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Two important lessons from EKRA cases in 2022

Lawmakers initially enacted the Eliminating Kickbacks Recovery Act (EKRA) four years ago as part of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (SUPPORT Act). Although touted by Congress as a law to help address the growing opioid crisis, critics voiced concern the overly broad language within the law could pose unintended problems for clinical and diagnostic labs.

We now know EKRA does more than simply address the over-prescription of opioid medications. It essentially makes it illegal to receive or offer any remuneration in exchange for a referral to a clinical laboratory whether opioids are involved or not. The law defines remuneration as a kickback, bribe, or rebate. Criminal penalties for a violation are harsh. The law allows up to $200,000 in financial penalties and 10 years imprisonment.

How has the Department of Justice applied this law?

Thus far, the DOJ appears to use the broad language to their benefit. One of the more recent cases, US v Malena Badon Lepetich, provides an example of how the government could use EKRA in cases that do not involve opioids or toxicology. In this case, the DOJ accused the owner of a clinical laboratory of filing fraudulent charges for COVID-19 testing. They also claim the owner solicited and received bribes for respiratory testing and medically unnecessary urine testing. We will provide updates on the case as they become available.

What does this case mean for clinical labs throughout the country?

The DOJ’s indictment of the lab owner shows us two things:

  • The DOJ will use a broad interpretation of EKRA to build a case against lab owners.
  • This can include allegations of fraud related to COVID-19 testing.

As such, lab owners are wise to carefully review their practices to better ensure they are in line with EKRA and other applicable regulations. The case also shows us that those who face an investigation or allegations of an EKRA violation are wise to take the matter seriously. The DOJ is likely to aggressively pursue the matter.

Attorney John Rivas is responsible for this communication