Movin' On Up

As the baby boomers enter retirement, we have seen, and will continue to see, tremendous changes in the way many businesses cater to them. Baby boomers, for the most part, are not going to settle. They are used to getting what they want, and they're looking for individuality, ease of use and, especially, comfort.

Most important, they are willing to pay extra to get these additional features. This plays well into the hands of savvy HME companies that want to provide upgrades on the equipment they put out. Why sell a manual hospital bed if the beneficiary wants one that is fully electric? It makes the beneficiary happy and it helps your bottom line. A win-win situation in anyone's book.

The question, then, is how do you properly bill an upgrade? (An upgrade is defined as an item that goes beyond what is medically necessary under Medicare's coverage requirements.)

Medicare has come up with several modifiers you can use to indicate that you are providing an upgrade. The “GK” modifier is used when an ABN is obtained and you want to collect the difference from the beneficiary. The “GL” modifier is used when no ABN has been obtained and you want to provide the upgrade with no additional charge to the beneficiary.

In the case of the GK, let's assume that the beneficiary wants a fully electric bed (E0265) but he or she only meets the Medicare guidelines for a manual bed. In this case, you would obtain an ABN for the E0265 and bill it with a GA modifier. You would then, on the next claim line, bill the manual bed (E0255) using a GK modifier:

E0265GA
E0255KXGK

Note that the claims must be billed in this specific order. Also, remember that using the KX modifier means that you have all the required documentation per the local coverage determination.

When billed this way, Medicare will know that you are providing an upgrade and will deny the first line, E0265GA, as not medically necessary with a Patient Responsibility (PR) message. Then the claim line with the E0255KXGK will continue through to normal claims processing. This will keep you from having to work a denial right off the bat for billing the E0265 without the correct modifier. Also, be sure to make the proper adjustment in your aged accounts receivable so you are not tracking the E0265GA, as you do not expect to be paid on that claim from Medicare.

Now let's look at how to bill for an upgrade without an ABN. You will use the GL modifier or the GK/GZ modifiers, depending on the situation.