Is it legal to pay addiction treatment admissions staff per admission?

No. The federal Eliminating Kickbacks in Recovery Act, 18 U.S.C. section 220, makes it a crime to pay remuneration to induce referrals to a recovery home, treatment facility or laboratory, with penalties up to ten years in prison and a $200,000 fine per occurrence. EKRA has an employee compensation exception, but it only protects payments not determined by the volume of referrals or the amount billed.

How do rehab referral services make money?

Lead generators sell phone calls and web form submissions to treatment facilities, commonly at $20 to $40 per routed call, funded by search advertising where clicks have cost upwards of $90 and Google's suggested minimum bid for some rehab terms reached $187. Patient brokers have been federally prosecuted for taking per patient payments from facilities.

Going deeper

How the money works.

This page is for people who want to understand the incentives. If you are looking for help right now, start with choosing a center or just message us instead.

Before you read this

Most people working in treatment got into it because they care, and plenty of programs operate honestly. This is not an argument against getting help.

It is here because understanding how a system is paid tells you a lot about how it behaves, and because families who have been burned deserve to know they were not imagining it.

What the law says

In 2018 Congress passed the Eliminating Kickbacks in Recovery Act, EKRA. It made it a federal crime to pay or receive anything to induce a referral to a recovery home, a treatment facility or a lab. Up to ten years in prison and a $200,000 fine per occurrence. It covers private insurance, which the older federal Anti Kickback Statute did not. Florida, Georgia, California, New York, Tennessee and Utah have their own patient brokering laws.

What the record shows

EKRA has an employee compensation exception. It protects payments that are not determined by the volume of referrals or by the amount billed. That clause is where everything turns. 18 U.S.C. 220

The structure that gets used

You cannot write a check that says a set amount per admission. So a person goes on salary, which is an employee payment, which is excepted.

Then the salary gets renegotiated. Every month or two. Three at the outside. And the number that drives the renegotiation is how many admissions that person brought in.

From my own experience

Everybody inside knows what that arrangement is. It is built so that on paper it reads as a salary and in practice it works as a per head payment with a delay in it.

Same for business development. Same for the outreach coordinators. The title changes, the compensation logic does not.

And those photos of reps from two facilities meeting up, captioned about how they discussed serving the recovery community, are usually referral conversations. How many each side sends the other, what insurance they want, what each expects back.

What the record shows

Federal prosecutors have charged this. In the Casey Mahoney case, an EKRA conviction, the contracts recited fixed fees, but DOJ established the payments were actually negotiated based on the patients' insurance reimbursements and the number of days Mahoney was able to bill. He paid roughly $2.9 million to referral brokers. DOJ

DOJ has separately described kickbacks structured as recurring monthly payments per patient, with the patient's value set by their insurance type. DOJ

In 2025 the Ninth Circuit issued the first appellate ruling on EKRA, holding that it reaches marketing intermediaries, while declining to make percentage based marketing compensation automatically illegal. Analysis

The rest of it

What the record shows

Phone calls are a product with a price. Congressional oversight documented call centers charging facilities $20 to $40 per routed call, facilities paying upwards of $90 per click on search ads, and Google's suggested minimum bid for "drug rehab locations" reaching $187 per click. The same memo documented facilities running unbranded websites posed as neutral directories. House Energy and Commerce

Urine testing carries a lot of the margin. A basic dipstick screen historically cost as little as $5. Oversight documented clinics charging over $4,000 for a single test. In one prosecution a patient tested eleven times in about a month generated over $488,000 in billing. Philadelphia Inquirer

Cycling has been charged directly. In a $112 million case, DOJ established operators moved a core group of patients between facilities to maximize billing. In another, drugs were supplied to patients whose benefits were running out so a documented relapse would restart coverage. Those are convictions, not allegations. DOJ · DOJ

What to do with this

Not distrust everybody. Just know what to ask. When you know admissions comp often tracks admissions, you understand the warmth and the urgency. When you know handoffs can follow relationships, you know to ask for options.

None of that means a place is bad. It means ask the questions.

The questions to ask What we actually do

Sources for this page

Eliminating Kickbacks in Recovery Act, 18 U.S.C. section 220. Source
US Department of Justice, conviction of Casey Mahoney under EKRA, September 2024. Source
US Department of Justice, Central District of California, Sober Homes Initiative case announcements, December 16, 2021. Source
United States v. Schena, US Court of Appeals for the Ninth Circuit, July 2025, first appellate decision interpreting EKRA. Source
US House Energy and Commerce, Subcommittee on Oversight and Investigations, Majority Memorandum, July 20, 2018. Source
Jeremy Roebuck, Philadelphia Inquirer, December 9, 2019. Source
US Department of Justice, conviction of Compass Detox and WAR Network operators in a $112 million scheme. Source
US Department of Justice, Southern District of Florida, sentencing of Kenneth Chatman, May 17, 2017. Source
Florida Statutes section 817.505, the Patient Brokering Act. Source

All public record. We link it so you can check us.