Pharmacy Law & PBM Issues

Pharmacy Law

The Firm provides extensive resources for retail pharmacy owners and operators; from pharmacy benefit manager (PBM) audits and disputes to regulatory compliance and transactional support. We work closely with independent pharmacies to protect their rights and optimize operations and profitability.

The Firm provides extensive resources for specialty pharmacy owners and operators; from pharmacy benefit manager (PBM) audits and disputes to regulatory compliance and transactional support. We work closely with independent pharmacies and have extensive experience with the legal nuances affecting this sector.

Since the implementation of the ZPIC and RAC programs, healthcare providers and suppliers have experienced increased scrutiny in the pursuit of overpayments and fraud.  Medicare’s most vital tool in its progressive search is the use of statistical sampling.  In theory, statistical sampling offers a reliable and low cost approach to addressing large volumes of claims.  However, this process gives the government a huge advantage as it places a heavy assumption of a large number of claims without actual review of the claims.  Thus, it is important for providers and suppliers to understand the process and know how to challenge such studies in order to minimize potential repayment obligations and retain revenue.

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Intended to address the growing nationwide opioid epidemic that has also greatly affected Floridians, Governor Scott signed HB21 into law effective July 1, 2018 that pertains to prescribing and dispensing controlled substances. Those that do not adhere to these new regulations risk facing disciplinary actions that range anywhere from warnings and penalties, to loss of licensure and criminal exposure depending on the extent of the violation. For questions on how these new regulations may affect your practice, contact a member of our team.

Take a moment to reflect – are you engaged in telephonic marketing or sales? Be it a healthcare businesses’ own internal based sales team or a third party providing such services, many individuals and entities are telemarketing and don’t even realize. If conducting telephonic sales either out of a Florida based location, or if calling into Florida, then pay attention! There is a Florida law that requires all such marketers to register for a telemarketing license or file for an exemption therefrom. While it’s not a new regulation, it’s one that is often overlooked and one that carries serious consequences for non-compliance.

Compounding pharmacies are subject to a multitude of federal and state laws and regulations, and with huge individual and corporate liability general knowledge of the laws is simply not enough. The Florida Healthcare Law Firm team has deep experience with laws regarding prompt pay, insurance regulations, controlled substances, ERISA, Anti-Kickback Statute, Stark Law, False Claims Act, Tricare rules and regulations, DEA rules and regulations and much more. If you are compounding and submitting claims for reimbursement to Tricare, there is even more to consider. You will also want to have your relationships with any referral sources / marketers reviewed to make sure those are in compliance.

Attention to detail through the entire process of offering Durable Medical Equipment Prosthetics & Orthotics Supplies (“DMEPOS”) to Medicare beneficiaries is of the utmost importance. Incorrectly filling out the state licensure application or Medicare Part B Enrollment Application can result in delays in processing your application, and could ultimately result in the denial of your application. Intentionally providing false or misleading information any enrollment application can subject the applicant to a variety of civil and/or criminal penalties. Additionally, depending on the specifics pertaining to your practice setting and services being offered, there may be a variety of other Federal and State regulations that may have to be considered (Stark, Anti-Kickback, etc.).

Part of a PBMs function is to audit a pharmacy’s claims to ensure that the claims submitted are in compliance with the PBM and insurance companies’ requirements. Typical audits come primarily in two forms (1) desktop audit; and (2) field/on-site audit. A selected pharmacy usually will receive a letter or fax from the PBM informing an audit will be taking place.

PBMs will often overstep their authority and the pharmacy must know its rights to protect its practice and patients. Make sure that the PBM is in compliance with both their contractual requirements (as set forth both in the applicable PBM Provider Manual and the contract between the PBM and pharmacy) in addition to any pertinent federal or state regulations applicable to pharmacy operations. The Florida Healthcare Law Firm is uniquely positioned to engage with the PBMs to advocate for your pharmacy and protect its rights!

The team at Florida Healthcare Law Firm has the diverse experience to provide legal counsel to pharmaceutical wholesalers and distributors across the United States. The objective of our representation is to act a guide and resource to get our clients through Federal and State laws and regulations while striving for the utmost in compliance.

Laws that apply to our wholesaler clients include state pharmacy practice acts, DEA rules and regulations, state controlled substances laws and regulations, as well as the Anti-Kickback Statute, Stark Law, and False Claims Act.

