General Surgery Coding Alert

Question: I've heard that guidelines for Medicare modifiers -GA and -GX have changed. How should I apply these modifiers?

Texas Subscriber

Answer: Even when you do not expect Medicare to cover a given service/procedure, you must file a claim with your Medicare carrier. And you must append modifier -GA (Waiver of liability statement on file) to all CPT codes covered by an advance beneficiary notice (ABN). An ABN is a written notice provided by the physician to inform a beneficiary that Medicare may not cover a particular service or procedure and asks the patient to pay. The ABN must clearly identify the service or procedure to be rendered and state the reason that it may not be covered.

And, physicians must provide ABNs before they render services that they know Medicare does not consider medically necessary or will not reimburse. Append modifier -GA only when billing a service that doesn't pass medical-necessity edits and you obtained a signed ABN from the patient. Modifier -GA will alert Medicare to note on the explanation of benefits that the patient is responsible for payment.

For instance, an ABN may be necessary if a patient's diagnosis does not warrant a procedure based on Medicare guidelines or if the physician provides legitimate services that exceed Medicare frequency rules. An ABN is not necessary when providing procedures/services that Medicare never covers. Nonetheless, you may ask the patient to sign to verify that he or she is aware of being responsible for the cost of the service/procedure.

In some cases, the patient may request that the physician submit a claim for noncovered services in hopes of receiving coverage from a secondary insurer. Until 2001, you would have submitted such claims using modifier -GX (Service not covered by Medicare). The modifier indicated that Medicare should issue a denial notice, allowing the patient to pursue payment from other insurers.

On April 26, 2001, CMS released program memorandum B-01-30 replacing modifier -GX with modifiers -GY (Item or service statutorily excluded or does not meet the definition of any Medicare benefit) and -GZ (Item or service expected to be denied as not reasonable and necessary), effective Jan. 1, 2002. The agency meant for these new modifiers to describe the reason why Medicare does not allow the service/procedure.

Note: Program Memorandum B-01-03 may be downloaded for viewing from the CMS Web site.

Physicians should apply modifier -GY to the appropriate code when billing Medicare for a general program exclusion service. Modifier -GZ is used when billing a service that doesn't pass medical-necessity edits and the physician did not obtain a signed ABN from the patient. Medicare will not automatically deny claims submitted with modifier -GZ based on a particular CPT code. The carrier, however, may deny the claim based on other criteria such as diagnosis to procedure coding.

According to the memo, "Anytime the modifiers -GY or -GZ are used, providers and suppliers must explain why the services or supplies are being submitted. This information is entered in Item 19 of Form HCFA-1500. For the electronic format, providers and suppliers must report this information in the claims level note. If space for additional narrative is needed, the provider or supplier must enter the qualifier 'ADD' in NTE01, then enter the additional narrative in NTE02." CMS-approved examples of explanatory language include "Claim submitted to receive denial for secondary payer" or "Service performed by family member."