Kaiser Permanente, California’s largest HMO, requires patients to arbitrate claims – and that arbitration is binding. While most people have at least a vague idea of how lawsuits work, arbitration is a different animal. So, how does it work?

Generally speaking, there can either be one, neutral arbitrator who hears and decides the case or each party can have their own arbitrator who will present their client’s case to a neutral arbitrator. Because the process can be confusing, we asked Jeff Milman, a member of the Advocate Law Group Network who has been practicing law for over 25 years and specializes in medical negligence, to provide clarification. “Let’s assume you’ve got a case, whether it be one arbitrator or a party – where there’s two party arbitrators and then a neutral. When the case first starts, everybody’s going to start doing discovery. So, there’s usually a scheduling conference that occurs early on where the dates will be set.”

“For example, by such-and-such a date the parties will have agreed to at least discuss settlement. By such-and-such a date, the parties will have designated their experts. By such-and-such a date, we are going to have the arbitration. So, everybody has their calendars on this conference call.”

“That sets the pattern for the case. Then, if the case resolves through discovery, experts or a settlement conference, that’s great. If not, you show up at the appointed time and place. Some of these arbitrations may go for days or weeks and they’re very similar to a jury trial. It’s just somewhat more informal. It’s in a conference room. The rules of evidence and the presentations are a little more relaxed, especially if you’re dealing with a retired judge and the case resolves by eventually a verdict of some type.”

Arbitration vs. mediation

Arbitration and mediation are terms that often get confused. Patients of Kaiser Permanente are required to arbitrate their claims, however, the company may also require patients to use mediation as a form of dispute resolution. So, what’s the difference between the two? Milman explained, “Arbitration is where there is a hearing. It is scheduled. You submit briefs. You put on witnesses, whether it be your client testifying, whether it be experts or whether you’re cross-examining.”

“Mediation is basically a process whereby you submit a brief for purposes of settlement. It may be an open brief or confidential. You’ll show up to the mediation, which may be scheduled for several hours. You’re not presenting evidence. The mediator’s job is to bounce back and forth between rooms, and as I lovingly say, ‘Try and work out a deal where everybody’s equally unhappy.’ In other words, to convince them to pay more money than they want and to get us to accept less money than we want.”