Many payors have incorporated policies for providers to inform payors on discarded or wastage amounts of drugs in single-use packages. To ensure appropriate reimbursement, the providers are required to submit two claim lines for the administered drug. One claim line reflects the dosage administered to the patient and the second is for the wastage amount. To ensure that the claim line for wastages is properly documented, a claim line modifier is required. There are multiple modifiers that can be applied for multiple rationales, but for drug wastage, a modifier of “JW” is utilized to denote a claim line that reflects wastage. The JW modifier is a Healthcare Common Procedure Coding System (HCPCS) Level II modifier that is commonly used for Medicare Part B drug claims to report the amount of drug or biological that is discarded and eligible for payment under the discarded drug/Drug Wastage policy.
To illustrate the concept of waste and Single Dose Vials observe the following example:
The Challenge for the Providers and Payors
The discarded drug should be billed on a separate line with the JW modifier, and the provider must convert the dose unit given to the patient to the proper units for billing based on the HCPCS/CPT code descriptor. These calculations can become complex without appropriate crosswalk data and usage of a system that does not properly support the provider in the accurate coding of a claim. If the drug administered, and amount wasted or discarded are not clearly, completely, and properly documented in the medical records supplied for review, any excess billed amounts may be denied or delayed. Similar burden applies to the payor’s business associates who conduct claim reviews and audits for this.
RJ Health benchmark data shows that over 17% of claims submitted for unused drugs were submitted with invalid wastage information resulting in inefficiencies, over/underpayments and delays in claims processing.
The RJ Health Solution
RJ Health is at the forefront of Medical Drugs and reimbursement issues and is addressing the lack of transparency between providers and payors. As part the RJ Reimbursement suite of products, it has built crosswalks and logic for both providers and payors to identify and calculate potential medical drugs with wastage potential that are associated with unused single-dose vials.
RJ dose and wastage calculation is one of the new features added to RJ SaaS/Web portals, API library. Based on the administered dose or units, it is able to calculate and convert the units for both claim lines for appropriate submission. Above are the screenshots from RJ SaaS tool, www.Reimbursementcodes.com illustrating the process and calculation.
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1. “Overspending driven by oversized single dose vials of cancer drugs” https://www.bmj.com/content/352/bmj.i788/rr BMJ 2016
2. CMS Medicare Policy for JW Modifier – Billing of Discarded Drugs: The following overview of CMS’ policy applies ONLY to single-dose vials – NOT multi-dose. Effective January 1, 2017, claims for discarded drug or biological amount not administered to any patient, shall be submitted using the JW modifier. Also, effective January 1, 2017, providers must document the discarded drugs or biologicals in the patient’s medical record.
a) Click here for JW Modifier: Drug amount discarded/not administered to any patient
b) Click the link below to review the actual CMS policy in the Medicare Claims Processing Manual (Chapter 17 Drugs and Biologicals, Section 40 – Discarded Drugs and Biologicals) https://www.cms.hhs.gov/manuals/downloads/clm104c17.pdf