Pharmacy Benefit Manager (PBM) audits are a perennial challenge for pharmacies, and several signs point to 2025 as a time of more frequent and aggressive audits than in years past. I’m the last “Chicken Little” to proclaim the sky is falling, but a number of factors point to less restraint. Yes, I know that Trump sent an offhand tweet about going after the “middlemen,” but no concrete follow-up, let alone a workplan, has emerged. That is not surprising because the Administration’s focus is on illegal immigration, and the entire alphabet-soup of federal agencies will be prioritizing that task for the foreseeable future.

The federal priorities under Trump mean that there will be less oversight of every participant in the supply chain except, perhaps, those that handle controlled substances. DEA is fully funded and operating like a twin hydra: putting the brake on registrations while pressing the gas on inspections and warrants, as we wrote about HERE. As DEA’s initiative presses on, you would be well-served to keep Nancy Coffey’s number close at-hand; she knows how to talk DEA’s language because she was employed there for more than 30 years.

Reduced federal oversight means that PBMs will increase their efforts to eliminate competitors to their mail-order businesses through sham audit clawbacks and unlawful terminations. Even the best PBM “fair audit” laws, including in states like Texas, have yet to have much impact on stopping PBM abuses because the cost of filing a lawsuit to enforce those laws is difficult to finance, and the PBMs have teams of lawyers who pull every procedural gimmick possible to win by attrition.

In short, if you think PBMs are going to cut-back on their audits to avoid further scrutiny by the Trump Administration, you are sorely mistaken. These companies have operated with impunity for decades, and are more likely going to double-down on bogus audits, including to fund public relations campaigns and lobbyists who will fall over themselves to blame others for the rising cost of drugs. It will be 2025 hypocrisy in the extreme.

The Expanding Scope of PBM Audits

Notably, it seems like every regulator in the country is now conducting inventory audits, including OIG itself, as we wrote about HERE around the same time last year. In addition, there are a number of notable updates to the PBM Manuals that will affect pharmacy operations. For example, Optum’s latest manual requires pharmacies to have stock-on-hand prior to the submission of a claim. ESI and Caremark have also updated their manuals in subtle, but important, ways that will make it easier for them to recoup on claims.

Second, pressure on margins in the Medicare Advantage Part C program continues, and those payors, such as Optum and Humana, that rely heavily on capitated risk will continue their efforts to more closely manage costs, including by shifting high-price medications to their in-house mail order pharmacies.

Third, telehealth relationships, often a driver for high-reimbursing items at the the retail counter, are going to be all the more in focus this year, both from the PBM and government agency perspective. I anticipate that regulators will finally begin to relent in their efforts to chase Covid scams, largely because perpetrators are long gone and the vast amounts of money involved will never be recovered at this point. That means that government regulators will turn their focus back to more traditional areas of enforcement.

Compounders have captivated the Nation’s attention with respect to weight-loss drugs, but this story has become somewhat stale from an enforcement standpoint.  Don’t get me wrong, there will be lots of litigation and scrutiny, but the alternatives to sterile injectables and the predominantly cash-pay model have reduced risk in this space measurably. That said, if a New England Compounding Center disaster recurs, everyone in the industry better take cover. (And call me to get in the foxhole with you.)

Common Audit Triggers

Navigating Regulatory Changes

Recent regulatory changes are transforming how PBM audits are conducted. New York’s Part 459 regulations, effective in July 2025, standardize audit procedures with clear notice periods and appeals processes. For independent pharmacies, these rules bring much-needed consistency, helping reduce the likelihood of arbitrary penalties.

The federal "Lower Costs, More Transparency Act" (HR 5378) requires PBMs to provide detailed semiannual reports, including rebates and pricing structures. Similarly, states like Vermont and Louisiana have introduced measures to ban spread pricing and ensure fair reimbursement rates, alleviating some financial pressures on smaller pharmacies.

Staying informed about these changes is crucial. Pharmacies should regularly update compliance policies and monitor legislative developments. Consulting with experts can further help ensure adherence to evolving regulations and minimize risks.

Preparing for PBM Audits

Effective preparation can reduce disruptions and ensure smoother audit experiences. Start by conducting regular mock audits to simulate real conditions. For example, review claims for high-cost medications, ensuring that inventory records align with dispensing data and all required documentation is complete.

Training staff regularly is essential. Employees should be aware of current compliance guidelines and common pitfalls, such as incomplete patient signatures or errors in billing codes. Stay close to your largest business partners, as PBM audits typically will attempt to drive a wedge between these relationships.

Conclusion

PBM audits in 2025 present significant challenges, but pharmacies can take proactive steps to protect themselves. By understanding the trends, preparing for common triggers, and staying ahead of regulatory changes, pharmacies can reduce risks and maintain compliance.

To navigate PBM audits with confidence, call (800) 345-4125 for a consultation with one of our PBM audit specialists today. This is what we do, day-in and day-out, and our results show it.