First Coast allowances for not-otherwise classified (NOC) drugs that have not been priced by CMS are typically paid using 106% or 103% of the wholesale acquisition cost (WAC) for Part B, and 95% of the average wholesale price (AWP) for Part A, depending on the year. If there is no published WAC, then we would pay based on invoice. When drugs and biologicals are priced based on invoice methodology, the submitted provider cost must reflect the provider’s actual acquisition cost. This includes accounting for any discounts, rebates, prompt-pay reductions, chargebacks, credits, or other price concessions received from manufacturers, distributors, or group purchasing organizations. Invoice pricing determinations will be based on the new acquisition cost after all applicable reductions, not the gross or list price.

We evaluate contractor priced fees on an annual basis or more frequently when revised cost (wholesale acquisition cost, average wholesale price, etc.) information is received.

Claims and additional documentation request (ADR)s

When submitting a claim for a new drug, please report the name of the drug and dosage administered in block 19 of the 1500 claim form or electronic equivalent, Loop 2400 Segment NTE02. 

When submitting and ADR response you should submit the invoice received from the pharmacy or manufacturer showing the drug cost. 

Denial reasons

The main reasons drug claim lines may reject or deny are:

1. Drug and biological claims or claim lines may be rejected when the submitted documentation does not include both the specific drug name and the actual dose administered to the beneficiary. Submission of the drug name and strength alone, without identification of the administered dosage, is insufficient to support accurate pricing and payment determinations. Accurate allowance calculations require clear documentation of the total units administered, expressed in milligrams, micrograms, milliliters, international units, or other applicable dosage measures, as appropriate for the drug billed. When this information is not provided, the contractor cannot determine the correct payable amount using established pricing methodologies. Claims that do not include complete dosage information may be denied or rejected until sufficient documentation is submitted to support the calculation of the applicable allowance.
2. The provider submits medical records, a superbill, or the packing slip. When the invoice amount is not contained in the claim narrative, the submitted invoice must show the drug’s actual cost.
   

3. The invoice provided is for a different drug than the one being billed.
   

Codes paid by Medicare

The easiest way to look up a code and see how Medicare reimburses it is to visit the fee schedule page on our website. You can search for the specialty fees on our fee schedule page, which includes information on other services, such as ambulance, clinical laboratory, etc. If you cannot find a fee or information regarding the coverage of a service or procedure code, contact customer service.