Nursing homes have taken to creating complex corporate schemes to avoid being held financially accountable in lawsuits. Increasingly, they are improperly insured such that they can avoid liability by going bankrupt or making judgments extremely difficult to collect. We firmly believe that lawsuits play an important role in keeping nursing homes accountable and maintaining high quality nursing and rehabilitative care standards. When you are considering placing a loved one in a nursing home, you should ask that the nursing home demonstrate to you that it has insurance as required by law under Colorado Revised Statute 13-64-301.
This law generally mandates that each and every nursing home have $500,000 of dollar one (no deductible) insurance per incident or $3 million per facility each year. Informed consumers should ask to see proof of coverage because nursing homes are often created with worthless financial shell corporations so they can hide from lawsuits behind their lack of coverage.
Our recent Hise settlement with the State of Colorado will close the loophole that has been allowing nursing homes to avoid financial responsibility and will now be requiring proof of insurance. However, we believe that individual consumers also have a role to play in enforcing this change by demanding proof of compliance with applicable laws as part of their placement decisions.