NEW Dispense as Written (DAW) Code Revealed

Chances are you have come across a claim or two (or several thousand!) with a DAW code of 1, 2, or 9. Pharmacy staff are usually knowledgeable about when to use these DAW codes – that a DAW 1 may be appropriate to use when the prescriber does not authorize generic substitution on a multi-source brand, a DAW 2 when the patient requested the brand name, and a DAW 9 when the plan explicitly indicates the brand name product is preferred. The same DAW guidance applies for biologic reference products (e.g., Lantus®) with an interchangeable biosimilar (i.e., Semglee®).

While those three DAW scenarios are fairly straightforward, real-world claim adjudication can be a bit more complex and a single numeric DAW code may not accurately convey the true billing situation. Take for instance a patient with a commercial plan for their primary coverage and Medicaid as their secondary. Sometimes, one payor may prefer the brand while the other prefers the generic. Then what?!

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The National Council for Prescription Drug Programs (NCPDP) has added its first non-numeric DAW code. The first alpha code, DAW A, can now be found in the NCPDP Telecommunication Version D and Above Questions, Answers and Editorial Updates Version 65, updated May 2024.

DAW A is utilized on multi-payor claims (i.e., when the same prescription is processed by at least two payors) and can be used on either the claim to the primary payor or on the coordinate of benefits claim to the secondary payor. It is only used to indicate to one payor that the other payor is requiring the multi-source brand or reference product (with an interchangeable biosimilar) be dispensed.

  • A DAW 9 will be used on the claim to the payor requiring the multi-source brand/reference product to be dispensed (as long as the prescriber did not require the brand/reference product). It does not matter if this is the primary payor or secondary.
  • A DAW A should be submitted on the claim to the other payor that is not requiring the multi-source brand/reference product to be dispensed. Again, it does not matter if this is the primary payor or secondary.

Utilizing a DAW A code allows the payor that is not requiring the multi-source brand/reference product to accept the claim with the associated brand pricing rules or reject the claim as 70: Product/Service Not Covered – Plan/Benefit Exclusion.

PAAS Tips:

  • As with any DAW code other than 0, ensure there is appropriate documentation on the hardcopy or within the prescription record to indicate which plan required brand and which did not
  • The most common scenario is when Medicaid is the secondary payor and they are requiring the brand/reference product, but the primary payor is not. The pharmacy would follow these steps:
    1. Submit the claim for the generic drug using DAW 0 to primary for a paid claim with non-$0 patient copay
    2. Continue billing and submit the claim for the generic drug using DAW 0 to Medicaid (secondary)
    3. Medicaid would reject the claim as 606-Brand Drug/Specific Labeler Code Required
    4. Reverse the claim and resubmit the multi-source brand/reference product to the primary with DAW 9; they should reject with 22: M/I DAW Code and if the pharmacy would continue and bill to Medicaid (secondary), Medicaid may reject the claim as 6E: M/I Other Payor Reject Code
    5. The pharmacy would then bill the claim to primary for the multi-source brand/reference product with a DAW A (Multi-Payor Brand/Reference Product Formulary Conflict) and the primary payor should accept the claim and apply brand pricing
    6. The pharmacy would then continue to bill the multi-source brand/reference product to Medicaid as the secondary payor with DAW 9
  • Be aware of DAW A utilization and remain conscientious .
    • Watch for DAW code updates from your software vendor
    • While NCPDP billing guidance has been updated to account for this new DAW code, there may be a divergence between NCPDP standards and actual implementation by payors much like the DAW 9 versus DAW 0 situation for a multi-source brand/reference product with an interchangeable biologic in the marketplace (for more information, refer to the February 2024 Newsline article, Best Practices for DAW Billing in Pharmacies)
  • For additional DAW code descriptions and billing scenarios, review the DAW Codes Explained tool which was recently updated to include DAW A guidance
  • Confused about biologic terminology like Reference Products and Interchangeable Biosimilars? Review our February 2024 Newsline article Insulin Substitution Review: Understanding Purple Book Terminology

Sara Hathaway, PharmD
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