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5 Things You Must Know About EKRA Law in 2021

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The Eliminating Kickbacks in Recovery Act (“EKRA”) was passed by Congress on October 24, 2018 as a part of the SUPPORT Act.

It targets patient brokers who seek to profit from illegal patient referrals by prohibiting laboratories, clinics, recovery centers, and other clinical treatment facilities from accepting or paying kickbacks for such referrals.

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Dr. Nick Oberheiden
Dr. Nick Oberheiden

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John W. Sellers
John W. Sellers

Former Senior Trial Attorney
U.S. Department of Justice

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Joanne Fine DeLena
Joanne Fine DeLena

Former Assistant U.S. Attorney

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Joe Brown
Joe Brown

Former U.S. Attorney & Former District Attorney

Local Trial & Defense Counsel

Amanda Marshall
Amanda Marshall

Former U.S. Attorney

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Aaron L. Wiley
Aaron L. Wiley

Former Federal Prosecutor

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Roger Bach
Roger Bach

Former Special Agent (OIG)

Michael Koslow
Michael Koslow

Former Supervisory Special Agent (FBI)

Chris Quick
Chris Quick

Former Special Agent (FBI & IRS-CI)

Kevin M. Sheridan
Kevin M. Sheridan

Former Special Agent (FBI)

Ray Yuen
Ray Yuen

Former Supervisory Special Agent (FBI)

Dennis A. Wichern
Dennis A. Wichern

Former Special Agent-in-Charge (DEA)

In this blog post, we explain five things you must know about EKRA to be prepared for 2021.

1. The Eliminating Kickbacks in Recovery Act (“EKRA”) represents another aggressive step by the federal government to counter the national opioid crisis in the United States.

The Eliminating Kickbacks in Recovery Act (“EKRA”), 18 U.S.C. § 220, makes it a federal crime for anyone, with respect to services covered by a health care benefit program, to knowingly and willfully:

  • solicit or receive any remuneration (including any kickback, bribe, or rebate) 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
  • pay or offer any remuneration (including any kickback, bribe, or rebate) directly or indirectly, overtly or covertly, in cash or in kind-
    • 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.

Violations of this provision subjects the individual to a fine of not more than $200,000, an imprisonment term of not more than 10 years, or both, for each occurrence.

Additional violations that may be imposed include sanctions, licensure revocations, or the exclusion from participating in governmental healthcare programs.

The agencies charged with the enforcement and prosecution of EKRA are the Department of Health and Human Services and the DOJ.

2. Individuals have already pled guilty to EKRA violations as a result of DOJ investigations, and this trend is likely to continue in 2021.

The DOJ has already begun prosecuting individuals under EKRA. For instance, in early 2020, an office manager of a substance abuse treatment clinic pleaded guilty to EKRA violations through her solicitation of kickbacks from a toxicology lab in exchange for referrals.

Recently in September 2020, two men pled guilty for conspiracy to commit health care fraud and conspiracy to violate EKRA. Their conduct entailed an elaborate multi-state patient brokering scheme by which their marketing company recruited patient referrals in exchange for kickbacks covered by health care program reimbursements.

The DOJ plans to continue its aggressive approach in 2021, especially in the midst of the rapid increase in COVID-19-related frauds.

3. EKRA is broader than the federal Anti-Kickback Statute and other federal statutes.

EKRA has received criticism for its potential to criminalize conduct that was permissible under the federal Anti-Kickback Statute and other federal statutes. Broadly, the Anti-Kickback Statute prohibits knowing and willful payments to induce patient referrals or generate business involving any service payable to governmental health care programs. In other words, the Anti-Kickback Statute is limited to federal and state healthcare programs.

Under EKRA, health care benefit programs include not only state and federal healthcare programs (e.g., Medicare and Medicaid) but also private health insurance plans. EKRA’s reach is therefore more extensive than the Anti-Kickback Statute. It potentially applies any time an entity provides medical services and regardless of whether such services are covered by government insurance plans (federal or state), private health insurance plans, or even in cases where the patients themselves pay.

Additionally, EKRA contains less exemptions than the Anti-kickback Statute. While the Anti-Kickback Statute contains statutory and regulatory safe habors, EKRA has less statutory safe harbors and no regulatory safe harbors. Therefore, conduct that was once exempt from the Anti-Kickback Statute is now prohibited by EKRA.

Because of the lack of federal guidance, individuals and entities are left in an uncertain state as to which conduct is prohibited and how to reconcile the differences between EKRA and other federal and state legislation prohibiting kickbacks.

4. EKRA significantly alters the nature of the relationship between laboratories and their marketing and sales personnel.

EKRA substantially changes the relationship between laboratories, clinics, recovery centers, or other clinical treatment facilities and their marketing and sales personnel. As mentioned, the text of EKRA appears to prohibit certain commonly accepted business practices such as paying of sales commissions to marketing personnel or giving free equipment to physician clients. This conduct was a traditionally accepted practice and was not prohibited under the Anti-Kickback Statute, though it is now prohibited under EKRA.

EKRA also applies regardless of the entity’s medical business operations and regardless of payor. Even though EKRA was intended to combat the growing opioid epidemic, the text of the statute is broader than the purpose.

As a result, many laboratories may now be forced to revise and amend their marketing, sales, and patient broker arrangements in order to be compliant with EKRA.

5. Violations of EKRA law may also violate other federal statutes.

EKRA prohibits anyone from knowingly and willfully soliciting or receiving remuneration or paying or offering remuneration—kickbacks—with respect to the services of a health care benefit program. Violating this provision can subject an individual or entity to liability under other federal statutes such legislation that prohibits making false statements as well as the False Claims Act.

An individual or entity violates the False Claims Act each and every time they submit a claim that they know is false with respect to a federal government program.

Because of this, it is incumbent upon individuals and entities in the healthcare industry to re-evaluate the terms of their marketing and sales arrangements to ensure that they are in compliance with EKRA.

Hiring an attorney that fully understands the implications of EKRA laws would help safeguard your business operations, professional license, and reputation. Reach out to the team at Oberheiden, P.C. today.

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