Focused Claim Audits Deliver Valuable ROI
TFG Partners – Case Example
- J3490/J9999 – Unclassified Drugs
TFG Partners has noticed an increasing number of claims for injectable drugs being submitted under unclassified J3490 or J9999 codes. TFG Partners has for years expressed serious concerns with the rapid increase of use of injectable drugs and frequent inadequate submission of these claims for injectables. Not identifying the specific injectable drug involved can make it almost impossible to determine correct AWP pricing, discounts, etc., and easily result in over or underpayments.
A specific example was a recent J-3490 claim for drugs used to treat a patient suffering from Osteomyelitis, a bone infection.
The drug’s NDC, 00409-4055-03 was mentioned on the HCFA 1500 which turned out to be Clymdamycin, a relatively low cost antibiotic. The provider charged total of 66 units of Clymdamycin for treatment over a 7 day hospital stay. The injectable was charged at a cost of $140.70 a unit, or a total
billed amount of $9,240.
The administrator, not knowing that it was really paying for Clymdamycin, only adjusted the billed amount by the network agreed-upon discount of 50% for J-3490 codes, thus reducing the billed amount from $9,240 to a paid amount of $4,620.
Had the claim be filed correctly for 66 900mg/6ml vials of Clymdamycin, it would have been determined that:
- The standard unit dose is 150 mg costing $0.938, hence the AWP Redbook cost would be $5.63 per 900 mg vial, not the $140.70 charged which also happens to be the cost of a box of 25 vials.
- The payments at AWP thus should be $371.58 (66 vials times $5.63) and not the $9,240 billed or $4,620 paid.
- As a result, the claim was overpaid by $4,248.42
- Additionally, a medical review should have brought out that the recommended dosage for 7 days would have been in the 14 vial range with a maximum recommended dosage around 35 vials, both below the 66 vials billed or far below the 1650 vials in 66-25 vial cases.
TGF Partners Solution & Outcomes
TFG Partners correctly identified the problem and working with the administrator, recoveries as well as a review of other medical claims from this provider were successfully initiated. Since the root cause of the problem had been isolated, i.e. acceptance of an identifiable J claim under the non-specific J-3490 code, it was recommended to reject all J-3490 claims for which an NDC or HICPIC code exists.
In general, inaccurate submission and adjudication based on inaccurate information can lead to under or in many cases significant overpayments of a plan’s obligations. Administrators should pay J codes using the appropriate code. Incomplete claims and inaccurately coded claims should be returned for completion, and not be paid on inadequate information. Additionally, the system should have the capability to flag what appears to be highly excessive pricing or quantities and assure that an in-depth review of unusual outliers takes place.