Ethics in Sober Living and the Law, Part 2

Senate Bill 4015: Raising the Bar for Recovery Housing — and Why Some Providers Quietly Oppose It

In June 2025, the New Jersey Senate passed Bill S4015, a long-awaited piece of legislation aimed at bringing greater oversight to recovery housing in the state. The bill grants the Department of Human Services (DHS) clear authority to license, inspect, and regulate sober living homes and halfway houses — something advocates have been requesting for years.

At Midway House of NJ, we welcome this change. We've long believed that stronger regulation — done thoughtfully — can help protect residents, elevate standards, and ensure that recovery housing stays focused on recovery. But as the dust settles, it’s also worth taking a closer look at why this bill matters — and why it’s generating quiet concern in some corners of the treatment world.

What Senate Bill 4015 Actually Does

This bill doesn’t just reaffirm that sober living homes should meet health and safety standards — it also introduces a number of specific requirements aimed at preventing fraud and exploitation in aftercare housing:

• Licensing of all recovery housing facilities through DHS

• Criminal background checks for owners, administrators, and key staff

• A centralized online registry of open beds, updated daily

• Stronger accountability for providers involved in both housing and treatment services

These changes are a direct response to years of reported abuses — including financial exploitation, “patient brokering,” and bait-and-switch housing schemes that have surfaced not just in New Jersey, but nationwide.

A Delicate Reality: Where Housing and Treatment Overlap

To be clear: many treatment centers that offer affiliated housing do so with integrity and a genuine commitment to client wellbeing. In fact, Midway House partners with numerous providers across New Jersey who refer clients to us when their in-house options are full, unsuitable, or when a more independent living arrangement is appropriate. These relationships are essential to long-term recovery.

However, the reality is that the business model of dual provider-housing arrangements creates natural pressure points. When housing is bundled with treatment — and particularly when it’s tied to insurance billing — financial incentives can unintentionally overshadow recovery goals.

This is where issues often arise:

• Clients are promised free or low-cost housing while they’re enrolled in IOP or other services.

• Once insurance runs out or the client steps down from care, rent jumps significantly, sometimes with little warning.

• Some providers prioritize occupancy over fit, placing clients into housing environments that may not align with their clinical or personal needs.

Again, not every provider operates this way, and many strive to avoid these pitfalls. But the structure of the system can unintentionally set the stage for ethical gray areas — and that’s precisely what S4015 is designed to address.

Why Licensing Matters — and What Ethical Providers Already Do

For homes like Midway House of NJ, S4015 is simply a formalization of standards we've held ourselves to for years. We’ve never relied on treatment billing, kickbacks, or bundled arrangements. Our residents pay a fixed, transparent rent, and our operations are fully separate from any treatment center.

Licensing ensures:

• Background checks are conducted on those running sober homes — which adds a layer of accountability for residents and their families.

• Open bed listings are maintained and accessible — reducing the likelihood of misinformation or manipulation during the placement process.

• Homes that serve vulnerable individuals in early recovery are not flying under the radar — but instead are participating in a transparent, accountable ecosystem.

In short, licensing protects not only residents — but also the treatment providers and families trying to help them make informed, ethical choices.

The Bigger Picture: Ethics and Access

One of the biggest challenges facing the recovery community today is the shortage of ethical, affordable sober living beds. Treatment centers sometimes end up maintaining housing not because it’s their core strength, but because there simply aren’t enough trustworthy third-party homes in their area to refer to.

That’s why Midway House believes that raising the bar for recovery housing doesn’t mean pushing providers out of the space — it means encouraging clarity, separation, and ethical partnerships.

When sober homes are licensed, ethical, and treatment-independent, everyone benefits:

• Providers can refer patients with confidence, knowing their aftercare won’t become a liability.

• Residents experience housing as a stable platform for growth, not a transactional service.

• The system becomes less vulnerable to bad actors, and more resilient overall.

What Ethical Sober Living Houses Should Look Like

Senate Bill 4015 raises the floor — but ethical providers must continue raising the ceiling.

At Midway House of NJ, we strive to:

• Provide safe, affordable, and structured housing that supports a recovery lifestyle

• Communicate clearly and openly with referring providers, residents, and families

• Stay completely independent of any treatment center or insurance-funded care

• Support our residents' autonomy while offering accountability, community, and support

These values have guided our work from the beginning, and we believe they represent a model that other homes — whether independent or affiliated — can look to as a benchmark.

Final Thoughts: The Law Is Just the Beginning

Senate Bill 4015 is a step in the right direction. It provides clarity, oversight, and protection for some of the most vulnerable individuals in our healthcare system: people in early recovery. But as with any law, its real impact will depend on how it's implemented — and on how the broader recovery community responds.

At Midway House of NJ, we don’t just support ethical standards — we embody them. And we’ll continue to do our part to promote a sober living model that uplifts, empowers, and respects every resident we serve.

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Stay tuned for Part 3 of our Ethics in Sober Living and the Law series, where we’ll explore the proposed voluntary certification program under NJ Assembly Bill A3230 — and why third-party credentialing could be a game-changer for recovery housing.