TCPA Ruling: Health Insurance “Update” Fax Is Not A TCPA Advertisement

By Sheila Raftery Wiggins

A federal court ruled that a fax sent by a pharmacy benefit manager (“PBM”) to healthcare providers notifying recipients of changes to insured parties’ coverage for prescriptions – the fax mentioned the PBM’s business but did not promote any products or services – did not constitute an “advertisement” under the Telephone Consumer Protection Act, 47 U.S.C. § 227 (“TCPA”).  The court applied the “commercial nature” test for a TCPA advertisement.

CaremarkPCS Health, LLC, a PBM which manages prescription drug benefits for health insurers (“Caremark”), sent an unsolicited fax to more than 55,000 health care providers notifying them of new supply limits on coverage for opioid prescriptions for certain patients covered by plans sponsored by Caremark clients.

A health care provider sued Caremark asserting that the unsolicited fax was an unsolicited advertisement under the TCPA because: (1) the fax referred to services provided by Caremark and (2) Caremark may gain an economic benefit as a result of sending the fax.

The court rejected these arguments.  First, the court found that the fax’s statement about Caremark’s services was informational.  Second, the court stated that merely because Caremark may obtain a remote economic benefit in the future does not convert a noncommercial, informational communication into a commercial solicitation.  The court looked at the “primary purpose” of the fax as being informational, not promotional.  The court also looked at the nature of Caremark’s business when determining the purpose of the fax.  BPP v. CaremarkPCS Health, LLC, No. 4:20-cv-126, 2021 WL 5195785 (E.D. Mo. Nov. 9, 2021).

Lesson:  The intent of the message in the fax – informational and not promotional – should be clear in order to avoid the communication being an “advertisement” under the TCPA.