As baby boomers age and require long-term services, Florida's assisted living facilities (ALFs) are "at a turning point" and facing a large influx of residents in the upcoming years, according to Sen. Colleen Burton.
So Burton has filed legislation to gird the industry with tort changes that reduce liability risks for ALFs.
Members of the Senate Judiciary Committee unanimously voted to send SB 238 to its next committee of reference, Senate Health Policy, which Burton chairs.
It's the second bill the Senate judicial panel has passed since the start of the Session that changes existing tort law relating to the provision of health care.
The Senate Judiciary Committee on Jan. 22 passed a proposal by Chairman Sen. Clay Yarborough that reintroduced caps in medical malpractice suits. The caps were tagged onto SB 248, which eliminates a long-standing prohibition on wrongful death cases stemming from medical malpractice involving certain adults.
It's not clear whether the House has an appetite to pass additional restrictions on lawsuits. For instance, HB 995, the companion to Burton's bill, has been referred to four different House panels, none of which has considered it yet.
Meanwhile, Burton said her bill is necessary because there has been an uptick in ALF lawsuits in recent years. While they are being settled outside of court, Burton said, the suits are driving ALF's liability premiums.
"What we're looking at is a bill to begin to bring those parties interested in this issue together to come up with a compromise that will allow for lawsuits that should be filed, but also protect assisted living facilities and the seniors who reside there from rising costs."
She did agree to tag an amendment onto the bill that Florida Justice Association (FJA) lobbyist Brecht Heuchan said improved the underlying legislation. But he still has concerns with the proposal.
"This bill is about who is ultimately responsible for the care of our residents, Florida's residents in these long-term care facilities. That's what it's about," he said. "The crux of the matter is how this passive investor definition is defined."
The amended bill defines a passive investor as an individual entity that has an interest in a facility but does not participate in the decision-making or operations of the facility. The definition mirrors the passive investor definition that has been in Florida's nursing home statutes since 2014, Heuchan said.
"The original law was passed to protect true legitimate third parties and landlords and stockholders from liability and lawsuits. As has been said, if you own Amazon stock, and one of their truck drivers speeds through a school zone and hits a kid, you shouldn't be sued. That makes total sense," Heuchan said.
But in the near decade since the law was passed, there's been an influx of capital in the nursing home industry from private equity firms, and owners from other states. He said nursing home investors are buying the land where the nursing homes are being built, essentially becoming landlords. The landlords enter into contracts with providers that Heuchan said essentially dictate budgets for care and staffing, yet they cannot be sued.
"They insulate themselves from the liability of caring for our long-term care, these fragile residents and lawyers who seek to sue them," he said.
There are approximately 3,000 licensed ALFs in the state today providing residents to more than 106,000 people.
ALFs are establishments that provide housing, meals and one or more personal services, for periods exceeding 24 hours, to one or more adults who are not relatives of the owner or the administrator.
Residents residing in ALFs are guaranteed certain rights.
A resident or his or her guardian, or a person or organization acting on behalf of the resident with the resident's consent, or the consent of his or her guardian, or the personal representative of a deceased resident's estate can bring a cause of action against an ALF. Nothing in ALF statutes limits who may be sued for a violation of a resident's rights. In ALF litigation, passive investors can be sued.
Nursing home residents also have guaranteed rights. By contrast, nursing home statutes limit lawsuits to the licensed facility, the licensed facility's management or consulting company, the licensee's employees and any direct caregivers, whether employees or contractors. Passive investors cannot be sued.
There are 691 licensed nursing homes in Florida. Nursing homes provide 24-hour-a-day nursing care, case management, health monitoring, personal care, meals, physical, occupational and speech therapy, social activities, and respite care for those the state's most frail residents.
Robin Khanal, an Orlando defense lawyer with 20 years of experience defending long-term care providers from litigation, said ALFs need safeguards from litigation.
"I can go into court now and defend nursing homes that have these safeguards and you don't get 20 defendants in a lawsuit. Unfortunately, because these safeguards do not exist, I got into an ALF case and there is a plethora, a large list, of defendants. And all we are asking for are the same procedural safeguards that the nursing homes get as to who can be named and when," he said.
He added that the lack of guardrails has led ALFs to close their doors and leave the state.
SB 238 also makes it harder for plaintiffs to seek punitive damages against ALF providers by requiring the court to hold a hearing determining whether sufficient admissible evidence providing a reasonable basis for the recovery of punitive damages exists. If the plaintiff cannot make this demonstration, the defendant will not incur the costs associated with defending the claim.
Tampa resident Courtney Hancock is the Vice President of Clinical Services at Validus Senior Living. Speaking in support of the bill, she recalled her experiences with Senate Judiciary Committee members.
"Twenty years ago when I went to nursing school, I was ill-prepared for the amount of time I would spend away from the bedside and in the courtroom defending professional liability civil claims, claims that year over year, I have seen an increase in volume and a decrease in merit," she said.
"I'm not here today to tell you we never get it wrong. But these claims have driven the costs of insurance so high in the last several years that it's now in the top two line items in our expense sheet. And mirroring that increase are our deductibles and retentions we pay on each and every claim, which is now in the six figures."
She said Validus Senior Living has to try to cover those increases and they are partially cost-shifted to residents in the form of higher costs, she said.
Burton said with a growing population, Florida needs to take steps to ensure that ALFs remain part of the long-term care delivery system while ensuring people can access the courts when harm is caused.
"When somebody visits an assisted living facility to tour to try to make a decision about where their family members should be, I want them to feel safe. I want them to believe that if something wrong happens to their loved one, that here is appropriate, appropriate recourse," Burton said.
"So I would appreciate your support as we move forward and continue to make sure we have a vibrant community of caregivers out there in our state for those of us who need it today and those of us who might need it in the future."
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