A: The Deficit Reduction Act of 2005 (DRA) requires state Medicaid programs to collect rebates on physician-administered drugs in order to receive federal funding for coverage of these drugs.

 

Since there are often several NDCs linked to a single HCPCS code, the Centers for Medicare and Medicaid Services (CMS) consider the use of NDC numbers critical to correctly identify the drug and manufacturer in order to invoice and collect the rebates.

A: The Medicaid Drug Rebate Program was created by the Omnibus Budget Reconciliation Act of 1990 (OBRA '90) and became effective 1/1/1991. The law requires that drug manufacturers enter into an agreement with CMS to provide rebates for their drug products that Medicaid pays for. Outpatient Medicaid pharmacy providers have billed with NDC's and submitted for rebates since 1991. The DRA has expanded the rebate requirement to physician-administered drugs.

A: All providers who bill DMAP for physician-administered drug codes for outpatient services need to report the NDC for the drugs administered.

A: Any medical practitioner whose licensed scope of practice includes administration of drugs.

A: Yes, for outpatient services only. Inpatient services are not included in the DRA and do not require NDC reporting.

A: The only CPT codes that require NDC information are immune globulin codes 90281 through 90399. Generally, diagnostics, radiopharmaceuticals and vaccines are exempt from the NDC reporting requirements.

DMAP will require NDC reporting for drugs billed using HCPCS codes, including:

• A,C, J, Q (except for contrast materials, codes Q9951-Q9968), and S codes.
• "Not otherwise classified" (NOC) and "Not otherwise specified" (NOS) drug codes (e.g., J3490, J999 and C9399).
• For hospitals, Revenue Center Codes 251-259 and 634-636 will require a CPT/HCPCS code and NDC reporting. If you billed on or after July 1, 2011, using codes 250, 262, 263, 331, 332 or 335 and were denied due to missing CPT/HCPCS or NDC for claims, please rebill DMAP.

A: No. DMAP does not include vaccines in the rebate requirements. However, other payers may have different requirements. This quick reference includes examples of the codes and descriptors used for billing vaccines.

A: Yes. Because the state may pay a portion of the Medicare crossover claim (e.g., Medicare coinsurance/deductibles and drug procedure codes not covered by Medicare), physician-administered drug claims for Medicare-Medicaid recipients also require NDCs with the HCPCS codes.

A: Yes. The 340B Drug Pricing Program resulted from the enactment of the Veterans Health Care Act of 1992, which is Section 340B of the Public Health Service Act. Providers are able to acquire drugs through that program at significantly discounted rates. Because of the discounted acquisition cost, these drugs are not eligible for the Medicaid Drug Rebate Program.

 

State Medicaid programs are obligated to ensure that rebates are not claimed on 340B drugs. The DRA 2005 does not exclude 340B drugs; therefore, all providers must also meet these requirements. In order for providers to identify 340B drugs dispensed in an outpatient or clinic setting, the National Medicaid Electronic Data Interchange HIPAA workgroup has recommended use of the "UD" modifier. Oregon Medicaid has instructed its providers to also bill with the "UD" modifier in its supplemental billing guides.

A: When you need to report NDCs for outpatient physician-administered drug services, you must use the 11-digit NDC listed on the drug packaging. To find out if the NDC is rebateable, search for the NDC in the CMS drug rebate file posted at www.cms.gov/MedicaidDrugRebateProgram/09_DrugProdData.asp click on "Drug Product Data"). If the NDC is on file, it is rebateable.

A: Refer to Oregon Administrative Rule 410-130-0180 (Drugs) in the Medical-Surgical Program administrative rulebook.

A: Revenue Center Codes 251-259 and 634-636 will require a CPT/HCPCS code and NDC reporting.

