Billing for Immunosuppressive Drugs (Rev. 1448; 07-07-08)

by  Jared Staheli
July 8th, 2015

Beginning January 1, 1987, Medicare pays for FDA approved immunosuppressive drugs and for drugs used in immunosuppressive therapy. (See the Medicare Benefit Policy Manual, Chapter 15 for detailed coverage requirements.) Generally, contractors pay for self-administered immunosuppressive drugs that are specifically labeled and approved for marketing as such by the FDA, or identified in FDA-approved labeling for use in conjunction with immunosuppressive drug therapy. This benefit is subject to the Part B deductible and coinsurance provision.

Contractors are expected to keep informed of FDA additions to the list of the immunosuppressive drugs and notify providers. Prescriptions for immunosuppressive drugs generally should be nonrefillable and limited to a 30-day supply. The 30-day guideline is necessary because dosage frequently diminishes over a period of time, and further, it is not uncommon for the physician to change the prescription from one drug to another. Also, these drugs are expensive and the coinsurance liability on unused drugs could be a financial burden to the beneficiary. Unless there are special circumstances, contractors will not consider a supply of drugs in excess of 30 days to be reasonable and necessary and should deny payment accordingly.

Entities that normally bill the carrier bill the DME MAC. Entities that normally bill the FI continue to bill the FI, except for hospitals subject to OPPS, which must bill the DME MAC.

Prior to December 21, 2000 coverage was limited to immunosuppressive drugs received within 36 months of a transplant. ESRD beneficiaries continue to be limited to 36 months of coverage after a Medicare covered kidney transplant. For all other beneficiaries, BBA ‘97 increased the length of time a beneficiary could receive immunosuppressives by a sliding method. So for the period 8/97 thru 12/00 a longer period of time MAY apply for a transplant. Effective with immunosuppressive drugs furnished on or after December 21, 2000, there is no time limit, but an organ transplant must have occurred for which immunosuppressive therapy is appropriate. That is, the time limit for immunosuppressive drugs was eliminated for transplant beneficiaries that will continue Medicare coverage after 36 months based on disability or age. The date of transplant is reported to the FI with occurrence code 36.

CWF will edit claim records to determine if a history of a transplant is on record. If not an error will be returned. See Chapter 27 for edit codes and resolution.

For claims filed on and after July 1, 2008, suppliers that furnish an immunosuppressive drug to a Medicare beneficiary, when such drug has been prescribed due to the beneficiary having undergone an organ transplant, shall: 1) secure from the prescriber the date of such organ transplant, 2) retain documentation of such transplant date in its files, and 3) annotate the Medicare claim for such drug with the “KX” modifier to signify both that the supplier retains such documentation of the beneficiary’s transplant date and that such transplant date precedes the Date of Service (DOS) for furnishing the drug.

For claims received on and after July 1, 2008, contractors shall accept claims for immunosuppressive drugs without a KX modifier but shall deny such claims unless a query of the Master Beneficiary Record (MBR) shows that Medicare has made payment for an organ transplant on a date that precedes the DOS of the immunosuppressive drug claim.

In the context of a claim for an immunosuppressive drug that is submitted to Medicare in order to receive payment, the use of the KX modifier signifies that the supplier has documentation on file to the effect that the beneficiary has undergone an organ transplant on a date certain and that the immunosuppressive drug has been prescribed incident to such transplant.

If a supplier has not determined (or does not have documentation on file to support a determination) that either the beneficiary did not receive an organ transplant or that the beneficiary was not enrolled in Medicare Part A as of the date of the transplant, then the supplier may not, with respect to furnishing an immunosuppressive drug: 1) bill Medicare, 2) bill or collect any amount from the beneficiary, or 3) issue an Advance Beneficiary Notice (ABN) to the beneficiary.


Billing for Immunosuppressive Drugs (Rev. 1448; 07-07-08). (2015, July 8). Find-A-Code Articles. Retrieved from

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