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National Drug Code (NDC) FAQs: NDCs and Medi-Cal Claims Process

  1. When should providers start billing with NDCs on Medi-Cal claims?
    A: Effective for dates of service starting September 1, 2008, providers are encouraged to begin using the NDC in conjunction with the customary Healthcare Common Procedure Coding System (HCPCS) Level I, II or III codes.
  2. What is the final implementation date when providers will only be able to use the NDC on claims?
    A: Effective for dates of service on or after April 1, 2009, claims that do not have a valid NDC and the appropriate HCPCS Level I, II or III code will result in the claim being denied.
  3. How should providers submit their Medi-Cal claims?
    A: Providers may submit paper claims using the CMS-1500 and UB-04 claim forms or electronically in the ASC X12N 837 5010A1 Institutional or Professional formats. Until the Internet Professional Claim Submission (IPCS) system have been updated, providers using those claims submission methods must continue to provide the appropriate HCPCS Level I, II or III codes.
  4. Is NDC information required on Medi-Cal claims?
    A: Yes, when the drug is billed independent of the service. See chart below:

    Type of Claim
    NDC

    Medicare/Medi-Cal crossover claims

    Not required.
    Fee for Service Medi-Cal as primary Required when the drug is billed
    independent of the service.

    Medi-Cal as secondary (other health coverage)

    Required when the drug is billed independent of the service.

    California Children’s Services (CCS) claims

    Required when the drug is billed independent of the service.

    Genetically Handicapped Persons Program (GHPP)

    Required when the drug is billed independent of the service.

    Presumptive Eligibility claims

    Required when the drug is billed independent of the service.

    Every Woman Counts (EWC) claims

    Required when the drug is billed independent of the service.

    Child Health & Disability Prevention (CHDP) claims Not required.

    Family PACT (Planning, Access, Care and Treatment) claims

    Required when the drug is billed independent of the service. Not required for HCPCS III codes X1500 and Z7610.

  5. Are the NDC and unit of measurement required on a crossover claim when billing with either the UB-04 or CMS-1500 claim forms?
    A: Crossover claims do not require NDC information at this time. If Medicare implements all of the NDC requirements at a future point in time and requires Medi-Cal to use it for crossover claims, then Medi-Cal will notify providers accordingly.
  6. Is NDC information required on Medi-Cal managed care claims?
    A: Medi-Cal has instructed that the managed care plans (MCPs) such as the County Organized Health System (COHS) provide the NDC for drug claims even if the claims are submitted outside of the MCP contract guidelines. Other MCPs such as CalOPTIMA, Central Coast Alliance for Health, Health Plan of San Mateo, Partnership HealthPlan of California and CenCal Health have already been contacted by Medi-Cal about NDC requirements for MCPs. Providers should contact the MCP directly to find out specific information.
  7. Are compound drugs exempt from NDC reporting requirements in the hospital outpatient environment?
    A: No. Each drug dispensed should be entered on separate lines of the CMS-1500 or UB-04 claim forms using the appropriate HCPCS Level I, II or III code and NDC.
  8. The Centers for Medicare & Medicaid Services (CMS) Change Request from May 2, 2008 seems to state that only UB-04 claim form billers must include NDC information. Is that correct?
    A: No. For Medi-Cal claims, both the CMS-1500 and UB-04 claim forms require NDC information.
  9. What happens if a provider bills for a physician-administered drug that is not on the contracted drug list?
    A: Claims for drugs made by manufacturers that are not on the Drugs: Contract List Part 5 – Authorized Manufacturer Labeler Codes will be denied, unless the drug was already authorized by Medi-Cal.
  10. Is the NDC required on an outpatient claim if a drug is not reimbursed by Medi-Cal?
    A: Medi-Cal encourages providers to use the NDC for every claim.  If a claim is denied, then providers will receive the correct reason code for the denial.

