PBMs are huge companies that often use their market power in an abusive and predatory manner. This case study and successful network appeal provides an example of why experienced PBM audit defense attorneys are necessary to hold PBMs legally accountable and protect your rights.

Given the highly regulated healthcare industry, pharmacies often find themselves navigating complex legal terrain, especially when faced with the daunting prospect of network termination. HLA specializes in providing robust legal support to pharmacies, ensuring their rights are protected and their voices heard.

pbm audit

PBM Terminations are Often Pretextual

PBMs monitor prescription mix and reimbursements, often focusing on those pharmacies that dispense high-cost or high-margin drugs. If a PBM determines that a pharmacy is dispensing a disproportionate amount of such products, that pharmacy often will be targeted for a PBM audit.

There are many legitimate explanations for atypical dispensing patterns, none of which involve a violation of the provider manual or network enrollment forms. Nonetheless, PBMs will often terminate pharmacies in these scenarios based on failure to collect co-pays, aberrant products, or other pretextual reasons.

HLA's Strategic Approach on Appeal

An independent pharmacy based in Texas retained us after receiving a termination notice from a major PBM. The termination letter asserted that the pharmacy had violated various provisions of the PBM provider manual, including the dispensing of aberrant products.

Our approach to win on appeal was strategic and multifaceted. We began by meticulously dissecting the grounds for termination and identifying any legal vulnerabilities. Through extensive research and analysis, we crafted a compelling argument to challenge the PBM's decision, highlighting why termination was unjustified and disproportionate to the alleged conduct.

Fierce Legal Argument is Critical to Success

We engaged in extensive discussions with the PBM's attorney, presenting our case persuasively and advocating fiercely on behalf of our pharmacy client. Our audit defense team leveraged our attorneys’ deep understanding of healthcare law and industry dynamics to negotiate effectively and navigate the intricacies of PBM contracts and provider manuals.

Ultimately, the PBM was forced to accept the merits of our arguments and rescind the termination notice. This pivotal moment marked a significant victory for our client and serves as a testament to the power of skilled legal representation.

Remedial Action Helps Prevent Future Targeting

In many cases, effective remedial action helps to address the PBM's concerns and avoid additional PBM audits. Here, unfortunately, the pharmacy had not complied with the corrective action plan (CAP) we had implemented, which made our appeal all the more difficult.

Nonetheless, remedial action is often imperfect, especially when manual processes are involved. Accordingly, we collaborated with our client to develop a more robust and improved CAP to address the PBM's concerns. Such comprehensive compliance measures are often necessary to protect pharmacies from future PBM scrutiny.

HLA is Available to Help

Here at HLA, we take pride in our ability to deliver tangible results for clients. Our successful reversal of PBM termination is just one example of our unwavering commitment to protecting the interests of independent pharmacies nationwide. Whether it is navigating PBM audit disputes, regulatory compliance, board matters, or government investigations, we stand ready to advocate fiercely on behalf of our pharmacy clients and secure favorable outcomes.

If your pharmacy is facing challenges within the complex landscape of healthcare, do not navigate them alone. Contact us today to learn more about how we can support your legal needs and safeguard your pharmacy business.

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