Bill Sponsors
J. Lombardi, Hull, Sanchez, Cruz, and Stewart
Committee
House Corporations
Summary
Select
This legislation, known as the "Patient Brokering Act," prohibits healthcare providers and facilities from engaging in "patient brokering." This means it denies them the ability to offer, pay, solicit, or receive any form of payment, bribe, or kickback in exchange for referring patients. The bill outlines specific exceptions for standard insurance practices and certain assisted living referrals. Violations of this act are classified as felonies and carry significant financial penalties ranging from $50,000 to $500,000, depending on the number of patients involved. The Attorney General is authorized to enforce these provisions.
Sponsor
Analysis
Pros for Progressives
- Protects vulnerable populations, particularly those seeking addiction treatment or mental health services, from being exploited as commodities by unscrupulous providers seeking profit over patient well-being.
- Combats systemic corruption within the healthcare industry by criminalizing predatory referral schemes, ensuring that medical recommendations are based on patient needs rather than financial kickbacks.
- Imposes substantial financial penalties on corporate entities and bad actors, discouraging profit-driven exploitation of the healthcare system and holding powerful institutions accountable.
Cons for Progressives
- Creates new felony offenses, expanding the carceral state and potentially contributing to mass incarceration rather than addressing the root causes of healthcare profiteering through administrative regulation.
- Includes exceptions for assisted living facilities to pay for referrals if the patient is not on Medicaid, potentially creating a two-tiered system where wealthier patients are marketed differently than low-income patients.
- The steep mandatory fines could disproportionately impact smaller, community-based clinics or providers who might accidentally violate technical referral rules, potentially forcing them to close.
Pros for Conservatives
- Strengthens the rule of law by cracking down on fraud and establishing severe felony penalties for those who attempt to cheat the system through bribery and kickbacks.
- Promotes fair market competition by ensuring that healthcare providers compete on the quality of their services rather than on illicit financial arrangements and paid referrals.
- Protects the financial integrity of the healthcare sector and insurance industry by reducing fraudulent claims and unnecessary costs associated with patient trafficking schemes.
Cons for Conservatives
- Increases government regulation over private business interactions and contracts, restricting how private entities can market their services and form financial partnerships.
- Grants the Attorney General broad powers to intervene in the healthcare market and sue private businesses, potentially leading to government overreach.
- Imposes excessively high fines (up to $500,000) that could be viewed as punitive government confiscation of private wealth and harmful to business viability.
Constitutional Concerns
None Likely
Impact Overview
Groups Affected
- Healthcare Providers
- Health Insurers
- Marketing Agencies
- Assisted Living Facilities
- Patients
Towns Affected
All
Cost to Taxpayers
None
Revenue Generated
Violators: $50,000 to $500,000 per offense
BillBuddy Impact Ratings
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Public Services
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Regulatory
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Clarity of Bill Language
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Bill Status
Current Status
Held
Comm Passed
Floor Passed
Law
History
• 01/15/2026 Introduced, referred to House Corporations
Bill Text
SECTION 1. Title 6 of the General Laws entitled "COMMERCIAL LAW -- GENERAL REGULATORY PROVISIONS" is hereby amended by adding thereto the following chapter: CHAPTER 13.4 PATIENT BROKERING ACT
6-13.4-1. Definitions.
The following words as used in this chapter, unless a different meaning is required by the context or is specifically prescribed, shall have the following meanings:
(1) "Health care provider" means any person or entity licensed, certified, or registered; required to be licensed, certified or registered; or lawfully exempt from being required to be licensed, certified or registered with the department of health; any person or entity that has contracted with the department of health to provide goods or services to Medicaid recipients pursuant to Rhode Island law; any provider of behavioral health care services provided by the department of behavioral health care, developmental disabilities and hospitals; or any federally supported primary care program authorized under 42 U.S.C. Chapter 6A, "Public Health Service."