    For example: If the drug is billed with the NDC and it is not reimbursed by Medi-Cal, the denial reason code will indicate that the drug was not covered. Any claim billed without the NDC will be denied because the NDC was not entered. It will appear as if the provider made a mistake so the denial code may not be accurate.
  11. If the required NDC information is missing, will the entire claim be denied or just the claim line for the physician-administered drug?
    A: Only the claim line for the physician-administered drug will be denied if the NDC information is missing or invalid. Other claim lines will not be impacted.
  12. Must the NDC Unit of Measure match the HCPCS Level I, II or III code units/quantity information?
    A: No.
  13. If a provider enters the HCPCS Level I, II or III code, units and/or NDC correctly, but does not enter the unit of measurement correctly, will that line item be denied?
    A: No, not when the NDC number and HCPCS code match in the validation table. The NDC unit of measurement date will be collected only. The field does have to contain information, and we want providers to make their best attempt to list correct information.
  14. Should providers follow the national CMS guidelines for entering a decimal in the Unit of Measure field or the Medi-Cal guidelines as indicated in the provider manuals and Medi-Cal Updates?
    A: When billing Medi-Cal, providers must follow the Medi-Cal guidelines for submitting a claim.
  15. Will Medi-Cal use a “unit” conversion for rebates on provider claims that contain a valid HCPCS code, units and the NDC?
    A: Yes. There is a conversion process in place that will convert the HCPCS code units to the appropriate NDC units for rebates. Medi-Cal will not be publishing the conversion table.
  16. How should the units of measurement (gm; ml; un) be calculated and entered on either the CMS-1500 or UB-04 claim form?
    A: The NDC units of measure are by weight (grams; gm), volume (milliliter; ml) or count (unit; un). Each dispensed dosage should be converted into one of these units of measure.

    For example: If the drug is a liquid, the concentration should be converted to milliliters (ml). For 1,000 ml and 10,000 units administered or dispensed, 10 ml was used (10,000 un ÷ 1000 ml). Based on this example, “ML000010000” would be entered on either the CMS-1500 or UB-04 claim form as the unit of measure as part of the NDC information for the dosage. Providers that may have additional questions about determining NDC quantity for Medi-Cal claims are advised to consult with their pharmacists.
  17. Should providers bill for drugs with NDCs using standard or international units of measurement? For example, Vitamin A is measured based on international units (F2), but the Meditech Dictionary uses standard units of measure.
    A: Providers should submit claims for all administered or dispensed drugs with an NDC using standard units of measure. Any administered or dispensed drugs with an NDC measured in international units (F2) should be converted to standard measurements (gm; ml; un). International units of measure are not currently being used at this time. Vitamin A is administered or dispensed as a liquid and should be billed in milliliters. Providers that may have additional questions about determining NDC quantity for Medi-Cal claims are advised to consult with their pharmacists
    .
  18. Will injectable products, in a liquid dosage form, that currently use microgram (mcg) or milligram (mg) designation reporting in Box 24G need to be converted to milliliters (mL) for the purpose of Unit of Measurement reporting in the shaded area of Box 24D on the CMS-1500 form (Box 46 of the UB-04 form)?
    A: Yes. Providers that may have additional questions about determining NDC quantity for Medi-Cal claims are advised to consult with their pharmacists.
  19. How should providers bill for administered or dispensed dosages with a NDC that was calculated in micrograms (mcg)?
    A: This is a conversion issue that is drug and dosage-specific. Grams (gm) are used for topical forms of medicines as a unit of weight measurement instead of dosage. Micrograms (mcg) are a unit of measurement based on the dosage of the drug.

    For example:  If 400 mcg of a drug was administered with a concentration of 200 mcg per milliliter (mcg/ml) and the HCPCS billing unit was calculated increments of 100 mcg, then providers should bill four HCPCS units (100 mcg x 4 = 400 mcg), but enter the NDC unit of measure as "ML" for two milliliters of the mcg concentration per milliliter (400 mcg ÷ 200 mcg/ml = 2 ml). Providers that may have additional questions about determining NDC quantity for Medi-Cal claims are advised to consult with their pharmacists.
  20. How should providers enter NDC information for drugs that are measured in both grams (gm) and milliliters (ml) at the same time?  For example, Albumin 12.5 gm = 240 ml (5% solution).  Is there cross-reference in place for units of measurement of this type?
    A: Providers should bill all liquids in milliliters (ml) using basic proportionate math. There is no cross-referencing process or system available at this time.

