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J-Codes: Pesky Medical Codes to Save Thousands

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Employers

J-Codes: Pesky Medical Codes to Save Thousands

J-codes – are the dirty little secret nobody wants to talk about. Learning how to address this six- to seven-figure expense can immediately save your business upwards of hundreds of thousands of dollars while saving potentially millions on employer plans. On our topic of immediate impact, today we touch on medical billing codes.

One of the fastest growing health care expenditures today are specifically medical drug costs. Among the top 10 most expensive drugs in the US today, costs can range between $600K to over $2.1M annually.[1] On top, the base price of J code billings have continuously gone up in price. The past several years has seen skyrocketing costs year over year.

Medical billing codes are essential for companies to navigate to help their business and employees save. Healthcare Common Procedure Coding System (HCPCS) Level II codes or J Codes are the billing codes used by providers for drugs, or medical devices they administer when billing claims to insurance. Infused drugs are therefore often referred to as “J code” drugs.[2]

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The provider pays X, then marks it up to Y which is what your business, insurer, or employer ends up paying. That’s why the place where the drug is infused (doctor’s office, infusion center, hospital, or at home) can significantly drive up the cost of a claim. But in the end – it’s still the same drug.

Because these drugs are bought and then administered by the provider, these costs are often opaquely priced, and not tied to drug pricing parameters as they would be in a pharmacy. This already applies to everything from Tylenol provided during a hospital stay, but becomes especially important for J code billing items that can have much higher base costs. Many J Code drugs are often very expensive to begin with (such as chemotherapy), making charges that are multiples of the cost of the drug even more impactful.

Simply by moving infusions from the doctor’s office or the hospital to the patient’s home can help you save significant amounts while receiving an improved patient experience. In fact, J Code infusions administered in the hospital vs. taken at home can cost over 5x as much[3]. Even cheaper if considering getting the drugs from abroad or through competitive outlets to reduce the drug cost further. Given how expensive J code drugs are to begin with, this typically amounts to a savings of hundreds of thousands of dollars in billable costs.

Your team doesn’t have to spend extra needless hours in a hospital, while they save by buying drugs directly, administered with more personal care.

With more specialty, high dollar, and infused drugs entering the market each and every day, it’s vitally important to stay on top of this complex area of spend for your plan. Immediate results, better care, and truly significant savings.

[1] AscellaHealth Launches Innovative Infusion Management Program, Improves Patient Safety and Health Outcomes, Increases Net Cost Transparency. Business Wire. (2020, December 1). https://www.businesswire.com/news/home/20201201005123/en/AscellaHealth-Launches-Innovative-Infusion-Management-Program-Improves-Patient-Safety-and-Health-Outcomes-Increases-Net-Cost-Transparency. July 2021.

[2] The Gist of J Code Drugs. Apex Benefits. (2020, August 5). https://apexbg.com/the-gist-of-j-code-drugs/. July 2021.

[3] AscellaHealth. (n.d.). Specialty Medical Benefit Management: Intravenous Immunoglobulin (IVIG). https://www.ascellahealth.com/sites/default/files/ascellahealth_ivigprogram_medication_therapy_mgmt_.pdf. July 2021.