Use required 340B modifiers for accurate payment

Published: July 29, 2022 
Last modified: Jan. 11, 2023
Updated to include information about the implementation of new CMS 340B rates.

On Dec. 2, 2022, we implemented the Centers for Medicare & Medicaid Services (CMS) new 340B rates in our systems, which they published on Oct. 18, 2022. CMS continues to require the modifiers JG or TB for 340B program medication purchases.

Are you a non-exempt 340B Medicare Advantage health care facility or hospital? If so, to receive accurate claim payments involving separately payable, Outpatient Perspective Payment System (OPPS) drugs and biologics with status indicator K, UnitedHealthcare requires 1 of 2 things:

  1. The JG modifier (if purchased through the 340B program and should be reimbursed at the discounted rate), or
  2. An attestation that this drug or biologic wasn’t purchased through the 340B program (and should be considered for reimbursement at the full cost)

Claim review and notification begins July 23

Beginning July 23, 2021, if a claim for a status indicator K drug is received without the JG modifier and an attestation was not completed for a provider who is not exempt from the 340B program, UnitedHealthcare will assume the drug was purchased through the 340B program and adjust the claim to provide reimbursement at the discounted 340B rate of average sales price (ASP) minus 22.5%.

If you are set up to receive Smart Edits, within 24 hours of claim submission, you will receive a message on your 277CA clearinghouse report indicating the claim may be subject to 340B coding and billing requirements. 

Options to modify your claim

If you receive a Smart Edit notification, you have 2 choices to modify your original claim submission. 

1.     If you purchased the drug or biologic through the 340B program: Update and resubmit the claim with the JG modifier as follows:

  • Place the modifier on the UB claim form, Service Line Remarks status K drugs line
  • For a claim with multiple drug lines, use the appropriate 340B modifier on separate claim lines for each separately payable, non-pass-through 340B-acquired drug (status indicator K)

2.     If you did not purchase through the 340B program: Attest that the drug or biological was not purchased through the 340B program as follows:

  • Use the UB claim form Service Line Remarks field (see example below)
  • The attestation must include:
    • The word “attests”
    • The reason why the item was not obtained through the 340B program (according to CMS guidance) in the status K drug line, and The specific drug code (if multiple drug codes were billed)
  • Do not include the JG modifier

If the JG modifier or attestation is not provided

If you submit 340B claims without the JG modifier or attestation, payment for the 340B drug will be at the discounted rate of ASP minus 22.5%. Your provider remittance advice (PRA) will indicate that the claim was paid with a 340B program payment discount.

In the future

Please adjust your billing process to include the JG modifier on appropriate claims or provide an attestation when drugs or biologics are purchased outside of the 340B program. Doing so helps ensure prompt and accurate claim processing.

Other 340B updates and reminders 

  • Drug payment rate: UnitedHealthcare will continue to pay for 340B-acquired drugs (status indicator K) that include the JG modifier at the discounted rate of ASP minus 22.5%
  • Medicare billing requirements: 340B facilities must follow CMS coding and billing requirements, and provide accurate and complete claim documentation upon request
  • Ongoing payment reviews: UnitedHealthcare will continue to do retrospective reviews on paid 340B claims to determine compliance with the CMS coding and billing requirements

Additional resources

We're here to help. If you have any questions regarding the use of 340B modifiers, please visit the Contact Us page.