Updated: April 2026
Purpose
North Dakota Medicaid covers most drugs and biologics administered in a physician's office or other licensed practitioner’s (OLPs) office or outpatient setting that cannot be self-administered. Physicians and other licensed practitioners are responsible for ensuring that the treatment is appropriate based on FDA-approved indications, compendia-supported indications, and standards of practice. To be covered, drugs and biologics must represent an expense to the physician, OLP, or legal entity billing Medicaid. Injections by a physician or OLP of medications that can be self-administered are not covered unless justified by the member’s condition.
Applicability
Eligible Providers
To receive payment from ND Medicaid, the eligible servicing and billing providers must be enrolled with ND Medicaid on the date of service, and their National Provider Identifiers (NPIs) must be active in their Medicaid enrollment records. Servicing providers acting as a locum tenens provider must be enrolled with ND Medicaid, and services they provide must be billed with their NPI. Please refer to provider enrollment for additional details on enrollment eligibility and supporting documentation requirements.
Physician administered drug services can be ordered and provided by the following enrolled providers as allowed by the scope of their licensure:
- Physicians
- Physician Assistants
- Advanced Practice Registered Nurses
- Nurse Practitioner
- Clinical Nurse Specialist
- Certified Nurse Midwife
- Certified registered nurse anesthetists
Eligible Members
Providers are responsible for verifying a member’s eligibility before providing services. Eligibility can be verified using the ND Medicaid MMIS Portal or through the Automated Voice Response System by dialing 1.877.328.7098.
Refer to the Member Eligibility Manual for additional information regarding eligibility including information regarding limited coverage categories.
Covered Services and Limits
General Provider Policies
The General Provider Policies details basic coverage requirements for all services. Basic coverage requirements include:
- The provider must be enrolled in ND Medicaid;
- Services must be medically necessary;
- The member must be eligible on the date of service; and
- If applicable, the service has an approved service authorization.
The Procedure Code Look-up Tool can be used to identify if a procedure code is covered by ND Medicaid along with code specific details such as ORP requirements, Service Authorization requirements, and current rates.
Oncology Drug Trials
ND Medicaid will pay for chemotherapy when administered via a protocol that is registered with one of the main regional oncology research organizations provided the FDA has approved each medication in the regimen. FDA approval can be for any indication.
If the member has a primary payer, the primary payer must be billed before requesting payment from ND Medicaid. If the primary payer denies coverage of the product because they consider the use “experimental”, ND Medicaid will also deny the claim.
Service Authorization Requirements
Please use the Procedure Look-up Tool to identify physician administered drugs that require service authorization.
Noncovered Services
General Noncovered Services
The Noncovered Services Policy contains a general list of services that are not covered by North Dakota Medicaid.
Drugs that are not included in the Medicaid Drug Rebate Program are non-covered.
Documentation Requirements
General Requirements
Providers must keep legible medical and financial records that fully justify and disclose the extent of services provided and billed to ND Medicaid. Records must be retained for at least 7 years after the last date the claim was paid or denied. Providers must follow the documentation requirements in the Provider Requirements Policy.
Reimbursement Methodology and Claim Instructions
Timely Filing
ND Medicaid must receive an original Medicaid primary claim within one hundred eighty (180) days from the date of service. The time limit may be waived or extended by ND Medicaid in certain circumstances. The Timely Filing Policy contains additional information.
Third-Party Liability
Medicaid members may have one or more additional source of coverage for health services. ND Medicaid is generally the payer of last resort. Providers must pursue the availability of third-party payment sources. The Third Party Liability Policy contains additional information.
Client Share (Recipient Liability)
Client share (recipient liability) is the monthly amount a member must pay toward the cost of medical services before the Medicaid program will pay for services received. The Client Share Policy contains additional information.
Reimbursement
A claim for services must be submitted at the provider’s usual and customary charge. Payment for services is limited to the lesser of the provider’s usual and customary charge or the ND Medicaid calculated reimbursement.
Claim Form
Physician administered drugs must be billed electronically via the 837P or 837I claim transaction. Physician administered drugs will not be reimbursed when submitted on a paper CMS 1500 or UB04 form. Detailed claim instructions are available on the ND Medicaid Provider Guidelines, Policies & Manual webpage.
Claim Requirements
For physician administered drugs, in addition to the HCPCS drug code, providers may separately bill the applicable administration procedures, including intramuscular or subcutaneous injections and intravenous or subcutaneous infusion.
