MedImpact HealthCare Systems

Nov 22, 2023

To print this article, all you need is to be registered or login on Mondaq.com. The Louisiana Insurance Department ("Department")recently fined Express Scripts Administrators, LLC("ESA") $275,000 and MedImpact Healthcare Systems, Inc.("MedImpact") $250,000 for allegedly failing to payelectronically adjudicated insurance claims to pharmacies in atimely manner on behalf of the Louisiana Office of Group Benefits("OGB"). OGB provides health and life insurance benefitsto Louisiana-qualified state employees, retirees of participatingLouisiana state agencies, and eligible dependents. ESA andMedImpact are third party administrators ("TPAs")operating as pharmacy benefit managers ("PBMs") forOGB. Per a recent press release issued by the Department, its Officeof Consumer Services investigated ESA and MedImpact after receivingthousands of remittance advices from the Louisiana IndependentPharmacy Association to substantiate complaints from 19 independentpharmacies alleging numerous violations of the Louisiana InsuranceCode. As a result of the Department's investigations, itdetermined that both PBMs failed to ensure electronicallyadjudicated claims were paid within 15 days as required byLouisiana law. The Department's press release also indicated that ESAadmitted to failing to pay 1.3 million electronically adjudicatedclaims within 15 days due to a software issue. ESA has paid $1.5million in interest to the affected pharmacies and also agreed topay a $275,000 fine and to make the necessary changes to itsprocesses and procedures specified in a Consent Order with theDepartment. The Department's press release indicated that 664,770 claimswere paid by MedImpact in excess of 15 days as required byLouisiana law. MedImpact agreed to pay $602,000 in interest to theaffected pharmacies and to pay a $250,000 fine. Commissioner Donelan also announced in the Department'spress release that neither the software issue cited by ESA, nor thestate of emergency declaration cited by MedImpact (related to theCovid-19 pandemic) excused ESA or MedImpact from complying withLouisiana law. The content of this article is intended to provide a generalguide to the subject matter. Specialist advice should be soughtabout your specific circumstances. AUTHOR(S)