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Ask a Rev Cycle Expert: Do We Use JG Modifier with M1145?


Based on the Most Favored Nation (MFN) Model Interim Final Rule (IFC), it appears we would still add the JG modifier for 340b purchased drugs, but we would not use the JG modifier on the add-on code M1145. Please see the below excerpt and confirm if that the JG modifier is not needed with M1145.

If CMS finalizes the proposed OPPS payment policy to pay for drugs acquired under the 340B program at ASP minus 34.7 percent, plus an add-on of 6 percent of the product’s ASP, the MFN Drug Payment Amount for an MFN Model drug furnished by an MFN participant and billed with the JG modifier will be capped at ASP minus 34.7 percent. In such cases, the MFN participant will also receive the per-dose add-on payment amount described in section III.F. of this IFC.


Correct, you would report modifier JG Drug or biological acquired with 340b drug pricing program discount only on the Healthcare Common Procedure Coding System (HCPCS) code for the drug. You would not need to append the modifier to HCPCS code M1145 Most favored nation (MFN) model drug add-on amount, per dose, (do not bill with line items that have the JW modifier).

Currently, there is a temporary restraining order issued to delay implementation of the Most Favored Nation (MFN) Model by fourteen days. You may view the memorandum and order here.

Medicare Program: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; New Categories for Hospital Outpatient Department Prior Authorization Process; Clinical Laboratory Fee Schedule: Laboratory Date of Service Policy; Overall Hospital Quality Star Rating Methodology; Physician-owned Hospitals; Notice of Closure of Two Teaching Hospitals and Opportunity To Apply for Available Slots, Radiation Oncology Model; and Reporting Requirements for Hospitals and Critical Access Hospitals (CAHs) to Report COVID-19 Therapeutic Inventory and Usage and to Report Acute Respiratory Illness During the Public Health Emergency (PHE) for Coronavirus Disease 2019 (COVID-19)

“…As discussed in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59369 through 59370), to effectuate the payment adjustment for 340B-acquired drugs, we implemented modifier “JG”, effective January 1, 2018. Hospitals paid under the OPPS, other than a type of hospital excluded from the OPPS (such as critical access hospitals), or excepted from the 340B drug payment policy for CY 2018, were required to report modifier “JG” on the same claim line as the drug HCPCS code to identify a 340B-acquired drug…..”

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