PSAOs offer a valuable service for independent pharmacies, but it is important to understand how this service works and your rights under the PSAO agreement to avoid being surprised. With this knowledge, you can better predict and plan for the risks you may be exposed to. Independent pharmacies that receive PPE payments may be surprised to learn that these payments can be adjusted after the fact. Before you sign your PSAO agreement, it is important to know if PSAO can adjust your payments and ask for a refund and, if so, what this process entails. This will allow you to control risk and better manage your cash flow. PSAs also have affiliation requirements. Some require to participate in wholesale sales contracts and others are strictly subject to a fee. These requirements and the services offered must be independently audited to determine which PSAO is best suited to its business plan. As part of the pharmacy contract with PBM, which was allegedly negotiated on behalf of the pharmacy by its PSAO, the PBM explicitly opens several compound ingredients for reimbursement.
For example, the PBM manual (included in the underlying agreement between pharmacy and PBM) explicitly states that it does not compensate “any compound containing unauthorized ingredients” and “various bulk chemical components” with respect to the reimbursement of compounds. This is ridiculous because many bulk compound ingredients are not “FDA-licensed” and therefore many of the actual ingredients in the compounds for these PBM are not refundable. In addition, the PBM manual states that it reimburses only “eligible ingredients.” Thus, the pharmacy loses money on most links for this PBM. Independent pharmacies are required to sign contracts that PSAOs sign on their behalf, but may not know the terms of these contracts or even their existence. Before you sign your PSAO agreement, respect the rights you have or don`t have to ask questions and get information about PSAO`s contracts with other parties having a direct impact on your business. In 2010, independent pharmacies spent about 17% of all prescription drugs in the United States. In order to obtain, distribute and recover payments for dispensed drugs, pharmacies interact with a network of companies, including pharmaceutical wholesalers and third-party payers. With limited time and limited resources, independent pharmacies may need assistance to interact with these facilities, particularly with third parties with large public and private health plans.
Most use PSAO to interact on their behalf. PSAOs develop pharmacy networks by signing contractual agreements with each pharmacy allowing them to interact with third-party payers on behalf of the pharmacy, for example by negotiating contracts. While some services provided by PSAOs may vary, PSAOs may be identified and distinguished by other pharmaceutical distribution and payment system companies through the provision of intermediate services or other pharmacy support services with paying third parties. When a pharmacy signs a PSAO agreement, they join thousands of other pharmacies for benefits such as higher reimbursement rates and better contracts for preferred supplier discounts. Although you never intend to have an argument, sometimes they arise. Before you sign your PSAO agreement, find out about the dispute handling requirements. Many contracts have provisions that require you to participate in dispute resolution before taking action, or require them to file an action only in certain states or jurisdictions.
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