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Frier Levitt Succeeds in Challenging PBM Audit Based on Services Inadvertently Billed to Deceased Patients

Frier Levitt recently assisted an independent pharmacy with a PBM audit in which the Pharmacy Benefit Manager (PBM) alleged that the pharmacy had billed several claims to four beneficiaries who were deceased on the date of service for the claim. The PBM advised that if the pharmacy did not demonstrate the appropriate billing of those prescriptions, the claims would be reversed, and the full amount previously paid on each of those claims, recouped from the pharmacy. The total amount of claims at issue totaled nearly $4,000.

Frier Levitt reviewed the pharmacy’s documentation with respect to each of the dispensed and adjudicated claims and, utilizing its knowledge of the industry alongside a creative and proactive corrective action plan it drafted for the pharmacy, appealed the audit. The PBM reversed all findings, resulting in a $0 recoupment to the pharmacy.

In order to appropriately administer prescription drug plans, PBMs routinely conduct extensive audits of the pharmacies contracted within their pharmacy network. As is the case with audits in general, PBMs audits often follow certain trends which vary and evolve (recent trends have been, for example, auditing on one particular medication or on the use of a particular manufacturer’s coupon). One potentially emerging trend is to audit pharmacies based upon their billing of services to patients who were reported as deceased at the time the services were rendered.

PBM audits can severely hamper an independent pharmacy, not only because findings of discrepant claims can be financially costly, but because such findings can lead to termination of the pharmacy from that PBM’s pharmacy network, resulting in the inability to serve large patient populations. To take it one step further, termination from a PBM network may cause a pharmacy to report such termination on applications for credentialing and recredentialing for other PBM pharmacy networks, which may result in a domino effect and a loss of multiple contracts, which could ultimately put the pharmacy out of business.

If your pharmacy has been audited by a PBM, contact Frier Levitt to speak to an attorney.