RETIRED - JW Modifier Use - Correct Coding - Effective January 1 2017 - JD DME

Joint DME MAC Publication

Posted September 16, 2010

The Centers for Medicare & Medicaid Services (CMS) recently issued updated guidance on the billing of drug wastage to REQUIRE use of the JW modifier (DRUG AMOUNT DISCARDED/NOT ADMINISTERED TO ANY PATIENT). For the Durable Medical Equipment Medicare Administrative Contractors (DME MACs), the JW modifier only applies to the following Local Coverage Determinations (LCDs):

• External Infusion Pumps
• Intravenous Immune Globulin (IVIG)
• Nebulizers

These LCDs will be updated to include the JW modifier requirements. Required use of the JW modifier is effective for claims with dates of service (DOS) on or after January 1, 2017.

The Medicare Claims Processing Manual (Internet-only Manual 100-04), Chapter 17, Section 40 contains information on the use of the JW modifier for discarded drugs and biologicals. The Medicare program provides payment for the amount of a single use vial or other single use package of drug or biological discarded, in addition to the dose administered, up to the amount of the drug or biological. There are two scenarios that can occur:

Scenario 1
When the HCPCS code Unit of Service (UOS) is less than the drug quantity contained in the single use vial or single dose package, the following applies:

• The quantity administered is billed on one claim line without the JW modifier; and,
• The quantity discarded is billed on a separate claim line with the JW modifier.

In this scenario, the JW modifier must be billed on a separate line to provide payment for the amount of discarded drug or biological. For example:

• A single use vial is labeled to contain 100 mg of a drug.
• The drug's HCPCS code UOS is 1 UOS = 1 mg.
• 95 mg of the 100 mg in the vial are administered to the beneficiary.
• 5 mg remaining in the vial are discarded.
• The 95 mg dose is billed on one claim line as 95 UOS.
• The discarded 5 mg is billed as 5 UOS on a separate claim line with the JW modifier.
• Both claim line items would be processed for payment.

Scenario 2
When the HCPCS code UOS is equal to or greater than the total of the actual dose and the amount discarded, use of the JW modifier is not permitted. If the quantity of drug administered is less that a full UOS, the billed UOS is rounded to the appropriate UOS. For example:

• A single use vial is labeled to contain 100 mg of a drug.
• The drug's HCPCS code UOS is 1 UOS = 100 mg.
• 70 mg of the 100 mg in the vial are administered to the beneficiary.
• 30 mg remaining in the vial are discarded.
• The 70 mg dose is billed correctly by rounding up to one UOS (representing the entire 100 mg vial) on a single line item.
• The single line item of 1 UOS would be processed for payment of the combined total 100 mg of administered and discarded drug.
• The discarded 30 mg must not be billed as another 1 UOS on a separate line item with the JW modifier. Billing an additional 1 UOS for the discarded drug with the JW modifier is incorrect billing and will result in an overpayment.

Multi-use vials are not subject to payment for discarded amounts of drug or biological.

Claims for drugs billed to Medicare must use drug dosage formulations and/or unit dose sizes that minimize wastage. Providers and suppliers are expected to use drugs or biologicals most efficiently, in a clinically appropriate manner. Only when the most efficient combination of dosage forms are used and there is drug remaining may a supplier bill the discarded amount using the JW modifier on the claim line for the UOS not administered to the patient. Because of the HCPCS code descriptors and the associated UOS for DMEPOS items, the DME MACs expect rare use of the JW modifier on claims.

The JW modifier is used in conjunction with other modifiers listed in the applicable LCDs. For example, suppliers must add a JW modifier to codes for nebulizer drugs, in conjunction with the KX modifier, only if all of the criteria in the "Coverage Indications, Limitations and/or Medical Necessity" section of the Nebulizer LCD have been met.

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