Senior Living Legal Issues to Watch in 2023 and Beyond
By Tim Regan | April 24, 2023
From the possibility of litigation from residents and their families to potential Fair Housing Act violations, the senior living industry in 2023 is fraught with legal risks.
There was a time in the not-too-distant past when senior living operators were not often in the eye of regulators or plaintiff attorneys. That has since changed, according to Hanson Bridgett Partner Paul Gordon, who serves as general counsel to the American Seniors Housing Association (ASHA) and sits on the organization’s executive board.
“There’s much more focus by the plaintiffs bar and by the regulatory agencies on senior living than there ever was,” Gordon told Senior Housing News.
As such, it’s imperative in 2023 and beyond that senior living operators know and plan for the new complicated legal environment.
Here are 3 legal issues to know and watch this year and in the future:
The senior living industry has long had significant liability and litigation risk, given its nature of taking care of older adults who sometimes need help with complex medical and care conditions. In 2023, that trend has only intensified and evolved.
One area of outsized legal risk, namely for low-acuity senior living operators such as those that manage active adult or independent living communities, is the possibility of litigation stemming from resident health events, attorneys told SHN.
At the heart of the issue are residents who have aged in place but over the years have become less independent due to aging.
It’s a common tale in senior living: A resident moves into a low-acuity setting when they are more able-bodied. As they age, they might need some extra help. So, the community makes little exceptions here or there, like performing courtesy wellness checks. This may not cause any immediate issues, but it does make the resident’s care somewhat of a gray area.
Matt Murer, who is department chair for the national health care practice of law firm Polsinelli, said it’s common for senior living operators to make exceptions for certain residents out of the kindness of their hearts. While well-intentioned, that is opening the door for legal ambiguity, and potentially litigation, down the road.
“Liability comes from the exceptions you make in your policies,” Murer said.
These arrangements can last for years without issue. But just one health event could put the community or operator in hot legal water.
“The family comes out and says you should have prevented this from happening,” Gordon said. “And so, [they say] ‘We’re going to sue you for personal injury, wrongful death, fraud or elder abuse.’”
Both Gordon and Murer agree that clarity in service delivery is the best ward against this kind of litigation.
“Make it very, very clear in all of their written materials that no care or monitoring of the residents’ health and safety are provided — that’s the number-one thing,” Gordon said.
And on when it comes to written policies, sometimes simple is better than complicated.
“I always tell my clients, I’d much rather see a really short policy that your staff can summarize for me really quickly on the floor than a 10-page one that looks great in a binder,” Murer said.
Fair Housing Act liability
Earlier this month, a provider agreed to pay $215,000 to resolve a Fair Housing Act lawsuit brought by the Department of Justice. The payment was a costly reminder that Fair Housing Act enforcement is alive and well in 2023.
Both Murer and Gordon agree that knowing the law is of utmost importance, given the evergreen possibility of enforcement from the federal government.
Operators on the lower end of the care continuum usually have the least civil liability, relative to skilled nursing; that flips in the case of the Fair Housing Act, which protects people against certain kinds of housing discrimination, including racial, sexual, familial status and on the basis of disability.
The act dictates that senior living operators cannot inquire about disability status when a resident moves in. While many operators might not believe they ask specifically about “disabilities” when their residents move in, some might do a health evaluation to determine care levels. Same difference in the eye of the law, according to Murer.
“Communities often in these cases will come back and argue, ‘Well, we know this person had a stroke or they have a wheelchair, so they may not be appropriate [for the community],” Murer said. “That is not a fair question to ask.”
Murer’s firm frequently works with clients on cases related to Fair Housing Act violations, and he added that he often sees cases related to communities denying residents the right to have a private-duty aide.
For campuses that mix independent living with other kinds of housing, including assisted living and memory care — including continuing care retirement communities — the issue becomes even more complicated, according to Murer and Gordon.
“What I tell my clients is, when you train your marketing staff, everybody gets to apply,” Murer said. “If somebody asks you, ‘Do you think I’ll be accepted?’ You say, ‘We judge every single applicant on a case-by-case basis, we encourage you to apply.’”
“Your staff saying anything other than that really can open you up to liability,” he added.
Liability risks of understaffing
All operators know chronic understaffing is an operational risk. But not all know that chronic understaffing also opens up senior living operators to litigation.
As operators have learned over the last three years, having the right number of staff on hand can mean the difference between a well-run community and one that is plagued with issues. What they might not know is that those issues can culminate into legal risks if they are not handled properly.
“It’s going to create dissatisfaction from families, it’s going to create poor assessments,” Murer said. “It spills over into … falls, which is the number-one liability issue from a claim perspective for these communities.”
Gordon said litigation stemming from allegations of understaffing is one of the most active areas of legal risk for assisted living operators.
“Plaintiffs’ attorneys … try to do class-action types of litigation against multi-facility assisted living providers alleging understaffing — intentional, pervasive, widespread understaffing,” Gordon said.
Usually, attorneys will try to point to understaffing as a budgetary concern as proof that senior living companies mismanaged their communities and created conditions that led to bad outcomes among residents, he said.
Sometimes, they will build a case around an internal memo regarding reducing staff levels to cut costs — something that has become routine for many operators since Covid-19 started.
“What you never want to see arise in a piece of litigation like that is a memo talking about setting staffing to save money, unless there’s also something in that memo about maintaining or improving quality,” Gordon said.
Gordon added that while staffing is a pernicious issue with no black-and-white solutions, operators must at least be aware that it is a significant area of legal risk.
“When you’re doing your staffing assignments … correlate staffing with resident need, or at least discuss it, evaluate it and document that you’re evaluating it,” he said.