Chances are you’ve heard about the new IHC policy mandating patient sign binding arbitration agreements.  This story was recently brought to my attention by a Bill Gephardt story on KUTV 2 News and has received continued attention by both the Salt Lake Tribune (see story) and the Deseret News (see story).  As proponents of arbitration will tell you, the concept of “alternative dispute resolution” (ADR) has been a recognized method of settling disputes since the early ‘20s, but has only recently become more popular.

I’ve been aware of many of the arbitration agreements I have entered into for sometime—my credit cards and some of my utilities include arbitration provisions repudiating my right to sue for most claims.  (Yes, I actually read the fine print in the account disclosures.)  Arbitration provisions are becoming increasingly common in employment agreements, and many customer interactions.  However, I have consistently had some concerns with the industry trend toward arbitration.

• First, many agreements state that my grievances with a company must go through arbitration proceedings, but have exclusionary provisions for any company action against me.  That’s not a level playing field.
• Second, arbitration organizations are a business (whether non-profit or not).  Businesses cultivate clients.  It then follows that an arbiter who finds against a corporation whether through repeated proceedings, or by awarding significant damages on a single case would find themselves in the bad graces of a company.  In short, the system shows a built-in vested interest toward repeat business in favor of the company.  With this in mind, is there such a thing as an un-biased arbiter?
• Third, discovery is limited.  In civil proceedings each party can subpoena records, compel depositions, and otherwise compel the other to divulge information which can be used at trial.  In arbitration proceedings, discovery is often limited or voluntary.  If I enter into arbitration proceedings against a company for discrimination grievances, for example, it is likely that I would not be able to see records documenting the offending employee’s past incidents which may identify a pattern the company repeatedly ignored.
• Along the same lines, I would not be able to access information about other arbitrated complaints or past awards for similar suits, because arbitration proceedings are considered confidential.  This is somewhat of a misnomer.  As a single affected person I wouldn’t have access to these records, but the company would, as a party to each of the previous actions.  In feel quite strongly that any arbitration under such circumstances would be weighted against me.
• Lastly, submission to arbitration agreements should be voluntary.  As a customer, I would be hard pressed to find a credit card company that did not include mandatory arbitration as part of its terms.  I doubt I would be able to find a cable TV provider offering a voluntary opt-out provision for arbitration.  (In fairness to Comcast, their arbitration provision appears to be fairly reasonable, although still weighted in favor of the corporation.)  If I was an employee at a company where Intermountain Healthcare, with their mandatory arbitration agreements, was my only option for health insurance I would be subject to the “no agreement, no coverage” policy that seems to be taking hold.

Don’t get me wrong, I’m not against arbitration agreements—there are some significant upsides.  Reduced costs for both parties being prime among them.  However, I believe considerable pitfalls also exist, and both courts and the legislature need to take an active role in preserving my civil rights and defining under what circumstances an arbitration agreement can be required or considered unenforceable. See the search results at findlaw.com which lists some good examples, namely this article and this article.

To wrap up, I particularly enjoyed the last part of Lois Collins’ Deseret News article of 14 Oct 2003 where she quotes a lawyer as saying “..the American Arbitration Association has abolished arbitration in medical malpractice actions unless the patient agrees to it after being injured. Pre-injury agreements have been determined by the AAA to be fundamentally unfair.’”

I’d have to agree.  After all, agreeing to mandatory arbitration or losing coverage seems to go against every “Patient Bill of Rights” I’ve ever seen posted in a doctor’s office. It’s a real non-choice.