The major insurance company has argued in federal court that it does not have to pay a settlement that includes one of its client nursing homes because the manager did not obtain an insurance company sign-off during negotiations.
Nightingale Healthcare's Arlington Health and Rehabilitation were sued in county court for negligence by Donald Stirlings, resulting in a nearly $3.3 million ju-appointment ruling against Nightingale and its administrative department.
However, following that verdict, Nightingale negotiated a settlement, perhaps in an effort to avoid a more legitimate conflict and lower its financial obligations.
The National Fire & Marine Insurance Company and its Medpro Group sued in the US district of Washington on Wednesday, seeking to escape responsibility for the settlement agreed on April 1. The amount of the settlement has not been disclosed.
The company acknowledged that it had covered Arlington under its Senior Care Responsibility Policy in 2023 and 2024, and its MedPro unit has agreed to advocacy and compensation in negligence cases. However, National Fire also argued that the policy of “approving a finding that is likely to be valid” with MedPro, would pose an option that could have been denied by a court-approved settlement.
“The company's obligation to protect and pay losses against claims or potential claims is strictly conditioned on cooperation with all insured companies in investigations, defenses and/or settlements,” the company said in its lawsuit. “As per the terms of the policy, Nightingale may not enter into or sign a settlement of a claim or a potential claim, except for the insured's own costs and liability, without written permission from Medpro.”
The back stops…where?
According to policy documents included in Wednesday's legal filing, Medpro's general advisory office would have organized liability defenses and participated in settlement negotiations.
It is unknown when and how the process collapsed.
Emails sent by McKnight Long-Term Care News to CEOs and corporate operating employees listed on the Nightingale website were not answered on Friday and their phone numbers were not answered.
Nightingale is a family-owned company with eight skilled nursing and support facilities in Washington. Owners Andrea Liebron Clay and James Clay were founded in 2014, with one of Andrea's sons listed as the Director of Operations.
They are not the first insurance nursing home that National Marine played hardball.
In 2022, the Berkshire Hathaway-owned company refused to fully pay for dozens of COVID-related claims filed by Genesis Healthcare. The insurance company has convinced Pennsylvania district court judges that providers must pay $3 million in self-insurance retention for each covid event before the national fire service is obliged to provide coverage for underlying litigation, preliminary lawsuits or potential claims.
McKnight's failed to reach Medpro and the public relations office on Friday, and messages left to the company's advisors were not answered.
