Are PBM Audit Fees Enforceable? It Depends.

Independent pharmacies face numerous challenges and obstacles when being audited by pharmacy benefit managers (PBMs). One audit related tactic utilized by PBMs that is causing financial harm to independent pharmacies throughout the country is the assessment of significant, and often times excessive, PBM audit fees. The ways in which these fees are assessed by a PBM against a pharmacy vary from PBM to PBM. In some cases, PBM audit fees assessed against a pharmacy represent a significant amount of money beyond the audited or recouped amount. These fees may also represent a substantial revenue/profit center for a PBM. Furthermore, in some cases PBMs are already being compensated for the cost of auditing from their plan sponsor clients. 

However, depending on the circumstances of an audit and certain other factors, a PBM’s audit fee may not be enforceable at all. For example, there are certain states with laws that limit or in some cases prohibit the assessment of audit fees against pharmacies. Moreover, to determine whether an audit fee is enforceable, it is crucial to have an in depth understanding of the contracts between the pharmacy and the PBMs with whom it has contracted. Additionally, a pharmacy must have an in depth understanding of the type of audit being conducted by the PBM and the methods used by the PBM to conduct the audit. PBMs conduct various types of audits and use different processes and methods to conduct audits ranging from straightforward desktop audits to more onerous onsite audits. All these factors must be considered and analyzed to determine whether PBM audit fees are enforceable and having knowledgeable legal counsel is critical in analyzing whether these fees should be challenged.

How Frier Levitt Can Help

Frier Levitt has extensive experience dealing with PBM audits including the issue of PBM audit fees and the enforceability, or lack thereof, of such audit fees. Contact us today to learn more about your Pharmacy’s rights as it pertains to PBM audits and the assessment of PBM audit fees.