Frier Levitt Helps Pharmacies and Plan Sponsors with Legal Issues Involving Maximum Allowable Cost (MAC) Pricing and Appeals
As a national healthcare and life sciences boutique law firm, Frier Levitt understands that there are numerous complex issues facing Pharmacies and Plan Sponsors throughout the country and that some issues have a disproportionate impact. Maximum Allowable Cost or MAC pricing is one such issue, and Frier Levitt has taken a holistic approach in combatting improper MAC pricing tactics by Pharmacy Benefit Managers (“PBMs”). PBMs often manipulate MAC methodologies and reimbursement benchmarks, creating unfair and unsustainable payment dynamics. We combat these tactics with a tailored, holistic strategy that reflects each client’s unique operations, contracts, and market pressures.
Our team identifies improper MAC practices, leverages state and federal MAC laws, pursues contractual and administrative remedies, and, when necessary, litigates to enforce compliance and recover losses. From audits and appeals to contract restructuring and regulatory advocacy, we deploy practical solutions that protect reimbursement integrity and long‑term viability for pharmacies and plan sponsors nationwide.
Understanding the Complex Pricing Issues Involved in MAC
MAC pricing is yet another PBM created scheme that harms Pharmacies, Plan Sponsors, and, ultimately, patients. To address this crucial issue, Frier Levitt created a MAC Pricing Practice Group with attorneys who have spent years studying the various laws, rules, and regulations governing the establishment of MAC pricing as well as PBM contracts, including the various provisions related to MAC pricing. Frier Levitt helps Pharmacies and Plan Sponsors address all legal issues involving and related to MAC pricing, whether on an individual claim-by-claim basis or from an overall contractual negotiation and reimbursement standpoint.
As PBMs ramp up their methods of minimizing profit margins for Independent Pharmacies and rely on opaque contracting tactics to shield PBM revenue and profits, many states have recognized the troubles Pharmacies and Plan Sponsors face regarding multisource generic drugs. While generic drugs are typically viewed as a vehicle for lowering the cost of healthcare, PBMs have devised perverse tactics to utilize and reimburse generic drugs in a manner that increases PBM profits to the detriment of Pharmacies, Plan Sponsors, and, most importantly, Patients. In many cases, these tactics have actually increased the cost of healthcare. In response to these improper tactics, nearly 40 states have enacted some form of law governing MAC pricing and the corresponding appeals process, with some states even enacting laws that afford their resident pharmacies additional protection under their business tort laws. In some instances, a PBM’s failure to follow MAC pricing laws may constitute a deceptive and unconscionable trade practice, exposing the PBM to direct claims by the pharmacy for monetary damages, including, for example, treble damages, and attorneys’ fees. Because of variations in state law, PBM processes, and procedures for MAC-related legal disputes, including MAC appeals, knowledgeable legal counsel is critical to fully understanding your legal rights regarding MAC pricing. Frier Levitt’s comprehensive understanding of the complex area of the law combined with creative legal thinking helps Pharmacies and Plan Sponsors confidently address these legal issues.
How Frier Levitt Helps Pharmacies and Plan Sponsors with MAC Legal Issues
Frier Levitt’s MAC Pricing Practice Group counsels Pharmacies and Plan Sponsors throughout the United States on all aspects of MAC pricing including:
- Contract negotiation, including how MAC reimbursement affects the overall reimbursement
- MAC Reimbursement
- Helping Plan Sponsors understand and negotiate PBM contract terms and conditions
- Helping Plan Sponsors, including state agencies, audit PBMs
- Legality of PBMs’ MAC pricing
- PBM MAC reimbursement appeals
- Amounts charged to plan sponsors
- Gaining a greater understanding of PBM spread pricing and the role MAC plays in spread pricing
- Auditing of PBM performance and compliance with contractual and fiduciary obligations
- Educating Pharmacies regarding their contractual rights and PBM tactics
- Fighting unfair MAC reimbursements, including the use of state laws restraining unfair PBM practices
Pharmacies that dispense a significant volume of generic drugs and have questions or concerns regarding PBM MAC pricing practices are encouraged to contact us to speak with an attorney. Plan sponsors should also reach out to discuss how MAC reimbursement impacts the amounts they pay to a PBM for the administration of their pharmacy benefit.
Frier Levitt provides strategic, industry-focused legal counsel tailored to your needs. Contact our team today to learn how we can help you.
