CMS issued an Interim Final Rule with Comment Period that established the New COVID-19 Treatments Add-on Payment (NCTAP) under the Medicare Inpatient Prospective Payment System (IPPS). The NCTAP, designed to mitigate potential financial disincentives for hospitals to provide new COVID-19 treatments, is effective from November 2, 2020, until the end of the COVID-19 public health emergency (PHE). 

Through the NCTAP, the Medicare Program will provide an enhanced payment for eligible inpatient cases that use certain new products with current FDA approval or emergency use authorization (EUA) to treat COVID-19, including the following:

• On August 23, 2020, the FDA issued (reissued on November 30, 2020, and revised on March 9, 2021) an EUA for the use of COVID-19 convalescent plasma for treating COVID-19 in hospitalized patients
• On October 22, 2020, the FDA approved remdesivir (Veklury) for the treatment of COVID-19 for adults and certain pediatric patients requiring hospitalization
• On November 19, 2020, the FDA issued an EUA for the use of baricitinib (Olumiant), in combination with remdesivir (Veklury), for the treatment of suspected or laboratory confirmed COVID-19 in certain hospitalized patients

For eligible cases, the NCTAP is equal to the lesser of these:

• 65% of the operating outlier threshold for the claim
• 65% of the amount by which the costs of the case exceed the standard Diagnosis-Related Group (DRG) payment (including the adjustment to the relative weight under Section 3710 of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act)

Coding for NCTAP

NCTAP claims are those that are eligible for the 20% add-on payment under Section 3710 of the CARES Act. Eligible claims have both of the following:

• ICD-10-CM diagnosis code U07.1 (COVID-19)
• ICD-10-PCS codes for remdesivir (Veklury), COVID-19 convalescent plasma, or baricitinib (Olumiant) in combination with remdesivir, as described below