This week, a new phenomenon began to emerge, impacting compounding pharmacies that previously received letters dated April 7, 2020 from Express Scripts, Inc. (“ESI”) initiating recoupment actions. At the request of the Defense Health Agency (“DHA”), ESI sent letters dated June 25, 2020 to some of the pharmacies within its network suspending the recoupment actions initiated on April 7, 2020 based on the lack of a Prescriber Patient Relationship, until further notice. While these new suspension letters may provide some relief to pharmacies by staying the 90-day timeframe to appeal and halting the offsets against pharmacy’s current claims, they leave a lot of uncertainty as to when and if the recoupment actions and offsets will resume.
ESI Suspension of Previous Recoupment Actions
Between late May and early June, Express Scripts, Inc. (“ESI”), at the request of the Defense Health Agency (“DHA”), sent out another wave of letters initiating recoupment actions to pharmacies based on allegations of lack of patient/prescriber relationship. These letters, all of which were dated April 7, but were not received until several weeks thereafter, were sent to hundreds of pharmacies, relating to claims submitted to Tricare in the 2015 year; generally, the claims identified for recoupment related to compounded medications. Each of these letters broadly alleged that prescriptions had been dispensed without a valid patient/prescriber relationship, without providing any additional information as to the basis for the allegations, or what methodology had been employed to derive those findings.
ESI’s most recent blast correspondence, dated June 25, 2020, states that, under the direction of DHA, ESI has suspended all further recoupment actions which were based on the lack of a Prescriber Patient Relationship as initiated in the letter dated April 7, 2020 (but, as outlined in the letter, was intended to be dated June 1, 2020) until further notice. ESI clarified that due to DHA’s direction to ESI to suspend the recoupment action, the 90-day time period to submit information and documentation in support of a request for an administrative review is being stayed for the pharmacies as of June 23, 2020 until further notice. This most recent correspondence from ESI additionally states that ESI will be “unable to answer any questions regarding this matter until DHA provides further information which will be coming in the next few weeks.”
While these new suspension letters may provide some relief to pharmacies, they leave a lot of uncertainty as to when and if the recoupment actions and the offsets will resume. Specifically, we view the statements contained within the June 25th letter, when considered in conjunction with ESI’s past actions, as a “slow down” of ESI’s recoupment efforts, tied primarily to procedural defects, rather than an abandonment or withdrawal of those efforts.
Pharmacies who have received initial recoupment letters should be on the lookout for the referenced June 25, 2020 suspension letter and should utilize this period of “stay” of the recoupment action to continue to vigilantly prepare appeals and gather the relevant documentation to combat ESI’s allegations. Moreover, ESI has, in some instances, already begun its offset for pharmacies who continue to submit claims to ESI. In many instances, this offset began before the applicable pharmacies had received ESI’s original letter initiating recoupment. We urge pharmacies to continue to monitor their remittances to determine whether the recoupment process has actually been suspended.
While there is uncertainty in the future of these recoupment actions, ultimately, we urge that ESI’s letters be responded to, and be responded to timely.
How Frier Levitt Can Help
Frier Levitt is dedicated to preserving our client’s rights during these uncertain times. If you have received a letter from ESI seeking recoupment or suspending the recoupment action until further notice, let us help you navigate the appeals process.
