CurrentPremera BluecrossPolicy cmi_171641

National Drug Code (NDC) Billing Guidelines - Outpatient Facility Claims

Governs submission and billing requirements for National Drug Code (NDC) numbers, units, and associated HCPCS procedure codes on outpatient facility (hospital/facility) claims for Premera Blue Cross and affiliated lines of business.

Policy Summary

PayerPremera Bluecross

PolicyNational Drug Code (NDC) Billing Guidelines - Outpatient Facility Claims

Policy CodePolicy cmi_171641

Change TypeAdded/Clarified/Revised

Effective Date01/01/18

Next Review Date

Key ActionInclude an active 11-digit NDC, NDC unit/basis of measure and NDC units on the same outpatient facility claim line as the appropriate HCPCS drug procedure code.

SourceLink

POLICY UPDATE CHANGES

Added a new section 'Codes/Coding Guidelines' listing mandates for Washington providers and their billing guidelines (WA SB 6127 and WA SB 6228) effective January 1, 2025.

Created a Discarded, Wasted and Non-Administered Drugs section with instructions to bill wasted single-use vial amounts on a separate claim line using modifier JW; JZ used when no wastage.

Removed 'ME - Milligrams' unit of measurement from the policy and expanded paper claim field guidance (Field 43) and how to bill administered vs wasted drugs.

11-digitrequired NDC billing format (5-4-2)

2-linewasted single-use vial billing

4preferred unit codes listed

WAstate-specific mandates effective

Outpatient Facility Coverage Criteria

Outpatient facility NDC billing criteria

Billing and reimbursement conditions for drugs administered or supplied in outpatient facility settings. Covered when ALL of the following are met:

Submit an active/valid 11-digit NDC, NDC unit/basis of measurement and NDC units on the same outpatient facility claim line as the appropriate HCPCS drug procedure code for any drug, radiopharmaceutical, supply or device with an assigned NDC.

On electronic (ANSI 837I) or paper (UB-04/CMS-1450) outpatient facility claims, each drug must be reported on an individual line with the required fields populated: Revenue Code (UB-04 Field 42), NDC (Field 43) left-justified as an 11-digit number, HCPCS drug procedure code (Field 44), date of service (Field 45), HCPCS units (Field 46), and charge (Field 47).

If the NDC on packaging is fewer than 11 digits or contains asterisks for leading zeros, the missing digits or asterisk placeholders must be filled with zeros to submit the complete 11-digit NDC on the claim.

Reimbursement for discarded, non-administered or wasted drugs is allowed ONLY for single-use vials or packages; multi-use vials are not reimbursed for discarded or wasted amounts.

Policy Summary

PayerPremera Bluecross

PolicyNational Drug Code (NDC) Billing Guidelines - Outpatient Facility Claims

Policy CodePolicy cmi_171641

Change TypeAdded/Clarified/Revised

Effective Date01/01/18

Next Review Date

Key ActionInclude an active 11-digit NDC, NDC unit/basis of measure and NDC units on the same outpatient facility claim line as the appropriate HCPCS drug procedure code.

SourceLink

On This Page

Trek Health ingests and normalizes Transparency in Coverage data and payer policy updates to give provider organizations a clear view of how commercial reimbursement behaves across markets, payers, and services. Our platform transforms raw payer disclosures into structured intelligence that supports contract evaluation, payer negotiations, and service line strategy. By combining market benchmarks with ongoing policy visibility, Trek helps teams identify variability, risk, and opportunity in commercial reimbursement. The result is faster insight, stronger negotiating positions, and more informed financial decisions.

Coding and Units Guidance

NDC and wastage codingmixedCovered

N4	Product or Service ID Qualifier for NDC in ANSI 837I and UB-04 Field 43
UN, ML, GR, F2	Preferred NDC unit/basis of measurement codes: UN=Units, ML=Milliliter, GR=Gram, F2=International Unit
JW	Modifier for drug amount discarded/not administered to any patient
JZ	Modifier for zero drug amount discarded/not administered to any patient

NDC unit quantity field limits (UB-04 Field 43)mixedCovered

max 7 digits before decimal / max 3 digits after decimal

Maximum NDC unit quantity field length for UB-04 Field 43 (enter whole numbers without decimal when applicable)

HCPCS drug codesHCPCS

J-series, C-series, Q-series, S-series (HCPCS)

HCPCS drug procedure codes to be used in Field 44 on UB-04

NDC unit quantity field limits (UB-04 Field 43)

UB-04 Field 43 unit quantity limitsMaximum of 7 digits before the decimal and maximum of 3 digits after the decimal for the NDC unit quantity field (Field 43).

