Bass, Berry & Sims attorney Danielle Sloane commented on a recent Ninth Circuit ruling clarifying a 2018 law that prohibits kickbacks for referring patients to medical testing labs and addiction treatment centers under the Eliminating Kickbacks in Recovery Act (EKRA).
“The ruling seems quite significant,” Danielle told Law360. “For the first time in a criminal case, a circuit court has thoughtfully analyzed EKRA and concluded convincingly that violating EKRA requires more than paying a commission alone.” She added, the ruling “requires paying a commission combined with inappropriate marketing,”
The ruling provides some clarity for laboratories and substance abuse treatment providers. “This opinion will likely give a lot of labs, particularly smaller labs that have historically not felt like they had the financial capacity to take risks, more confidence to reinstate commissions along with strong compliance infrastructure,” said Danielle.
In addition to any state-level kickback laws, “Labs and substance abuse providers should be careful to avoid pushing tests or services for purposes that go beyond payor coverage policies, particularly without credible support like a peer-reviewed study,” she said.
The full article, “9th Circ. Clarifies Kickback Boundaries For Referral Bonuses,” was published by Law360 on July 29 and is available online.