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SNFs face troubling trend following Golden Gate decision

11/26/2018

Skilled nursing facilities and other long-term care establishments are finding their advertising claims under fire as plaintiffs use state consumer protection statutes to lodge malpractice claims against them. Disconcertingly, plaintiffs are increasingly finding support from the courts despite the fact that the claims often stretch the definition of “consumer fraud” beyond a reasonable boundary.

A recent Pennsylvania Supreme Court decision, Commonwealth of Pennsylvania v. Golden Gate National Senior Care, LLC, dramatically demonstrated the drift. The court’s determination — that failure to provide the services documented in a care plan can be alleged as a form of consumer fraud under the UTPCPL (Unfair Trade Practices and Consumer Protection Law) — is bad law for all long-term care providers.

The matter focused on a series of claims that a skilled nursing facility, Golden Gate National Senior Care, made in its marketing materials and documents. Pennsylvania’s Office of Attorney General disputed some of the facility’s statements, including assertions that it has “licensed nurses and nursing assistants available to provide nursing care and help with activities of daily living.”

In the case, the plaintiff’s theory had been rebuffed by the appellate court — the Commonwealth Court of Pennsylvania — which ruled that “the Marketing Statements were offered and understood as an expression of the seller’s opinion only, which is to be discounted as such by the buyer, and on which no reasonable person would rely, they are puffery, and may not form the basis for a UTPCPL action.”

Indeed, state consumer protection acts were originally enacted to address advertising fraud. But many have been expanded to address fraud in consumer transactions. The Pennsylvania high court subsequently made that point in this case by holding that non-advertising marketing materials are also covered by the Pennsylvania Unfair Trade Practices and Consumer Protection Law.

Read the full article by Nancy Reynolds in McKnight's Long-Term Care News.