    For example: Albumin is 12.5 gm per 240 ml. If 25 gm were dispensed, the NDC units of measurement would be 480 ml (25 gm dispensed ÷ 12.5 gm = 2 x 240 ml = 480 ml dispensed). Providers that may have additional questions about determining NDC quantity for Medi-Cal claims are advised to consult with their pharmacists.
  21. For Epoetin Alfa, should providers enter the units of measurement as units or milliliters since the product description lists both types of measurement?
    A: The HCPCS code units will continue to be billed in increments of 1,000 (Example: A HCPCS code quantity of 10 would be 10,000 units). If it is a liquid, the NDC quantity should be entered in milliliters. The unit or “UN” designation for the NDC quantity should be referred to as “Each” and should be used for the quantities of tablets, capsules, powder vials for reconstitution and prescription kits. Providers that may have additional questions about determining NDC quantity for Medi-Cal claims are advised to consult with their pharmacists.
  22. If a provider administers 8 gm of a drug that has a NDC and 2 gm were wasted during the process, does the provider bill for 10 gm, or only the 8 gm that was used?
    A: Medi-Cal will reimburse the provider for the entire 10 gm that was used. Providers should make sure that they enter the NDC and appropriate quantity of the drug correctly on the CMS-1500 or UB-04 claim form. Providers that may have additional questions about determining NDC quantity for Medi-Cal claims are advised to consult with their pharmacists.
  23. How do providers enter the quantity for a drug on the UB-04 claim form that has more than six, whole-number digits for its unit of measurement prior to the three digits allotted for decimals?
    A: The occasion that a drug with an NDC would have more than six, whole-number digits would be very rare. Grams (gm) are a unit of weight measurement for ointments and creams that will probably not exceed 1000 kilos when dispensed.  Units (un) are for capsules or powders and it is not likely that more than 100,000 units will be dispensed with a single prescription. Milliliters (ml) are used for liquids that are also not likely to be dispensed more than 1000 liters at one time. If there is drug dispensed with an NDC requiring more than six digits, the unit of measurement quantity should be split onto the claim form as two separate line items. Providers that may have additional questions about determining NDC quantity for Medi-Cal claims are advised to consult with their pharmacists.
  24. How would providers enter a product such as Interferon (18 million units) on a claim form?  What unit of measurement designation should be used?
    A: Interferon is a liquid so milliliters (ml) would be the correct unit of measurement. The 18 million units of Interferon administered should be converted to milliliters. Providers that may have additional questions about determining NDC quantity for Medi-Cal claims are advised to consult with their pharmacists.
  25. Do NDCs eliminate the need for providers to describe the drugs used with a HCPCS Level III code such as Z7610 (miscellaneous drugs) or a procedure code such as 90779 (therapeutic injection) in the Additional Claim Information field (Box 19) on the CMS-1500 claim form?
    A: No. Any drugs administered or dispensed for codes such as these still require a description in the Additional Claim Information field (Box 19) on the CMS-1500 claim form or the Remarks field (Box 80) on the UB-04 claim form. Family PACT (Planning Access Care and Treatment) providers are exempt from reporting the NDC along with Z7610.
  26. How do providers bill for two medications when HCPCS Level III code Z7610 (miscellaneous supplies) is used for both medications administered or dispensed on the same day?
    A: The Medi-Cal claims payment system will allow HCPCS Level III code Z7610 to be used more than once for the same date of service.  Providers should enter this code twice as separate line items along with the appropriate NDCs. Family PACT providers are exempt from reporting the NDC along with Z7610.
  27. Considering the current Medi-Cal reimbursement rate, can providers/hospitals choose to not report NDC information and allow the claim line to deny, rather than going to the expense of changing procedures, policies and systems to capture NDC information?
    A: The Department of Health Care Services requests all providers of physician-administered drugs to accurately document and submit claims for all physician-administered drugs covered by the Medi-Cal Program.



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