Acting Governor Way signs bills to crack down on deceptive addiction treatment practices in New Jersey

TRENTON, N.J. — Acting Gov. Tahesha Way on Monday signed two bills aimed at protecting people seeking addiction treatment from being misled, exploited, or referred for profit, measures that state leaders say will strengthen accountability in the substance use treatment industry and ensure care decisions are based on clinical need rather than financial gain.

“It is important to protect individuals dealing with addiction,” Way said. “We must ensure proper treatment without exploitation by holding providers accountable and implementing strong safeguards. Too often, vulnerable people are targeted by those who prioritize profit over care, which is unacceptable.”

The first bill (A3973/S3952) revises existing law on patient referrals to substance use disorder treatment facilities, recovery residences, and clinical laboratories. It reclassifies patient brokering from a fourth-degree to a third-degree crime, imposes mandatory $50,000 fines per violation, and requires restitution to affected patients or insurers. Inspired by a New Jersey State Commission of Investigation (SCI) report, the measure targets “patient brokering,” where individuals or entities accept kickbacks to steer people into treatment centers for financial reasons instead of quality of care. It applies to both for-profit and nonprofit health care facilities, as well as recovery residences like sober living homes.

The second bill (A3974/S3955) prohibits deceptive marketing by addiction treatment providers, requiring that all advertising be accurate, complete, and transparent about the services offered, their location, and the provider’s identity and affiliations. It authorizes the Department of Health and the Department of Community Affairs to investigate violations and impose civil penalties of up to $20,000 per offense.

“It is critical that laws are in place to protect individuals and families when they are at their most vulnerable – like when seeking recovery help from drug and alcohol addiction,” said Department of Community Affairs Commissioner Jacquelyn A. Suárez. “DCA’s Division of Codes and Standards works to ensure that violators will be held accountable and penalized for misdeeds.”

“New Jersey is sending a clear message that we will not tolerate predatory practices toward individuals seeking treatment for substance use disorder,” said Department of Health Acting Commissioner Jeff Brown. “It’s critical that New Jersey’s health care facilities serving these individuals advertise their services honestly and truthfully. When they don’t, they should be held accountable.”

“Today’s bill signings represent a major step forward in protecting individuals and families seeking help for substance use disorders,” Human Services Commissioner Sarah Adelman said. “By strengthening oversight and eliminating deceptive marketing practices, we are ensuring that New Jersey residents can access care that is ethical, transparent, and effective. These laws reflect our unwavering commitment to supporting recovery with dignity and integrity, while holding providers to the highest standards of accountability.”

Attorney General Matthew J. Platkin said, “Successful treatment for substance-use disorders depends on honest providers and professionals who refer patients to the providers most suited to their needs. These bills strengthen our ability to go after providers who make false claims about their treatment and those who would undermine a vulnerable person’s chances for recovery by exploiting the situation for kickbacks and other forms of illicit profit.”

“People seeking help for substance use disorder deserve honesty, transparency, and dignity,” said New Jersey Public Defender Jennifer Sellitti. “Deceptive marketing tactics exploit individuals and families during their most vulnerable moments. This legislation represents a crucial step toward holding treatment providers and recovery residences to the highest ethical standards, ensuring that people can trust the care and support they seek.”

“These bills are a positive step for those citizens of our State who suffered from the type of shortcomings in the addiction rehabilitation industry SCI uncovered,” said Bruce Keller, SCI’s executive director. “They also underscore the importance of SCI’s work in ensuring New Jersey maintains its reputation as a state readily capable of legislative reforms when problems are brought to light.”

According to the Department of Human Services, 44,350 patients were admitted for substance use treatment in 2023. State officials say these laws safeguard vulnerable residents by promoting honesty and transparency in the addiction treatment industry.

Anyone struggling with drug addiction is encouraged to call 1-844-ReachNJ, a 24/7 helpline offering free, confidential support.