Frier Levitt successfully reversed a network enrollment denial by a major Pharmacy Benefit Manager (“PBM”) against a New Jersey-based community pharmacy. Since the pharmacy is located in a city identified as being in a “HEAT Zone,” the PBM required the pharmacy to undergo additional credentialing reviews in order to obtain admission into its network. Ultimately, the PBM denied the pharmacy’s enrollment application, alleging several deficiencies, including inventory shortages identified during an invoice review, credentialing application discrepancies dealing with the failure to report common ownership interests, and other similar disclosures throughout the application process. Thereafter, Frier Levitt attorneys intervened and helped guide the pharmacy through the PBM’s vague appeal procedures. After exhausting the PBM’s appeal process, Frier Levitt demanded the PBM admit the pharmacy since it had adequately demonstrated that there were no inventory shortages despite the PBM’s allegations, and that the pharmacy otherwise met the terms and conditions of participation of the PBM’s networks. Shortly thereafter, the PBM reversed its decision and allowed the pharmacy’s admission into its network.
PBM credentialing processes are complex. However, even more challenging is gaining admission into PBM networks as a pharmacy located in a “HEAT Zone.” The Health Care Fraud Prevention and Enforcement Action Team (“HEAT”) was formed as a joint initiative between the Office of the Inspector General, the U.S. Department of Justice, and the U.S. Department of Health and Human Services to prevent and prosecute healthcare fraud, waste, and abuse. HEAT includes the Medicare Fraud Strike Force, which combines the resources of federal, state, and local law enforcement entities to combat healthcare fraud, waste, and abuse, and operates in and around major U.S. cities, such as Brooklyn, Chicago, Houston, Los Angeles, Miami, Tampa Bay, etc. PBMs have also designated certain counties as HEAT Zones, including Essex County, New Jersey and Orange County, California.
Thus, it is critical that pharmacies seeking admission into major PBMs’ networks prepare and submit complete credentialing applications and expect to undergo additional credentialing hurdles (i.e., invoice reconciliations), especially where those pharmacies are located in HEAT Zones subject to heightened requirements.
How Frier Levitt Can Help
If your pharmacy is seeking admission into a major PBM’s network or is being denied entry, Frier Levitt can help. Our attorneys have extensive experience counseling pharmacies through the PBM credentialing process and defending against PBMs with respect to the denial of network access. Contact us to speak with an attorney about navigating your pharmacy through credentialing and network requirements set forth by PBMs.
