Inpatient Medications Reimbursed Under Medical Coverage

Policy No: 116
Originally Created: 07/01/2021
Section: Facility
Last Reviewed: 02/01/2024
Last Revised: 11/01/2022
Approved: 02/08/2024
Effective: 03/01/2024
Policy Applies To: Group and Individual & Medicare Advantage

This policy applies to inpatient facilities.

Average Wholesale Price (AWP): A prescription drug term referring to the average listed or published price of a drug. AWP pricing is based on data obtained from manufacturers, distributors, and other suppliers. Our health plan uses Medi-Span as their primary source for AWP.

National Drug Code (NDC): Drugs are identified and reported using a unique NDC (three-segment number), which serves as the FDA’s (Food and Drug Administration) identifier for drugs.

Our health plan requires units of measurement to be placed on the claim to determine the reimbursement amount for medications reimbursed under medical coverage. The order of the methodologies employed in determining the proper amount is:

• If manufacturers invoice, including the date of the invoice as well as the pricing is provided, our health plan will price at 100% of the supplier invoice for the cost of the drug only. Fees such as shipping and handling will not be reimbursed.
• If NDC is provided, our health plan will price at 100% AWP, for the date of service.
• If no NDC or invoice is provided within 15 days of our health plans request, our health plan will price at 100% of the most applicable AWP, based on the description and dosage supplied, for the date of service.

None

Pricing Codes Without RVUs

Timely Receipt of Records

Discarded Drugs and Biologicals