Preparing for Readmission into a PBM Network Should Start Immediately Following Termination

Pharmacy Benefit Managers (“PBMs”) closely monitor independent pharmacies and their claims submission. As part of the monitoring, PBMs conduct audits and Fraud, Waste and Abuse (“FWA”) investigations on a regular basis.  Following such audits and investigations, PBMs often impose financial penalty (i.e., recoupment of the entire reimbursement on a claim) as well as terminate pharmacies from their pharmacy network. For independent pharmacies, PBM termination is a devastating outcome especially when such termination was effectuated by any of the three largest PBMs, Caremark, Express Scripts, and OptumRx. Pharmacies can be terminated from seeking readmission for one year or for five years, depending upon the underlying basis of termination.  

In the event of termination, pharmacies should begin preparing for readmission into PBMs’ network immediately following the termination. PBMs track history of audits and investigations. Thus, it is imperative that pharmacies demonstrate, when seeking readmission into PBMs’ pharmacy network, that they took the necessary steps to “cure” any and all discrepancies that formed the basis of termination. PBMs have alleged many different types of discrepancies as the basis of their decision to terminate pharmacies. In the recent past, PBMs have focused on pharmacy’s mailing practice while on a retail-contract, copay policies and procedures, bona fide physician-patient-pharmacy relationship, and inventory. When seeking readmission into PBM network, the pharmacy should be able to articulate and show that it has implemented adequate corrective action plans as well as fuller policies and procedures. PBMs then consider whether to invite the pharmacy to reapply for network participation. 

How Frier Levitt Can Help
PBMs will not allow terminated pharmacies from joining their network unless the pharmacies taken the steps to prevent recurrence of shortfalls that led to termination. In this vein, pharmacies should consult with industry experts to start preparing for PBM network readmission. If your pharmacy was terminated by a PBM, contact Frier Levitt today to speak to an attorney. Frier Levitt offers several Flat Fee services including PBM Readmission.

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