We had the opportunity to discuss arbitration issues with Bryan Rotella, Esq., who concentrates his practice on advising businesses, particularly in health care, on arbitration issues. In Part 1, we discussed the benefits and logistics relative to the development and implementation of an arbitration program. In Part 2, we discussed issues relative to the enforcement and handling of arbitrations. Mr. Rotella’s continued discussion in Part 3 examines finality of arbitration awards.

Question: Are final arbitration awards subject to appeal?

Mr. Rotella: One of the substantive and economic benefits of arbitration is that both sides have the ability to realize a final result without, generally speaking, the potential for extended and often costly appeals. Cases that remain in the civil system do not necessarily afford this potential for finality on a reasonably timely and cost effective basis. The opportunity for the parties to achieve some sense of self-determination in resolving disputes in an agreeable forum is a key reason we recommend implementation of arbitration to resolve health care disputes. Nevertheless, there are very limited circumstances in which an award can and should be vacated.

Question: What circumstances would lead to this potential?

Mr. Rotella: First, we must determine whether the arbitration is being conducted pursuant to state or federal law. With the frequent involvement of federal government sponsored programs such as Medicare and connection to interstate commerce in health care related matters, the Federal Arbitration Act (FAA), is most often the governing law for Health Care Arbitrations. In fact, due to the FAA and US Supreme Court’s liberal policy in favor of arbitration, whenever possible, I recommend specifically referencing in the arbitration agreement that the FAA will apply. Under the FAA, an arbitration award may only be vacated in very limited circumstances. Specific examples include:

• Where the award was procured by corruption, fraud, or undue means;
• Where there was evident partiality or corruption in the arbitrators, or either of them;
• Where the arbitrators were guilty of misconduct in refusing to postpone the hearing, upon sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy; or of any other misbehavior by which the rights of any party have been prejudiced; or
• Where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.

Given that most frequently Health Care Arbitration panels involve each side designating an arbitrator, with the third arbitrator selected thereafter, circumstances of patent illegitimate conduct by a panelist are highly unlikely. Rather, when a challenge is made it usually alleges that the arbitrators exceeded their powers. However, courts have clarified this to only apply to the extremely limited circumstances when the award is: (1) completely irrational or (2) exhibits a manifest disregard of the law. Any challenge attempting to “re-litigate” the matters at issue in the arbitration will be met with strong resistance.

Question: The forum for examining this issue is back into civil court?

Mr. Rotella: Yes, and it is also the forum in which the final award, particularly in the usual scenario of the absence of contest of the award, is reduced to a judgment. This provides the platform for a dismissal of the underlying lawsuit, now that the parties have resolved the dispute. Bottom line, the extremely limited potential for an arbitration award to be overturned further illustrates that the many benefits to binding, tripartite arbitration in the health care litigation area far outweigh any potential downside.

__________

Bryan Rotella, Esq. practices with the Tampa, Fl. Law firm of Ansa Assuncao, LLP. His practice is focused on the health care industry with a specialty in the development, implementation and enforcement of arbitration agreements. Mr. Rotella is a graduate of The Ohio State University and the law school at Pepperdine University. He represents clients nationwide in state and federal courts and before arbitration panels. He is admitted to the Florida and California Bars. Further information is located at: ansalaw.com.

______________

The strategic partnership of DULAC, Inc. and RiskQual Technologies, Inc., provides innovative and advanced solutions to the risk management, claims administration, and MMSEA Section 111 issues that confront hospitals and health systems in an ever evolving regulatory and compliance environment.

The Centers for Medicare and Medicaid Services (CMS) is also focused on, and devoting resources to, precluding expenses from being paid out of Medicare on the “front-end”. Part of this effort is expressed via the reality of the Medicare Recovery Audit Program.

Our consultants have advised that during Demonstration Projects, Recovery Audit Contractors (“RACs”) found $1 Billion in ostensibly improper payments. Only 19.6% of all RAC denials were appealed at any level. An extremely small percentage of RAC determinations were overturned – 6.8%

A RAC can arise from several different means. Some of the denials are unanticipated because the RACs have not requested any records in advance of the denial. The denials, therefore, are from data abstraction, claims review, and extrapolation from sample reviews. RACs direct scrutiny at the physician’s decision to “admit as an inpatient”.

Empirically, standard “form letters” appealing denials are no longer effective. Appeal letters must describe the patient’s clinical picture at the time the patient presented to the hospital. We have developed affiliated resources to assist health care providers with the challenges associated with these audits.

Our subsequent blogs will provide further perspectives on the overall RAC issue as well as to provide a roadmap for a solution.

We had the opportunity to discuss arbitration issues with Bryan Rotella, Esq., who concentrates his practice on advising businesses, particularly in health care, on arbitration issues. In Part 1 of our discussion, which was recently posted to this blog, we discussed the benefits and logistics relative to the development and implementation of an arbitration program. In Part 2 below, we discuss issues relative to the enforcement and handling of arbitrations.

