# Compounded Drug Billing



## celcano (Apr 13, 2016)

We have just recently started to implant pain pumps and are starting to do refills.  We are charged a delivery fee from the pharmacy that provides the compounded drugs.  Can we bill for the delivery fee?  If so, what code would we use or would we just add that fee into the cost of the drugs?  Or....is this just another charge that we absorb...

Thank you for your input.


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## KMCFADYEN (Apr 15, 2016)

There is no way of billing the fee.  

We bill out the appropriate compound drug code (i.e. Q7799)

Submitting Claims for Compounded Medications, Including Medication Administered via Implanted Infusion Pumps

This article explains the correct method for submitting compounded drugs. 

Compounded medications are created by a pharmacist in accordance with the Federal Food, Drug and Cosmetic Act and may be covered under Medicare when their use meets all other criteria for services incident to a physician’s service. 

Compounded medications do not have a National Drug Code (NDC) number, an average sales price (ASP) or an average wholesale price (AWP). Accordingly, the specific HCPCS J codes for the drugs in the compounded formulation may not be submitted. Instead, providers must use HCPCS code J7799 (unclassified drug) (use HCPCS code Q9977 (compound drug, NOC) effective with dates of service July 1, 2015 and after) for reimbursement of the compound. 

The use of compounded drugs has been especially prevalent in the filling of implantable infusion pumps. Whether a single agent or a combination of agents is used, the compounded medication must be submitted with HCPCS code J7799 (use HCPCS code HCPCS code Q9977 (compound drug, NOC) effective with dates of service July 1, 2015 and after) even though the compound is similar to or includes a drug with a specific HCPCS code (e.g., HCPCS code J2275 for preservative free morphine). 

Providers who document and use the true off-the-shelf product without compounding may continue to use the specific HCPCS code. Because non-compounded drugs administered via DME are reimbursed at 95 percent of AWP instead of ASP + 6 percent, the HCPCS KD modifier must be used to indicate this situation. If administered pump dose exceeds MAU for a particular drug, submit documentation to include expected days of therapy on pump (e.g., 18, 30, 40, 60 or 90 day pump). 

When billing for the use of compounded medications, use HPCPS code J7799 (use HCPCS code Q9977 (compound drug, NOC) effective with dates of service July 1, 2015 and after) on a single claim line, quantity billed = '1', and enter the name and total dose (in mg or mcg) of each drug of the refill in Box 19 of the CMS 1500 or the appropriate comment loop of electronic claims. If box 19 cannot accommodate all the information, attach the information to the paper claim. Evaluation and management codes, pump refilling codes, and pump adjustment codes are also reimbursable if clinically appropriate during the visit. 

Example: Unit of 1 J7799 (use HCPCS code Q9977 (compound drug, NOC) effective with dates of service July 1, 2015 and after) claim line detail: Entered in Box 19 or the electronic comment field 'Morphine Sulfate XX mg + Fentanyl YY mcg + Clonidine ZZ mcg' 

Compounded drugs are contractor priced. Palmetto GBA will reimburse compounded drugs for use in implanted infusion pumps by multiplying the price per mcg or mg in the table below by the total number of mcg or mg of each drug used to refill the pump. In addition to the combined allowable calculated by the dosage detailed, a pharmacy compounding fee of $60 per refill will be included in the total allowable for the refill. 

 Medication Price

 Per mg or mcg
 Morphine Sulfate	 $0.050/mg
 Hydromorphone	 $0.130/mg
 Bupivicaine	 $0.040/mg
 Tetracaine	 $0.040/mg
 Fentanyl PF	 $0.0072/mcg
 Droperidol	 $0.0013/mcg
 Ketamine	 $0.0048/mcg
 Baclofen	 $0.003/mcg
 Clonidine	 $0.001/mcg
 Sufentanyl	 $0.090/mcg
 Prialt*	 $7.900/mcg
*Prialt is a drug only available from its pharmaceutical manufacturer. If given as single drug in the pump, use HCPCS code J2278. If mixed with other drugs in the pump, consider the mixture a compounded drug and use the HPCPS code J7799 (use HCPCS code Q9977 (compound drug, NOC) effective with dates of service July 1, 2015 and after). Indicate wastage if portion of a vial is not used by using the JW HCPCS modifier.

Compounded drugs submitted with dates of service July 1, 2015 and after with HCPCS code J7799 will be rejected.


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## dwaldman (Apr 16, 2016)

J7999  
Compounded drug, not otherwise classified  

The above code became effective January 1st 2016. The payment potentially will revolve around sending in the invoice and as seen in the instructions provided from the Palmetto Medicare article, they describe in the previous post you received, the carrier providing a:" pharmacy compounding fee of $60 per refill will be included in the total allowable for the refill."

The carrier you are billing might have separate requirements and payment methodologies.


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