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Key notes about Insurance Contracts and Licensing when Buying or Starting a Pharmacy
If you are buying or starting a pharmacy one of the first things to understand is what you will have to do to receive your licenses and PBM contracts. Not doing this could cause you to lose business or delay your opening/purchase. Below are key items to do to ensure you know what is required for licensing and insurance contracts.
1. Call your State Board – understand what the process is for license approval. Are they going to do an inspection, when will the inspection occur, what is required to pass? What is the timeline? Some states require a board meeting you must attend. These are just examples and will differ from state to state, so call them understand it.
2. Does your state require a state control license? Some states require a separate number via a separate application and if they do it can delay your process.
3. Call Medicaid – every states process for receiving a Medicaid number will differ. Call Medicaid understand what is required to obtain. If buying, will you keep the number, will the number change, and do they require approval in advance of sale? If starting how long will it take?
4. Do managed Medicaid plans require Medicaid approval? - In some states if you contract with the managed care company you automatically can bill Medicaid, in other states you have to have the Medicaid number to activate the managed care.
5. Are you in a Hot Zone? CMS has Hot Zones and if you are in a hot zone you will be forced to wait on contracts with certain Medicare plans, sometimes up to 1 year.
6. If buying are you doing an asset or stock sale? – this will impact all your licensing, if asset sale you will most likely get all new licenses and PBM contracts if you are doing a stock sale you will probably try to keep all the licenses and contracts. The stock sale will cause you to follow a different process and you may or may not be able to keep the licenses so make sure you understand this early in the purchase process.
7. Are you going to bill Med B for diabetic supplies, immunizations or anything else? – Med B is not included with your PSAO like Medicare Part D and will require a separate application. Med B for immunizations can be obtained with a simple application however diabetic supplies is considered DME and all DME requires an accreditation which can take some time.
8. Some PBMs will require an inspection – the PBMs will at times require an inspection and you will have to be open prior to them doing so. Call the key providers in your area and understand if they will or not.