Record Nursing Home Verdict Proves Nearly Impossible to Collect

February 9, 2012
By Parker Scheer LLP on February 9, 2012 10:11 AM |

The family of Elvira Nunziata was awarded $200 million from a Florida jury against a nursing home that the jury found responsible for her wrongful death. The family, however, will unlikely collect any of the verdict because of the complex corporate structure in place at the nursing home in question. This complicated corporate structure exists in many of the nation's largest nursing homes and renders most judgment proof and unaccountable. This case, and the huge verdict that may go uncollected, has put this issue at the forefront again.

Elvira Nunziata was a 92-year-old patient at a long-term care facility in Florida who had dementia and was in a wheelchair. She was able to pass through a door that was likely left open by employees going outside for a smoke. She toppled down a flight of stairs strapped to her wheelchair and died as a result of her injuries.

Her family brought a wrongful death lawsuit against the nursing home responsible for her care and safety. The attorneys retained by the family to pursue the wrongful death case soon found out that the entity responsible for running the nursing home no longer existed. Trying to trace who would be responsible for paying the judgment has proved nearly impossible.

Frighteningly, this is not a rare occurrence. A review of the 10 largest for-profit nursing home chains in the United States revealed several layers of ownership. One layer might own the building; while another would lease the building, hire staffers and pay the bills. Nursing homes are structured this way in a concerted effort to provide protection from lawsuits. Even the federal regulators who issue the licenses to these nursing homes and Medicare and Medicaid who pay the bills are unable to determine which affiliated companies control what. If regulators pull an operator's license for substandard care, that company could dissolve and an affiliated company could take over.

Why does this matter?

This complex corporate structure is deceptive to families whose loved ones are in nursing homes and holds the entities that run them unaccountable. It not only presents a problem in the collectability of judgments, but also the day-to-day operations of nursing homes. While families may assume that the administrator of a nursing home or the local owner is making the decisions regarding staff and supplies that is not always the case. These decisions, made solely based on a for-profit scheme, could actually be made by a real estate investor in New York.

Congress must get involved and enact legislation to require transparency in the corporate structure of these facilities. At the very least, this must be done to promote patient safety. To read more on the case involving Elvira Nunziata click here.

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Please see Mandatory Arbitration Clauses - 'Til Death Do Us Arbitrate? , Are Nursing Homes Over-Medicating Residents? and Nursing Home Arbitration Agreements - Here to Stay? for related personal injury posts.