All About NDC Codes

What is an NDC Code?

A National Drug Code (NDC) is a unique 10- or 11-digit number assigned to medications in the United States. It identifies three key components of the drug:

1. Manufacturer – the company that produces the medication

2. Product – the specific formulation and strength

3. Package – the size or type of packaging

In medical billing, NDC codes are used to report and bill for prescription drugs and certain medical products, ensuring accurate tracking, reimbursement, and compliance with payer requirements.

NDC numbers are used for all FDA-approved medications, regardless of the route of administration. That includes:

• Orally administered medications (tablets, capsules, liquids)

• Injectable medications

• Topical creams and ointments

• Inhalers, eye drops, and other forms

Administration Codes and NDCs

When billing for medications, it’s important to note that the NDC code identifies the drug, but it does not indicate how the medication is administered.

 For certain routes, such as injections or infusions, a CPT or HCPCS administration code must be added to the claim to accurately report the service provided. This ensures the payer is aware of both the drug dispensed (via NDC) and the method of administration (via CPT/HCPCS), which is essential for proper reimbursement. 

For example, intravenous infusions often use CPT code 96365, which should be billed alongside the NDC code for the medication.

How to Set Up NDC Codes in OptiMantra

1. Navigate to your Services settings: Settings > Services > Services (Fee Schedule). 

2.  To add a new service with NDC code information, click + Add New Service. To update an existing service, click the Edit button next to the service.

3. In the NDC Code field, enter the code exactly as it appears on the medication label.

4. The system requires 11 digits. If your NDC is shorter, you can add leading or trailing zeros to meet this requirement.

5. In the NDC Unit Price field, enter the price charged per unit (this is determined by your practice; we do not maintain standard pricing for medications).

6. In the Default Units field, enter the default quantity for this medication.

7. In the NDC Unit of Measure field, select the appropriate measurement type:

   1. Gram (g)

   2. Milligram (mg)

   3. Milliliter (mL)

   4. Unit

   5. International Unit (IU)

8. The NDC Qualifier field defaults to “N4”, which is standard for identifying the NDC in claims.

9. In the HCPCS/CPT Code field, enter the code that corresponds to the method of administration for the medication (for example, CPT 96372 for subcutaneous or intramuscular injections). This ensures both the drug and its administration are correctly billed.

Note: When a claim is created for a service that includes NDC code information, the system will automatically populate the NDC details from the service onto the claim form—no manual updates are required.

Example of NDC Code Formatting:

Example of how NDC codes appear on the claim form:

 

Additional Tips

• Format consistency: Always enter the NDC in 11-digit format, even if the original label shows less digits.

• Payer requirements: Some insurers may require an NDC even if a J-code or CPT is submitted for the medication.

• Verification: Double-check the NDC on the bottle or package to ensure it matches the code entered in OptiMantra. Incorrect NDCs can result in claim denials.