FAQs about in-office injections: What you need to know

March 1, 2005

A number of questions still surround coding and reimbursement for in-office drug injections. As a result, this article will take a slightly different approach, using a "frequently asked questions" format. I?ll repeat the questions I?ve been asked about the new drug payments at seminars and via phone and e-mail, and attempt to give you straight answers to the best of my understanding.

Correction
In my February 2005 Urology Times article ("Reimbursement, codes for injections are new in 2005," page 36), the code given for therapeutic and diagnostic injections was wrong. G0353 is actually for intravenous injection. The correct code for intramuscular injection, diagnostic and therapeutic, is G0351. Please accept my apology for this mistake.

Also, I have some good news about therapeutic injections. The rules have been changed. If you look on AUACodingToday.com (see related article, page 4), the payment designation for this code is now A instead of T.

That means, as of Jan. 1, 2005, you can charge an office visit (if the OV is "medically necessary" and meets the definition of the -25 modifier), with a diagnostic or therapeutic injection for the first time since 1992. The -25 modifier must be attached to the E&M code.

A number of questions still surround coding and reimbursement for in-office drug injections. As a result, this article will take a slightly different approach, using a "frequently asked questions" format. I'll repeat the questions I've been asked about the new drug payments at seminars and via phone and e-mail, and attempt to give you straight answers to the best of my understanding.

You are well aware by now that the Medicare Modernization Act of 2003 changed the way physicians are paid for injectable drugs in the office. In the past, urologists were paid a percentage of the average wholesale price (AWP), whereas this year we are being paid based on average sales price (ASP). The change will have a significant financial impact on practicing urologists (see "How urologists are impacted financially," below).

Also, CMS changed the rules last year on how we can charge for office visits in conjunction with our chemotherapy injections, and the injection codes have changed. What can the practicing urologist expect this year? Below are some answers related to reimbursement and coding for the drugs themselves as well as the injection of these drugs.

What is the difference between AWP and ASP? AWP is the price provided by the pharmaceutical company for each drug prior to January 2005. This was published in the ?red book? and in many cases did not accurately reflect the price the drugs were selling for. ASP is the average price that each drug sold for in the quarter being reported.

How is ASP calculated? Each pharmaceutical company will calculate the ASP for each of its drugs on a quarterly basis, using actual sales information based on detailed and standardized rules. All drug sales, with few exceptions (eg, drugs sold to Medicaid, other government agencies, and a few other specific categories), will be included. All sales to physicians, purchasing groups, pharmacists, and wholesalers, including all volume, cash, or other discounts will be used in the calculations.ASP will first be determined by the manufacturer's report, which includes all sales, number of units, and the price of each unit (manufacturer's ASP). Then CMS will average all manufacturers' ASP that is charged under a single "J" code according to their respective volumes to determine an ASP for that J code. For example, the ASP for leuprolide acetate (Lupron, Eligard) will be averaged to develop a single ASP for the J code J9217.

What is "least costly alternative" (LCA)? LCA is the payment methodology that allows Medicare to pay the same payment for drugs that have been determined by Medicare to be "medically equivalent," for example leuprolide (Lupron, Eligard) and goserelin acetate (Zoladex). The Medicare carrier in each state decides whether or not to pay for the drugs using the LCA methodology.

Which states are not using the LCA methodology? Those that are not currently LCA states are Illinois, Michigan, Minnesota, Wisconsin, and Montana. Also, Utah has rescinded the LCA payment methodology for 6 months, starting in January.

What can I do to change my state to a non-LCA state? Contact your Medicare carrier medical director and explain the reasons that you think it should be discontinued. AUA has presented this argument to CMS.

What will Medicare pay for leuprolide this year in a non-LCA state? The payment as published (106% of ASP) in the final payment rules for 2005 is $253.13 for J9217. Medicare will pay 80% of $253.13 for both Lupron and Eligard.

What will the government pay for a goserelin implant this year in a non-LCA state? The payment for J9202 as published is $189.79. The payment will be 80% of the published price.

What will Medicare pay for triptorelin pamoate for injectable suspension (Trelstar) this year in a non-LCA state? Triptorelin, being re-launched by Watson Pharmaceuticals in the second quarter of this year, is in a unique position. Since the drgu has been off the market for the last several quarters, it probably will not have an ASP. Therefore it will be paid using wholesale acquisition cost (WAC) methodology.

Contractually, Medicare could potentially pay a higher price according to the WAC. If Watson decided to give a cash discount, volume discount, etc., the discount would apply to the average selling price over 12 months. Therefore, contract price could continue to be lower than ASP for the next year.

What will Medicare pay for leuprolide and goserelin in an LCA state? Medicare has determined that goserelin and all forms of leuprolide injectables are medically equivalent. Therefore, it will pay equally for all three--Lupron, Eligard, and Zoladex (or drugs in that category). Medicare will pay 80% of $189.79, the published price for goserelin, which is the lowest payment of the three drugs. Currently, triptorelin is not included in the LCA payment category and therefore would not be included. However, any state could change its policy and include it in the future.