(2) "Health care provider network entity" means a corporation, partnership, or limited liability company owned or operated by two (2) or more health care providers and organized for the purpose of entering into agreements with health insurers, health care purchasing groups, or the Medicare or Medicaid program.
(3) "Health insurer" means any insurance company authorized to transact health insurance in the state, any insurance company authorized to transact health insurance or casualty insurance in the state that is offering a minimum premium plan or stop-loss coverage for any person or entity providing health care benefits, any self-insurance plan as defined in title 27, any health maintenance organization, any prepaid health clinic, any prepaid limited health service organization, any multiple-employer welfare arrangement authorized to transact business in the state pursuant to title 27, or any fraternal benefit society lawfully providing health benefits to its members.
6-13.4-2. Patient brokering prohibited.
It is an unfair sales practice for any person, including any health care provider or health care facility, to:
(1) Offer or pay a commission, benefit, bonus, rebate, kickback, or bribe, directly or indirectly, in cash or in kind, or engage in any split-fee arrangement, in any form whatsoever, to induce the referral of a patient or patronage to or from a health care provider or health care facility;
(2) Solicit or receive a commission, benefit, bonus, rebate, kickback, or bribe, directly or indirectly, in cash or in kind, or engage in any split-fee arrangement, in any form whatsoever, in return for referring a patient or patronage to or from a health care provider or health care facility;
(3) Solicit or receive a commission, benefit, bonus, rebate, kickback, or bribe, directly or indirectly, in cash or in kind, or engage in any split-fee arrangement, in any form whatsoever, in return for the acceptance or acknowledgement of treatment from a health care provider or health care facility; or
(4) Aid, abet, advise, or otherwise participate in the conduct prohibited under this section.
6-13.4-3. Exceptions.
This chapter shall not apply to:
(1) Any discount, payment, waiver of payment, or payment practice not prohibited by 42 U.S.C. § 1320a-7b(b) or regulations promulgated thereunder.
(2) Any payment, compensation, or financial arrangement within a group practice, provided such payment, compensation, or arrangement is not to or from persons who are not members of the group practice.
(3) Payments to a health care provider or health care facility for professional consultation services.
(4) Commissions, fees, or other remuneration lawfully paid to insurance agents as provided under title 27.
(5) Payments by a health insurer who reimburses, provides, offers to provide, or administers health, mental health, or substance abuse goods or services under a health benefit plan. LC003761 - Page 2 of 5
(6) Payments to or by a health care provider or health care facility, or a health care provider network entity, that has contracted with a health insurer, a health care purchasing group, or the Medicare or Medicaid program to provide health, metal health, or substance abuse goods or services under a health benefit plan when such payments are for goods or services under the plan; provided however, that nothing in this section shall affect whether a health care provider network entity is an insurer required to be licensed under Rhode Island law.
(7) Insurance advertising gifts lawfully permitted under title 27.
(8) When applicable, commissions or fees paid to a nurse registry licensed pursuant to the department of health for referring persons providing health care services to clients of the nurse registry.
(9) Payments by a health care provider or health care facility to a health, mental health, or substance abuse information service that provides information upon request and without charge to consumers about providers of health care goods or services to enable consumers to select appropriate providers or facilities, provided that, such information service:
(i) Does not attempt through its standard questions for solicitation of consumer criteria or through any other means to steer or lead a consumer to select or consider selection of a particular health care provider or health care facility;
(ii) Does not provide or represent itself as providing diagnostic or counseling services or assessments of illness or injury and does not make any promises of cure or guarantees of treatment;
(iii) Does not provide or arrange for transportation of a consumer to or from the location of a health care provider or health care facility; and
(iv) Charges and collects fees from a health care provider or health care facility participating in its services that are set in advance, are consistent with the fair market value for those information services, and are not based on the potential value of a patient or patients to a health care provider or health care facility or of the goods or services provided by the health care provider or health care facility.
(10) An individual employed by the assisted living facility, or with whom the facility contracts to provide marketing services for the facility, if the individual clearly indicates that they work with or for the facility.
