstances:

When The Agreement May Not Be Enforceable

• Signing without authority: If someone signed without proper legal authority to do so (like a family member without power of attorney)
• Unconscionability: If the terms are extremely one-sided or unfair
• Lack of capacity: If the resident lacked mental capacity to understand what they were signing
• Fraud or misrepresentation: If the facility misled the resident about the agreement’s purpose or effects

The Tennessee Supreme Court has established that nursing home arbitration agreements must be fair and clearly explained to be enforceable. In Owens v. National Health Corp., the court refused to enforce an arbitration agreement because it was unfairly one-sided.

Steps to Protect Your Rights

If you or a loved one is considering a nursing home, here’s how to handle arbitration agreements:

Before Signing

• Read carefully: Review all admission documents thoroughly
• Ask questions: Request clarification on any confusing terms
• Negotiate: Try to modify or remove the arbitration clause
• Consider alternatives: Look for facilities that don’t require arbitration agreements
• Consult an attorney: Get legal advice before signing important documents

If You’ve Already Signed

If your loved one has already signed an arbitration agreement and you’re facing a potential claim, don’t assume you have no options. Consult with a nursing home abuse attorney who can review the specific agreement and circumstances. Depending on the situation, the agreement might be challenged based on:

• How it was presented and signed
• Whether the person had proper capacity
• If it meets Tennessee’s requirements for fairness
• Whether it covers the specific harm that occurred

The most effective protection is to refuse to sign the arbitration agreement in the first place—which is your right under federal law.

Frequently Asked Questions

Can I refuse to sign an arbitration agreement at a nursing home?

Yes. Under federal regulations, nursing homes cannot make signing an arbitration agreement a condition of admission. You can decline to sign while still proceeding with admission.

What if my loved one already signed an arbitration agreement?

The agreement may still be challengeable depending on circumstances like mental capacity at signing, how it was presented, or if the terms are unfairly one-sided. Consult with an attorney to review your specific situation.

Does Medicare or Medicaid have any rules about nursing home arbitration agreements?

Yes. Facilities receiving Medicare or Medicaid funding must follow federal rules requiring a clear explanation of arbitration agreements, acknowledgment of understanding, and a 30-day right to rescind after signing.

How much does nursing home arbitration typically cost?

Costs vary, but arbitration filing fees often range from $1,500-$6,000, plus hourly rates for arbitrators ($250-$800 per hour). Many agreements specify how these costs are divided between parties.

Can I still report nursing home abuse to authorities if I’ve signed an arbitration agreement?

Absolutely. Arbitration agreements only affect civil lawsuits. You can still report abuse or neglect to the Tennessee Department of Health, Adult Protective Services, and law enforcement regardless of any arbitration agreement.

Your Right to Court Isn’t Lost

When your loved one suffers harm in a nursing home, the last thing you need is to discover your legal options are limited by an agreement you barely remember signing. At The Higgins Firm, we’ve helped families across Tennessee overcome arbitration barriers and hold nursing homes accountable for abuse and neglect.

Our attorneys know the tactics nursing homes use to shield themselves from liability, and we know how to counter them.

Contact The Higgins Firm today for a consultation. We’ll review your arbitration agreement, identify potential weaknesses, and develop a strategy to pursue the justice your loved one deserves.