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Update: Drug Wastage Policy effective November 1

Release Date: August 31, 2012

Please note:  This article has been revised from the original version - updates were made to include details on billing for smallest dose vials.   

Drug Wastage

Blue Cross and Blue Shield of North Carolina (BCBSNC) encourages providers to care for and administer drugs or biologicals to patients in a clinically appropriate and efficient manner. BCBSNC acknowledges that there are circumstances where unused drugs or biologicals must be discarded. In which case, BCBSNC will pay for both the administered and discarded drug and biological if specific criteria are met including tracking of the wastage.

  • The units billed must correspond with the smallest dose (vial) available for purchase from the manufacturer(s) that could provide the appropriate dose for the patient.

Billing BCBSNC for Discarded Drugs and Biologicals

As noted above, BCBSNC will provide payment for discarded drugs or biologicals when certain criteria are met. Specifically, BCBSNC will reimburse discarded drugs or biologicals up to the dosage amount indicated on the vial or package label minus the administered dose(s) if:

  • The drug or biological is supplied in a single‐use vial or single‐use package;
  • The drug or biological is initially administered to the patient to appropriately address the patient’s condition and any unused portion is discarded. A provider cannot bill BCBSNC for discarded drugs if none of the drug was initially administered to a patient (e.g. BCBSNC beneficiary misses an appointment).
  • The amount wasted is recorded in the patient chart or a separate waste report log;
  • The provider’s written policy and practice is to manage single-use drugs and biologicals and bill all payers in the same manner; and 
  • The amount billed to BCBSNC as discarded drug is not administered to another patient.

Modifier JW

Modifier JW is defined as “drug or biological amount discarded/not administered to any patient.” Physicians, hospitals and other providers or suppliers may use modifier JW to indicate drug wastage for non-inpatient administered drugs.

BCBSNC requests providers report the drug amount administered on one line, and on a separate line report the amount of drug NOT administered (wasted) with modifier -JW appended to the associated HCPCS code.

It should be noted that modifier JW is not used when the actual dose of the drug or biological administered is less than the billing unit defined in the HCPCS descriptor. For example, HCPSC J2175 descriptor states meperidine hydrochloride, per 100 mg. Therefore, one billing unit is equal to 100 mg. If 97 mg of J2175 is administered and 3 mg of J2175 is wasted, modifier JW should not be reported. This is because the amount administered, 97 mg, is less than the billing unit, which is 100 mg.

Billing Reminders for Drug Wastage

The following table summarizes the do’s and don’ts regarding billing for drug wastage.



Do bill BCBSNC for discarded drugs and biologicals up to the amount on the single-use vial or package label minus the administered dose(s) when appropriate.

Do not bill BCBSNC the extra amount the drug manufacturer provided to account for wastage in syringe hubs. Many manufacturers provide an extra drug in each vial to account for the wastage in the syringe hubs. This extra amount should not be billed to BCBSNC because it is not an expense to the provider and it exceeds the amount on the vial or package label.


Do use modifier JW when single-use vials or single use packages are appropriately discarded after administering a dose(s). The use of modifier JW is appropriate for services rendered in all non-inpatient places of service. 


Do not bill BCBSNC for drug wastage if none of the drug was initially administered. BCBSNC will not reimburse for unused drugs or biologicals that result from a missed patient appointment.


Do not bill BCBSNC for discarded drugs or biologicals for multi-use vials.

The original Drug Wastage Policy effective September 1, 2011 notice was communicated on June 1, 2011 and can be accessed by visiting the Important News webpage at