The Centers for Medicare & Medicaid Services (CMS) issued the Self-Administered Drug Exclusion Program Memorandum, Change Request 2200, on August 1, 2002. The directive instructed each Medicare carrier to establish a process, modeled along CMS guidelines, to determine the exclusion from Medicare coverage of those drugs, which were deemed usually self-administered, even though they may have been previously covered under "incident to" provisions. This notification is Empire Medicare Services’ response to the CMS instructions. The details of the Medicare process can be viewed at http://www.cms.hhs.gov/manuals/pm_trans/ab02072.pdf under Reference File AB-02-72. The list of drugs identified includes those which are administered "incident to" a physician’s service, and more importantly, those drugs that will not be covered or will no longer be covered "incident to" a physician service, because they have been deemed by Empire to be "usually self-administered" by the patients who take them.

*HCPCS code J2354 is effective for dates of service on or after 01/01/2004. For dates of service prior to 01/01/2004, use HCPCS Code J2352.

HCPCS code J9214 has been removed and is now payable for all dates of service.

The Process

Reliable statistical information on the extent of self-administration by the patient may not always be available. In the absence of such data, drugs delivered intravenously should be presumed to be not usually self-administered by the patient. Absent evidence to the contrary, drugs delivered by intramuscular injection may be presumed to be not usually self-administered by the patient, although the depth and nature of the particular intramuscular injection may be considered in applying this presumption. Absent evidence to the contrary, drugs delivered by subcutaneous injection will be presumed to be self-administered by the patient, although Empire will consider other factors such as acuteness of condition and frequency and duration of injection.

For the purposes of applying this exclusion, the term "usually self-administered" means self-administered more than 50 percent of the time for all Medicare beneficiaries who receive the drug, while not inpatients in a hospital, SNF or other facility. If a drug is self-administered more than 50 percent of the time, the drug is excluded from coverage, and Empire will make no payment for it. The determination of exclusion or coverage is on a drug-by-drug basis, and not on a beneficiary-by-beneficiary basis.

Empire arrived at a single determination for each drug by reviewing each indication and its route of administration for that indication. The relative contribution for each indication to the total use of that drug (i.e., weighted average) was obtained in order to arrive at the overall status of administration. Hypothetically, if a drug has three indications, and for the first indication which makes up 30 percent of the use, the drug is usually self-administered, while the second and third indications, which make up collectively 70 percent of the use, the drug is not usually self-administered, then the drug would be determined overall to be not usually self-administered. Consequently, this drug would be payable incident to a physician’s service under Medicare self-administered exclusion provisions. Conversely, if a different drug has two indications, and for the first indication, which comprises 60 percent of the use, it is usually self-administered, and for the remaining 40 percent use of the drug, it is not usually self-administered, then the overall determination would be that the drug is usually self-administered. In this case, the drug would be excluded from coverage under Medicare self-administered guidelines.

For a certain injectable drug, it is "apparent on its face value" by the nature of the condition(s) for which the drugs is administered, or the usual course of treatment for specific conditions (chronic vs. acute), what the usual mode of administration is. For example, Medicare deems a treatment course of injections lasting less than two weeks, regardless of frequency of injection or route, as acute. It would be unlikely that the patient would self-administer the drug. Therefore, the drug would be covered under Medicare self-administered exclusion provisions. For other injectable medications, it may be apparent by the usual and customary route of administration that the drug would be covered (IV, IM medications).

Definitions/Clarifications

In applying this exclusion process, Empire utilized the following definitions and clarifications:

The term usually, as applied in this decision means more than 50 percent of the time for all Medicare beneficiaries who are within Empire’s jurisdiction, who are not facility inpatients and to whom the drug is administered. Consequently, a drug is "usually" self-administered when more than 50 percent of the time the beneficiary injects him or herself.

Self-administered means administered by the patient to him or herself, and does not include administered by spouses, nursing aides, allied health professionals, or physicians.

Incident to the provider’s service means that the provider or nurse practitioner be personally present for the administration of the drug.

Medicare will only pay for the drug if the drug is administered incident to a provider service, AND it has already been deemed usually not self-administered.

This coverage does not establish a universal Medicare prescription coverage plan.

This coverage process only applies to the consideration of whether a drug is usually self-administered, and not to whether it is medically necessary. Drugs that are deemed not to be usually self-administered may still not be covered/payable if they do not meet all medical necessity criteria.

Places of service appropriate for this benefit are office (11) and home (12) if the physician or qualified non-physician practitioner is present, or the outpatient hospital (22). Inpatient hospital administration of drugs is not included in this benefit, nor in the determination of whether or not a drug is self-administered.

The physician must purchase the drug. If the drug is purchased by the beneficiary and then administered by the physician, the drug will not be covered.

Drugs administered by a home health agency nurse are not reimbursable under these provisions.

Evidentiary criteria utilized in arriving at Empire’s specific determinations include, but not exclusively or collectively, peer reviewed medical literature, standards of medical practice, evidence-based practice guidelines, FDA-approved label, and package inserts.

Drugs administered other than by injection (i.e., topically, or as suppositories or via inhalers) are assumed to be self-administered and are not covered under this benefit.

Implementation

The publication date of this list and any subsequent additions to the list begins a 45-day notice period. Empire Medicare Services, during this time, will maintain current existing medical review and payment procedures. After the 45-day period, Empire will deny payment for "Not Covered" drugs on this list, subject to the terms of this notice. The list will be regularly reviewed and updated.

Appeals/Comments

For a particular drug, if a beneficiary’s claim is denied because the drug is subject to the "self-administered drug" exclusion, the beneficiary may appeal the denial. In cases where Empire has deemed a drug usually self-administered, and therefore not covered, and an individual beneficiary appeals the denial on grounds that he or she does not self-administer the drug, it should not be assumed that the Empire decision would be overturned, once the appeal is made. An Advance Beneficiary Notice (ABN) is not required in this case since this a "benefit category" denial (i.e., a denial based on the fact that there is no benefit category under which the drug may be covered) and not a denial based on medical necessity. The physicians or providers may bill the beneficiary for an excluded drug. Providers, billing for an excluded drug, may wish to provide beneficiaries with a Notice of Exclusion from Medicare Benefits (NEMB) (form CMS-20007), available on the CMS Web site at: http://cms.hhs.gov/medicare/bni/20007_English.pdf. Additionally, providers accepting assignment may appeal a denial under provisions found in Chapter 12, Section 12000 of the Medicare Carriers Manual. Providers, as part of an appeal, should submit to Empire practice pattern evidence and/or scientific literature to support the potential overall reversal of Empire’s position on a particular drug. A hospital may also appeal a denial under Section 3781.2 of the Medicare Intermediary Manual to its fiscal intermediary.

Reference: Change Request 2200, Transmittal AB-02-072, CR 2311, Transmittal AB-02-139

Posted: 04/22/04

CPT codes, descriptions, and other data only are copyright 2003 American Medical Association (or such other date of publication of CPT). All Rights Reserved. Applicable FARS/DFARS Apply.