MedicaidReimbursementHigh impact
Outpatient Hospital Drugs and Biologicals Payment Update
SC Medicaid - SCDHHS·SC·Claims & Billing
Effective date
Oct 1, 2026
We identified it
Sep 3, 2026
Summary
Effective October 1, 2026, South Carolina Medicaid will change how it reimburses outpatient hospital drugs and biologicals. These drugs will now be reimbursed using the same methodology as physician-administered drugs, and certain outpatient hospital drugs will be reimbursed as add-ons without the outpatient hospital multiplier applied. This affects billing methodology and reimbursement calculations for all outpatient drugs and biologicals at hospital facilities.
Action Required
By September 30, 2026: Billing team must prepare for the payment methodology change by (1) reviewing the updated Hospital Services Provider Manual once published by SC DHHS on or after October 1, 2026; (2) identifying which outpatient hospital drugs and biologicals will be classified as add-ons and exempt from the outpatient hospital multiplier; (3) updating billing system logic to apply the physician-administered drug reimbursement methodology to applicable outpatient hospital drugs; (4) modifying claim submission and reimbursement calculation processes to remove the outpatient hospital multiplier from designated add-on drugs; (5) training billing staff on the new payment structure. For MCO-enrolled members, coordinate with managed care organizations regarding coverage and authorization requirements. Contact SC DHHS Provider Service Center at (888) 289-0709 (Mon-Thu 7:30am-5pm, Fri 8:30am-5pm) or via https://www.scdhhs.gov/providers/contact-provider-representative with questions. Failure to implement these changes by the effective date will result in claim denials and revenue loss.