Congress has enacted a new Anti-Kickback law, known as the Eliminating Kickbacks in Recovery Act of 2018 (EKRA). This legislation specifically targets arrangements involving recovery homes, clinical treatment facilities, and laboratories.
Congressional Intent and Purpose
The primary intent behind EKRA was to address the brokering of opioid use disorder patients for profit, making such practices illegal. Congress was concerned that vulnerable individuals could be steered toward ineffective or substandard treatment programs due to referral inducements and kickbacks, rather than being directed by factors like quality and effectiveness. While the goal was to protect patients, the law’s drafting has led to interpretations that extend beyond its intended scope, creating compliance challenges for providers.
Impact on Compliance
EKRA has introduced significant ambiguity, complicating compliance efforts for providers—even those who are diligent and well-meaning. The law adds a new layer of kickback analysis in addition to existing frameworks such as the Anti-Kickback Statute (AKS), Safe Harbor provisions, Stark Law, and relevant state laws. This has resulted in increased compliance costs and heightened criminal and civil exposure for providers. The effectiveness of EKRA in achieving congressional aims, given the already robust regulation by existing laws, is questionable. The necessity of an additional Anti-Kickback law and whether its ambiguous nature justifies the costs of compliance remain open questions.
Scope and Application of EKRA
EKRA generally applies to arrangements involving recovery homes, clinical treatment facilities, and laboratories. It prohibits offering or paying remuneration for referrals or the use of services provided by these entities. The law is applicable to both those making referrals and the recovery-based providers receiving them. Notably, these prohibitions mirror those found in the existing Anti-Kickback Statute.
Definitions of Covered Providers
Statutory definitions shape the scope of EKRA’s coverage. The law explicitly applies to clinical laboratories, and its definitions suggest that all clinical laboratory referrals are covered, not just those related to substance abuse. EKRA also encompasses “recovery homes,” which are shared living environments free from alcohol and illicit drugs, emphasizing peer support and connections to services that foster sustained recovery from substance use disorders. “Clinical treatment facilities” under EKRA exclude hospitals but include other medical settings offering detoxification, risk reduction, outpatient care, residential treatment, or rehabilitation for substance use, provided they are licensed or certified under state law.
Comparison to the Anti-Kickback Statute (AKS)
EKRA’s general prohibition against remuneration for referrals is similar to the federal AKS. Both statutes likely apply to arrangements involving recovery homes, clinical treatment programs, and clinical laboratories. However, EKRA does not apply to arrangements that violate the AKS. A significant ambiguity is the lack of a clear definition for “referral” within EKRA, and while it may seem logical to reference the AKS definition, EKRA does not expressly endorse this.
Exceptions and Safe Harbors
The main distinction between EKRA and the AKS centers on statutory exceptions and the application of safe harbors. EKRA features its own exceptions, and the safe harbors under the AKS do not apply to EKRA-covered arrangements. This creates the potential for inconsistent interpretation between the two federal statutes and makes the compliance process more complex for providers.
Penalties for Violation
EKRA imposes severe penalties for violations. Each occurrence can result in fines of up to $200,000 and up to 10 years of federal imprisonment. Compliance failures often involve multiple violations, substantially increasing legal exposure.
Compliance Challenges
As with other kickback laws, compliance depends on interpreting applicable exceptions. EKRA falls short in this regard, offering narrower exceptions than those under the AKS and lacking the benefit of established safe harbor provisions. Providers engaged in arrangements with recovery-related entities must thoroughly review those arrangements for compliance with EKRA. Additionally, recovery-related providers should evaluate their relationships with external referral sources, employees, and contractors to ensure adherence to the new law. EKRA’s broader application and numerous ill-defined areas necessitate careful risk analysis or, in some cases, the termination of problematic arrangements.
Further Information
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