Arkansas Pharmacies Face Backlog of Unpaid Insurance Claims for COVID-19 Treatments – Arkansas Advocate

More than 170 Arkansas pharmacies will receive nearly $3.7 million in federal funds, pending legislative committee approval, in reimbursement for unpaid insurance claims covering COVID-19 treatments between March 2020 and May of this year.

The Arkansas Legislative Council’s Subcommittee on Performance Evaluation and Expenditure Review (PEER) approved the Arkansas Association of Pharmacists’ application for funding on Tuesday. The full board is expected to vote Friday to distribute the money, which comes from the state’s allocation of American Rescue Plan Act funds received in 2021, originally more than $1.5 billion.

The Federal Health Resources and Services Administration (HRSA) had a $20 billion program to cover the costs of COVID-19 testing, treatment and vaccines for uninsured Americans during the pandemic, but the program ran out of funds in March 2022.

Pharmacies nationwide then developed backlogs of unpaid insurance claims, particularly for dispensing monoclonal antibodies to treat COVID-positive patients, Arkansas Pharmacists Association CEO John Vinson told lawmakers.

I don’t know of a single supplier in any state for an uncompensated monoclonal antibody injection that was paid for through HRSA, even though it should have been eligible, Vinson said.

In a June 23 letter to Governor Sarah Huckabee Sanders detailing the funding request, Vinson said 110 pharmacies across Arkansas were licensed to dispense monoclonal antibodies in 2021 at the urging of the Arkansas Department of Health, in response to the infectious Delta variant of COVID-19.

These pharmacies, mostly in rural areas, have administered antibodies to more than 20,000 Arkansas, reducing deaths and hospitalizations by 70 to 85%, Vinson wrote.

This effort has not been without financial, mental and physical strain on an already taxed patient care system, he wrote. This is a workforce issue with many pharmacies struggling to maintain staff and having to reduce the hours available for patient care.

Kyle Lomax, CEO of Southern Pharmacy in northeast Arkansas, said providing antibodies to COVID patients at the pharmacies’ Jonesboro location has eased the burden of care on overwhelmed local health care systems.

Southern Pharmacy is entitled to $44,842 in ARPA funds, $28,545 of which is designated for the Jonesboro location, according to data provided by Vinson to state officials.

In addition, De Queen Health & Wellness Pharmacy in Southwest Arkansas will receive $291,870 in ARPA funds. Owner Chester Barber said he was grateful for the forthcoming payback.

If we weren’t able to receive money for unpaid claims, my pharmacy would really be under a huge financial strain, Barber said. Arkansas Pharmacists Association ARPA request data.

Sacrificial Lamb

De Queen Pharmacy was in a unique position during the height of the pandemic because Sevier County, where De Queen is the largest city, did not have a hospital from 2019 to 2022. The former hospital closed when its out-of-state owner was accused of Medicaid fraudand a new hospital opened just north of De Queen in December 2022, partly with the help of ARPA funds.

The lack of a hospital has made vaccinations and COVID-19 treatments even more important to the area, Barber said. The pharmacy that he and his two sons run has been inundated with people from the area looking for vaccinations and antibodies during the pandemic, and high demand has led to soaring supply and labor costs for the facility, he said.

It was a very difficult time, Barber said. The billing aspect of [healthcare] we’ve been sidelined while trying to save people’s lives, especially through the Delta variant while trying to get them in and treated.

In March 2022, HRSA notified pharmacies that the program to cover uninsured COVID-19 treatments was running out of money. Lomax and Barber both said they have only days’ notice to file claims with the federal government.

Some of Barber’s claims missed the deadline and some of those that did were not repaid because HRSA ran out of money, he said.

Former Governor Asa Hutchinson urged uninsured Arkansans to seek out COVID-19 treatments, saying they shouldn’t have to pay for them, but that wasn’t always true if patients’ insurance policies had expired or had unpaid deductibles, Barber said.

Pharmacies have been put out there as a sacrificial lamb for free COVID treatments for Arkansans, he said.

Gov. Sarah Huckabee Sanders’ administration had to stay updated on ARPA funding requests after Sanders took office in January, which slowed the process of the pharmacies’ application reaching state lawmakers for approval, Barber said.

Hutchinson established an ARPA Steering Committee in 2021 and Sanders he dissolved it in January.

Aid to rural hospitals

Pharmacies have received free COVID-19 vaccines and monoclonal antibodies from the federal government. The anticipated reimbursements won’t cover COVID-related pharmacy labor and supply costs, but they will offset them, Lomax and Barber said.

We’ve had to invest a lot of infrastructure, treatments and protocols to make sure we’re protecting not just our patients from exposure [to COVID]but also our employees, said Lomax.

In addition to HRSA, insurance companies outside Arkansas also have not paid COVID-19-related claims, Andy Babbitt, deputy director of the state Department of Finance and Administration, told PEER members Tuesday.

The Arkansas Association of Pharmacists worked with the state Department of Finance to determine reimbursable amounts for each eligible pharmacy, Vinson wrote in his letter to Sanders.

Babbitt told lawmakers the pharmacies will have to reimburse the state for ARPA relief funds if HRSA or the insurance companies ever reimburse them for existing claims.

State Senator Missy Irvin, R-Mountain View, said she is frustrated with unpaid insurance claims, especially since several rural hospitals have been waiting months for ARPA funds in light of their pandemic-related expenses. Three rural hospitals, including one in Sevier County, they received ARPA funds from the state.

I’m ready for the money to get to hospitals, Irvin said. We’ve dragged our feet long enough and we can’t create a level playing field.

The PEER subcommittee also approved a one-year extension on a contract with the consulting firm Alvarez and Marsal on Tuesday, which evaluated 18 rural hospitals in 2022 to determine if they were eligible for ARPA financial relief. The state initially hired the company to help lawmakers decide how to prioritize requests from hospitals for declining state ARPA funds.

The state will pay the company more than $1.8 million in ARPA funds for a year of ongoing work evaluating rural hospitals.

Irvin said he hopes Alvarez and Marsal include unpaid insurance claims in their considerations of hospitals’ eligibility for financial aid.