Brad Gallgher, co-leader of the Health Care Controversies and Pharmacy Teams, was featured in the Specialty Pharmacy Continuum article “Avoiding Legal Trouble With PBMs and Regulators,” which cautioned that specialty pharmacies face intensifying scrutiny from pharmacy benefit managers (PBMs) and regulators—and shrinking margins for error.
Brad emphasized that strict, ongoing compliance with provider manuals is essential, noting that “even the small changes that happen all the time” can trigger audit findings. He warned that PBMs are increasingly willing to recoup funds and terminate contracts “at far lower dollar thresholds than in the past” when pharmacies fall short.
Brad urged pharmacies to take every audit finding seriously, regardless of size. “Even if the dollar amount is $900, you should always respond and make sure you get the last word,” he said, explaining that repeat or similar findings may be treated as systemic issues. Dispelling a common misconception, he added that PBMs are no longer reserving terminations for large-dollar disputes: “We’re seeing more terminations below $10,000,” with even modest findings used as grounds for network removal.
The article also highlighted audit pressure points such as mail-order delivery and copay collection, where PBMs now demand extensive documentation. “If a patient denies receiving medication, even once, you’d better have airtight records to show otherwise,” Brad said, noting that PBMs may still require patient attestations despite tracking and signature proof. He further advised heightened caution when regulators appear on-site. “Anytime the DEA, OIG, or attorney general’s office shows up, that should trigger heightened awareness,” he said, underscoring that small compliance issues can quickly escalate and threaten a pharmacy’s ability to remain in a PBM network.
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