Drugs and Biologicals billing under ASC setup

Billing for Drugs and Biologicals

• ASCs are strongly encouraged to report charges for all separately payable drugs and biologicals using the correct HCPCS codes for the items used. ASCs billing for these products must make certain that the reported units of service of the reported HCPCS code are consistent with the quantity of the drug or biological that was used in the care of the patient. ASCs should not report HCPCS codes and separate charges for drugs and biologicals that receive packaged payment through the payment for the associated covered surgical procedure.

• If two are more drugs or biologicals are mixed together to facilitate administration, the correct HCPCS codes should be reported separately for each product used in the care of the patient. Mixing two or more products does not constitute a “new” drug as regulated by the FDA under the New Drug Application (NDA) process. In these situations, ASCs are reminded that it is not appropriate to bill the NOC HCPCS code 39399. This code is for new drugs and biologicals that are approved by the FDA and do not have a HCPCS code assigned.

Drugs and Biologicals with Payment Based on Average Sales Price (ASP) Effective April 1, 2008
• Payments for separately payable drugs and biologicals based on the ASP will be updated on a quarterly basis as later quarter ASP submissions become available. In cases where adjustments to payment rates for previous quarters (January 2008) are necessary based on the most recent ASP submissions, CMS will incorporate changes to the payment rates in the April 2008 release of the ASC drug file.

Drugs and Biologicals with Payment Based on ASP Effective October 1, 2008

• Payments for separately payable drugs and biologicals based on the ASP will be updated on a quarterly basis as later quarter ASP submissions become available. In cases where adjustments to payment rates for a previous quarter(s) are necessary based on the most recent ASP submissions, CMS will incorporate changes to the payment rates in the October 2008 release of the ASC Drug File.

• Medicare contractors will make available to the ASCs the list of any newly added codes and previous quarter payment rate changes as identified in CR 6205.

Correct Reporting of Units for Drugs
ASCs are reminded to ensure that units of drugs administered to patients are accurately reported in terms of the dosage specified in the full HCPCS code descriptor. That is, units should be reported in multiples of the units included in the HCPCS descriptor.

• For example, if the drug’s HCPCS code descriptor specifies 6 mg and 6 mg of the drug were administered to the patient, the units billed should be 1.

• As another example, if the drug’s HCPCS descriptor specifies 50 mg and 200 mg of the drug were administered to the patient, the units billed should be 4.

• ASCs should not bill the units based on how the drug is packaged, stored or stocked. That is, if the HCPCS descriptor for the drug code specifies 1 mg and a 10 mg vial of the drug was administered to the patient, 10 units should be reported on the bill, even though only one vial was administered.

• HCPCS short descriptors are limited to 28 characters, including spaces, so short descriptors do not always capture the complete description of the drug. Therefore, before submitting Medicare claims for drugs and biologicals, it is extremely important to review the complete long descriptors for the applicable HCPCS codes.

• ASCs should not report HCPCS codes and separate charges for drugs and biologicals that receive packaged payment through the payment for the associated covered surgical procedure.