CMS Pub. 100-04, ch. 32, § 67.2

Generally speaking, institutional, providers should not have to report the usage of a no cost item. However, for some

claims (e.g., hospital Outpatient Prospective Payment System (OPPS) claims), providers may be required to bill a no cost

item due to claims processing edits that require an item (even if received at no cost) to be billed along with an associated

service (e.g., a specified device must be reported along with a specified implantation procedure).

For OPPS claims, when a drug is provided at no cost, claims processing edits prevent drug administration charges from

being billed when the claim does not contain a covered/billable drug charge. Therefore, for drugs provided at no cost in the

hospital outpatient department, providers must report the applicable drug HCPCS code and appropriate units with a token

charge of less than $1.01 for the item in the covered charge field and mirror this less than $1.01 amount reported in the

noncovered charge field. Providers must also bill the corresponding drug administration charge with the appropriate drug

administration CPT or HCPCS code.

For OPPS claims, providers must report a token charge of less than $1.01 for the item in the covered charge field, along

with the applicable HCPCS modifier (i.e., modifier –FB) appended to the procedure code that reports the service requiring

a device. For more information on billing no cost items under the OPPS, refer to Chapter 4, §20.6.9 and 61.3.1 of this

manual.

By billing in this way, the provider is accomplishing four things:

1) Communicating to the contractor that the provider is not seeking payment for the no cost item;

2) Reflecting, with completeness and accuracy, all services provided to the patient;

3) Preventing the line item or claim from being rejected/denied by system edits that require an item to be billed in

conjunction with an associated procedure (such as implantation or administration procedures);

4) Assuring that the patient and provider are not held liable for any charges for the no cost item.

Future updates will be issued in a Recurring Update Notification.