New York Governor Signs Bill Providing Independent Pharmacies Greater Audit Protection from PBMs

On April 12, 2018, New York Governor Andrew Cuomo signed Assembly Bill A9507C, enhancing oversight and limitations on how PBMs can audit and recoup on pharmacies located in New York. The bill limits PBM audits to 100 randomly selected prescriptions and only permits a PBM to audit a prescription within 24 months after claim submission or adjudication. Furthermore, a PBM can no longer recoup on unintentional clerical errors that do not result in financial burden, provided the prescription was otherwise correctly filled. This bill marks a major success for New York pharmacies’ protections against abusive PBM audit practices. 

Amongst the new limitations on PBMs, New York increased a pharmacy’s rights to appeal by requiring the PBM to allow for 45 days to address discrepancies in the preliminary audit report – including the granting of reasonable requests for deadline extensions. The bill also prevents a PBM from prohibiting or penalizing a pharmacy or pharmacist from disclosing to a patient information regarding the cost of the prescription medication or the availability of any therapeutically equivalent alternative medications or alternative methods of purchasing the prescription medication, including but not limited to, paying a cash price. PBMs can also no longer require the pharmacy to charge or collect copayment from an individual that exceeds the total submitted charges by the pharmacy for which the pharmacy is paid. Moreover, if a patient pays a copayment, the pharmacy must retain the adjudicated costs and the PBM is prohibited from redacting or recouping the adjudicated cost.

With the passing of Assembly Bill A9507C, New York joins other states with pharmacy audit protection laws and takes another step in the right direction for increasing independent pharmacy protections from aggressive and unjust PBM audit and recoupment tactics.

If your New York pharmacy has received an audit request from a PBM on or after April 12, 2018, contact Frier Levitt today to speak to an attorney about your rights.