At the 2025 Immunoglobulin National Society (IgNS) Annual Conference, Frier Levitt Partner, Jesse Dresser, delivered a session titled “Changing Reimbursement Landscape (related to Specialty Infusion Pharmacy)” a presentation that resonated deeply with infusion providers nationwide. This discussion unpacked the increased reimbursement pressures specialty and home infusion pharmacies face as pharmacy benefit managers (PBMs) continue to impose below acquisition cost payment models, misapplied DIR fees, and restrictive network structures.
Across the country, these trends have created a financial squeeze on providers delivering some of the most complex therapies in healthcare. DIR fees, once limited to the retail setting, are now being applied to infusion pharmacies without consideration for the specialized services these providers offer. As such, pharmacies are being reimbursed at rates that fail to cover acquisition costs let alone nursing, logistics, or clinical oversight.
The stark economic reality is that home infusion pharmacies are being measured by retail pharmacy metrics and paid through reimbursement models that simply do not fit.
Understanding the Reimbursement Landscape
PBMs structure their networks with varying levels of restriction—closed networks with limited access, “preferred” or “home infusion” addenda for select participants, and contracts that allow reimbursement “up to an average” rate across all pharmacies. In practice, however, this means one provider may receive drastically less than another under the same agreement.
This aggregate-rate guarantee language, used by some of the largest PBMs allows reimbursement across the “book of business” to balance out on average, even if individual pharmacies are paid below cost. While this may satisfy the technical requirements of the contract, it creates an unsustainable model for independent and specialty pharmacies who cannot offset losses across multiple lines of business.
Why DIR Fees Don’t Fit the Infusion Model
DIR fees were designed to capture post point-of-sale rebates and performance-based adjustments under Medicare Part D, primarily for retail pharmacies. However, infusion providers deliver far more comprehensive services including nursing administration, patient monitoring, and coordination with prescribers that are not reflected in metrics like generic substitution or medication adherence.
When PBMs apply these retail-based metrics to infusion claims, they effectively penalize providers for not dispensing generics or not meeting adherence thresholds that are irrelevant to the infusion setting. These misapplied DIR fees distort true performance, erode margins, and threaten patient access to home infusion care.
Proof of the Problem: “Below-Water” Reimbursement
Post DIR-Fee reimbursement models have made the situation worse. Some PBMs now price reimbursement below the cost of acquisition (WAC or NADAC). For instance, a rate of AWP – 26.3% requires a pharmacy to buy at WAC – 11.5% to merely break even—a margin rarely achievable. This disparity leaves even compliant providers operating at a loss and unable to sustain care for Medicare or commercial patients.
In addition, these contracts often lack transparency, preventing pharmacies from verifying how PBMs calculate the “average” rate or how much affiliated mail-order entities are reimbursed for the same products. The imbalance not only raises antitrust concerns but also undermines fair market access guaranteed under both federal and state law.
Key Takeaways for Infusion Pharmacies
- Audit your contracts – Confirm whether your PBM agreement contains “aggregate” reimbursement language or retail-based DIR metrics.
- Check your classification – Ensure you are credentialed under the correct Home Infusion Addendum and billing using NCPDP 03 (Home Infusion) and Patient Residence 01 (Home) codes.
- Track and document underpayment patterns to establish historical loss evidence.
- Leverage available state and federal protections when challenging PBMs for unfair reimbursement.
- Many state and federal statutes create multiple avenues for appealing unfair rates, filing reimbursement disputes, and pursuing litigation or arbitration when payors fail to meet contractual or statutory obligations.
- Engage legal counsel early, before accepting network terms that can restrict access or lower rates retroactively.
Fighting Back: Strategic Steps Toward Reimbursement Relief
To challenge improper reimbursement or DIR assessments, infusion providers should take a multi-pronged approach:
- Review all active contracts and addenda to confirm correct classification and network participation.
- Leverage applicable legal and regulatory protections to reinforce fair access to participation and reimbursement.
- File internal PBM disputes and appeals—document the financial impact and cite applicable laws.
- Escalate unresolved issues through appropriate oversight or dispute resolution procedures.
- Collaborate with counsel experienced in PBM litigation and reimbursement strategy to ensure compliance while preserving leverage.
How Frier Levitt Can Help
At Frier Levitt, we represent pharmacies, infusion providers, and healthcare entities nationwide in navigating the complex intersection of PBM contracting, state and federal reimbursement laws, and payor disputes.
Our team has secured favorable awards and settlements restoring millions in lost reimbursement for pharmacy clients. As the reimbursement landscape continues to evolve, Frier Levitt stands ready to defend provider rights and sustain the future of specialty and infusion pharmacy care.
Frier Levitt provides strategic, industry-focused legal counsel tailored to your needs. Contact our team today to learn how we can help you.
Senior Counsel
