EKRA - Eliminating Kickbacks in Recovery Act

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What Does EKRA Stand For?

The term “EKRA” is shorthand for the “Eliminating Kickbacks in Recovery Act”, a federal law enacted as part of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment Support for Patients and Communities Act (Pub. L. 115-271) in 2018. This act forms an integral part of a strategy aimed at preventing unscrupulous practices in the healthcare sector, specifically those related to addiction treatment services. For those dealing with EKRA, a counsel of experienced professionals like that of Chapman Law Group Healthcare Attorneys can be invaluable.

What is the Eliminating Kickbacks in Recovery Act?

In simple terms, the Eliminating Kickbacks in Recovery Act (42 U.S.C. § 1320a–7b(g)-(h)) is a legislation that restricts any individual or entity from knowingly and purposefully soliciting, receiving, offering, or paying remuneration to facilitate referrals to any recovery home, clinical treatment facility, or laboratory. The Act’s influence extends to both public and private institutions and is designed to eradicate fraudulent behavior within the healthcare industry.

 Congress’s intent was to eliminate the Anti-Kickback Statutes Bona Fide Employee safe habors for diagnostic testing. Though the intent was to target Toxicology labs more specifically, the language was structured to include all diagnostic testing (recovery hones, clinical treatment facilities, laboratories, etc.) Elaborating further, their goal was to stop solicitation of sober homes, and similar entities which referred individuals to laboratories and resulted in sales personnel being compensated by commission based on revenue generated from each individual test.

The penalties for violating EKRA can be steep and the language specifically states “fined not more than $200,000, imprisoned not more than 10 years, or both, for each occurrence.”

Does EKRA Apply to All Payors?

Yes, one unique aspect of EKRA is its scope; it is applicable to all payors, not just those linked to federal healthcare programs. This makes it critical for all healthcare providers, regardless of their involvement with Medicare or Medicaid, to ensure they are in compliance with EKRA.

How Does EKRA Affect Laboratories?

According to EKRA (42 U.S.C. § 1320a–7b(g)), its impact on laboratories is substantial. Any laboratory-related business arrangement, from employment contracts to referral agreements, could fall under the Act’s scrutiny. Violations could result in charges for participating in a kickback scheme, making EKRA compliance a top priority for all laboratories.

EKRA has introduced significant changes to the relationship between laboratories and their sales and marketing personnel, imposing restrictions on previously permissible activities. Unlike other federal statutes, EKRA prohibits practices such as paying sales commissions to marketing personnel, creating a climate of uncertainty due to the broad definitions of “laboratory” and “referral”.

The definition of a “laboratory” under 42 U.S.C. 263a encompasses various healthcare entities that utilize labs in their operations. Consequently, many healthcare entities must now proactively ensure compliance with EKRA. Adding to the uncertainty, EKRA lacks a clear definition of what constitutes a “referral”, granting federal agencies more discretion in their investigations and prosecutions.

In line with EKRA’s provisions (42 U.S.C. § 1320a–7b(g)), laboratories face substantial impacts. All aspects of laboratory-related business arrangements, including employment contracts and referral agreements, fall within the Act’s purview. Failure to comply with EKRA can result in charges related to participation in kickback schemes, emphasizing the paramount importance of EKRA compliance for all laboratories.

EKRA's Affect Treatment Facilities and Recovery Homes

Treatment facilities, including substance abuse treatment centers or rehabilitation centers, may be subject to EKRA regulations if they engage in arrangements that involve referrals and remuneration. Any payments made in connection with referrals could potentially raise compliance concerns under EKRA. It is crucial for treatment facilities to carefully evaluate their business relationships, referral practices, and financial arrangements to align with EKRA requirements.

Similarly, recovery homes or sober living facilities may also be affected by EKRA. If these facilities engage in referral arrangements or receive payments related to referrals for healthcare services, they must be mindful of EKRA’s provisions. Compliance efforts should focus on reviewing agreements, monitoring financial arrangements, and implementing safeguards to ensure adherence to the Act.

Given the broad scope of EKRA and the potential consequences of non-compliance, treatment facilities and recovery homes should consult legal counsel knowledgeable in healthcare regulations to navigate the complexities of EKRA and establish robust compliance programs. By staying informed and taking proactive steps, these healthcare facilities can mitigate risks and maintain compliance with EKRA’s requirements.

How Does EKRA Affect Marketing Personnel?

For marketing personnel working in the healthcare sector, it is crucial to understand EKRA’s (42 U.S.C. § 1320a–7b(g)) far-reaching implications. For those engaged in the promotion of addiction treatment programs, EKRA stipulates that referral-related compensation must not be connected to the value or number of referrals generated. Not adhering to this can result in severe kickback charges.

These longstanding practices by laboratories, such as employing individuals for marketing and sales services, now carry the risk of violating EKRA. Merely providing any form of remuneration in connection with a referral can lead to civil and criminal liability. To mitigate these risks, laboratories must continuously revise, reassess, and closely monitor their marketing, sales, and patient broker arrangements.

Is EKRA Criminal or Civil?

The EKRA statute is fundamentally a criminal law. Violations carry substantial penalties, with possible sentences of up to ten years in prison and fines of up to $200,000 per count. Given these harsh penalties, having an experienced EKRA lawyer, with specialized knowledge of healthcare law and white collar criminal defense, like those at Chapman Law Group, can provide a crucial line of defense.

What is the Difference Between EKRA and the Federal Anti-Kickback Statute?

Although both EKRA (42 U.S.C. § 1320a–7b(g)) and the Federal Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)) are designed to prevent healthcare fraud, they differ in several key aspects. For instance, the Federal Anti-Kickback Statute’s jurisdiction extends only to federal healthcare programs, while EKRA applies to all healthcare services. Furthermore, EKRA’s safe harbors are more restrictive, making compliance a more complex task.

In focus, the AKS targets kickbacks and improper financial arrangements that may influence referrals for any healthcare services payable by federal healthcare programs, while EKRA focuses on kickbacks related to the provision of substance abuse treatment and recovery services in recovery homes, clinical treatment facilities, and laboratories. It is specific to this particular area of healthcare and does not have the same broad application as AKS or Stark Law.

Does EKRA Have Safe Harbors?

Indeed, EKRA (42 U.S.C. § 1320a–7b(g)) provides for certain safe harbors or exceptions, including particular types of payment arrangements, discounts, and bona fide employment relationships. However, these exceptions are narrower than those under the Federal Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)), which adds another layer of complexity to EKRA compliance.

Does EKRA Implicate the False Claims Act?

EKRA violations can potentially lead to repercussions under the False Claims Act (31 U.S.C. §§ 3729–3733). If a healthcare provider is found guilty of submitting false claims due to a violation of EKRA, they may face additional penalties under the False Claims Act.

EKRA Compliance Attorneys

Navigating the complexities of laws like EKRA, the Federal Anti-Kickback Statute, Stark Law, and the Federal False Claims Act demands prowess, and that’s where the Chapman Law Group shines. Our team of seasoned healthcare defense attorneys, proficient in healthcare compliance and white collar criminal defense law, stands ready to safeguard your professional reputation. We offer both robust defense strategies for potential EKRA charges and proactive assistance in creating and auditing comprehensive healthcare compliance programs. Don’t leave your career to chance – contact Chapman Law Group today and let us be your trusted legal ally in achieving peace of mind.

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