JW Modifier and JZ Modifier in Medical Billing: Discarded Drug Billing from Single-Dose Vials

The JW modifier reports the amount of a drug discarded from a single-dose container, billed on a second claim line with the same HCPCS code and the number of units wasted. The JZ modifier attests that nothing was discarded. Every separately payable single-dose drug line billed to Medicare now needs one or the other.

Oncology infusion suites discard drug every day because vial sizes do not match weight-based doses. JW gets the practice paid for the discarded amount, and JZ documents when nothing was discarded.

Where you see it

Place	What goes there
CMS-1500 box 24D, 837P loop 2400 SV101	The J-code followed by JW on the discarded line, or JZ on a no-waste line
CMS-1500 box 24G, 837P SV104	Units administered on the first line; units discarded on the JW line
Medical record	The discarded amount, which CMS requires you to document
Remittance	Both lines priced at the same payment limit; a JW line that pays zero or a line returned as unprocessable is the first sign of a modifier problem
CMS JW and JZ Modifier Policy HCPCS Codes list	The non-exhaustive list of drug codes whose NDCs are all single-dose, updated about twice a year

The dates that matter

Date	What changed
January 1, 2017	CMS made JW mandatory in every MAC jurisdiction for discarded amounts of separately payable Part B drugs from single-dose containers; before that each MAC chose
January 1, 2023	The discarded drug refund took effect; CMS began using JW and JZ data to calculate it
July 1, 2023	JZ required on single-dose drug claims with no discarded amount
October 1, 2023	Claims that omit the correct modifier may be returned as unprocessable until resubmitted
January 1, 2025	Suppliers who prepare but do not administer a drug report JW for amounts discarded during preparation, otherwise JZ

Which drugs and which settings

The policy applies to drugs separately payable under Medicare Part B that FDA labeling describes as a single-dose container or single-use package. In the physician office that is essentially every drug billed incident to a physician service. In the hospital outpatient department and the ASC it applies only to separately payable drugs, not to packaged ones. It does not apply to multiple-dose vials, to drugs in an RHC or FQHC, to inpatient claims, or to the influenza, pneumococcal and COVID-19 vaccines that are roster billed.

Billers often miss two details. First, a drug that is excluded from the refund, such as a multiple-source drug or a contrast agent, still needs JW or JZ if it comes in a single-dose container. Second, a single-dose drug billed under an unlisted code (J3490, J3590, J9999) in the office still needs the modifier; CMS has said that does not extend to C9399 on hospital claims. The published code list is not complete, and the rule also applies to single-dose drugs that are not on it.

Four claims

The billing unit is the HCPCS descriptor unit; the discarded amount is the labeled vial content minus the prescribed dose. Overfill, anything above the label, is never billable. October 2026 national payment limits are used below to show the arithmetic; they are before geographic adjustment and sequestration and are not what any practice will be paid.

1. Waste from a weight-based dose. Bevacizumab 7.5 mg/kg for a 72 kg patient is 540 mg, drawn from one 400 mg vial and two 100 mg vials. J9035 is “per 10 mg”.

Line	Code	Modifier	Units	Payment limit	Allowed
1	J9035	none	54	75.492	4,076.57
2	J9035	JW	6	75.492	452.95

The 60 mg left in the vials is paid. Without line 2 the practice absorbs 452.95; without any modifier the whole claim can be returned.

2. No waste. Pembrolizumab 200 mg from two 100 mg vials. J9271 is “per 1 mg”. One line: J9271, JZ, 200 units, allowed 12,450.60. Both vials go on the one line.

3. Dose smaller than the unit. A drug with a 10 mg billing unit, 7 mg given from a 10 mg single-dose vial. One line, 1 unit, JZ. The unit pays for the entire vial, so a JW line for the 3 mg would be an overpayment, as the Medicare manual states.

4. Multiple-dose vial. Dexamethasone from a 30 mL multiple-dose vial: J1100, no JW, no JZ. The modifiers do not belong on multiple-dose containers, and a JW line here denies.

The manufacturer refund, and why it matters to you

The Infrastructure Investment and Jobs Act (section 90004, November 15, 2021) amended section 1847A of the Social Security Act so that manufacturers refund Medicare for discarded amounts of “refundable” single-dose drugs: separately payable single-source drugs and biosimilars whose NDCs are all single-dose or single-use. The refund is the discarded units times the payment limit, less an applicable percentage of the drug’s total allowed charges in the quarter. The statute sets that percentage at 10 percent; CMS has raised it for a few categories, to 26 percent for qualifying orphan drugs, 35 percent for hydrogel-reconstituted drugs with variable dosing, and 45 or 90 percent for very low-volume doses.

Excluded from the refund, though not from the modifiers: radiopharmaceuticals and imaging agents, drugs that must be filtered before dilution, and new drugs for roughly their first 18 months of sales. CMS said it intends to send the report covering calendar year 2025 in September 2026, with payment due by December 31 of the year the report is issued and a civil money penalty of 125 percent of the refund for non-payment.

Practices do not pay or receive any of this money. But Medicare now collects refunds based on JW and JZ data, so modifier errors are a likely audit target, not a minor clerical issue.

What to do

• Store the container type with each drug. Single-dose or multiple-dose from the FDA label, not from memory. The scrubber decides from that flag whether a line needs JW or JZ or neither.
• Compute waste from the vials actually used. The nurse’s administration record should show the vials opened and the dose given; the difference, in HCPCS units, is the JW line.
• Document the discarded amount in the chart. CMS requires it, and it is the first thing an auditor asks for.
• Watch doses smaller than a unit. Round up to one unit with JZ; never pair a 1-unit line with a JW line.
• Recognize the returns. A single-dose drug line with neither modifier is returned as unprocessable; correct and resubmit, there is nothing to appeal. A JW line on a multiple-dose drug or on an overfill amount denies as an invalid modifier use. The remittance will show a claim adjustment group and reason code; the group and reason codes article explains how to read them.
• Iridium Suite’s claim scrubber applies configurable checks on drug units and on the JW and JZ wastage modifiers as the charge is entered.

Related terms

• J-codes and NDC reporting
• ASP plus 6 percent: how Medicare pays for Part B drugs
• Chemotherapy administration codes 96413, 96415, 96417
• Radiation oncology modifiers, including JW and JZ on radiopharmaceuticals
• Medically unlikely edits (MUE)
• Missing charges and charge capture

Further reading: CMS, Discarded Drugs (JW and JZ modifiers and the refund program); CMS, Discarded Drugs and Biologicals: JW Modifier and JZ Modifier Policy FAQs (PDF, updated January 2025); CMS, JW Modifier and JZ Modifier Policy HCPCS Codes (PDF); CMS Medicare Claims Processing Manual, Chapter 17, section 40, Discarded Drugs and Biologicals (PDF).