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Elizabeth M. Whitehorn, Director

Provider Notice issued 10/19/07

Reporting of the National Drug Code (NDC)

 

To:​

Participating Medical Assistance Providers​
Date:​ October 19, 2007​
Re:​ Reporting of the National Drug Code (NDC)​

 

The final rule implementing the drug rebate requirements from the Deficit Reduction Act of 2005 requires all state Medicaid Agencies to collect drug rebates for physician administered or dispensed drugs. This includes physician-administered or dispensed drugs given in the physician’s office or the hospital outpatient department. This requirement does apply to Medicare crossovers. Providers must continue to report the HCPCS code for all drugs, in conjunction with the NDC.

 

 

The NDC reporting requirement will be implemented effective with dates of service on and after January 1, 2008. HFS is allowing a 90-day transition period for providers to comply with this requirement. During this transition period, non-institutional providers and physicians will receive informational messages on their Remittance Advice, in the near future. Informational messages for institutional providers will begin at a later date. The informational messages Identified below are the Informational Codes and the Rejection Error Codes:

 

Informational Only Codes Effective 1/1/08 Rejection Error Codes Description
I10 H16 Missing/Invalid NDC
I11 R77 NDC Not Covered on Date of Service
I12 C01 NDC/Item Number Not on File
I13 R86 NDC is Terminated
I20 D82 NDC Not Covered/MFGR Not on File for Rebate
I21 D83 NDC Not Covered/MFGR Not on File for Rebate on Date of Service
I22 D88 NDC/Item Number Not Approved on File
I23 D90 Manufacturer Not on File For Rebate Quarter
I24 F68 NDC Obsolete/Check Obsolete Date
I25 R78 DESI Drug Not Allowed for Payment
I26 U65 NDC Not Valid for Date of Service

 

HIPAA 837P Transactions and Direct Data Entry through the MEDI System


The department will continue to require that the Health Care Procedure Coding System (HCPCS) codes be supplied to supplement NDC codes for administered or dispensed drugs. Billing instructions for electronic claim transactions can be found in Chapter 300, Topic 302, located on the department’s Web site at: http://www.hfs.illinois.gov/handbooks/

Paper Transactions


The HCPCS code with the charge and the appropriate quantity based on the HCPCS definition should be billed on one service line. The corresponding NDC is billed in the next service line and should include the number of containers/packages (vials, ampules or syringes, etc.) used in the quantity field, and a charge of zero in the charges field. The NDC service line must always be the service line directly after the drug HCPCS code service line. 

Reporting of Multiple NDCs

 

When billing for drugs with one HCPCS and multiple NDCs based upon the dosage administered, follow these procedures:

 

  • Service Line 1:  HCPCS Code

  • Service Line 2:  NDC

  • Service Line 3:  HCPCS Code (same as Service Line 1) - Modifier 76 (Repeat Procedure)

  • Service Line 4:  NDC

  • Service Line 5:  HCPCS Code (same as Service Line 1 & 3) - Modifier 51 (Multiple Procedures)

  • Service Line 6:  NDC

 

 

These procedures apply to both paper and electronic transactions. 

Hand Priced Drug Procedure Codes

 

The department will require both the HCPCS code and NDC for drugs requiring hand pricing. These procedure codes are identified on the physician’s fee schedule on the department’s Web site at <http://wwwqa.illinois.gov/hfs/MedicalProviders/MedicaidReimbursement/Pages/default.aspx>. Providers must report the HCPCS code in the procedure field, the product name, strength and the dosage administered or dispensed in the description field, quantity of 1 in the quantity/units field and total charges for the drug in the charges field. In the service line immediately following, providers must report the NDC in the procedure field, number of containers/packages (vials, ampules or syringes, etc.) in the quantity/units field and charge of zero in the charges field.

 

If you have questions regarding this notice, please contact the Bureau of Comprehensive Health Services at 1-877-782-5565.

 

Theresa A. Eagleson, Administrator
Division of Medical Programs