The use of so-called “secrecy clauses” in assisted living and nursing home arbitration agreements hit another snag after Arizona’s top attorney announced a second settlement affecting dozens of long-term care settings in the state.
Arizona Attorney General Kris Mayes announced court approval last week of a consent judgment terminating secrecy clauses in arbitration agreements used by facilities operated by Bandera Healthcare, an Arizona subsidiary of The Ensign Group.
This is the second consent decree obtained by Mayes in recent months. She previously secured a similar agreement with Senita Ridge, a memory care community on the campus of the Ridges at Peoria Senior Living, in February. A judge ordered Rose Marie Scheske, a former resident, and the community to participate in a confidential arbitration proceeding after she filed a lawsuit in 2021 against the community alleging abuse and neglect.
But Mayes filed an intervention motion in December against The Goodman Group, the Minnesota-based manager of the community, and Ridges at Peoria, alleging that the fundamental arbitration agreement violated Arizona’s Adult Protective Services Act.
The more recent case involved a lawsuit filed by the family of Robert Knight, who had dementia and died from a bed sore he reportedly received while he was living at Sun West Choice Healthcare & Rehabilitation. Some claims in the lawsuit were covered by an arbitration agreement containing a secrecy clause, in violation of Arizona law requiring notice to the attorney general in cases of abuse, neglect or exploitation of vulnerable adults.
Bandera Healthcare and Apache Trail Healthcare, doing business as Sun West, discontinued the use of confidentiality clauses in arbitration agreements in January, shortly after Maye’s intervention in the Senita Ridge case.
Mayes has said that although private arbitration can be an effective way to resolve legal disputes, the agreements “cross a legal line when they require the parties to keep allegations of elder abuse secret.”
The Arizona Health Care Association previously had told McKnight’s Senior Living that it supported transparency between families and long-term care operators but that admission and other contracts used by assisted living communities and skilled nursing facilities are “unique.” The association’s executive director, David Voepel, had said the arbitration agreement process can create a more efficient and less expensive method of resolving conflicts while keeping families’ personal health information and family matters confidential and out of the public record.
Mayes said in a statement that she was pleased to learn that Bandera already had changed their forms to eliminate the clauses before her office intervened in the case. She said she was committed to continue filing interventions as long as operators continue to use secrecy clauses in their arbitration agreements.
“Anyone who signed one of these secrecy clauses in the past should know that the clauses are not enforceable against them,” Mayes said, adding that she intends to continue “exposing and eliminating” failure that led to previous harms. “I hope every long-term care facility in Arizona gets that message and embraces transparency without the need for intervention from the attorney general’s office.”