Providers must ensure that the units of drugs or biologics administered to patients are accurately reported regarding the dosage/units specified in the complete HCPCS code descriptor. Before submitting claims, providers should review the HCPCS code long descriptor. The provider should not bill units based on how the drug is packaged, priced, stored, or stocked. The following are examples of how to bill units:
- HCPCS drug descriptor is 10 mg. 700mg of the drug is administered to the member. The units billed are 70.
- HCPCS drug descriptor is 5 mcg. 5 mcg of the drug is administered to the member. The units billed are 1.
- HCPCS drug descriptor is 25 mg. 250 mg of the drug is administered to the member. The units billed are 10.
Pharmacy Acquired Drugs
Drugs acquired directly from the pharmacy for administration in the clinic should be reported on the claim at zero dollars or a nominal amount of $0.01 if required by the provider’s billing system.
Discarded Portion of Administered Drugs
When a provider must discard the remainder of a single-use vial or other single-use package after administering a dose or quantity of the drug or biological, the provider must bill the amount of the unused and discarded drug on a separate claim line using the JW modifier. Providers are expected to use the package size that minimizes the amount of waste billed to North Dakota Medicaid. For example, if a patient needs 50 mg of a drug and the product comes in 50 and 100 mg vials, providers should use the 50 mg vial. Reimbursement will be made for the discarded amount of a single-use dosage drug or biological product that is discarded and the amount administered to the member up to the amount indicated on the vial or package label that is necessary for the member’s condition. The discarded drugs or biologics are not administered to another patient. PPS hospital outpatient departments reimbursed under the Enhanced Ambulatory Payment Grouping (EAPG) system receive the full EAPG for the administered drug on a single line. Drug lines submitted with the JW modifier will be paid at $0.00.
National Drug Code (NDC)
Physician administered drugs must be billed with a HCPCS code and an 11-character NDC with no hyphens or spaces. The Federal Deficit Reduction Act of 2005 (DRA) requires Medicaid state agencies to collect rebates from participating drug manufacturers for physician-administered or dispensed drugs. An NDC is required as it allows the state to identify which manufacturer should be billed for rebates. The NDC is found on the drug container, such as a vial, bottle, or tube. The NDC submitted on the claim must be the actual NDC number on the package or container from which the medication was administered. The NDC must be entered in Field 24D of the CMS 1500 or the 2410 Loop, LIN 03 field/element of the HIPAA 837 Professional Electronic form.
340B Drugs
The 340B Program requires drug manufacturers participating in Medicaid to provide outpatient drugs to covered entities at significantly reduced prices. To participate in the 340B Program, covered entities must register, be enrolled, and comply with all 340B Program requirements administered by HRSA. Any drugs billed to ND Medicaid that were acquired through a 340B contract or agreement must be excluded from the Medicaid drug rebate invoicing process to avoid duplicative discounts. Therefore, any drug acquired through a 340B contract or agreement must be identified on the claim line with one of the following modifiers:
- UD - Medicaid level of care 13, as defined by each state - 340B acquired drug
- TB - Drug or biological acquired with 340B drug pricing program discount, reported for informational purposes for select entities
Covered entities, as described in section 1927 (a)(5)(B) of the Social Security Act, are required to bill no more than their actual acquisition cost on the claim line for the drug when billing a 340B product. Actual acquisition cost means the 340B drugs where the upfront cost does not include the 340B discount but is later provided as a rebate to the provider.
References
Related Policies
Contact
Medical Services
600 East Boulevard Ave
Bismarck, ND 58505-0250
Phone: (701) 328-2310
Email: dhsmedicalservices@nd.gov
Policy Updates
November 2025
- 340B
- Language added to clarify that drugs acquired through 340B must be billed at actual acquisition cost.
January 2026
- 340B
- Language changed to remove reference to 340B Pilot Program which no longer exists
February 2026
- Claim Form
- Correction made in policy. Claims for physician-administrated drugs with NDCs must be billed using an electronic claim format (837p or 837i). Claims lines that contain physician-administered drugs submitted on paper claim forms, CMS1500 or UB04, will be denied.
April 2026
- Claim Requirements
- Language added about how drug waste lines are handled on claims reimbursed under EAPG methodology.
- Reference to modifier JG was removed. HCPCS modifier JG was termed by CMS December 31, 2024.
- ADA updates made throughout document.