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Indiana Court of Appeals Rules Exclusive Arbitration Clause Bypasses Indiana’s Medical Malpractice Act

Posted Sep 2, 20202 min Read

Regulatory & Clinical

On September 2, 2020, the Indiana Court of Appeals reversed a trial court’s decision in King v. Aperion Care that an estate could not compel arbitration until the medical malpractice claim proceeded through the review process set forth in Indiana’s Medical Malpractice Act (“Act”).

Ms. King was a resident at Aperion from March 3, 2015, until July 1, 2015.  As a part of the admission process, Mr. King signed an arbitration agreement to govern any future claims.  On June 8, 2017, the Estate of Ms. King filed a complaint with the Indiana Department of Insurance alleging medical malpractice related to the nursing care Ms. King received while a resident of Aperion.  The Estate of Ms. King then filed a motion to compel arbitration.  The trial court held that the allegations could not be submitted to arbitration until the medical-review panel process was completed under the Act.

However, the Indiana Court of Appeals reversed, holding that the Act does apply because the arbitration agreement provided the exclusive avenue for resolution of claims between the parties.  The Indiana Court of Appeals specifically pointed to the language of the arbitration agreement, which provided that any legal dispute, controversy, demand, or claim should be resolved exclusively by Neutral Binding Arbitration.  In closing the Indiana Court of Appeals stated, “Given that the parties agreed that the exclusive means for resolving any claims was arbitration and our precedent stating that when construing arbitration agreements, “every doubt is to be resolved in favor of arbitration,” Sanford, 813 N.E.2d at 416, we conclude that the Facility relinquished its right to avail itself of the Act.”

It is important to note that the Indiana Court of Appeals also stated that the parties could have agreed as a condition precedent to arbitration that the arbitration of any issue falling under the Act must be presented to a review panel prior to being submitted to arbitration.  Long-term care facilities are therefore encouraged to review any arbitration agreements with legal counsel and determine if they would like to include a condition precedent in their agreements going forward to avail themselves to the Act prior to submitting to arbitration.

For the entirety of the Indiana Court of Appeals ruling, please click here.

About the Author

Laura Brown, Director of Legislative and Legal Affairs