Medicare Reimbursement for Discarded Drugs

When a provider discards remaining drug in a single-use container after administering a dose, Medicare provides payment for the discarded amount, as well as the dose administered, up to the amount designated in the single-use container.

This FAQ addresses the following:

1. What is the Medicare policy for discarded drugs?
2. Why did CMS establish a discarded drug policy?
3. What modifiers apply to claims for drugs provided in single-use containers?
4. How is modifier JW used on a claim for reimbursement?
5. How is modifier JZ used on a claim for reimbursement?
6. When do modifiers JW and JZ not apply?
7. When a not otherwise classified (NOC) HCPCS code applies, how should it be billed?
8. When the administered dose is less than 1 unit contained in a vial, how should it be billed?
9. How is overfill handled?
10. Does discarded medication need to be documented in the medical record?

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