EPLI Exposures for Assisted Living and Skilled Nursing Facilities

EPLI Exposures for Assisted Living and Skilled Nursing Facilities

All businesses face employment-related exposures, including the long-term care industry, with assisted living and skilled nursing facilities having specific characteristics common with many healthcare providers that present greater liability risks. These include high employee turnover, regulatory scrutiny over patient care that results in employee firings and legal disputes alleging wrongful termination, and a proactive litigation system, among other issues.

There is a high cost associated with defending an employment practices claim along with increased settlement amounts that without the proper risk management and insurance programs in place can severely impact the bottom line and reputation of an assisted living facility or nursing home. Developing internal expertise in the area of training staff and/or hiring qualified HR professionals in employment practices is a key step in managing EPL risks. Training involves topics on preventing workplace harassment and workplace discrimination, how to conduct internal investigations, performance management, proper documentation, preventing wrongful discharge claims, new hire screening, discipline and termination interviewing, to name just a few things. Training should be focused on appropriate workplace behavior, understanding new employment laws, and familiarizing managers with best practices.

Having Management Liability insurance is also critical for long-term care facilities, including securing Employment Practices Liability Insurance (EPLI). EPLI provides long-term care facilities with coverage for legal costs to defend against claims as well as indemnification should a settlement be reached or a judgment rendered. It creates a ceiling that enables these facilities to more aggressively fight frivolous claims and to be more aggressive in settlement discussions. Also, many EPLI insurers offer helpful resources for reducing/managing pre-loss exposures related to employment practices, such a risk-prevention tools, claims management and legal services after a claim or incident has occurred.

Examples of claims that long-term care facilities have experienced include a 50-plus-year-old nurse who filed a lawsuit against a nursing home alleging she was terminated because of a work-related herniated disc that prevented her from heavy lifting, bending and stretching. She claimed that could continue to do most of her essential duties even with her injury. She was awarded a multi-million-dollar settlement. In another case, a female at a skilled nursing facility alleged a hostile workplace environment after claiming she was being sexually harassed by co-workers. The facility took the appropriate steps in investigating the situation, reprimanding the offending workers, and put in place a strong sexual harassment training program. Unrelated to this incident, the female employee was fired for poor attendance and work quality six months later. She filed a suit for wrongful termination. The facility had EPLI coverage and settled for $20,000 after spending $14,000 in legal costs.

About Caitlin Morgan

Caitlin Morgan provides EPLI insurance for assisted living facilities and nursing homes, partnering with several insurance carriers to offer tailored solutions. For more information about how we can assist you and your clients, contact us at 877.226.1027.