My claim contains HCPCS code C9399 (Unclassified drugs or biologicals), and received reason code 32512 indicating that the associated units must be equal to one. Please explain this reason code.

Reason code 32512 states, 'type of bill is equal to outpatient, pricing indicator = Y, HCPCS code C9399 is present but associated units are greater than one. Units must be equal to one.'

HCPCS code C9399 should be used to report drugs and biologicals that have been approved by the Food and Drug Administration (FDA), but that do not yet have a product-specific drug/biological HCPCS assigned. Per Change Request (CR) 3287, HCPCS code C9399 should be reported as follows:
  • For the ANSI ASC X12N 837 I, hospital outpatient departments will report on type of bill (TOB) = 13x, containing revenue code 0636, HCPCS code C9399, and NDC number present in Loop 2400 LIN 03 of the 837 I
  • The hospital may report in the 'Remarks' section of the CMS-1450 or its electronic equivalent the National Drug Code (NDC) for the drug, the quantity of the drug that was administered, the unit of measure applicable to the drug or biological, and the date the drug was furnished to the beneficiary
When billing the applicable information for the unassigned drug on Page 2 in Direct Data Entry (DDE), providers should report one drug per revenue line. In addition, each occurrence of C9399 should be billed with a corresponding unit of one, regardless of the actual quantity of the drug that is administered.

1.  Drug 'X' is approved by the FDA, but does not yet have a HCPCS code assigned. During the outpatient encounter on January 1, 2010, 5 units of the drug are administered.

 Rev HCPCS Code Unit Serv Date
 0636  C9399  1  0101

2. Drug 'X' and Drug 'Y' are approved by the FDA, but do not yet have a HCPCS code assigned. During an outpatient encounter on March 1, 2010, five units of Drug 'X' are administered and three units of Drug 'Y' are administered.

 Rev HCPCS Code Unit Serv Date
 0636  C9399   1  0101
 0636  C9399   1  0101

Note that the unit of one will essentially act as a placeholder and will direct Palmetto GBA to review the additional NDC information that will be present on the claim. In addition to the information included on Page 2, the provider should also include the NDC number, the quantity of the drug that was administered, the unit of measure applicable to the drug and the date the drug was furnished in both 'Remarks' and on the NDC page in DDE.

This information will be reviewed and used in the pricing of the unassigned drug(s). Palmetto GBA will manually calculate the payment for the drug or biological at 95 percent of the average wholesale price (AWP). The Fiscal Intermediary (FI) will pay 80 percent of that calculated payment to the hospital; beneficiaries will be responsible for the 20 percent co-pay after the deductible is met.

  1. The Centers for Medicare & Medicaid Services (CMS) Internet-Only Manuals, Publication 100-04, Medicare Claims Processing Manual, Chapter 17, Section 90.2-90.3 (PDF, 538 KB)
  2. Change Request 3287 (PDF, 51 KB) – MMA: Hospital Outpatient Billing and Payment under Outpatient Prospective Payment System for New Drugs and Biologicals After FDA Approval but Before Assignment of a Product-Specific Drug/Biological HCPCS Code
  3. Change Request 6330 (PDF, 52 KB) – Clarification on Use of National Drug Codes (NDCs) in 837 I Billing

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