By Fredrick P. Niemann, Esq. a New Jersey Consumer Fraud Lawyer
Are New Jersey nursing homes subject to the Consumer Fraud act? The answer is, no!
Under the learned professional exception of New Jersey law, our courts have held that hospital services do not fall within the purview of the CFA as hospitals in New Jersey are strongly regulated. In one case, a hospital sued the defendants in the special civil part to collect for services rendered to their son. Defendant filed a counterclaim under the CFA alleging unlawful or unethical medical practices. The trial court granted summary judgment in favor of plaintiff. On appeal, as a case of first impression, the court drew upon precedent established in other jurisdictions and found persuasive decisional law interpreting its CFA. The court ultimately held that there was “no purpose to a requirement that hospital services be within the purview of the [CFA] when those same services fall within the purview of the Department of Health.”
Like hospitals, nursing home facilities, particularly those accepting patients who receive federally funded medical assistance, Medicare and Medicaid, are strictly regulated. The New Jersey Department of Health and Senior Services is authorized to maintain an action in the name of the State to enforce the provisions of the NHA and any rules or regulations promulgated pursuant to the NHA. N.J.S.A. 30:13–8a. Any plaintiff who prevails shall be entitled to treble damages in any action to enforce the provision of, the provision at issue in this case. N.J.S.A. 30:13–8b. Applying the CFA to Manahawkin, which, like a hospital, is subject to state regulation, would create an impermissible circumstance where divergent determinations and penalties for the same subject matter may occur. On that basis, we conclude that defendant’s nursing home does not fall within the purview of CFA.
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