What's happening
This bill prohibits providers of substance use disorder services from paying or receiving payments for patient referrals, with certain exceptions and enforcement provisions.
Why it matters
Closes loopholes on "patient brokering". by clearly defining what counts as an illegal payment or benefit for referring individuals to substance use disorder treatment, aiming to curb exploitative practices that can prioritize profit over patient care.
Establishes criminal penalties. (misdemeanor charges) for both individuals and organizations that engage in prohibited referral payment schemes, increasing the legal risks and deterrents for unethical providers.
Includes safeguards for legitimate business practices. by explicitly exempting lawful insurer payments, certain marketing activities (with transparency requirements), and actions permitted under federal law, so as not to disrupt normal operations or patient access.
Empowers state oversight and enforcement. by granting investigative and regulatory authority to the commissioner, and allowing for rules to adapt over time—potentially improving accountability and ongoing protection for vulnerable patients.
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Who cares
Headline styles
Ban Kickbacks for Rehab Referrals
Plain English, a few words. Used as the page title.
Sponsors
18 Co-sponsors
1 Multi-sponsor
History
- Signed chap.223
- Delivered to governor
- Returned to assembly
- Passed senateVote 62–0
- 3rd reading cal.251
- Substituted for S6544B
- Referred to rules
- Delivered to senate
- Passed assembly
- Ordered to third reading rules cal.160
- Rules report cal.160
- Reported
Show 6 earlier actions
- Reported referred to rules
- Print number 7689a
- Amend (t) and recommit to codes
- Referred to codes
- Reported referred to codes
- Referred to alcoholism and drug abuse
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Ban Kickbacks for Rehab Referrals
Senate Floor Calendar · Sponsor Fredrick J. Akshar II
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
7689--A
2017-2018 Regular Sessions
IN ASSEMBLY
May 9, 2017
Introduced by M. of A. L. ROSENTHAL, D'URSO, THIELE, SKOUFIS, CUSICK -read once and referred to the Committee on Alcoholism and Drug Abuse -- reported and referred to the Committee on Codes -- recommitted to the Committee on Codes in accordance with Assembly Rule 3, sec. 2 -committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee
AN ACT to amend the mental hygiene law, in relation to prohibited practices by providers of substance use disorder services
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The mental hygiene law is amended by adding a new section 32.06 to read as follows: § 32.06 Prohibited practices by providers of substance use disorder
services.
1. For purposes of this section, unless the context clearly requires otherwise, "provider" shall mean any person, firm, partnership, group, practice association, fiduciary, employer, representative thereof or any other entity who is providing or purporting to provide substance use disorder services. Provided, however, that "provider" shall not include a person receiving substance use disorder services from the provider.
2. No provider shall intentionally solicit, receive, accept or agree to receive or accept any payment, benefit or other consideration in any form to the extent such payment, benefit or other consideration is given for the referral of a person as a potential patient for substance use disorder services.
3. No provider providing or purporting to provide substance use disorder services pursuant to this chapter, shall intentionally make, offer, give, or agree to make, offer, or give any payment, benefit or other consideration in any form to the extent such payment, benefit or other consideration is given for the referral of a person as a potential patient for substance use disorder services.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
A LBD10119-04-8
A. 7689--A 2
4. This section shall not apply to any:
(a) lawful payments by a health maintenance organization or health insurer, operating in accordance with article thirty-two or forty-three of the insurance law or article forty-four of the public health law on behalf of their enrollees for such substance use disorder services or other benefits required to be provided;
(b) lawful payments to or by a provider to a health maintenance organization or health insurer operating in accordance with article thirtytwo or forty-three of the insurance law or article forty-four of the public health law, as payment for services provided, a refund for an overpayment, a participating provider fee, or any similar remuneration;
(c) provider for an activity that, at the time of such activity, would have been lawful as specifically exempt, or otherwise not prohibited, under any federal statute or regulations, including but not limited to 42 U.S.C. § 1320a-7b (b) or the regulations promulgated thereunder, if conducted by a person, firm, partnership, group, practice, association, fiduciary, employer representative thereof or any other entity providing substance use disorder services;
(d) any employee or representative of a provider who is conducting marketing activities, where the employee or representative identifies the provider represented or for whom or which the employee or representative works, identifies that the employee or representative is a marketer and not a clinician or other individual who can provide diagnostic, counseling or assessment services, and such marketing activities are limited to educating the potential patient about the program with no effort to steer or lead the potential patient to select or consider selection of the substance use disorder services provider represented or for whom or which the employee or representative works; or
(e) commissions, fees or other remuneration lawfully paid to insurance agents as provided under the insurance law.
5. Any provider who intentionally violates the provisions of subdivision two or three of this section shall be guilty of a misdemeanor as defined in the penal law.
6. If the commissioner has reason to believe a provider has violated subdivision two or three of this section, the commissioner may proceed to investigate and institute enforcement actions, as may be authorized pursuant to the applicable provisions of this article.
7. The provisions of this section are in addition to any other civil, administrative or criminal enforcement actions provided by law. Penalties authorized under this section may be imposed against corporate providers and individual providers.
8. The commissioner shall adopt and may amend rules and regulations to effectuate the provisions of this section.
§ 2. This act shall take effect on the sixtieth day after it shall have become a law.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.