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Definition · Pharmacy, Medicare enrollment, and access

DIR fees

DIR fees (direct and indirect remuneration) are price concessions Medicare Part D plans and their pharmacy benefit managers collect from network pharmacies. They are often tied to performance scores. Since January 1, 2024, CMS rule CMS-4192-F requires plans to apply all pharmacy price concessions at the point of sale. The pharmacy now knows its payment when it fills.

What DIR fees are

DIR stands for direct and indirect remuneration. It is the Part D category for money that changes a drug's final cost after the sale, including manufacturer rebates and pharmacy price concessions. In pharmacy talk, DIR fees means the pharmacy side. These are amounts plans and PBMs take back, often based on performance metrics like adherence.

Before 2024, many of these fees were assessed months after a claim was paid. A pharmacy could not see its real margin at the counter. CMS rule CMS-4192-F changed that. Starting January 1, 2024, plans must apply all pharmacy price concessions to the negotiated price at the point of sale. The negotiated price is now the lowest possible payment.

Point-of-sale concessions removed the surprise but not the pressure. Many network contracts still tie pharmacy payment to performance scores such as adherence on statins, diabetes drugs, and blood pressure drugs. Rivvi is a HIPAA-compliant AI workspace where owners can analyze fill and performance files in chat. Its action layer runs refill outreach by call and text.

Questions

DIR fees, answered

What does DIR stand for?
DIR stands for direct and indirect remuneration. In Medicare Part D it covers any payment that changes a drug's cost after the sale, such as manufacturer rebates and pharmacy price concessions. Pharmacists usually say DIR fees to mean the concessions charged to pharmacies.
What changed with DIR fees in 2024?
Under CMS-4192-F, starting January 1, 2024, Part D plans must apply all price concessions they receive from network pharmacies at the point of sale. The negotiated price must be the lowest possible payment to the pharmacy. That ended the old pattern of fees assessed months after a claim was paid.
Do DIR fees still exist?
The concessions still exist, but they now show up at the point of sale instead of months later. Pharmacies see lower reimbursement on the claim itself. Performance terms in network contracts can still affect payment, so adherence scores still matter to pharmacy margins.

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