(11) Payments by an assisted living facility to a referral service that provides information, consultation, or referrals to consumers to assist them in finding appropriate care or housing options for seniors or disabled adults if the referred consumers are not Medicaid recipients.
(12) A resident of an assisted living facility who refers a friend, family members, or other individuals with whom the resident has a personal relationship to the assisted living facility, in LC003761 - Page 3 of 5 which case the assisted living facility may provide a monetary reward to the resident for making such referral.
6-13.4-4. Penalties - Enforcement.
(a) Any person, including an officer, partner, agent, attorney or other representative of a firm, joint venture, partnership, business trust, syndicate, corporation, or other business entity, who violates any provision of this chapter commits a felony and shall, in addition to any criminal sentence imposed, be ordered to pay a fine of fifty thousand dollars ($50,000) for a violation involving fewer than ten (10) patients; one hundred thousand dollars ($100,000) for a violation involving between ten (10) and fewer than twenty (20) patients; and five hundred thousand dollars ($500,000) for any violation where the prohibited conduct involves twenty (20) or more patients.
(b) Notwithstanding the existence or pursuit of any other remedy, the Rhode Island attorney general may maintain an action for injunctive or other process to enforce the provisions of this chapter.
(c) The party bringing an action under this chapter may recover reasonable expenses in obtaining injunctive relief, including, but not limited to, investigative costs, court costs, reasonable attorneys' fees, witness costs, and deposition expenses.
(d) The provisions of this chapter are in addition to any other civil, administrative, or criminal actions provided by law and may be imposed against both corporate and individual defendants.
SECTION 2. This act shall take effect upon passage.
6-13.4-1. Definitions.
The following words as used in this chapter, unless a different meaning is required by the context or is specifically prescribed, shall have the following meanings:
(1) "Health care provider" means any person or entity licensed, certified, or registered; required to be licensed, certified or registered; or lawfully exempt from being required to be licensed, certified or registered with the department of health; any person or entity that has contracted with the department of health to provide goods or services to Medicaid recipients pursuant to Rhode Island law; any provider of behavioral health care services provided by the department of behavioral health care, developmental disabilities and hospitals; or any federally supported primary care program authorized under 42 U.S.C. Chapter 6A, "Public Health Service."
(2) "Health care provider network entity" means a corporation, partnership, or limited liability company owned or operated by two (2) or more health care providers and organized for the purpose of entering into agreements with health insurers, health care purchasing groups, or the Medicare or Medicaid program.
(3) "Health insurer" means any insurance company authorized to transact health insurance in the state, any insurance company authorized to transact health insurance or casualty insurance in the state that is offering a minimum premium plan or stop-loss coverage for any person or entity providing health care benefits, any self-insurance plan as defined in title 27, any health maintenance organization, any prepaid health clinic, any prepaid limited health service organization, any multiple-employer welfare arrangement authorized to transact business in the state pursuant to title 27, or any fraternal benefit society lawfully providing health benefits to its members.
6-13.4-2. Patient brokering prohibited.
It is an unfair sales practice for any person, including any health care provider or health care facility, to:
(1) Offer or pay a commission, benefit, bonus, rebate, kickback, or bribe, directly or indirectly, in cash or in kind, or engage in any split-fee arrangement, in any form whatsoever, to induce the referral of a patient or patronage to or from a health care provider or health care facility;
(2) Solicit or receive a commission, benefit, bonus, rebate, kickback, or bribe, directly or indirectly, in cash or in kind, or engage in any split-fee arrangement, in any form whatsoever, in return for referring a patient or patronage to or from a health care provider or health care facility;
(3) Solicit or receive a commission, benefit, bonus, rebate, kickback, or bribe, directly or indirectly, in cash or in kind, or engage in any split-fee arrangement, in any form whatsoever, in return for the acceptance or acknowledgement of treatment from a health care provider or health care facility; or
(4) Aid, abet, advise, or otherwise participate in the conduct prohibited under this section.
