Don’t forget to seek reimbursement for discarded drugs

May 25, 2017

Not doing so leaves money on the table

Q: There are times when we don’t administer the whole amount of a drug to a patient, so we are disposing of some. Since we paid for the full amount of the vial or package, can we bill for the total amount?

A: According to the Centers for Medicare & Medicaid Services (CMS), you should be reimbursed for the unused drug or biologicals when they are from a single-use vial or single-use package that is properly discarded. The exception to this are those drugs and biologics provided under the Competitive Acquisition Program (CAP) for Part B drugs and biologicals. The JW modifier (drug amount discarded/not administered to any patient on the claim for the unused portion of the drug) should now be utilized when billing for discarded drugs.

Since July 2016, providers are required to bill for the full single-dose vial or package and use the JW modifier. Medicare Administrative Contractors are identifying and monitoring the specific details regarding how the discarded drug or biological information should be documented. 

Providers are required to:

  • Use the JW modifier for claims with unused drugs or biologicals from single use vials or single use packages that are appropriately discarded (except those provided under the CAP for Part B drugs and biologicals), and

  • Document the discarded drug or biological in the patient’s medical record when submitting claims with unused Part B drugs or biologicals from single use vials or single use packages that are appropriately discarded.



Billing Example Using JW Modifier

Consider two single-use vials, each containing 20 mg of a drug. You administer 35 mg to the patient and discard 5 mg. The HCPCS code description states that the drug unit is
1 mg = 1 unit.

The 35 unit dose is billed on one line,
while the discarded 5 units may be billed on another line with the JW modifier. Both line items would be processed for payment.
 Claim line 1  – provide the following information:

Claim line 1 - provide the following information: 

  • HCPCS code for drug administered with no modifier

  • Number of units administered to the patient

  • Calculated submitted price for only the amount of drug given

 Claim line 2  – provide the following information:


  • HCPCS code for the drug wasted with the JW 

  • Number of units wasted

  • Calculated submitted price for only the amount of drug wasted


 Claim line 1:   JXXXX x 35 units, cost for 35 units

 Claim line 2:   JXXXX-JW x 5 units, cost for 5 units

Keep in mind that you aren’t required to submit the information for reimbursement of the wasted drug amount. In this situation, only submit a claim for the drug amount administered to the patient. However, if you choose to do this, you are leaving money on the table, which could add up if you administer drugs frequently in your office.