A: The NDC is the number which identifies a drug. The NDC number consists of 11 digits in a 5-4-2 format. The first 5 digits identify the manufacturer of the drug and are assigned by the Food and Drug Administration. The remaining digits are assigned by the manufacturer and identify the specific product and package size. Some packages will display fewer than 11 digits, but leading "0"s can be assumed and need to be used when billing. For example:

 

NDC on label	Configuration on label	NDC in required 5-4-2 format
05678-123-01	5-3-2	05678-0123-01
5678-0123-01	4-4-2	05678-0123-01
05678-0123-1	5-4-1	05678-0123-01

 

The NDC is found on the drug container (i.e. vial, bottle, tube). The NDC submitted to Medicaid must be the actual NDC number on the package or container from which the medication was administered. Do not bill for one manufacturer's product and dispense another. The benefits of accurate billing include reduced audit, telephone calls and manufacturers' dispute of their rebate invoices.

 

It is considered a fraudulent billing practice to bill using an NDC other than the one administered.

A: Yes. Provider reimbursement is based on the HCPCS description and units of service. The state's mandated rebate submission is based on the NDC and those units.

A: Yes. Use the HCPCS code and service units as you have in the past; this is the basis for your reimbursement.

 

NDC units are based upon the numeric quantity administered to the patient and the unit of measurement. The unit of measurement (UOM) codes are:

• F2 = International Unit
• GR= Gram
• ML = Milliliter
• UN = Unit (Each

The actual metric decimal quantity administered and the unit of measurement are required for billing. If reporting a fraction, use a decimal point. For example: Three 0.5ml vials are dispensed, the correct quantity to bill is 1.5 ml.

A: It depends on how the manufacturer and CMS have determined the rebate unit amount. The rule of thumb is:

• If a drug comes in a vial in powder form and has to be reconstituted before administration, then bill each vial (unit/each) used. (UN)
• If a drug comes in a vial in a liquid form, bill in milliliters. (ML)
• Grams are usually used when an ointment, cream, inhaler, or a bulk powder in a jar are dispensed. This unit of measure will primarily be used in the retail pharmacy setting and not for physician-administered drug billing. (GR)
• International Units will mainly be used when billing for Factor VIII-Antihemophilic Factors. (F2)

For example:

 

A patient received 4 mg Zofran IV in the physician's office. The NDC you used was 00173-0442-02, which is Zofran 2 mg/ml in solution form. There are 2 milliliters per vial.

• You would bill J2405 (ondansetron hydrochloride, per 1 mg) with 4 HCPCS units
• Since this drug comes in a liquid form, you would bill the NDC units as 2 milliliters. (ML2)

A patient received 1 gram of Rocephin IM in the physician's office. The NDC of the product used was 00004-1963-02, which is Rocephin 500 mg vial in a powder form that you needed to reconstitute before the injection.

• You would bill J0696 (ceftriaxone sodium, per 250 mg) with 4 HCPCS units
• Since this drug comes in powder form, you would bill the NDC units as 2 Units (also called 2 Each). (UN2)

Please note: NDCs listed above have hyphens between the segments for easier visualization. When submitting NDCs on claims, submit as an eleven digit number with no hyphens or spaces between segments.

A: If the drug is packaged in a multi-dose vial (can be used for more than one patient), then only bill DMAP for the units administered.

 

If the drug is packaged in a single dose vial that cannot be used for multiple injections, payment is allowed for the amount of the drug or biological discarded along with the amount administered, up to the maximum number of allowed units. The units billed must correspond with the smallest dose (vial) available for purchase from the manufacturer(s) that could provide the appropriate dose for the patient.

 

When calculating the NDC units, the HCPCS procedure code units should be converted to the NDC units, using the proper decimal units. For example, if a patient received only 2 mg of Zofran and you used the NDC which for Zofran 2 mg/ml in a 2 ml vial, the billing would look like this: HCPCS J2405 (ondansetron hydrochloride, per 1 mg) 2 units NDC 00173044202 ML1.

A: See quick tips about reporting NDC on professional and institutional claims in paper and electronic formats. You can also refer to the provider guidelines for your program.

A: Only the detail line that required NDC reporting will deny. Other services billed on the claim will process as usual.

A: No. The NDC submitted to Medicaid must be the actual NDC number on the package or container from which the medication was administered. It is considered a fraudulent billing practice to bill using an NDC other than the one administered.

A: No. If you do bill without a CPT/HCPCS, services billed under those Revenue Center Codes will deny.