SENATE BUDGET AND APPROPRIATIONS COMMITTEE

STATEMENT TO

[Second Reprint]

ASSEMBLY, No. 3974

with committee amendments

STATE OF NEW JERSEY

DATED:  MARCH 17, 2025

      The Senate Budget and Appropriations Committee reports favorably and with committee amendments Assembly Bill No. 3974 (2R).

      As amended, this bill prohibits the use of deceptive marketing practices by substance use disorder treatment providers and recovery residences.

      The bill requires each treatment provider and recovery residence in the State to provide accurate and complete information, in plain language, on the types and methods of services provided, the location in which services are provided, and the treatment provider’s or recovery residence’s name and brand name, phone number, mailing address, and business location address when publishing or disseminating any marketing or advertising materials.

      Under this bill, it will be an unlawful practice for a treatment provider or a recovery residence, as applicable, to:

      (1) make a false or misleading statement about the treatment provider’s or recovery residence’s status as an in-network or out-of-network provider;

      (2) provide, or direct any other person or entity to provide, false or misleading information about the identity of, or contact information for, any treatment provider or recovery residence;

      (3) include any false or misleading information about the Internet address of any treatment provider’s or recovery residence’s website, or to surreptitiously direct or redirect a person to another website;

      (4) suggest or imply that an affiliation with another treatment provider or recovery residence exists, unless the other treatment provider or recovery residence has provided express, written consent to indicate that affiliation;

      (5) make a false or misleading statement about the substance use disorder treatment services the treatment provider or recovery residence provides; or

      (6) make a false or misleading statement about the geographic location of the treatment provider or recovery residence, or the geographic location in which the treatment provider or recovery residence provides substance use disorder treatment services.

      Any treatment provider or recovery residence that violates the provisions of this bill will be liable to a civil penalty of not more than $20,000 for each violation.  Any person who suffers any injury or damages as a result of the use or employment by a treatment provider or recovery residence of any method, act, or practice declared unlawful under the bill may bring an action or assert a counterclaim therefor in any court of competent jurisdiction.  The court will, in addition to any appropriate legal or equitable relief, award threefold the damages sustained by any person in interest and award reasonable attorney fees, filing fees, and reasonable costs of suit.

      The Office of Licensing in the Department of Health may investigate alleged violations of this bill.  Upon finding a violation, the division may suspend or revoke the treatment provider’s license or certification, if applicable, or may impose a civil penalty against the treatment provider.  If the department imposes a civil penalty, the civil penalty will not be more than $20,000 for each violation.

      The Department of Community Affairs may investigate recovery residences for alleged violations and upon a finding of a violation, the Department of Community Affairs may suspend or revoke the recovery owner’s license or certification, if applicable, or may impose a civil penalty against the recovery residence owner.  The civil penalty would not be more than $20,000 per violation.

      As amended and reported by the committee, Assembly Bill No. 3974 (2R) is identical to Senate Bill No. 3955 (1R), which was also amended and reported by the committee on this date.

COMMITTEE AMENDMENTS:

      The committee amendments remove the definition of the term “affiliation.”  As used in this bill, the term is given the ordinary meaning of the word.  The amendments change the definition of the term “recovery residence” to mean a boarding house licensed by the Department of Community Affairs which provides a sober living environment and alcohol- and drug-free living accommodations to individuals with substance use disorders, or to individuals with co-occurring mental health and substance use disorders, but which does not provide clinical treatment services for mental health or substance use disorders.  The amendments also change the definition of “treatment provider” to mean a facility licensed in accordance with section 8 of P.L.1975, c.305 (C.26:2B-14) for substance use disorder treatment or services, or a substance use disorder treatment facility issued a certificate of approval pursuant to P.L.1970, c.334 (C.26:2G-21 et seq.).

      Additionally, the Department of Community Affairs may investigate recovery residences for alleged violations and upon a finding of a violation, the Department of Community Affairs may suspend or revoke the recovery residence owner’s license or certification, if applicable, or may impose a civil penalty against the recovery residence owner.  The civil penalty would not be more than $20,000 per violation

      Lastly, the committee amendments make certain technical corrections.

FISCAL IMPACT:

      Fiscal information for this bill is currently unavailable.