What is Modifier GZ in Medical Billing?

Medical billing is a complex and tricky field, and in the case of Medicare, precision and compliance are all that matters. Modifier GZ is one of such compliance-related tools, as it is a code explicitly indicating to the Medicare administration that a claim should be denied. 

Why however would any provider proceed with a claim that they know well would be denied? 

The solution is to comply with documentation, Advance Beneficiary Notices (ABNs), and to know the limit of medical necessity. In this blog, Credex Healthcare dissects the definition of Modifier GZ, its use. It also shows how it compares with other modifiers as well as the specific effect it has on claim processing.

Understanding Modifier GZ

Modifier GZ is known to be a billing version applied during the scenario especially when a healthcare provider anticipates that Medicare will deny a cover based on medical necessity failure. It also depends on the condition that the healthcare professional did not receive an Advance Beneficiary Notice (ABN) signed by the patient. 

Well, here the Provider code appendages allow the provider to withhold regular payment by adding Modifier GZ to a CPT code, or HCPCS code in order to demonstrate that the provider does not expect payment subject to medical necessity review.

People tend to not understand this modifier well. It is not supposed to collect payment or contest a denial; it is simply for a compliance flag on not reasonable, not necessary services on which the patient did not sign an ABN.

When to Use Modifier GZ

It is necessary to understand under which circumstances to apply the Modifier GZ in order to prevent fraud, waste, or abuse audits. You are to use Modifier GZ in the cases where:

• CMS or the given service does not serve medical necessity or does not measure the Local Coverage Determination (LCD) requirements.
• Before you gave the service, you failed to get an ABN.
• You still opt to send the claim to Medicare to get it documented as a denied claim.

An important point of difference: You cannot charge the patient the service because no ABN was given. The addition of Modifier GZ also completes the task of letting CMS know that the patient is not the one to bear financial responsibility.

GZ Modifier and Medicare Billing Rules

Modifier GZ applies particularly to Medicare billing. The claim is automatically denied by Medicare when used and Medicare code N115 is returned meaning. This service or item is not to be paid. No ABN was prepared for the beneficiary.” 

This modifier is meant to provide compliance rather than reimbursement. It shields the provider against the charge of an inappropriate billing or an attempt to collect to cover unnecessary costs to the patient without prior informing. The Policy on GZ Modifier by Medicare:

• Rejection of all line items at the end of which Modifier GZ is specified.
• No beneficiary liability (providers are prohibited to charge the patient).
• The provision of documentation should however remain in support of why the service was provided.

How the GZ Modifier Affects Claim Denials

Denial will be automatic when the claims will be submitted using Modifier GZ. This refusal is due process and is considered a part of compliance trail documentation not an effort or attempt at recapture of funds.

There are so many Effects of application of GZ Modifier, and some of them are as:

• No payback of Medicare.
• No right of appeal in the absence of issuance of ABN (which was not).
• The patient is not permitted any billing.
• Claim stays on record so that it can be audited and enhance transparent billing.

In any case where Modifier GZ is inappropriately utilized, e.g., services rendered may be medically necessary, signatures of ABN given, audit red flags or slow appeals may be provided.

Example Scenarios Involving Modifier GZ

So, here are some examples of situations that can be used in modifier GZ billing:

Case 1: Screening Electrocardiogram (EKG)

A physician makes a preventative request of an EKG screening on a Medicare patient. Of course this service is not covered by Medicare on the given indication. Absolutely no ABN was signed. When filing the claim, modifier GZ is supposed to be added on the CPT code.

Case 2: Foot Care Services

A traditionally executed foot care process is completed with a diabetic patient who does not have any clinical indicators according to the criteria in the LCD. ABN was not given. The claim in this case has to go with Modifier GZ.

Documentation and Compliance Best Practices

The core point about using Modifier GZ is not the need to append two letters, but rather to defend your practice against the liability.

Best Practices of Modifier GZ Compliance:

• In writing, document the reason for the service and the reasons why it might not be covered.
• Verify that no ABN had been issued and keep inner notes on that.
• Make no bill to the patient whatsoever.
• Considerably monitor CMS Local and National Coverage Decisions.
• Train the front desk and clinical personnel as to the necessity of ABNs.

At Credex health care, we are keeping practices ahead of CMS compliance through claims audits, real-time EHR integrations, and modifier usage training.

Final Thoughts: Stay Compliant, Stay Protected

It is to be noted that modifier GZ is something that must be understood by any provider who has to deal with Medicare claims. It does not acquire the quality of some sort of payment tool, but becomes a mechanism of transparency and compliance. 

A good and proper use of it will mean that your practice will not be accused of inappropriate billing. This will also increase trust by payers and patients in your practice.

Ready to Reduce Claim Denials and Stay CMS-Compliant?

At Credex Healthcare, we are renowned in assisting the practices such as yours through the complexities of tendering of coughs, they refer to them as Medicare modifiers, documentation standards, and billing rules. We have our expert medical billing practice that can assist you with training your staff, reviewing your claim denials, and assisting you to implement modifier protocol.

To get the help you need to clean up your revenue cycle and achieve clean claims submission – every time, contact us now.

FAQs About Modifier GZ in Medical Billing

How does Modifier GZ work when billing a medical firm?

Modifier GZ means that a service will be refused by Medicare as one without medical necessity and ABN was not signed by the patient.

What occurs to claims with GZ Modifier?

The claims are automatically rejected and the patient can not be charged with the service.

Is the patient liable to the payment when GZ is employed?

No. In the absence of an ABN provider accepts the liability.

How does Modifier GZ differ from GA?

When signing an ABN, modifier GA should be implemented, whereas in the case of no ABN given, GZ should apply.

Is it possible to use GZ in commercial insurance?

Generally no. Modifier GZ is not accepted by most commercial insurers and they have policies on non-covered services.

Is GZ modifier a sure pathway to claim denial?

Yes. It is meant to serve as a sure form of denial.

When is it not right to use Modifier GZ?

Do not use it, when the service has been signed with an ABN, or where it is obviously covered by Medicare.