Whole number entry ruleIf entering a whole number, do not include a decimal point or comma and do not zero-fill; leave remaining positions blank.

NDC unit quantity is separate from HCPCS unitsField 43 unit quantity refers to the NDC drug units (not the HCPCS drug procedure code units which go in Field 46).

Required Provider Billing Actions

Billing Rule

NDC submission requirement

Include an active/valid 11-digit NDC, the NDC unit/basis of measure, and NDC units on the same outpatient facility claim line as the appropriate HCPCS/procedure code. The NDC must be the 11-digit format (5-4-2); pad any missing digits or replace asterisks with leading zeros.

Submit NDC in Field 43 on UB-04/CMS-1450 or the equivalent loop/element on electronic ANSI 837I claims.
The correct NDC is found on the drug label or outer packaging; fill in missing digits or replace '*' with zeros to complete the 11-digit number.

Billing Rule

Billing for wasted/non-administered drugs

To bill wasted single-use vial drug amounts, submit two claim lines: one for the portion administered (no modifier) and one for the wasted portion with modifier JW. If no wastage occurred and the entire single-use vial was administered, append modifier JZ to the HCPCS drug procedure code and submit a single line. Multi-use vials are not eligible for reimbursement of wasted amounts.

Claim line #1 (administered portion): include an appropriate Revenue Code (Field 42), the NDC number (Field 43), the HCPCS drug procedure code (Field 44) with NO modifier, and the units administered (Field 46).
Claim line #2 (wasted portion): include an appropriate Revenue Code (Field 42), the same NDC number (Field 43), the same HCPCS drug procedure code (Field 44) appended with modifier JW, and the units wasted (Field 46).
If the entire single-use vial was administered with NO wastage: submit one claim line with Revenue Code (Field 42), NDC (Field 43), HCPCS drug procedure code appended with modifier JZ, and administered units (Field 46).

Billing Rule

WA HIV PEP and SUD medication billing mandates

Washington state mandates: HIV post-exposure prophylaxis (HIV PEP) drugs supplied in the Emergency Room and certain SUD medications must be billed on a separate claim line with specific revenue codes, appropriate diagnosis codes, HCPCS and active NDC details.

WA HIV PEP (effective 1/1/2025): bill on a separate line with Revenue Code 0253 (Take Home Drugs); include an appropriate diagnosis code indicating possible HIV exposure; include the HCPCS drug procedure code (or appropriate unlisted oral drug HCPCS) and a valid/active NDC for the drug.
WA SUD medication mandate (effective 1/1/2025): for opioid overdose reversal meds and long-acting injectable buprenorphine dispensed at certain outpatient facilities, bill each drug on a separate line with either Revenue Code 0636 (Drugs requiring detailed coding) or 0253 (Take Home Drugs); include an appropriate diagnosis in the F10-F16, F18-F19 range; include the HCPCS drug procedure code, a valid/active NDC, and appropriate units administered.

Key Terms and Definitions

National Drug Code (NDC)

NDC formatAn 11-digit National Drug Code (NDC) in 5-4-2 format (NNNNN-NNNN-NN) is required for each FDA-approved medication.

Segment meaningsFirst segment identifies the manufacturer/distributor (FDA-assigned); second identifies product/strength/formulation (manufacturer-assigned); third identifies package size/type (manufacturer-assigned).

Where to find the NDCThe appropriate NDC number is found on the drug label or outer packaging; if fewer than 11 digits or an asterisk appears, fill missing leading digits with zeros to complete 11 digits on the submitted claim.

Compound Drug

DefinitionA compound drug is an administered drug composed of more than one drug ingredient.

Billing requirement for compoundsWhen billing for a compound drug, each specific drug in the compound must be billed on a separate claim line with the appropriate HCPCS drug procedure code, product ID qualifier, NDC number, unit/basis of measurement, and NDC units.

Submission contextCompound drug NDCs and units must be submitted on outpatient facility claims (electronic ANSI 837I or paper UB-04) along with the appropriate HCPCS code on the same claim line(s) as required.