Pharmacy Audits & PBM Defense
Desk audits, on-site audits, clawback demands, and network terminations for Tennessee community and compounding pharmacies, handled by a former state regulator with a litigation firm behind him.
Eleven years inside Tennessee healthcare regulation, including as deputy general counsel at the Department of Health.
Licensed in Tennessee, with federal practice before the DEA, FDA, and HHS nationwide.
The healthcare division of Litson PLLC, ready if a matter reaches court.
How we approach it
A PBM audit notice usually arrives as a list of claims and a deadline, and the temptation is to pull the prescriptions, send them in, and hope the reviewer sees what you see. Matt Gibbs spent more than eleven years inside Tennessee healthcare regulation, including as deputy general counsel at the Department of Health, and the habit he brought with him is reading a records request the way the reviewer will read it, which means understanding what each claim is being tested against before a single page leaves the pharmacy. That reading also surfaces the deadlines and appeal windows written into the contract, which are easy to miss under the pressure of the notice and impossible to recover once they pass.
From there the work is organizing the file so that it answers the audit’s question on its own terms. Auditors are working from a contract and a set of criteria, and most discrepancies they flag come down to documentation that exists but was never assembled in the form the audit expects, so the response gathers the prescription, the dispensing record, the prescriber communication, and the patient signature log into a single account of each claim. When a finding is wrong, the appeal is built with the same discipline, and when a finding is right, the goal shifts to limiting the recoupment to what the contract actually allows, with the pharmacy’s cash flow in mind at every step.
Tennessee’s FAIR Rx Act, now law, changed some of the ground rules for how PBMs audit and reimburse pharmacies in the state, and understanding where those protections apply to a particular audit or termination is part of every response we prepare. When a dispute grows into a network termination or a contract claim that belongs in court, the litigation firm behind RxLaw Group is already familiar with the file, so nothing is lost in a handoff. The same file that answered the audit becomes the foundation for the appeal, the negotiation, or the claim, which is one more reason to build it carefully from the first day.
What we handle
From the first notice to the final appeal, and the preparation that keeps the next one small.
Reading the notice against the contract, organizing the claim file, and managing the auditor’s visit or records submission.
Answering each flagged claim with the prescription, dispensing, and prescriber records that show what actually happened.
Challenging preliminary and final findings within the contract’s appeal windows, with the documentation the reviewer needs to reverse them.
Limiting recoupment to what the contract and Tennessee law allow, and negotiating the terms when a balance is owed.
Responding to termination and suspension notices, and pursuing reinstatement or the remedies the contract provides.
Reimbursement, MAC pricing, and contract disagreements, including the protections Tennessee’s FAIR Rx Act now provides.
An active audit, appeal, or termination dispute is handled on an hourly or retainer basis with a clear scope and estimate before work begins. Members get the preparation that keeps findings small: unlimited questions, documentation and policy review, and a file that is ready before the next notice arrives, on one flat monthly fee.
Common questions
Read the notice against your contract before you pull a single record, because the notice tells you which claims are in question, what the auditor is testing them against, and how long you have to respond. Then gather the complete file for each claim, the prescription, the dispensing record, prescriber communications, and signature logs, and let counsel review it before it goes out. A well-organized first submission answers most of the questions an auditor would otherwise have to ask.
Yes. Most PBM contracts provide an appeal process for preliminary and final findings, and each stage runs on its own deadline. An appeal is strongest when it answers the specific discrepancy the auditor identified with the documentation that resolves it, rather than a general objection, which is why the claim file is organized claim by claim from the start.
Membership covers the questions, documentation review, and audit-readiness work that surround an audit, and it is the reason most members see small findings when a notice arrives. An active audit response, appeal, or termination dispute is a separate engagement, scoped and estimated up front on an hourly or retainer basis, so there is never a surprise about what is covered.
The FAIR Rx Act is now Tennessee law, and it sets state-level rules for how PBMs deal with pharmacies on matters such as audits, reimbursement, and network access. Whether a particular protection applies depends on the plan, the contract, and the claim, so part of every audit response we prepare is checking where the Act reaches and raising it where it helps.
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