Comprehensive, often difficult to decipher regulations is what sets owning a pharmacy (or other healthcare related entity) apart from other entrepreneurial endeavors. That however should not be the sole reason for a good actor to abstain from entering what could otherwise be an enjoyable, lucrative, and satisfying endeavor. Be it a ‘from scratch’ pharmacy or an acquisition, carefully weigh the pros and cons, and know the issues inherent with each option. In a brand new pharmacy the owner can be certain that there are no skeletons in the closet; that however comes with costs, both monetary and time. With an existing pharmacy, long story short: know what’s being bitten into before you CHOW. Regardless of the route taken, ensure a supportive team is along for the journey.

Providing telehealth services can be a worthy compliment to your practice; however, caution should be exercised before entering into a contractual relationship with a telehealth company. Keep in mind, when a telehealth company touts itself as “HIPAA compliant,” this is only one area where it must maintain compliance. It, along with the telehealth contract, must also be complaint with federal and/or state laws for furnishing telehealth services.

The Florida Healthcare Law Firm has created and reviewed a wide array of diverse business arrangements involving telehealth or telemedicine. If you are considering a telehealth model we can assist you with all components, from vetting a contractual opportunity or advise regarding the laws and landscape.

How we Help

Whether its navigating the increasingly complex PBM contracts to become an in-network provider, assisting with audits and appeals, or fighting payment suspensions and contract terminations, The Florida Healthcare Law Firm is uniquely positioned to help your pharmacy with all of its pharmacy law and PBM needs.

Articles from Our Team

People looking to enter the direct-to-consumer medical supply business often question whether becoming a pharmacy or durable medical equipment provider (DME) is a “better” endeavor. Now, more than ever, due to industry changes and because of the synergies between the two, the answer is “ become both.” Think about it. Read on

Like many entrepreneurial endeavors, owning a pharmacy requires careful planning and an astute risk versus reward analysis. However, unlike other industries, venturing into a healthcare business brings with it an entire new world of regulations, and rightly so. Pharmacies don’t sell widgets they sell prescription drugs, and to people whose well-being depends on it being done correctly. Read on

Receiving an audit from a PBM’s senior investigator or its Fraud Waste & Abuse (“FWA”) Department is typically a sign that a pharmacy is being closely scrutinized. Such audits may focus further on co-pay collection, and may require that the pharmacy’s drug wholesalers submit proof of purchase documentation directly to the PBM to evidence the pharmacy had the inventory of drugs it had submitted claims for. Sometimes the PBM will even reach out to the physician indicated on the prescription to confirm the authenticity thereof. These PBM auditing techniques are ripe with issues and commonly create confusion for the wholesalers and prescribers. This results all too often with inaccurate discrepancy reports being issued by the PBM requesting or offsetting monies that it is not entitled to. Read on

Monty Ray Grow was a defensive back on the Florida Gators’ football team from 1990 until 1993. He contracted to play for the Kansas City Chiefs in 1994 and then for the Jacksonville Jaguars in 1995 and 1996. On February 5, 2018, he was convicted by a federal jury in Miami for his chief role in a massive healthcare marketing scheme designed to defraud Tricare.

Tricare is a health benefit program that provides civilian benefits for U.S Armed Forces military personnel, retirees, their dependents, and some military reservists. Tricare is a Department of Defense Program. Read on

Stay proactive and keep yourself out of hot water. Being prepared, asking questions and staying up-to-date on changes in the pharmacy world will help your business stay compliant. Our industry expert roundtable of healthcare lawyers are here for you. Just send us a message and we will get back to you.

PBM Services

Over the years there has been tremendous consolidation in the healthcare industry; PBMs have been merging with PBMs, and insurance companies has been merging with PBMs. The result is that an increasing number of patient lives are in the hands of fewer administrators. Pharmacies are finding that it is becoming more difficult to gain access to these PBM networks, and once admitted it is becoming increasingly difficult for the pharmacy to adhere to their arduous requirements and to remain in network. Many PBMs even have their own pharmacies, seemingly creating further conflicts of interest. With fewer pharmacies in the PBMs’ network, the market share of pharmacies owned by the PBM increases. Even more money goes to the PBM in such cases. Now more than ever you need to fight to protect your practice and patients from being squeezed out of these PBM networks.

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