Fee development process of new drug code pricing
This section will describe the fee development process by our pricing committee when a new drug is FDA approved and there are no fees included in the ASP Medicare Part B drug pricing file or not otherwise classified (NOC) pricing file.
There are four scenarios for pricing a new drug.
Scenario 1:
New drug with no J code assigned and no wholesale acquisition cost (WAC) pricing available.
In this scenario, the provider would bill an NOC J code.
In the comments section of the claim, the provider will give the name of the drug and the dosage administered.
In this scenario, our pricing committee is unable to verify WAC pricing, so the drug will be listed to develop for an invoice for pricing.
Note: If/when an adequate number of invoices are received from an adequate number of different billing providers, our pricing committee will set a fee for the drug based on an average of all invoice costs received.
Scenario 2:
New drug with no J code assigned and with available WAC pricing.
In this scenario, the provider will bill an NOC J code.
In the comments section of the claim, the provider will give the name of the drug and the dosage administered.
In this scenario, our pricing committee will verify that the drug was given for an appropriate diagnosis and an appropriate dosage. Once verified, we will set a fee based on the CMS IOM guidelines (CMS IOM Pub. 100-04, Claims Processing Manual, Chapter 17 , section 20.1.3).
Scenario 3:
New drug with a J code assigned and no WAC pricing available.
In this scenario, the provider will bill using the J code assigned for the drug being administered. The provider must be aware of the J code descriptor and bill the appropriate number of units to be reimbursed correctly.
For example, if the J code descriptor indicates "per milligram" and the dosage administered is 5 milligrams, the provider must have five in the quantity billed (Q/B) field of the claim to be reimbursed for the five milligrams and not one milligram.
In this scenario, our pricing committee is unable to verify WAC pricing, so the drug will be listed to develop for an invoice for pricing.
Scenario 4:
New drug with a J code assigned with available WAC pricing.
In this scenario, the provider will bill using the J code assigned for the drug being administered. As stated above, the provider must be aware of the J code descriptor and bill the appropriate number of units to be reimbursed correctly.
In this scenario, our pricing committee will verify that the drug was given for an appropriate diagnosis and an appropriate dosage. Once verified, we will set a fee based on the CMS IOM guidelines (CMS IOM Pub. 100-04, Claims Processing Manual, Chapter 17 , section 20.1.3).