Question: What are some of the most common pitfalls that health care providers should be aware of relative to the enforceability of arbitration agreements?

Mr. Rotella: Issues in preparation, presentation and execution all can result in an otherwise enforceable agreement being determined invalid. With regard to the substance of the agreement, in long term care residencies here in Florida, provisions that restrict statutory rights as to damages have been deemed invalid. Presentation issues such as the agreement being buried within the contents of other intake paperwork have also resulted in adverse rulings. Additionally, if a patient is incapacitated, courts have held that the representative that should sign the agreement is the individual with a power of attorney that either provides all inclusive authority or the specific delegated right to enter into an arbitration agreement.

Question: Are there provisions in arbitration agreements that assist in enforcement?

Mr. Rotella: Provisions that advance a general spirit of efficiency and fairness to all parties are very helpful in enforcement efforts. Examples include requiring that the arbitration will be completed within a reasonable time period i.e., one year from the demand for arbitration and that the panel will include a member selected by each party with the third member being agreed upon by the selected panelists.

Question: Should outside counsel utilize a different method than with standard litigation, in their preparations and presentation of a case at arbitration?

Mr. Rotella: Juries are comprised in Florida of folks selected from a random pool of local residents with valid driver’s licenses. Arbitration panels are most often comprised of experienced health care litigators and/or retired judges. While the parties’ general themes will likely remain the same, many litigators not accustomed to arbitration, focus on collateral issues that resonate frequently with juries rather than what is likely at the forefront of the arbitrators’ minds, including the medical and quantifiable damages evidence. While outside counsel, of course, need to zealously represent their clients, discovery and hearing preparation should be narrowly tailored and targeted as arbitration is not meant to be an informal “full scale” trial but an efficient and cost effective means of resolving a care related dispute.
_____________

Bryan Rotella, Esq. practices with the Tampa, Fl. Law firm of Ansa Assuncao, LLP. His practice is focused on the health care industry with a specialty in the development, implementation and enforcement of arbitration agreements. Mr. Rotella is a graduate of The Ohio State University and the law school at Pepperdine University. He represents clients nationwide in state and federal courts and before arbitration panels. He is admitted to the Florida and California Bars. Further information is located at: ansalaw.com.

We had the opportunity to discuss arbitration issues with Bryan Rotella, Esq., who concentrates his practice on advising businesses, particularly in health care, on arbitration issues. In Part 1 of our series, Mr. Rotella provides an overview of arbitration and its applicability to medical malpractice claims administration.

Question: Is it worthwhile for the health care industry to explore binding arbitration implementation?

Mr. Rotella: As an alternative to resolving disputes, arbitration has existed for decades. It is rapidly becoming a desired forum to address service related disputes for health care companies and providers of all types. I believe that it presents a substantial opportunity to reduce risk and afford greater predictability as to potential verdict exposure. It is also more efficient and less costly as a process.

Question: Does this analysis apply only to large entities?

Mr. Rotella: My empirical experience is that an arbitration program benefits a wide spectrum of providers, from large long-term care enterprises to individual medical professional groups. I would recommend serious consideration to health care systems and individual hospitals as well, especially if they currently employ practitioners involved in higher exposure specialties such as obstetrics and gynecology, orthopedics and cardiology.

Question: Do providers experience difficulties in securing patient consent to arbitration agreements?

Mr. Rotella: In the health care setting, with certain exceptions, arbitration generally needs to be agreed to voluntarily by the patient. However, with proper program development and implementation, acceptance rates of 90% or higher can be achieved. Additionally, in Florida, with regard to for example MDs, hospitals and outpatient surgery centers involved in elective care, the law is favorable toward agreements where the provider mandates that a patient sign an arbitration agreement pre-treatment.

_______________________

Bryan Rotella, Esq. practices with the Tampa, Fl. Law firm of Ansa Assuncao, LLP. His practice is focused on the health care industry with a specialty in the development, implementation and enforcement of arbitration agreements. Mr. Rotella is a graduate of The Ohio State University and the law school at Pepperdine University. He represents clients nationwide in state and federal courts and before arbitration panels. He is admitted to the Florida and California Bars. Further information is located at: ansalaw.com.

Counsel advises that in the 2nd DCA of Florida, the case of Tarpon Springs Hospital Foundation v Reth controls, and ostensibly conflicts with the Fourth District opinion.

From a medical malpractice claims administration standpoint, the decision can impact the substance and logistics of counsel assignment as well as evaluating the overall exposure in a particular claim.

______________

The strategic partnership of DULAC, Inc. and RiskQual Technologies, Inc., provides innovative and advanced solutions to the risk management, claims administration, and MMSEA Section 111 issues that confront hospitals and health systems in an ever evolving regulatory and compliance environment.