EKRA and SUPPORT Act Impact: Legal Breakdown

By: Susan St. John

Most everyone knows that laws are being implementing in federal and state government to address the opioid crisis in the US. One such law is the Substance Use Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (“SUPPORT Act”) signed into law in October 2018 by President Trump. While the SUPPORT Act seeks to increase access to treatment for substance use disorders and prevention of substance use disorders, it also contains language to prevent abuse of the process to increase treatment access. Specifically, incorporated into the SUPPORT Act is the Eliminating Kickbacks in Recovery Act (“EKRA”) which directly targets unlawful referrals to recovery homes, clinical treatment facilities, and laboratories.

EKRA is similar to prohibited kickbacks and patient brokering pursuant to Sections 456.054 and 817.505, Florida Statutes, using similar language as both Florida statutes. EKRA makes it unlawful…

1. For anyone to solicit or receive any remuneration, directly or indirectly, overtly or covertly, in cash or in kind, in return for referring a patient or patronage to a recovery home, clinical treatment facility, or laboratory, or
2. Pay or offer any remuneration, directly or indirectly, overtly or covertly, in case or in kind
   1. To induce a referral of an individual to a recovery home, clinical treatment facility, or laboratory, or
   2. In exchange for an individual using the service of that recovery home, clinical treatment facility, or laboratory,

A person who violates EKRA may be fined up to $200,000, imprisoned for not more than 10 years, or both, for each occurrence. These are criminal penalties! Further, EKRA applies with respect to services covered by a health care benefit program in or affecting interstate or foreign commerce. EKRA is an intent based provision meaning that a person(s) knowingly and willfully engaged in such prohibited referral practice.

EKRA incorporates activities affecting interstate and foreign commerce. Interstate commerce can be summarized as any commercial transactions or traffic that cross state boundaries or that involve more than one state, including moving money or transportation of products across state boundaries (think out-of-state reference labs). Foreign commerce includes commercial transactions or traffic between any part of the United States and any place outside the United States (think call centers, BPO or marketing services related to substance use disorder treatment where the entity providing the service is offshore).

Under EKRA a health care benefit program is defined pursuant to 18 USC §24, which states:

“health care benefit program” means any public or private plan or contract, affecting commerce, under which any medial benefit, item, or service is provided to any individual, and includes any individual or entity who is providing a medical benefit, item, or service for which payment may be made under the plan or contract.

Importantly, “health care benefit program” under EKRA is not limited to federally funded health care programs or state health insurance programs, but is any health plan or contract, public or private. Thus, the providers included under EKRA must make prudent business decisions in how they will conduct business in light of this new law that criminalizes prohibited referrals.

Clinical treatment facility means “a medical setting, other than a hospital, that provided detoxification, risk reduction, outpatient treatment and care, residential treatment, or rehabilitation for substance use, pursuant to licensure or certification under state law.” Further, a recovery home is defined to mean, “a shared living environment that is, or purports to be, free from alcohol and illicit drug use and centered on peer support and connection to services that promote substantial recovery from substance use disorders.” It is not necessary for a recovery home to be licensed or certified under state law to fall under EKRA.

There are exceptions to EKRA, some of which follow the exceptions to the Federal Anti-Kickback Law. The exceptions to EKRA are as follows:

1. Discounts or other price reductions obtained by a provider under a health care benefit program if the discount/reduction is disclosed and reflected in the costs claimed or charges made by the provider;
2. Payments by a provider to an employee or independent contractor if payment is not determined by or does not vary by number of individuals referred, number of tests or procedures performed, or amount billed or received by a provider;
3. Drug discounts for a Medicare beneficiary under a Medicare coverage gap discount program;
4. Payments made by a provider to its agent pursuant to a personal services and management contract that meets the standards under 42 USC §1001.952(d) (federal anti-kickback law);
5. A waiver or discount of coinsurance or copay as long as the waiver or discount meets the standards under 42 USC §1001.952(h)(5);
6. Remuneration related to entities providing services to medically underserved areas, as such remuneration is described under 42 USC §1320a-7b(b)(3)(I).
7. Remuneration pursuant to an alternative payment model defined in Section 1833(z)(3)(C) of the Social Security Act (effective beginning in 2023) if the Secretary of HHS has determined that the payment arrangement is necessary for care coordination or value-based care; or
8. Any other payment, remuneration, discount, or reduction as determined by the Attorney General in consultation with the Secretary of HHS.

Exception 7 will not apply until the year 2023 and exception 8 is unknowable at this time. The rest of the exceptions are somewhat familiar as they are similar to the federal anti-kickback laws. EKRA gives the Attorney General, in consultation with the Secretary of HHS, the ability to promulgate rules to clarify the enumerated exceptions; however, EKRA does not mandate that any clarifying rules be promulgated. So far, no proposed rules for EKRA have been published in the federal register.

Providers included under EKRA should review existing relationships with other providers, independent contractors, and employees to make sure EKRA is not being violated. Likewise, providers coming under EKRA should be cautious when entering into new relationships for services from other providers, independent contractors, and employees to avoid violating EKRA. If a provider is uncertain whether an exception to EKRA might apply to a new or an existing relationship, legal counsel should be sought. Keep in mind that this is a new law, parts of which are not entirely clear, and there may be traps for the unwary. EKRA allows federal prosecution even if a provider’s patient base is not made up of Medicare beneficiaries. EKRA extends to all health care plans and contracts, both public and private.