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Pharmacies Face Expanded “Effective Rate” Withholdings from PSAOs

Late last year, Epic Pharmacy Network, Inc. (Epic) sent demands to network pharmacies notifying its members that it will withhold future payments because of a Generic Effective Rate (GER) adjustment. The adjustments surprised many pharmacies that were unaware of any withholding resulting in multiple state and federal court lawsuits.

Now, in 2019, pharmacies must be as diligent as ever to ensure that Pharmacy Services Administration Organizations (PSAOs) and Pharmacy Benefit Managers (PBMs) are playing fair. By now, PSAOs should have received data from PBMs regarding any alleged 2018 Effective Rate liability and PSAOs should be adjusting any attempted withholding based on these confirmed figures. Additionally, many new networks have implemented Effective Rate agreements for both Brand Effective Rate (BER) and Generic Effective Rate (GER) impacting 2019 claims.

If your pharmacy is facing PSAO withholdings or alleged liabilities due to PSAO-PBM Effective Rate agreements, Frier Levitt can work with you to confirm the accuracy of any potential adjustments and withholdings and discuss options to challenge these withholdings. Contact Frier Levitt today to speak to an attorney.