6-13.4-3. Exceptions.
This chapter shall not apply to:
(1) Any discount, payment, waiver of payment, or payment practice not prohibited by 42 U.S.C. § 1320a-7b(b) or regulations promulgated thereunder.
(2) Any payment, compensation, or financial arrangement within a group practice, provided such payment, compensation, or arrangement is not to or from persons who are not members of the group practice.
(3) Payments to a health care provider or health care facility for professional consultation services.
(4) Commissions, fees, or other remuneration lawfully paid to insurance agents as provided under title 27.
(5) Payments by a health insurer who reimburses, provides, offers to provide, or administers health, mental health, or substance abuse goods or services under a health benefit plan. LC003761 - Page 2 of 5
(6) Payments to or by a health care provider or health care facility, or a health care provider network entity, that has contracted with a health insurer, a health care purchasing group, or the Medicare or Medicaid program to provide health, metal health, or substance abuse goods or services under a health benefit plan when such payments are for goods or services under the plan; provided however, that nothing in this section shall affect whether a health care provider network entity is an insurer required to be licensed under Rhode Island law.
(7) Insurance advertising gifts lawfully permitted under title 27.
(8) When applicable, commissions or fees paid to a nurse registry licensed pursuant to the department of health for referring persons providing health care services to clients of the nurse registry.
(9) Payments by a health care provider or health care facility to a health, mental health, or substance abuse information service that provides information upon request and without charge to consumers about providers of health care goods or services to enable consumers to select appropriate providers or facilities, provided that, such information service:
(i) Does not attempt through its standard questions for solicitation of consumer criteria or through any other means to steer or lead a consumer to select or consider selection of a particular health care provider or health care facility;
(ii) Does not provide or represent itself as providing diagnostic or counseling services or assessments of illness or injury and does not make any promises of cure or guarantees of treatment;
(iii) Does not provide or arrange for transportation of a consumer to or from the location of a health care provider or health care facility; and
(iv) Charges and collects fees from a health care provider or health care facility participating in its services that are set in advance, are consistent with the fair market value for those information services, and are not based on the potential value of a patient or patients to a health care provider or health care facility or of the goods or services provided by the health care provider or health care facility.
(10) An individual employed by the assisted living facility, or with whom the facility contracts to provide marketing services for the facility, if the individual clearly indicates that they work with or for the facility.
(11) Payments by an assisted living facility to a referral service that provides information, consultation, or referrals to consumers to assist them in finding appropriate care or housing options for seniors or disabled adults if the referred consumers are not Medicaid recipients.
(12) A resident of an assisted living facility who refers a friend, family members, or other individuals with whom the resident has a personal relationship to the assisted living facility, in LC003761 - Page 3 of 5 which case the assisted living facility may provide a monetary reward to the resident for making such referral.
6-13.4-4. Penalties - Enforcement.
(a) Any person, including an officer, partner, agent, attorney or other representative of a firm, joint venture, partnership, business trust, syndicate, corporation, or other business entity, who violates any provision of this chapter commits a felony and shall, in addition to any criminal sentence imposed, be ordered to pay a fine of fifty thousand dollars ($50,000) for a violation involving fewer than ten (10) patients; one hundred thousand dollars ($100,000) for a violation involving between ten (10) and fewer than twenty (20) patients; and five hundred thousand dollars ($500,000) for any violation where the prohibited conduct involves twenty (20) or more patients.
(b) Notwithstanding the existence or pursuit of any other remedy, the Rhode Island attorney general may maintain an action for injunctive or other process to enforce the provisions of this chapter.
(c) The party bringing an action under this chapter may recover reasonable expenses in obtaining injunctive relief, including, but not limited to, investigative costs, court costs, reasonable attorneys' fees, witness costs, and deposition expenses.
(d) The provisions of this chapter are in addition to any other civil, administrative, or criminal actions provided by law and may be imposed against both corporate and individual defendants.
SECTION 2. This act shall take effect upon passage.