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PBMs Continue to Increase Scrutiny of Mailing Operations

While PBMs have scrutinized retail pharmacies for mailing activities for some time, over the last several weeks, several major PBMs have embarked on renewed tactics aimed at clamping down on pharmacies dispensing prescription medications to their patients through the mail or other common carrier. 

By way of example, certain PBMs (including Humana) have issued new waves of termination notices to pharmacies, alleging violations of contractual mail order limitations or improper out-of-state mailing. These notices typically state that the pharmacy has violated certain contractual provisions and/or applicable law, and indicate that the pharmacy will be terminated for its alleged infractions. In many cases, however, the data used by PBMs to justify network termination (particularly in the case of alleged unlicensed mailing) may be inaccurate. Because pharmacies may have certain appeal rights when receiving these termination notices, pharmacies are encouraged to seek legal assistance in a timely manner, otherwise they risk waiving their rights available under the law.

In addition to PBMs issuing termination notices for alleged violations, we have also seen instances where underlying plan sponsors and health plans have issued notices to pharmacies setting forth prohibitions on mailing, even to the pharmacy’s local customers. For example, CIGNA recently issued notifications to pharmacies (through its PBM) indicating that such network pharmacies were prohibited from sending any prescriptions to any patients through USPS, UPS, FedEx, DHL, etc., and suggesting that violations could result in network termination. 

Importantly, various laws and regulations exist that prohibit blanket exclusion of dispensing prescriptions to patients by mail for many types of networks. Efforts like these to limit lawful delivery of prescription medications to a pharmacy’s patients may run afoul of Federal and State Any Willing Provider Laws, and may carry an underlying anticompetitive effect. For example, CVS recently announced that they will be introducing one-day delivery to the patient’s home/office from their retail locations. Likewise, several other major PBMs own and operate their own, in-house mail order pharmacies. Thus, any efforts to restrict mailing by independent pharmacies, while simultaneously pushing patients to wholly-owned or affiliated mail order pharmacies, must be closely scrutinized.

Frier Levitt routinely represents pharmacies in challenging abusive PBM practices, including unreasonable restrictions on servicing patients through the mail. We have a great deal of experience in leveraging available laws, including any willing provider requirements, to assist pharmacies in maintaining the ability to service their patients. If you’ve received a termination notice from a PBM relating to mailing, or are facing restrictions on your ability to ship medications to patients, contact us today.