What is a Pharmacy Reimbursement?

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  • Written By: A. Leverkuhn
  • Edited By: Andrew Jones
  • Last Modified Date: 21 August 2019
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A pharmacy reimbursement is a specific kind of medical reimbursement that provides for effective health care accounting for medical providers across the United States of America. Within the general category of medical reimbursements, a pharmacy reimbursement is related to a drug cost. These kinds of reimbursements are critical for controlling costs from every angle, as patients, medical providers, insurance companies, and other parties each seek to control their own medical costs.

Generally speaking, a pharmacy reimbursement or other medical reimbursement is made necessary by the current U.S. health insurance system that is mostly manifested through smaller state systems in all 50 states. Resources from the American Health Information Management Association (AHIMA) show experts talking about medical reimbursements in the context of insurance systems where medical providers need to be reimbursed by insurance companies. Basically, reimbursement is the process of billing the responsible parties for covering costs related to health care, and payment by these parties. A pharmacy reimbursement is based on the use of a pharmaceutical drug.

Many kinds of pharmacy reimbursements are related to private insurance companies. In these situations, medical providers often bill insurance companies for the drug costs. Other kinds of pharmacy reimbursements are done under the federal entitlement programs of Medicare and Medicaid. Medicare generally provides for America’s seniors. Medicaid is a system available to those unable to afford conventional health insurance or individuals with disabilities.


Often, pharmacy reimbursements need to be billed in a certain way in order for insurance companies or federal entitlement programs to pay for them. This usually requires medical coding, where valuable medical coding professionals work up detailed Explanation of Benefit forms that result in quicker payment from the insurance companies or government entities. Having a medical coding staff on site is a major part of successful administration for any medical provider, whether or not that specific provider has a pharmacy set up in the building.

Patients who want to understand pharmacy reimbursements need to look critically at their own insurance systems, whether they are covered by a private insurance company, or one of the above federal programs. The federal government provides information on Medicare and Medicaid pharmacy reimbursements along with details on eligibility and coverage for citizens. To get more information about pharmacy reimbursements from a private insurer, patients, members or providers may need to call the customer service offices of the insurance company and route their questions to the appropriate parties.


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