Pharmacy Provider Alert: DIR Fees Continue to Increase

Direct and indirect remuneration (DIR) fees paid by pharmacy providers to pharmacy benefit managers (PBMs) are on the rise for the upcoming calendar year in 2022.  Pharmacy DIR fees have been utilized by PBMs to recoup monies on claims submissions post point-of-adjudication since at least 2016.  Providers subject to these fees should pay close attention to network updates that include an increase of DIR fees as the increase in these fees may go unnoticed until providers receive reimbursement from PBMs and payors. For example, one PBM in particular is expected to increase DIR fees by 2 percent in 2022.  Notably, without an increase in up-front reimbursement, an increase in DIR fees causes pharmacy provider’s net reimbursement to decrease.  This drastic increase in DIR fees could cause some providers to be reimbursed less than even the acquisition cost for medications dispensed to patients. Accordingly, it is important that all pharmacy providers review their contracts with PBMs each year to evaluate whether there is an increase in DIR fees without any change to up-front reimbursement.  Increasing DIR fees without increasing up-front reimbursement could make PBM recoupment of DIR fees even more unreasonable than it already is, and may continue to negatively affect pharmacy providers for years to come.

If you would like assistance reviewing your contracts with PBMs and/or challenging DIR fees, the Frier Levitt team strongly encourages seeking the advice of counsel or contacting Frier Levitt to speak with an attorney.