Pharmacies Are Providers, Too

Does anyone remember the buzz NYS Insurance Department Supervising Attorney Larry Fuchsberg unintentionally started in December 2006 with the issuance of his OGC opinion entitled "No-Fault Payment for Prescription Drugs"? Of course, Larry was correct in his interpretation of the then-limited scope of 11 NYCRR § 65-3.11(a) permitting direct payments of no-fault benefits to "providers of health care services" to not include pharmacies. But did not "must" mean not "may"? I recall a lengthy conversation I had with Larry regarding the intended import of his opinion on that subject.

In January of this year, the Insurance Department corrected what probably was this undersight, by proposing the Thirtieth Amendment to Regulation 83 (11 NYCRR Part 68), to amend Section 68.1(b)(3) to read as follows:

(3) A “licensed health provider” means a licensed healthcare professional acting within the scope of his or her licensure or an entity, including a pharmacy, properly formed in accordance with applicable law and acting within the scope of its license. (Added language underlined.)

Under 65-3.11(a), therefore, pharmacies now qualify as "providers of health care services" entitled to direct payment of no-fault benefits upon submission of either an AOB or ATP.

Effective as published in the NYS Register on April 16, 2008, this amendment also repealed Parts E and F of Appendix 17-C to Regulation 68, which the Department's Circular Letter No. 9 (2008) also issued on April 16, 2008 explains was intended to repeal the fee schedules previously established by the Insurance Department for prescription drugs, durable medical equipment, medical/surgical supplies, orthopedic footwear, and orthotic and prosthetic appliances dispensed to patients on/after July 11, 2007 that are now covered by the two fee schedules effective that date and established in 2007 by the Workers' Compensation Board.

Circular Letter No. 9 (2008) thus concludes:

Therefore, the maximum reimbursement for prescription drugs under the No-fault system, including all brand names and generic drugs, shall be the fees set forth under the schedule for the New York State Medicaid program at the time the prescription drugs are provided, plus a dispensing fee of five dollars for generic drugs and four dollars for brand-name drugs. References in the Workers’ Compensation pharmaceutical fee schedule pertaining to pharmacy network or the substitution of brand name drugs are not applicable to No-fault benefits.

Thanks, Larry, for shooting me an email this morning to remind me of this new amendment and to provide the push for this post.