For years, the behavioral health care industry was shrouded in stigma, which often led to an underfunded and under-resourced system that made it difficult for people to get the help they needed for mental health and substance abuse issues. However, as awareness and need for behavioral health services have grown, so too has the opportunity for individuals to access treatment. Expanded coverage, more funding, and technological innovations have made behavioral health care more accessible than ever before.
While this is a positive development for many individuals and families seeking help, it has also brought unintended consequences. As insurance coverage for behavioral health services has expanded, the industry has seen an influx of unethical providers who aim to exploit these opportunities for financial gain. These providers are more focused on insurance payouts than actually helping patients, and their actions have caused concern across the behavioral health space.
In response to these issues, federal and state governments have stepped in, introducing stricter regulations to keep these providers in check. One of the most important pieces of legislation aimed at curbing unethical practices is the Eliminating Kickback in Recovery Act of 2018 (EKRA), which was passed to address a growing concern about patient exploitation and fraud within the substance abuse treatment industry.
However, while EKRA’s intentions are clear — to prevent fraud and unethical practices — the implementation of the law has raised concerns, even among ethical providers who fear that its broad language and unclear regulations could harm legitimate businesses and stifle innovation in the industry.
Understanding the Need for EKRA: Tackling Unethical Providers
The substance abuse and mental health treatment industries have long struggled with fraudulent practices, often centered around patient brokering and kickbacks. Unscrupulous providers would exploit patients by offering monetary incentives or other perks in exchange for referrals, enrolling people in unnecessary treatments, or steering patients to specific facilities that were more interested in collecting insurance payments than delivering effective care.
The anti-kickback statute, which had long been a safeguard against these practices, applied only to providers who were reimbursed by federal health programs. But a significant portion of treatment, particularly in substance abuse care, is often paid for privately or through commercial insurers. This left a gap in regulation and allowed certain unethical actors to bypass the law and continue operating without consequences.
To fill this gap, EKRA was introduced. The act provides a new layer of oversight for non-federally reimbursed facilities, imposing criminal penalties on providers who solicit, receive, offer, or pay remuneration for patient referrals or services covered by a healthcare benefit program. This law targets recovery homes, clinical treatment facilities, and labs offering services related to addiction treatment or behavioral health care.
For violations, EKRA imposes steep penalties: fines of up to $200,000 and up to 10 years in prison for each occurrence. The goal is to ensure that patient care comes first, and that financial incentives do not interfere with the well-being of those seeking help.
Unintended Consequences: The Legal Concerns
Despite its good intentions, EKRA has raised some concerns, particularly among legal experts and those operating ethically within the behavioral health industry. One of the main issues lies in the vague language and unclear rules that can lead to unintended consequences.
Paul Gomez, a shareholder at law firm Polsinelli, pointed out in a recent webinar that the law’s broad language is problematic. For instance, traditionally accepted marketing practices, such as call center agreements, paid travel programs, and discounted patient copays, are now under scrutiny. These practices have long been common in the industry, and many ethical providers rely on them to reach potential patients and offer affordable services.
EKRA’s unclear definitions could potentially jeopardize these established practices. What was once considered a legitimate marketing expense or incentive might now be seen as a violation of the law. This has created a level of uncertainty, and many in the industry are questioning whether they will inadvertently violate the law while trying to operate within the boundaries of ethical treatment.
Furthermore, the ambiguity in EKRA’s language has raised concerns over non-medical addiction treatment facilities and private pay entities, which may not fall under the same regulations as medical facilities but could still face penalties. The uncertainty surrounding EKRA’s reach has left many providers unsure about how to comply with the law without unintentionally running afoul of it.
The EKRA Typo: A Potential Issue for Legal Clarity
One of the most pressing concerns about EKRA is the possibility of a significant typographical error in the legislation. During the webinar, Paul Gomez noted that EKRA contains a confusing statement regarding whether the law should apply to conduct that’s prohibited under the anti-kickback statute. The language reads that EKRA should not apply to conduct prohibited under the anti-kickback statute, but some legal experts believe that this may have been a drafting error.
The issue arises because some argue that the law should instead say that EKRA should not apply to conduct that is not prohibited under the anti-kickback statute or permitted under it. This confusion could have a massive impact on enforcement once the law begins to be enforced more rigorously, potentially leaving ethical providers in a difficult position.
EKRA’s Impact on the Behavioral Health Industry: A Double-Edged Sword
While EKRA aims to target unethical providers and improve patient outcomes, it has inadvertently placed ethical providers in a precarious position. The law’s broad language and lack of clarity have created uncertainty around what is acceptable in the marketing and operation of behavioral health care services.
The industry’s efforts to comply with the law and ensure that they are providing the best care for patients may be hampered by unnecessary restrictions and penalties. Many providers are worried that the same regulations designed to prevent fraud could also harm their ability to offer services effectively.
Furthermore, EKRA has complicated the ability for behavioral health providers to engage in practices that were once considered standard. Paid marketing, travel incentives, and discounting patient fees have been essential for some providers in creating access to services, and they may now be at risk of being caught in the law’s crossfire.
Moving Forward: Ensuring Fair and Effective Behavioral Health Care
As behavioral health care continues to evolve, it’s important to strike the right balance between protecting patients from exploitation and ensuring that legitimate providers have the flexibility they need to offer services effectively. EKRA’s intent to eliminate fraud and abuse is essential, but the law must be updated and clarified to avoid unintended consequences for ethical providers.
Moving forward, lawmakers and industry professionals need to work together to ensure that the legislation governing behavioral health care is clear, fair, and adequately tailored to the needs of the industry. As the demand for accessible, high-quality care increases, it is crucial that reforms like EKRA are implemented in a way that supports ethical providers and protects patients while still allowing for innovation and access in the behavioral health space.
In the meantime, behavioral health providers must stay vigilant, ensuring compliance with the law while continuing to advocate for clear and fair regulations that prioritize the well-being of those they serve.
