HCPCS Level II Coding
What this domain tests
HCPCS Level II items cover drugs and biologicals, supplies, DME, prosthetics, ambulance, and their modifiers, units, and coverage rules.
Core rules
- Level II codes begin with a letter followed by four digits, such as J, A, E, K, L, Q, and V codes.
- J codes for drugs have a defined billing unit. Divide the dose administered by the billing unit, and do not round up.
- Report the NDC when the payer requires it. Discarded drug is reported with modifier JW; JZ indicates no waste.
- Modifier KX documents medical necessity for certain DME; GA and GZ relate to ABN status; EY is an item supplied by a non-contracted entity.
- Supplies used in a physician office may be bundled into the procedure; separately billable supplies require a HCPCS code and payer policy support.
Worked example
A patient receives 40 mg of triamcinolone from a 50 mg vial. J3301 has a billing unit of 10 mg, so report 4 units for the 40 mg administered. The remaining 10 mg is discarded and reported as 1 unit of J3301-JW, assuming the payer requires waste reporting. Reporting 5 units without JW misstates both the dose and the waste.
Traps
Rounding units up; billing a drug with a CPT code instead of its J code; omitting JW for documented waste; using the wrong billing unit; applying KX without documentation; missing NDC requirements.