Caremark’s Requirements to Request Permission Prior to Making Bulk Purchases Successfully Overturned, but Replaced with Post-Purchase Notification Requirements

Last week, Frier Levitt discussed here that Caremark overturned certain aspects of the bulk purchase restriction that was imposed on pharmacies earlier this year. Specifically, Caremark required pharmacies to request permission in writing prior to making any bulk purchases of drug products, and indicated that pharmacies could only make such purchases once Caremark provided affirmative permission back to the pharmacy. As a result of several efforts made by this firm and several industry stakeholders that highlighted the vague and onerous requirements Caremark was seeking to enforce against pharmacies, Caremark stated it would reverse the requirement that pharmacies must obtain written permission prior to making any bulk purchases and indicated that it would provide updated language in its Provider Manual, as well as additional guidance to its network pharmacies.  As such, Caremark has removed the requirement that pharmacies must request and obtain permission prior to making a bulk purchase via mail only, effective immediately.

However, Frier Levitt has learned that Caremark is now requiring that pharmacies notify Caremark within 21 days of any bulk purchase via email or mail in order for such bulk purchases to be considered in the event of an invoice reconciliation audit of the pharmacy. In addition, the requesting pharmacy must also receive acknowledgment that Caremark received the pharmacy’s notification. Again, the requirement to obtain permission prior to making any bulk purchase has been removed and replaced with a requirement to notify Caremark within 21 days of any bulk purchase. Pharmacies are encouraged to review the updated terms and conditions in their respective Provider Manuals and the amendments associated with this new revision. To that end, pharmacies are also encouraged to understand tools available to them to challenge any unjust actions taken against them by any third party payor.

Contact us to speak with an attorney for more information about how this recent amendment may impact your pharmacy.