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By Karen Greco, Clinical Consultant Effective Jan. 1, 2017, CMS required providers to use the modifier JW on claims to report the wasted portion of a drug or biological from a single-use vial (or single-use package) that is eligible for payment under the discarded drug policy. The modifier should only be used for drugs in single-dose or single-use packaging. This policy mandates that the discarded amount of drugs or biologics be appropriately recorded in the patient’s medical record. When the claim is submitted, submit the first line with the drug and amount given. Submit a second line with the drug and include the JW modifier plus what was discarded. For example, a single-use vial of a drug that contains 100 units has 95 units administered to the patient and 5 units discarded. The 95-unit dose is billed on one line and the 5-unit, discarded dose is billed on a separate line with the JW modifier. Both lines will be processed for payment. This policy applies to providers and suppliers who buy and bill drugs and is intended to track discarded amounts of drugs that occur as a result of the preparation of a drug dose for administration to a beneficiary. The JW modifier requirement also applies to critical access hospitals (CAHs) because drugs are separately payable in the CAH setting. The JW modifier does not apply to drugs or biologicals administered in a rural health clinic (RHC) or a federally qualified health center (FQHC). Drugs and biologicals administered in RHCs and FQHCs are generally not separately payable under Part B. Instead, their payment is included in the RHC’s all-inclusive rate or the FQHC’s prospective payment system rate for the patient’s visit. Exceptions are the influenza, pneumococcal and Hepatitis B vaccines, which are paid separately at cost through an RHC’s or FQHC’s cost report and not via a claim.