Billing with National Drug Codes (NDC) FAQ

A NDC number is the industry standard identifier for drugs and provides full transparency to the drug administered. The NDC number identifies the manufacturer, drug name, dosage, strength, package size, and quantity.

The reporting of a NDC, along with the unit of measure and quantity, in addition to the appropriate Current Procedural Terminology (CPT®) or Health Care Procedure Coding System (HCPCS), is required for professional and outpatient facility places of service for specific drugs. This has been in place since September 1, 2016.

Claims submissions must be complete and accurate, meeting the requirements of our guidelines, or applicable service(s) will be denied. If you receive a denial, the member cannot be held liable (even with a signed waiver), and a corrected claim can be submitted for consideration of benefits.

Reminders:

• For processing dates of January 1, 2026 and after, the billing requirement for reporting a NDC on professional claims (billed on a CMS-1500) was fully enforced. 
• For processing dates of July 3, 2026 and after, the billing requirement for reporting a NDC on outpatient and ambulatory surgical center will be fully enforced.
• For processing dates of July 3, 2026 and after, for all applicable claims, the NDC, unit of measure, and quantity must be present.

The following places of service are required to bill with a NDC number:

• Ambulatory Surgical Center
• Community Mental Health Center
• Comprehensive Outpatient Rehabilitation Center
• Home Infusion 
• Hospital Outpatient
• Independent Kidney Disease Treatment Center 
• Outpatient Substance Abuse Facility
• Providers Office
• Psychiatric Day Care Facility
• Specialized Treatment Center

The NDC number can usually be located on the drug label or box's outer packaging. The number on the outer packaging may be less than 11-digits, and an asterisk may appear as a place holder for any leading zeros. The label also displays information about the NDC unit of measure for that specific drug.

If the drug comes in a box with multiple vials, using the NDC number on the box is recommended, to prevent a potential claim denial.

Acceptable values for the NDC units of measurement qualifiers are:

• F2 [International Unit] 
• GR [Gram]
• ME [Milligram] 
• ML [Milliliter] 
• UN [Unit] 
   

An NDC provider tool is available to assist practices in determining the unit of measure that must be reported. It is available in two locations:

• The Provider Resource Center, under the Tools and Resources link. 
• On our Provider Forms and Resources webpage, under the National Drug Code (NDC) Information and Resources accordion.

The follow claim submission data elements are required:

• Applicable Current Procedural Terminology (CPT®) or Health Care Procedure Coding System (HCPCS) codes and the HCPCS Unit. 
  • Correct billing of HCPCS Level II Drug(s) examples 
• N4 product ID qualifier 11-digit NDC (no hyphens).
  • Proper billing of a NDC requires the 11-digit NDC number
  • A 10-digit NDC number is not acceptable.
• Quantity/Dosage
  • Units indicated on the claim must be based on the dosage and correspond to the NDC billed.
  • If the dosage and NDC do not match the billed amount, the claim will be denied.
  • Note: Quantity is limited to eight (8) digits before the decimal point and three (3) digits after the decimal point.
• Name of drug

You must enter the NDC number on your claim in the 11-digit billing format (no spaces, hyphens or other characters). If the NDC on the package label is less than 11 digits, you must add a leading zero to the appropriate segment to create a 5-4-2 configuration. Examples:

• Shaded area of 24A: Indicate the NDC qualifier N4 followed immediately by the 11-digit NDC number of the drug dispensed, with no spaces, hyphens, or other characters.
  • Enter the appropriate unit of measure qualifier:
    • F2 [International Unit]
    • GR [Gram]
    • ME [Milligram]
    • ML [Milliliter]
    • UN [Unit]
  • Immediately following the unit of measure qualifier, indicate the NDC unit quantity, with no space in between.
  • The number of digits for the quantity is limited to eight (8) digits before the decimal and three (3) digits after.
• 24D: Enter the appropriate CPT®/HCPCS code. In item G (days or units), continue to report applicable CPT® or HCPCS units and not the NDC units administered.
• Complete all other applicable fields as appropriate.

Example of NDC Data on a CMS-1500 Paper Claim

• Field locator 42: Include the appropriate Revenue code
• Field locator 43:
  • Enter NDC qualifier N4 (left justified) followed by the 11-digit NDC number  of the drug dispensed, with no space between.
  • Enter the appropriate unit of measure qualifier, with no space between the NDC and the unit of measure qualifier:
    • F2 [International Unit]
    • GR [Gram]
    • ME [Milligram]
    • ML [Milliliter]
    • UN [Unit]
  • Enter the unit quantity (number of NDC units), with no space between the qualifier and the unit quantity
    • The decimal point is floating and the numbers to the right of the decimal point are restricted to three (3)
    • Field locator 44: Include CPT® or HCPCS code if required.
    • Field locator 46 (service or units): Continue to report applicable CPT® or HCPCS units and not the NDC units administered. 
• Complete all other applicable fields as appropriate.

Example of NDC Data on a UB-04 Paper Claim

Refer to the HIPAA-compliant 8371 companion guide or 837P companion guide (Loop – 2410 – Drug Identification) for full billing details.
 

You can find examples for correct billing of HCPCS Level II Drug(s) in our online document.

Please refer to our Corporate Payment Policy CPP_ 47 Discarded Drugs and Biologics for more information.

Yes, always include decimal quantities when reporting partial units so as to report the actual quantity administered. For example, if three 0.5ml vials are administered, report ML1.5.

• GR0.045
• ML1.5
• UN2

The maximum field length is eight (8) digits before the decimal point and up to three (3) digits after – i.e., 12345678.123. The decimal point is floating and the numbers to the right of the decimal point are restricted to three.

Do not use commas, do not back fill with zeros – this results in a change in quantity and can create incorrect processing or payment – and leave remaining positions blank.

• Missing or incorrectly formatted NDC number.
• Using a 10-digit NDC number instead of converting it to an 11-digit format.
• Omitting the quantity or unit of measure qualifier.

Reminder: For processing dates of July 3, 2026 and after, NDC, Unit of Measure, & Quantity must be present on the claim to avoid a claim line denial.

• Durable Medical Equipment 
• COVID-19 vaccine; however, it will be accepted if submitted. 
  • The NDC number must be a valid, active code, and reporting must be per our NDC guidelines.
• Flu vaccine; however, it will be accepted if submitted.
  • The NDC number must be a valid, active code, and reporting must be per our NDC guidelines.
• Services where Medicare is the primary carrier.