By Someone Who’s Seen Too Many Insurance Policies to Care Anymore
So you're running a nursing facility. Congratulations! That means you’ve signed up for a career in (1) endless regulatory hell, (2) daily complaints about the jello, and (3) the ever-looming possibility of being sued for literally anything. And we do mean anything—from a rogue bingo incident to full-blown allegations of criminal neglect.
Now let’s talk about your favorite topic: retaliation claims. Oh, you haven’t had one yet? That’s cute. Like a baby deer taking its first steps into the forest, unaware that the insurance industry is the pack of wolves waiting to gracefully deny coverage the moment anything smells even vaguely intentional.
Let’s get one thing straight: when it comes to lawsuits in skilled nursing facilities, it’s not if—it’s when. You could have Florence Nightingale herself running the place and someone’s still going to claim the staff gave them side-eye when they asked for an extra pudding cup. And thanks to modern anti-retaliation laws and common law torts, that side-eye might cost you the average monthly Medicaid billing rate times punitive damages, plus attorney fees, plus your soul.
But fear not. Today we’re diving headfirst into the magical swamp of insurance policy fine print, where words like “intent,” “allocation,” and “exclusions” hide around corners waiting to gut your coverage like a fish. This post is basically your life raft.
Insurance: The Coverage You Think You Have, But Probably Don’t
Let’s start with the golden goose: professional liability insurance. In theory, this covers the facility and its administrators when someone gets upset, injured, or insulted. In practice? It’s a game of “Gotcha!” where your insurer has an entire department devoted to explaining why this particular incident—though clearly involving negligence, tears, and several therapy sessions—isn’t actually covered.
Did the patient fall? Sure. Was someone supposed to help them up? Debatable. But if that patient complained last week that her oatmeal was cold, and now she's on the floor, bam—you’ve got yourself a retaliation claim. And if you think your insurer is going to say, “Don’t worry, we’ve got this,” you clearly haven’t read your exclusions lately.
Retaliation: Now with Statutory Enhancements!
The legal system, never one to miss a party, has added fuel to the dumpster fire. Some states have started passing laws specifically protecting nursing home residents from retaliation.
Take Illinois HB 2474, for example. This little gem doesn’t just say you can’t retaliate against residents—it says that even if a resident thinks you might have retaliated, they can sue your pants off. Formal complaint? Not needed! All they have to do is ask for better care, and if you so much as blink too slowly, you might be facing:
-
Consequential damages
-
Attorneys’ fees
-
“Additional damages” based on the average Medicaid billing rate
-
The eternal judgment of the plaintiff’s family Facebook group
Compare that to Minnesota, which kindly expanded its Patients’ Bill of Rights back in 2020. Their version protects residents who advocate for “necessary or improved care.” But don’t worry, they spared you the full lawsuit circus by not offering a private cause of action—just a looming sense of dread that it might happen anyway.
Intent: The Magic Word That Will Screw You
Here’s the kicker: retaliation claims aren’t like your usual “Oops, we left the call button out of reach” kind of lawsuits. These are allegations of intentional wrongdoing. And insurers hate intent. Like, rage blackout hate. If there’s even a whisper of intent to harm, they will sprint to the “intentional acts exclusion” faster than a nurse chasing a runaway walker.
This is where things get tricky. Retaliation claims look a lot like negligence claims. The patient fell. The nurse was involved. But now it’s not just a fall—it’s a vendetta. And suddenly, your plain old negligence case has transformed into a dramatic soap opera storyline complete with a villainous nurse exacting revenge for that time the resident complained about the mashed potatoes.
Guess what? Your insurer is now eyeing the “expected and intended conduct” exclusion, the “willful violation of law” exclusion, and probably making up a few others just to be safe.
Four Ways to Avoid Getting Thrown Under the Bus by Your Insurance
Let’s say you want to be prepared—like actually prepared, not just spiritually resigned. What should you do?
1. Demand Trial-Only Intent Exclusions
You want policy language that says your insurer can’t deny coverage based on “intentional acts” unless there’s been a final adjudication in a court of law. No more “we just think this was intentional” nonsense. It has to go through a trial. Preferably one that’s televised for maximum drama.
Bonus: if the case settles (which most do), the insurer can’t invoke the exclusion at all. They’ll have to cover it, muttering bitterly into their spreadsheets.
2. Keep Willful Violation Language on a Tight Leash
Exclusions based on willful statutory violations should come with a GPS tracker, handcuffs, and a signed affidavit from a judge. Otherwise, insurers will twist statutory retaliation claims into “willful misconduct” faster than you can say “denied.”
Negotiate that language like your facility depends on it. Because it does.
3. Negotiate Favorable Allocation Provisions
When a complaint includes both negligence and retaliation claims, insurers love to play a game called Allocation: How Little Can We Pay? They’ll try to argue, “Sure, we’ll cover the basic negligence... but 95% of this case is spicy retaliation stuff, and we don’t do spice.”
Don’t let them. Your policy should require reasonable allocation based on an objective review of the claim, not whatever magical math the insurer cooked up at 3 a.m. while binge-watching Suits.
4. Get Defense Coverage for All Claims
Make sure your insurer has to pay to defend all claims, even the ones they’re side-eyeing with suspicion. As long as one claim is potentially covered, they should be on the hook for the whole defense. Otherwise, you’ll be out of pocket faster than a nurse during fire drill training.
Insurance Renewal: Your Annual Exercise in Existential Dread
Here’s the reality: most nursing facilities renew their insurance with the enthusiasm of a teenager signing up for gym class. They don’t ask questions. They don’t read the policy. They just hope nothing goes wrong and toss it in a drawer labeled “Things We’ll Regret Later.”
But now that you know how badly retaliation claims can burn you, maybe it’s time to get serious. Ask about coverage enhancements. Scrutinize those exclusions. Make your broker earn their commission. And for the love of all that is holy, stop assuming your insurer has your back. They don’t. They have their shareholders’ backs—and they’ve got much better chairs.
Final Thoughts: Voodoo Dolls Not Covered, But Recommended
Running a nursing facility is tough enough without getting blindsided by lawsuits dressed in retaliation drag. Yes, your residents deserve protection. Yes, your employees should be held accountable. But your insurer? They’re not your friend. They’re not your partner. They’re that guy at the poker table pretending to lose, only to wipe you out with a royal flush made of exclusions.
So here’s what you do:
-
Read your policy.
-
Question everything.
-
Fight for trial-based exclusions.
-
Don’t let them weasel out of defense obligations.
-
And above all: be nice to your residents—but also, maybe install cameras.
Because one day, someone’s going to fall, and they’re going to say it wasn’t an accident. And when that happens, you’ll want more than just a policy. You’ll want a miracle.
But until then, at least try to get decent coverage. It might not save your reputation, but it’ll save your wallet.
