Several States throughout the United States have passed laws regarding Maximum Allowable Cost (MAC) pricing and the corresponding appeals process. In addition to enacting favorable MAC laws, some States such as Arkansas have afforded their resident pharmacies additional protections under their business tort laws. Together, these important laws not only expose PBMs to administrative fines and sanctions for non-compliance, but also permit Arkansas pharmacies to pursue direct civil remedies against offending PBMs.
In Arkansas, if a MAC appeal is upheld, the pharmacy is permitted to reverse and rebill the claim and the price change becomes effective for each similarly situated pharmacy. In the event the pharmacy’s appeal is denied, the PBM must provide the pharmacy with the NDC for the drug and name of a national or regional wholesaler operating in Arkansas that has the drug in stock at a price below the MAC. Furthermore, if the NDC/drug provided by the PBM is not available below the pharmacy’s acquisition cost from the wholesaler from whom the pharmacy purchases the majority of its prescription drugs, the PBM is required to adjust its MAC price above the challenging pharmacy’s acquisition cost. The pharmacy may then reverse and rebill each claim affected by the inability to obtain the drug at a cost that is equal to or less than the previously challenged MAC price.
Significantly, in addition to these provisions regarding the appeals process, a PBM’s failure to follow Arkansas’ MAC pricing laws may constitute a deceptive and unconscionable trade practice thereby exposing the PBM to direct claims by the pharmacy for monetary damages and attorneys’ fees. Thus, in addition to administrative penalties and fines that may be assessed against a PBM for its failure to comply with MAC pricing laws, Arkansas’ deceptive and unconscionable trade practices act provides independent pharmacies with direct recourse against a non-compliant PBM.
While PBMs are often required by law to have procedures in place for MAC appeals, frequently the manner in which the PBMs conduct the appeals process is unfair. Despite challenges by the Pharmaceutical Care Management Association (PCMA) beginning in 2015, Arkansas’ MAC law still remains largely intact and levels the proverbial “playing field” and provides independent pharmacies a bona fide opportunity to challenge the PBMs’ MAC pricing practices.
Frier Levitt represents pharmacies across the United States in challenging PBM audits, network access and reimbursement practices and policies, including MAC appeals. Contact Frier Levitt today to speak with an attorney about how your pharmacy may leverage Arkansas’ MAC appeal laws.