Do you and your team have a good process to readily identify and bill appropriately for self-administered drugs?

The Centers for Medicare & Medicaid Services (CMS) has had a longstanding policy excluding self-administered drugs (SADs) under the outpatient Part B benefit. Oral drugs, suppositories, and topical medications, for example, are easy enough to identify as self-administered, and medications normally administered by intramuscular injection are not usually considered self-administered. But what about drugs administered subcutaneously?

Recently, two Medicare Administrative Contractors (MACs) posted as part of their self-administered drug policy new requirements for reporting modifiers JA (administered intravenously) or JB (administered subcutaneously), depending on the route of administration for a drug present on their Self-Administered Drug (SAD) Exclusion List (keep in mind that some of them in fact may have multiple routes of administration for the hospital setting). These modifiers originally became effective for use on end-stage renal disease (ESRD) claims when billing for the route of administration of erythropoiesis-stimulating agents (ESAs). Now, hospital providers in these MAC jurisdictions will need to ensure that at least one of these modifiers is present when an SAD drug HCPCS Level II code (J or Q) is on the outpatient claim, so the hospital can ensure coverage when applicable. Both MACs stated that they will asterisk (*) the SAD HCPCS code when the JA or JB modifier is required.

Currently, there are three SADs that MACs have identified with multiple routes of administration:

CODE DESCRIPTOR GENERIC NAME DESCRIPTOR BRAND NAME
J0490 Injection, Belimumab, 10 Mg Benlysta®, subcutaneous*
J0129 Injection, Abatacept, 10 Mg (Code May Be Used For Medicare When Drug Administered Under The Direct Supervision Of A Physician, Not For Use When Drug Is Self Administered) Orencia®, subcutaneous*
J2354 Injection, Octreotide, Non-Depot Form For Subcutaneous Or Intravenous Injection, 25 Mcg Sandostatin®, subcutaneous*

 Note: HCPCS codes J0490 and J2354 are not present on all MAC SAD Exclusion Lists. 

The JA modifier appended to a SAD drug HCPCS code will alert the MAC that the drug was administered via intravenous push or intravenous infusion. It is important to note here that this modifier will not only ensure the drug does not get excluded or denied for coverage reasons, but that the drug administration charge itself does not get denied. A good example here is Orencia®. Orencia® can be administered in the outpatient hospital setting subcutaneously or intravenously, depending on the clinical scenario. Orencia® administered by IV infusion method in the hospital outpatient department can be billed as covered. Because HCPCS code J0129 appears on the MAC SAD Exclusion Lists, when Orencia® is administered via IV infusion, HCPCS code J0129 will need to be reported with the JA modifier to allow the drug and the drug administration to be covered.

The JB modifier appended to a SAD drug HCPCS code will alert the MAC that the drug was administered subcutaneously. So, to continue with our example above, Orencia® HCPCS code J0129 will need to be reported on the outpatient claim with the JB modifier when it is administered via subcutaneous injection. This also means that the hospital may not charge for the drug administration (e.g., 96372), since the drug itself is excluded from coverage.

Of note, one of the MACs said that “providers are reminded that no form of insulin, regardless of route of administration, including intravenous, intramuscular, subcutaneous, or inhalation is reimbursable by Medicare. [This includes J8499: Insulin, inhaled (Exubera®), variable.]” This statement appears to contradict this change in coding and billing (and rationale for covering a drug and its administration) because insulin could not reasonably be self-administered by a patient via intravenous methods.

The Medicare Benefit Policy Manual says “MACs may no longer pay for any drug when it is administered on an outpatient emergency basis, if the drug is excluded because it is usually self-administered by the patient.” This means that Medicare does not allow coverage of the drug because of their self-administered exclusion policy, so the hospital will bill using the JB modifier under these circumstances.

