Genesis is one of the country’s largest SNF and assisted living providers so naturally, it saw its share of COVID cases throughout the pandemic. Like other similar providers across the same industry, cases involving COVID infections are just now hitting the courts. Back in October, I wrote about the advancement of litigation involving COVID. There are two relevant posts.
- https://rhislop3.com/2023/10/13/friday-feature-sr-living-health-care-and-covid-litigation/
- https://rhislop3.com/2023/10/16/sr-living-litigation-and-covid-implications/
The case involving Genesis is interesting in so much that it comes via a liability carrier, National Fire and Marine. National Fire and Marine, in 2022, asked the US District Court for the Eastern District of Pennsylvania to rule via declaratory judgment that COVID was not a single healthcare event defined by the policy. In this interpretation, Genesis would have to pay a self-insured retention, or deductible, for each of its facilities before getting coverage for related lawsuits. Genesis under the policy, was required to pay the first $3 million for each healthcare event.
Genesis appealed the decision to the 3rd U.S. Circuit Court of Appeals claiming that the full extent of payments and claims is yet unknown and therefore, the event known as COVID is an amalgamation, not a series of singular events defined by each case or by each facility. Genesis has yet to reach the $3 million level in payouts/payments related to COVID cases.
Genesis faced at least 46 COVID claims, according to court records. It took out the policy with National Fire & Marine in fall 2020, with a coverage retroactive to December 2019. Genesis agreed to pay the first $3 million in costs, settlements or judgments for each healthcare event up to $160 million total. Genesis argued that COVID is a single event.
Per the decision, the Court wrote: “At this stage of the case, we fail to see how there is any ‘real and substantial threat’ of harm if a declaratory judgment is not entered,” the judges wrote. “Many COVID-related claims against Genesis already are barred by the statute of limitations in many states. So, the likelihood of Genesis’ costs exceeding $3 million any time soon — if ever — does not constitute a substantial threat of real harm.”
In the original decision from 2022, the US District Court agreed with National Fire and Marine and issued a declaratory judgment in their favor. Had Genesis not prevailed on appeal, the original judgement vacated, each claim would face a $3 million retention/deductible, and the insurer, would have zero liability for any claims (so far).
The full decision text from the Appellate Court is here: 22-3377-2023-12-18
As a significant portion of my firm’s work (H2 Healthcare, LLC) involves complex litigation support and expert/forensic witness work, we try to keep tabs of the senior living/post-acute litigation trends. Needless to say, COVID litigation is advancing rapidly and 2024 will unveil a whole bunch more decisions and perhaps, precedent around COVID related litigation, especially on wrongful death and harm. I’ll try to keep up.