A pharmacy has a right to request an informal hearing to contest the findings of an audit conducted by the HHSC IG or an entity that contracts with the federal government to audit Medicaid pharmacy providers. The informal hearing can be requested if the audit findings do not include findings that the pharmacy engaged in Medicaid fraud. In an informal hearing, an Administrative Law Judge (ALJ) from the HHSC Appeals Division will make the final decision on whether the complete findings of an audit, including any additional documentation provided, are accurate.

Refer to 1 TAC Section 354.1891 - Vendor Drug Providers Subject to Audit for more information.

3.1 Appeals Process

Pharmacy providers will have 15 days from receipt of the final audit report to request an informal hearing. Pharmacy staff will be notified via certified mail that the informal hearing has been scheduled. The notice is mailed to the pharmacy's address on file with the VDP or to the attorney representing the pharmacy. The date, time, and location of the hearing and any other pertinent details will be provided.

If the informal hearing request was not received within 15 days of the receipt of the final performance audit report, pharmacy providers will be notified via letter that the request was not submitted timely and that an informal hearing will not be scheduled.

If pharmacy staff are is unable to attend the scheduled hearing then the ALJ must be notified in advance. The ALJ determines if the provider's reasons for absence are acceptable. The hearing is rescheduled if the ALJ deems the provider's absence reasons acceptable and the notification process described above will begin again.

The ALJ will make the final decision. VDP staff will be available to address questions but will not vote on the matter.

3.2 Informal Hearings

Informal hearings will be recorded. The pharmacy provider is notified in advance of the hearing date, time and location and that they may request a copy of the recording free of charge.

A certified letter is sent to the pharmacy provider or to the attorney representing the pharmacy provider indicating the final amount due. The pharmacy provider has 30 days to either:

  • Pay the amount in full; or
  • Request and have an approved payment plan.