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N918 Remark Code: No Refund for Compounded Drug

N918 means no refund is being paid because CMS excludes prescription drug event records from the Maximum Fair Price refund process when the compound code shows the prescription was for a compounded drug. It is used only in the Medicare Drug Price Negotiation Program.

Quick facts

Code
N918 (RARC N918)
Status
Active In use since March 1, 2026.
Code set
Remittance Advice Remark Codes (RARC)
Group codes
  • CO (Contractual Obligation): When reported, reflects the refund that will not be paid on the excluded record. It is not a patient balance.
Official description
No refund because CMS excludes prescription drug event records when a compound code indicates it is for a compounded drug.
X12 Remittance Advice Remark Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What N918 means

The Maximum Fair Price refund process uses prescription drug event data to identify which fills qualify. CMS leaves out records whose compound code shows a compounded drug, since a compound mixes ingredients and does not map cleanly to a single selected drug’s price.

N918 tells the dispensing entity that this fill was excluded for that reason. No refund will be calculated for it.

Common causes

  • The prescription really was compounded using a selected drug as an ingredient.
  • The pharmacy system defaulted the compound code incorrectly on a standard fill.
  • A data error at the plan level carried the wrong code into the PDE.

What to do

  1. Look at the original pharmacy claim and confirm the compound code submitted.
  2. Accept the exclusion if the fill was a true compound.
  3. Correct the claim with the Part D plan if the code was wrong, using the plan’s reversal and resubmission rules.
  4. Ask the plan to update its PDE record and track the refund afterward.
  5. Audit your pharmacy system settings so the compound field defaults correctly for standard products.

Codes that may appear with N918

  • CO-307 (Medicare Maximum Fair Price Standard Default Refund Amount Adjustment.): The standard default refund adjustment, not paid because the record is excluded.
  • N911 (This claim cannot be reimbursed by the manufacturer until the Part D plan submits corrected prescription drug event data to CMS for maximum fair…): The refund is held until the Part D plan corrects its PDE data, rather than excluded.
  • N908 (No refund because this drug has been prospectively purchased at the maximum fair price.): No refund because the drug was bought at the MFP.
  • N907 (No refund because this claim has been identified as 340B-eligible with a ceiling price lower than the maximum fair price.): No refund because a lower 340B price applies.

N918 FAQ

What is a compound code?

It is a field on the pharmacy claim that tells the plan whether the prescription was a compounded preparation or a standard product. That value carries into the plan's prescription drug event record.

What if the prescription was not compounded?

Then the compound code was probably wrong. Correct the pharmacy claim with the Part D plan so the plan can update its PDE record, then follow up on the refund.

Are compounded drugs ever eligible?

Under current program guidance, PDE records flagged as compounds are excluded from the MFP refund process. Watch CMS guidance for changes.