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Know All Regarding DIR and GER Fees?

Acronyms….. they seem to be everywhere….. especially in healthcare. 

One acronym that has surfaced in the specialty pharmacy world is MIP

Scratching your head on what that one means? Well, it stands for Medically Integrated Specialty Pharmacy, one of the now hundreds of SPs that are owned and operated by Integrated HealthCare Systems (IHCSs) and hospitals. 

But wait…  there are more acronyms associated with MIPs….! How about DIRs? Yes, Direct and Indirect Remuneration (DIR) fees. Even MIPs are being hit by DIRs

But wait, there is now yet another acronym referencing the type of DIR fees being assessed by PBMs….. a GER which means Generic Effective Rate. Huh?  These new fees are calculated on a drug’s maximum allowable cost, wholesale acquisition cost, or average wholesale price (AWP).

Confused yet?

The article below is well worth a read even for those of us who think we are experts at understanding DIR fees. It covers a lot of ground and offers examples in fairly straightforward English. Any staff member who is less proficient on the topic would benefit from reading this article. 

An excerpt from the article follows…..

  • Between 2010 and 2020, retroactive DIR fees increased by more than 100,000%.  DIR fees are charged by PBMs outside of administration fees and are often collected after the point of sale (POS) and do not reflect the pharmacy’s actual reimbursement at the time of dispensing. Traditionally, DIR fees are based on so-called pharmacy performance metrics.  DIRs have recoupment fees of up to 15% of the adjudicated price paid to the pharmacy for dispensing a prescription. PBMs develop and manage specific criteria used to score the contracted pharmacy. The scoring process varies from insurer to insurer and may include unachievable goals for specialty pharmacies focused on dispensing oncology medications [for example]. Unrealistic goals may include………….

CLICK HERE to read the full article — PBM Fees Put the “GER” in Danger for Specialty Pharmacies

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