Agent authorized to make health care decisions under an Advanced Directive may not bind patient to nursing facility’s arbitration agreement.
Plaintiff Charles Logan executed an Advanced Directive (Prob. Code, §§ 4600–4805) appointing his nephew, Mark Harrod, as his health care agent. Harrod had authority to make “health care decisions” for Logan if he could not make them himself. Logan was admitted to defendants’ skilled nursing facility, where Harrod executed an admissions agreement and a separate arbitration agreement on Logan’s behalf as his “Legal Representative/Agent.” Logan later sued the facility and its owners, alleging elder abuse, negligence, and violations of the Residents’ Bill of Rights. The defendants moved to compel arbitration, which the court denied. Defendants appealed.
The Court of Appeal affirmed, holding that an agent’s authority to make health care decisions does not include the authority to enter into arbitration agreements. Relying on Garrison v. Superior Court (2005) 132 Cal.App.4th 253, defendants argued Harrod could sign the arbitration agreement on Logan’s behalf because the Directive authorized him to choose an appropriate health care facility. The Court of Appeal disagreed, holding that—contrary to the reasoning in Garrison—the relevant statutes limit health care decisions to the treatment of “physical or mental conditions.” (Prob. Code, § 4615.) The decision to enter into an arbitration agreement is not a health care decision, “[r]ather it is a decision about how disputes over health care decisions will be resolved.” The court also rejected Garrison’s holding that an agent could enter into an arbitration agreement as part of the “necessary or proper” excise of an agent’s authority. Because the arbitration agreement was optional, its execution could not be necessary to Harrod’s agency. Finally, the court drew support from recent federal regulations prohibiting Medicare and Medicaid nursing facilities from requiring arbitration agreements for admission; “arbitration agreements are not executed as part of the health care decision making process, but rather are entered into only after the agent chooses a nursing facility based on the limited options available and other factors unrelated to arbitration.”
The bulletin describing this appellate decision was originally prepared for the California Society for Healthcare Attorneys (CSHA) by H. Thomas Watson and Peder K. Batalden, who are partners at the appellate firm Horvitz & Levy LLP, and is republished with permission.
For more information regarding this bulletin, please contact H. Thomas Watson, Horvitz & Levy LLP, at 818-995-0800 or email@example.com.