The OIG will review claims with the modifier GY to determine if the modifier is used correctly. The object of the investigation is to determine the appropriate use of the modifier and to determine if Medicare patients are unknowingly becoming liable for health care expenses.
Modifier GY identifies services and supplies that are statutorily excluded from Medicare coverage. Use of these modifiers indicates that a denial of services is anticipated and the patient has not signed an ABN. Medicare defines a covered service as:
Generally, Medicare covers services that are considered medically reasonable and necessary to the overall diagnosis and treatment of the patient’s condition. Services or supplies are considered medically necessary when they meet one or more of the following requirements:
• Are proper and needed for the diagnosis or treatment of the patient’s medical condition
• Are furnished for the diagnosis, direct care, and treatment of the patient’s medical condition
• Meet the standards of good medical practice
• Are not mainly for the convenience of the patient, provider, or supplier
Examples of services that are covered include:
• Physician services such as surgery, consultations, office visits, and institutional calls
• Services and supplies furnished incident to physician professional services
• Outpatient hospital services furnished incident to physician services
• Outpatient diagnostic services furnished by a hospital
• Outpatient physical therapy (PT) services
• Outpatient occupational therapy (OT) services
• Outpatient speech-language pathology (SLP) services
• Diagnostic x-ray tests, laboratory tests, and other diagnostic tests
• X-ray, radium, and radioactive isotope therapy services
• Surgical dressings and splints, casts, and other devices used for reduction of fractures and dislocations
• Rental or purchase of durable medical equipment for use in the patient’s home
• Ambulance services
• Certain prosthetic devices that replace all or part of an internal body organ
• Leg, arm, back, and neck braces or artificial legs, arms, and eyes
• Certain medical supplies used in connection with home dialysis delivery systems
• Ambulatory Surgical Center services.
Services that do not meet the requirements above are statutorily excluded from Medicare coverage. Examples of some of these types of services include:
■ Personal comfort items
■ Routine physical checkups (including lab tests furnished as part of the routine physical exam)
■ Orthopaedic shoes or other supportive devices for the feet
■ Routine foot care
Under the Medicare program, 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 is appended to procedures that are excluded from the Medicare payment system.
In order to be certain that modifier GY is appended to services that are statutorily excluded:
• Append modifier GY to those services that are statutorily excluded that are printed on the superbill.
• Determine if your computer billing system allows you to include modifier GY as part of the code.
• Identify all services or items your practice provides that are statutorily excluded from Medicare payment and alert clinical staff as well as administrative staff. This can be performed by identifying them on the superbill (see below) or by compiling a list that is readily available to all staff.
• Identify services that are only statutorily excluded under certain circumstances such as cosmetic and educate staff members on these policies