CMS Pub. 100-04, ch. 4, § 61.3.1

Furnished Without Cost to the Hospital Prior to January 1, 2014

(Rev. 2903, Issued: 03-11-14, Effective: 04-01-14, Implementation: 04-07-14)

Effective January 1, 2007, the definition of modifier -FB is “Item Provided Without

Cost to Provider, Supplier or Practitioner, or Credit Received for Replacement

Device (Examples, but not Limited to: Covered Under Warranty, Replaced Due to

Defect, Free Samples).”

When a hospital furnishes a device received without cost or with full credit from a

manufacturer, the hospital must append modifier -FB to the procedure code (not the

device code) that reports the service provided to furnish the device. The hospital must

report a token charge for the device (less than $1.01) in the covered charge field.

This includes circumstances in which the cost of a replacement device is less than the

cost of the device being replaced, such that the hospital incurs no net cost for the device

being inserted. For example, if a device that originally cost $20,000 fails and is replaced

by a device that costs $16,000 and for which the manufacturer gives a credit of $16,000,

there is no cost to the hospital for the device being inserted and the hospital would

append modifier -FB to the procedure code and report a token charge for the device.