New Rehab Fraud Act Demands Federal Reports on Patient Dumping, Insurance Scams, and Illegal Tactics

The Protecting Patients from Rehab Fraud Act of 2025 is kicking off its mission by demanding a deep dive into the messy, often exploitative world of drug addiction treatment. Essentially, this bill says, “Before we write new rules, let’s figure out exactly how bad the fraud problem is.” It mandates two major federal reports, both due to Congress within one year of the law’s enactment, targeting the worst practices in the industry.

The Real-World Cost of Rehab Scams

If you or someone you know has looked for addiction treatment, you know it’s a minefield. This bill zeroes in on the most predatory behaviors that cost taxpayers, insurance companies, and, most importantly, vulnerable patients. It’s not just about bad facilities; it’s about outright fraud and abuse. The reports are designed to expose the scope of these issues so Congress can finally draft targeted legislation, moving beyond anecdotal evidence to hard data.

The Attorney General’s Deep Dive: Exposing the Predators

One of the most critical sections requires the Attorney General (AG) to deliver a report detailing the scope of illegal activities. This isn't a light review; it’s a mandate to find the numbers on things like patient brokering—where entities use illegal tactics to lure people into facilities—and insurance fraud, particularly in plans offered through the Affordable Care Act Exchange. Think of “patient brokering” as a bounty system: recruiters get paid to find patients, often pushing them toward high-cost, out-of-network plans, sometimes even encouraging patients to commit fraud to enroll.

The AG must also report on the chilling practice of “patient dumping” or “curbing.” This happens when a facility removes and abandons a patient the moment their insurance stops paying. The bill specifically asks for data on how often patients are dumped in locations far from where they came from and research on the link between being dumped and later homelessness or relapse. For the average family trying to get help for a loved one, these provisions are key: they aim to stop facilities from treating patients like commodities.

The Comptroller General’s Audit: Following the Money and the Law

The second required report comes from the Comptroller General of the United States (CG), focusing on government response and spending. The CG must detail what the Secretary of Health and Human Services (HHS) and state governments are currently doing to curb this insurance fraud. This is the accountability check, assessing the effectiveness of existing federal spending on rehabilitation facilities. If millions are being spent but fraud is rampant, this report will show where the gaps are, making sure future policy isn't just throwing good money after bad. Both reports must conclude with concrete recommendations for Congress to crack down on these illegal practices and better protect prospective patients.