In 2017, the Centers for Medicare & Medicaid Services (CMS) released claims-processing guidance clarifying the use of the JW modifier and how to bill Medicare for discarded drugs and biologics. This billing guideline is still in effect for all providers. The intent of the wasted/discarded drugs and biologics coding policy is to minimize waste and/or abuse.
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When a physician, other provider, hospital or supplier must discard the remainder of a single-dose vial (SDV) or other single-use package after administering a dose/quantity of the drug or biologic agent to a patient, Medicare will reimburse for the discarded amount, as well as the dose administered, up to the amount indicated on the vial or package label. Per Medicare guidelines the amount administered must be reported on one line and the amount of drug not administered (i.e., wasted) on a separate line with the modifier JW. The JW must be appended to the associated Healthcare Common Procedure Coding System (HCPCS) code.
The JW modifier is applicable only to the amount of the drug discarded or wasted, and not to the amount administered. Further, the amount wasted and identified by the JW modifier must be at least equal to one billing unit. For example, if the HCPCS code is reportable in 10 mg increments and 7 mg of a 10 mg SDV is administered, report the entire billing unit without a separate line for the amount wasted. If a HCPCS code is reportable in 10 mg increments and 70 mg from a 100 mg SDV is administered, the provider may report seven bill units as administered, and on a separate line report three units with the JW modifier appended to the HCPCS code to indicate the drug amount discarded.
To avoid any overpayment for drugs billed, always round up the amount administered to the next billing unit and round down the amount of drug discarded. For example, if an HCPCS code is reportable in 10 mg increments and the provider administers 77 mg from a 100 mg SDV, report eight units as administered and, on a separate line, report two units with the JW modifier appended to the HCPCS code to indicate the amount discarded.
As always, Medicare expects the administration of drugs to be scheduled and performed in an efficient manner, minimizing the amount of drug wastage.
The JW modifier is not permitted to identify discarded amounts from a multi-dose vial (MDV).