Congress passed the Eliminating Kickbacks in Recovery Act (the Act) in 2018 to prevent “patient brokering” in treatment for substance abuse disorders. The Act imposes criminal penalties against anyone who knowingly and willfully “solicits or receives any remuneration . . . in return for referring a patient or patronage to a recovery home, clinical treatment facility, or laboratory” or who knowingly and willfully “pays or offers any remuneration . . . to induce a referral of an individual to a recovery home, clinical treatment facility, or laboratory; or in exchange for an individual using the services of that recovery home, clinical treatment facility, or laboratory.”

The Act applies to all payors, even where no Federal program dollars are at play. Penalties are harsh and may include a fine up to $200,000 and imprisonment for up to 10 years. Because the Act broadly defines the facilities that are subject to its restrictions, any entity or individual providing addiction-treatment and recovery services (even if only as a minor part of their service offerings) and clinical laboratories should evaluate arrangements with referral sources to ensure compliance with the Act.

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