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Claims & Payment Policy (#133): 340B Drug Payment Reduction Policy

Summary of policy:

The 340B Drug Discount Program is a US federal government program that requires drug manufacturers to provide outpatient drugs to eligible health care organizations and covered entities at significantly reduced prices. The intent of the program is to allow covered entities to stretch scarce federal resources as far as possible, reaching more eligible patients and providing more comprehensive services.

Effective 1/1/2018, the Centers for Medicaid and Medicare (CMS) reduced the payment to participating providers paid under an Outpatient Prospective Payment System (OPPS) for certain drugs acquired through the 340B program. CMS established two Healthcare Common Procedure Coding System (HCPCs) Level II modifiers to identify 340B-acquired drugs. Providers are required to report either modifier “JG” or “TB” on OPPS claims. Modifier “JG” indicates the 340B as payable and modifier “TB” as informational.

What does this mean for providers?

Verified 340B providers who submit claims with 340B covered codes without required modifiers “JG” and “TB” in POS 22 (outpatient hospital) or 23 ( emergency room) and have the drug assigned a status indicator of “K”, will have the “JG” and/or “TB” modifier added to the claim. This will ensure the claim is reimbursed at the appropriate rate. Claims may be eligible for recovery of overpayments.

For more information please review the complete policy found on the Claims page under Payment Policies.


The Achievements in Clinical Excellence program (ACE) is a provider measurement program that recognizes those providers delivering both effective and efficient clinical care. Effective Thursday, June 30, 2016, WellCare will no longer participate with the ACE program and no further payments will be made with DOS after June 30, 2016. WellCare will continue to partner with high-performing physicians, hospitals and other providers to offer quality care by coordinating and integrating care to achieve better health outcomes and lower costs.

The ACE Form will be replaced by our Partnership for Quality Program (P4Q) 1. You should have received a P4Q Program Description in the mail and/or from a WellCare representative. If you have not received a packet of information regarding the program, please contact your Provider Relations Representative at 1-855-538-0454 to receive the program information.

2016 Partnership for Quality Program

Two ways for primary care physicians to earn Bonuses:

  1. Ensuring Eligible Members meet all applicable compliance criteria for the HEDIS® and Medication Adherence Program Measures;
  2. Completing a Continuity of Care “Appointment Agenda” to ensure Eligible Members receive appropriate care based on their health conditions.

Bonus payments will be made quarterly, beginning on or around June 2016, with successive payments on or around August 2016, November 2016, and April 2017. In addition, qualified providers with a demonstrated history of strong quality measure performance – and/or who return Appointment Agendas timely – are eligible for higher Bonuses.

Bonus payments are contingent upon compliance with the terms and conditions of the P4Q Program. If you have questions about our P4Q Program, please contact your Provider Relations Representative, or call Provider Services at 1-855-538-0454 (TTY 1-877-247-6272). You can reach us Monday–Friday from 8 a.m. to 6:30 p.m.

If you have questions about submitting CPT II codes, please contact your Provider Relations Representative.

Thank you for working with us to continue to strive to deliver higher quality health care to our members.

1Please note that not all Providers are eligible for the P4Q Program. Please check with your Provider Service Representative to confirm your eligibility.

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Last Updated On: 2/24/2020
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