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CMS Clarifies Proper Discarded Drug Use

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  • May 14, 2010
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Recent guidance issued by the Centers for Medicare & Medicaid Services (CMS) clarifies the appropriate use of modifier JW Discarded drug not administered when reporting unused units of drugs and biologicals for reimbursement. Failure to follow this guidance could result in excessive units billing.
Medicare reimburses physicians, hospitals, and other providers or suppliers for the unused units of a single-use vial or other single-use package as well as the dose administered up to the amount indicated on the vial or package label.

Properly Use Modifier JW

Report the number of unused units of a drug or biological on a separate line and append modifier JW to the applicable HCPCS Level II code.
CMS provides this example of proper billing:

“a single use vial that is labeled to contain 100 units of a drug has 95 units administered to the patient and 5 units discarded. The 95 unit dose is billed on one line, while the discarded 5 units may be billed on another line by using the JW modifier. Both line items would be processed for payment.”

When Not to Use Modifier JW

Do not use modifier JW to report unused units if the amount used was less than the billing unit. When the billing unit is equal to or greater than the total actual dose and the amount discarded, modifier JW is not permitted.
CMS provides this example of improper billing:

“One billing unit for a drug is equal to 10mg of the drug in a single use vial. A 7 mg dose is administered to a patient while 3mg of the remaining drug is discarded. The 7mg dose is billed using one billing unit that represents 10mg on a single line item.  The single line item of 1 unit would be processed for payment of the total 10mg of drug administered and discarded. Billing another unit on a separate line item with the JW modifier for the discarded 3 mg of drug is not permitted because it would result in overpayment.”

Refer to CMS Transmittal 1962, Change Request (CR) 6711, issued April 30, for specific language.

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No Responses to “CMS Clarifies Proper Discarded Drug Use”

  1. marjorie hodges says:

    what if you have an order for ativan ime im and you recieved a vial which has 2 mg can you save the unused portion and use it at another time ? do you bill for the whole vial if you throw half the vial away?

  2. debra cline says:

    i am not a nurse and don’t know the standard procedure for disposing of unused meds-my question is do hospitals/or can hospitals donate unused medications to places like St. Vincent DePaul in Baton Rouge, Louisiana-where medications can be given to the homeless and people out of work?

  3. Deedee Miller says:

    Would we use the JW modifier to bill for a drug when a patient knocks it out of the doctor’s hand and the vial is wasted?