It's been a while since I've dealt with this and it was only for patients with Medicare who were not inpatient. If a patient is given the med, like 2 ibuprofen tabs, and takes it in an outpatient setting (in the ED, clinic, office, etc), Medicare will not pay for it. The exception is when it's required for the services during that encounter. If I remember correctly, the facility billed for the drug product, then MC would deny to patient responsibility due to it being on their exclusion list. Needless to say, we had a lot of patient complaints when they weren't told this during the visit. Not to mention that the price of one tablet was significantly more than a whole bottle would have cost at the store. It was decided that the physicians would offer the med to the patient, but "recommend" they purchase it at a local drug store due to the MC denial/cost situation.
I do know that you shouldn't discount the cost, write off the charges, or not bill them at all, unless you're going to do that for ALL patients because it falls into the Anti-kickback statute.