Below are our suggested steps to prepare your team and hospital processes for billing all self-administered drugs appropriately:

  • You and your team should review and understand the requirements posted by your regional MAC and the guidance found in the CMS Internet-only Medicare Benefit Policy Manual.
  • Work with pharmacy team to review the MAC SAD list with the hospital formulary to know which drugs are routinely administered subcutaneously but could also be administered intravenously.
  • Review your hospital chargemaster and/or formulary to ensure that all self-administered drugs are appropriately coded (including drugs administered orally and topically).
  • Discuss with staff who will have the responsibility for appending applicable modifiers to the injectable SAD HCPCS codes.
  • Vet your hospital’s policies and procedures against current processes to ensure that the policies address new/current coding and billing guidance.
  • Test accounts with any updated coding and billing processes to ensure that claims look appropriate, based on the MAC requirements.

We recommend that hospital staff pay close attention to your MAC Local Coverage Article updates, as they will soon be following suit on this update to the coding and billing process, especially where it enhances the MACs’ process for adjudicating the claim and making determinations on the coverage of drug, based on this revised policy. At the time this article was written, other MACs (except one) have posted Future Effective Local Coverage Articles that will become effective April 5, 2021.

Remember that the self-administered drug policy is only applicable for hospital outpatient claims. The MACs and CMS have indicated that drugs and biologicals for use in the hospital, which are ordinarily furnished by the hospital for the care and treatment of inpatients, are covered, so the MACs ignore all instances when the drug is administered on an inpatient basis.

For more information on how Panacea is assisting providers nationwide with preparations for these and other changes, go online to https://www.panaceainc.com or call us at 866-926-5933, or contact us by email at contact@panaceainc.com.

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We have provided below the links to each regional MAC Self-Administered Drug Exclusion article.

Article Resources:

Noridian Healthcare Solutions

https://med.noridianmedicare.com/web/jeb/policies/sads

National Government Services

https://www.cms.gov/medicare-coverage-database/details/article-details.aspx?articleId=53022&ver=50&Cntrctr=273&ContrVer=1&CntrctrSelected=273*1&DocType=SAD&bc=AAAAQABAAAAA&

Novitas Solutions

https://www.cms.gov/medicare-coverage-database/details/article-details.aspx?articleId=53127&ver=95&Cntrctr=334&ContrVer=1&CntrctrSelected=334*1&name=Novitas+Solutions%2c+Inc.+(04411%2c+A+and+B+MAC%2c+J+-+H)&s=51&DocType=All&bc=AgAAAABAAAAA&

First Coast Service Options

https://www.cms.gov/medicare-coverage-database/details/article-details.aspx?articleId=52571&ver=51&CntrctrType=12&HCPCS=J0490&DateTag=yes&bc=AAAAACAAAAAA&

Palmetto GBA

https://www.cms.gov/medicare-coverage-database/details/article-details.aspx?articleId=53066&ver=59&CntrctrType=12&HCPCS=J0490&DateTag=yes&bc=AAAAACAAAAAA&

CGS

https://www.cms.gov/medicare-coverage-database/details/article-details.aspx?articleId=52527&ver=33&Cntrctr=228&ContrVer=2&CntrctrSelected=228*2&DocType=SAD&bc=AAABAABAAAAA&

Wisconsin Physician Services

https://www.cms.gov/medicare-coverage-database/details/article-details.aspx?articleId=52800&ver=45&name=143*1%7c147*1%7c144*1%7c148*1%7c145*1%7c149*1%7c146*1%7c151*1%7c268*1%7c264*1%7c265*1%7c266*1%7c267*1&AllHCPCS=yes&DateTag=yes&bc=AAAAACAAAAAA&

Medicare Coverage Database Self-Administered Drug (SAD) Exclusion List Report

https://www.cms.gov/medicare-coverage-database/reports/sad-exclusion-list-report.aspx

Medicare Benefit Policy Manual Chapter 15, Section 50.2 – Determining Self-Administration of Drug or Biological

https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/bp102c15.pdf