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Over the past several months, we have seen a significant increase in audits and investigations targeting pharmacies for misrepresentations around prior authorization. In many of these audits, pharmacies are being accused of falsifying information or impersonating prescriber offices to secure prior authorization approvals for high-cost medications. This practice poses substantial legal and financial risks.
Recent Example: OHM Pharmacy Settlement
In April 2025, OHM, a Florida pharmacy pleaded guilty to healthcare fraud and agreed to pay over $1 million in global resolution with federal authorities. Among other conduct, OHM completed and signed prior authorization forms on behalf of physicians, without authorization, and submitted false clinical claims to support approval, stating that patients had failed alternative medications without proper documentation.
This conduct resulted in both criminal charges and civil False Claims Act liability. The pharmacy also entered into a government-imposed Integrity Agreement requiring new internal compliance controls around prior authorization submissions.
Compliance Recommendations
To reduce exposure, pharmacies should take immediate action to review and strengthen their prior authorization compliance policies. Suggestions include:
(1) Do not submit a prior authorization or sign a form on behalf of a prescriber unless explicitly authorized in writing and compliant with plan rules.
(2) Avoid identifying as a “doctor’s office” of implying physician representation in prior authorization communications.
(3) Ensure all clinical justifications are accurate, documented, and traceable to the prescriber’s medical records.
(4) Ensure that all staff at your pharmacy is trained on, and adheres to, all PBM contracts’ requirements and state/federal law with respect to preparation of prior authorization requests for prescriber submissions
By keeping these recommendations at top of mind and implementing appropriate safeguards around prior authorizations, your pharmacy can significantly reduce the risk of unnecessary legal exposure during audits. In the meantime, if you have any concerns or require legal assistance, please do not hesitate to contact us at (212) 668-0200 or via email at info@mdrxlaw.com.
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