Tier 1 appeals

Tier 1 appeals are done at the Pharmacy Benefit Manager (PBM) level. PBMs must clearly describe pharmacies’ appeal rights in both their provider contracts and on their websites, with pharmacy-specific information that is easy to find. This description must include clear contact methods (phone, fax, and email or secure portal), step-by-step instructions for filing an appeal, and a detailed explanation of the appeals process. 

PBMs must allow pharmacies to submit supporting information showing that a reimbursement was below the pharmacy’s actual drug acquisition cost. Acceptable evidence includes purchase records, other cost documentation, or a formal attestation explaining the cost and the pharmacy’s efforts to obtain the drug at the best available price. 

The PBM is required to reconsider the reimbursement amount, review and investigate all submitted information, and give the pharmacy an opportunity to provide documentation or written comments. The PBM must issue a decision within 30 calendar days of receiving the appeal. If no decision is issued within that timeframe, the appeal is automatically considered denied. 

Tier 2 appeals

Tier 2 appeals are submitted to our office after you have received a denial or unsatisfactory response from the Tier 1 appeal.

One of the following people will review the appeal and issue an initial order:

  • Our presiding officer 
  • An administrative law judge from the Office of Administrative Hearings (OAH)  

You or your representative, such as a pharmacy services administrative organization (PSAO), can submit an appeal after a PBM denies your reimbursement request or if you disagree with the PBM's decision.

The appeals must be submitted within 30 days of receiving the PBM's decision or within 30 days of the PBM's deadline for responding to the first-tier appeal.

To file an appeal, the pharmacy will also need to meet all the requirements below:

  • The small pharmacy has no more than 15 retail locations.
  • They filled the prescription in Washington state.
  • They filled the prescription for a customer with a fully insured, non-ERISA plan.
  • The prescription was for a drug(s). 
  • They completed the reimbursement process through their PBM.
  • Within the past 30 days, they received a denial or a reimbursement they disagree with. 
  • The person submitting the appeal has the authority to file it under WAC 284-180-507. 

The Small Pharmacy Appeals Program follows these laws and rules:

  • RCW 48 is the State Insurance Code. 
  • WAC 284 contains rules for the insurance industry.  
  • WAC 284-180-507 contains rules for appeals from network pharmacies.
  • RCW 34.05 is the State’s Administrative Procedure Act.
  • WAC 10-08 contains procedures for administrative hearings.