Frier Levitt Successfully Reverses Two PBM Network Terminations

As PBMs continue to aggressively review participation in their retail pharmacy networks, several pharmacy providers find themselves at risk of termination over seemingly minor issues.  For example, Frier Levitt recently assisted an Illinois-based retail pharmacy from termination where the PBM alleged inventory shortfalls and prescriber denials. After working with the pharmacy to address the alleged findings, Frier Levitt represented the pharmacy in an appeal hearing with the PBM and clarified that there were no inventory shortfalls and wholesalers inadvertently left out some purchase information that would have otherwise resolved the inventory shortfalls. Further, as it relates to the patient denials, Frier Levitt, on behalf of the Pharmacy explained that they were either the result of a clerical error or where the pharmacy had obtained proper prescriber authorization prior to dispensing and pursuant to a valid prescription.  The PBM then decided to overturn the Pharmacy’s termination, based on adherence to enhanced policies and procedures, which Frier Levitt is assisting in drafting.

Similarly, a New York-based pharmacy faced PBM network termination over alleged inventory shortfalls amounting to approximately $20,000. Despite the pharmacy’s audit appeal that the basis of the inventory shortfalls were not associated with an actual lack of inventory, but rather, with the pharmacy’s purchases from a non-VAWD accredited wholesaler or with purchases made from neighboring pharmacies (that were not accepted during the audit), the PBM upheld the findings and moved forward with the pharmacy’s termination. After continued, good faith discussions with the PBM, Frier Levitt, and the pharmacy, the pharmacy’s termination was overturned, subject to the pharmacy implementing and ensuring compliance with corrective action measures.

Pharmacies that undergo any audit or investigation with a PBM are cautioned to take proactive efforts to resolve any discrepancy findings as unresolved findings may lead to termination.  While some PBMs might claim they have ceased audits in light of the COVID-19 crisis, PBMs have still continued “Fraud, Waste, and Abuse investigations” into pharmacies, which are often associated with inventory shortfalls, prescriber denials, patients denials, copayment collect, etc.

How Frier Levitt Can Help
If your pharmacy is undergoing an audit or investigation, contact Frier Levitt today to speak to an attorney.

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