In a press release issued last month, the Department of Justice announced its first criminal prosecution under the Eliminating Kickback in Recovery Act (EKRA).  Defendant Theresa Merced – who is 80 years old – pled guilty and admitted to soliciting kickbacks from a toxicology lab in exchange for referring urine drug tests to the lab.  Sentencing is scheduled for May 1, 2020. 

Merced, the office manager of a substance abuse treatment clinic, accepted a $4,000 check and promised inducements from the CEO of toxicology lab in exchange for Merced referring the clinic’s urine drug tests to the lab.  When asked by law enforcement agents about the check, Merced denied knowing anything about it and opined that it was a loan from the lab CEO to her husband. After her interview with the agents, Merced telephoned the lab CEO and requested he change the lab’s financial records to corroborate the story she told to law enforcement.  Merced subsequently pled guilty to one count of violating EKRA, one count of making false statements, and one count of attempted tampering with records. 

EKRA is a criminal statute that was passed in 2018 as part of a broader congressional effort to address the opioid crisis.  Subject to some exceptions, EKRA makes it a crime to knowingly and willingly: 

  1. Solicit or receive any remuneration in return for referring a patient to a recovery home, clinical treatment facility, or laboratory; or 
  2. Pay or offer any remuneration 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. 

Each individual violation of EKRA is punishable by up $200,000 fine, 10 years in jail, or both. EKRA is broad and applies to all clinical laboratory services, not just those related to substance abuse treatment.  Moreover, although EKRA similar to the Anti-Kickback Statute (AKS), EKRA applies to both commercial/private and federal healthcare programs. 

This prosecution telegraphs DOJ’s focus on prosecuting criminal behavior under EKRA.  To read more about EKRA, the differences between EKRA and the AKS, as well as this prosecution, please read Chilivis Grubman partner Scott Grubman’s recent article on the topic, published in the AHLA Weekly, by clicking here.

The attorneys at Chilivis Grubman represent individuals and businesses who are being investigated for, or charged with, healthcare-related crimes.  If you need assistance with such a matter, please contact us today.