Oncology & Hematology Coding Alert

Find out what 85 percent AWP means for your practice Your oncologist's chemotherapy drug reimbursement may take a hit in 2004 when you report anti-cancer drug codes such as J9062 and J9170, thanks to a decrease in Medicare payment rates that took effect Jan. 1. But you may be able to recoup some of the losses by comparing drug costs with reimbursement, coding experts say.
 
To calculate 2004 drug payment rates, Medicare now pays 85 percent of the average wholesale price (AWP) for most established chemotherapy and other injection drug codes. For 29 other drugs, the government will pay below 85 percent, says Carolyn M. Davis, CMA, CPC, CCP, CCS-P, CPHT, RMC, billing supervisor for Oncology Hematology West in Papillion, Neb., and a professional coding and continuing-education instructor at Iowa Western Community College. J9062 Now Pays $22 Less So, how will a 10 percent reduction of AWP affect your oncology practice? Let's say your oncologist administers chemotherapy treatments to a patient with ovarian cancer (183.0, Malignant neoplasm of ovary and other uterine adnexa; ovary). The physician used the drug Cisplatin, and you report J9062 (Cisplatin, 50 mg).
 
In 2003, Medicare paid a national average of $213.73 for J9062. This year, however, Medicare reimburses the drug at $191.23, according to the American Society of Clinical Oncology in Alexandria, Va. That's a loss of about $22 for each time you bill Cisplatin.
 
When your oncologist treats lymphoid leukemia (204.x), he or she often uses the drug fludarabine phosphate. To bill that code, you should report J9185 (Fludarabine phosphate, 50 mg).
 
Because of payment rate reductions, most Medicare carriers will pay about $292.30 in 2004. But last year, you would have received $326.69 for the same 50 mg of fludarabine phosphate.
 
"We fear that our oncology practice may make less money" this year because of the decreases in J code payments, says Valerie Puckett, CPC, director of billing and reimbursement at the UT Cancer Institute in Memphis, Tenn. For example, two of the drug codes her practice bills most often, J9170 (Docetaxel, 20 mg) and J9268 (Pentostatin, per 10 mg), both received cuts in reimbursement.
 
Medicare reduced J9170's average payment of $328 to $273. And the national average for J9268's reimbursement dropped from $1,926 to $1,723. In total, lower reimbursement for both J codes results in about $260 in losses. How to Recoup Net Costs To combat losses in drug reimbursement, oncology practices should compare the drug's cost with the insurer's reimbursement, Davis says.
 
If your practice finds that your carrier has paid below the net cost (the cost after rebates and incentives) that the practice incurred for using the drug, you should resubmit the drug codes. Make sure to include documentation of reimbursement and the [...]