Ob-Gyn Coding Alert

No more 'complex medical review' for these non-covered services.

Most of the time, when Medicare payers process denials in a speedy fashion, that's bad news for your practice -- but when you're using modifier GZ, you are already expecting a denial. CMS has made that happen faster with a new regulation indicating that all claims with modifier GZ appended will be denied immediately.

Background on why you'll use GZ: It happens to even the best-run medical practices -- the physician has just performed a service that does not meet the Medicare criteria for coverage at the time of the visit and the patient did not sign an ABN.

Follow This GA, GZ, and GY Example

For instance, suppose a 68-year old low-risk Medicare patient comes in for annual exam, but Medicare paid for her Pap and pelvic exam last year. You inform the patient that Medicare will not cover that part of the exam this year, but the patient requests the service anyway. The physician checks the encounter form for the services provided, and billing department sends the claim in to Medicare to get a denial so the patient's secondary insurance will cover it.

In a perfect world, you would have had the patient sign an advance beneficiary notice (ABN) so that you can apply modifier GA (Waiver of liability statement issued, as required by payer policy, individual case) to the part of the exam that would normally be covered by Medicare.

But sometimes the patient will refuse to sign the ABN, or for other extenuating reasons, the patient did not sign it at the time of the service as is required. In this case, you have no ABN for the pelvic and Pap part of the annual, and office policy dictates that you bill both the non-covered preventive medicine service (e.g., 99397, Periodic comprehensive preventive medicine reevaluation and management of an individual including an age- and genderappropriate history... established patient; 65 years and older) as well as G0101 (Cervical or vaginal cancer screening; pelvic and clinical breast examination) and Q0091 (Screening Papanicolaou smear; obtaining, preparing and conveyance of cervical or vaginal smear to laboratory).for the Medicare part of the exam.

When your billing department is ready to submit the claim, you realize there is no ABN, and so you should submit the claim as you normally would, adding a modifier GZ (Item or service expected to be denied as not reasonable and necessary) to the G and Q codes.

You should append modifier GY (Item or service statutorily excluded, does not meet the definition of any medicare benefit or for non-medicare insurers, is not a contract benefit) to the preventive code (e.g., 99397) as usual, since you do not need an ABN for a service that is never covered by Medicare.

GZ advantage and disadvantage: The advantage to reporting modifier GZ is to avoid the potential for fraud and abuse charges. The disadvantage is that because your ob-gyn provided a service which Medicare considers not medically necessary, the patient will not be held liable for payment. In other words, your ob-gyn will have provided a free service.

Break Down The New Rule's Meaning

In the past, your modifier GZ claims were potentially subject to complex medical reviews, which can slow claims and create logjams in your billing processes. However, CMS's new policy will ensure that these claims will be denied instantly.

In black and white: "Effective for dates of service on and after July 1, 2011, contractors shall automatically deny claim line(s) items submitted with a GZ modifier," states Transmittal 2148. Your explanation of benefits will list the denial codes CO (Provider/supplier liable) and 50 (These services are non-covered services because this is not deemed a 'medical necessity' by the payer).

Plan ahead: Don't allow yourself to resort to modifier GZ. Have a policy in place to collect ABNs when necessary. To read Transmittal 2148, visit www.cms.gov/transmittals/downloads/R2148CP.pdf