Will the payment for any of the drugs change next quarter? As long as there is competition in the marketplace and changes in the contract price that you pay for the drugs, chances are that ASPs will change each quarter for all drugs.

What can be done in the case of bladder cancer drugs, which cost more than what we're paid by Medicare? There is no good answer at this time. AUA is working on a solution and has raised the issue with the government. AUA is also exploring urologist options with group purchasing. Some physicians are thinking of sending their patients to the pharmacy, but if you do this, the patient will not be reimbursed by Medicare. Other urologists are refusing to buy, sending their patients to the hospital.

Is there a chance the government will change the rules and pay more for drugs this year? The rules allow for an exception to the ASP payment system. CMS has indicated it would take another look at the bladder cancer drugs, but has not indicated that it will pay more. I don't think there's any chance that Medicare will increase the price on LHRH agonists.

What am I being paid in 2005 for injecting LHRH agonists in the office? The national average payment by Medicare for LHRH injections has decreased from $64.07 in 2004 to $36.62.

What injection code should I use for injecting LHRH agonists this year? The new code for all LHRH injections for Medicare patients is G0356 (chemotherapeutic injection, hormonal). Therefore, this is the correct code to use for goserelin acetate (Zoladex), triptorelin pamoate (Trelstar), and leuprolide acetate (Lupron, Eligard) for Medicare patients in all states, even those that used to require you to use the therapeutic injection code. Continue to use 96400 for private insurance patients unless the payer instructs you to use the G codes.

Can I charge for the demonstration G codes each time I see a cancer patient for questioning about pain and their general condition and get paid the extra $130.00 per visit, as suggested in one of the coding newsletters? Unfortunately, you cannot charge those codes in conjunction with an intramuscular or subcutaneous injection. However, if you're giving an IV injection or infusion, you can charge the extra codes.

What injection code should I use this year for testosterone and other injections? The new code for Medicare is G0351 (therapeutic or diagnostic injection). Continue to use the CPT code 90782 for private payers.

Can I charge a nursing visit when I give an LHRH injection? No. One can no longer charge a 99211 first-level established patient visit (commonly called "the nursing code") on the same day that a chemotherapeutic administration occurs. The law changed the rules in 2004 for charging an evaluation and management service on the same day as a chemotheraputic administration (96400). This rule applies to the new Medicare code G0356 in 2005.

Can you charge for an office visit when the urologist evaluates a patient on the same day that an LHRH injection is administered? Yes, if the urologist sees the patient and provides a service that qualifies for the use of a -25 modifier and provides a higher level of service than 99211, then the E&M service can be charged by attaching the -25 modifier to the appropriate level office visit code. Be sure that your documentation reflects that the service is significant and separately identifiable from the injection and that it was medically necessary.

What happens if I switch from a 3-month to 1-month injection or a 12-month implant? The Office of Inspector General has warned physicians not to switch patients to different drug cycles for economic reasons. If you switch patients to implants or to different monthly intervals, be sure to document the medical reasons for doing this.

Can I still make a profit over 6%? Yes, the payment is for 106% over ASP, not the invoice price. The idea is to continue to buy low and sell high.

What is the best strategy for 2005? Urologists should continue to get the best price they can for the drug most appropriate for their patients, be sure the contract price is ASP or below, and be aware that the payment may change (possibly decrease) each quarter. It is advisable to be prepared to adjust purchasing contracts accordingly. Avoid long-term contracts until you know all of the options.

Will the payments change in 2006? In 2006, physicians will likely have two main options:

  • Choose to continue to buy drugs and to be paid 106% of the ASP, as you are doing in 2005.


  • Obtain drugs from one of the contracting agents designated by Medicare for each area that will deliver the drugs to the office at no cost to the physician. The rules governing the agencies have not been finalized. Originally, the regulations suggested that the decision is all or nothing; if a physician chooses to continue buying drugs, then they must buy all of their drugs. If they choose to use the acquisition agent, then they must obtain all drugs through that agency. However, CMS is considering allowing physicians to continue and is accepting comments on this issue currently.
    Making this choice will alleviate all charges for drugs to Medicare and will eliminate any income for storing or handling the drug. However, there are many unknowns about the new system.


How urologists are impacted financially


According to Medicare statistics, urologists received approximately 37% of their 2004 total Medicare revenues from drugs and 60% from all other services. Medicare has estimated that the change in payment for drugs will decrease the overall urology income from LHRH agonists by 38%. The overall impact will be a decrease of 14% in payments from Medicare.

This profit center last year accounted for over 30% of the "take-home pay" for some urologists. Urologists are expected to lose a majority of that income?approximately $60,000 for the average urologist.UT

Disclaimer: The information in this column is designed to be authoritative, and every effort has been made to ensure its accuracy at the time it was written. However, readers are encouraged to check with their individual carrier or private payers for updates and to confirm that this information conforms to their specific rules.