Pushed by lawmakers, delinquent insurer will pay up

A New York-based insurance company, under fire for allegedly failing to honor claims under Medicare's prescription drug benefit, has decided to pay up.

The Fox Insurance Company earlier this month wired $13.6 million in overdue payments to administrators of its ProCare Pharmacy Benefit Plan, which in turn will pay the pharmacy claims, according to the National Community Pharmacists Association (NCPA).

Fox was kicked out of the Part D drug program in March for violating a series of payment and appeals rules. But the company still received more than $33 million that month from Medicare — some of which the company was holding instead of settling pharmacy claims, according to the Centers for Medicare and Medicaid Services (CMS).

The episode prompted NCPA leaders to write a March letter to CMS, urging the agency to pressure Fox to make the payments. CMS did just that about a week later — to no evident effect. The saga attracted the attention of the bipartisan leaders of the Senate Finance Committee — Sens. Max Baucus (D-Mont.) and Charles Grassley (R-Iowa) — who penned their own letter to Fox at the end of last month.

Nine days later, Fox wired the $13.6 million to ProCare, its pharmacy benefit manager (PBM).

"Even though CMS terminated its Part D contract, Fox had a responsibility to honor these claims," NCPA said in a statement Monday. "Surprisingly, the foot dragging continued despite CMS’ admonition to Fox. Community pharmacies and ProCare, the PBM administrator, were left holding the bag, which is now being rectified with the first wave of payments being sent out."