Medicare • ABN • Medical Necessity • Modifier Guide

Modifier GZ

Item or Service Expected to Be Denied as Not Reasonable and Necessary

Learn what Modifier GZ means, when it should be reported, how it differs from GA and GY, what happens when an ABN was not obtained, and how AR callers should handle GZ-related Medicare denials.

Start Learning Quick Cheat Sheet

Expected to Be Denied as Not Reasonable and Necessary — No ABN on File

Modifier GZ at a Glance

The essential points every medical biller, coder and AR caller should know.

No ABN

GZ indicates that the provider expects Medicare to deny the item or service as not reasonable and necessary and an ABN was not obtained.

MED

Medical Necessity

GZ is associated with expected Medicare denials based on reasonable-and-necessary requirements.

ABN

ABN Not Obtained

The defining distinction between GZ and GA is whether the required ABN was obtained.

DENY

Expected Denial

GZ tells Medicare that the provider expects the service to be denied as not reasonable and necessary.

What Is Modifier GZ?

A simple explanation of GZ for medical billing and RCM professionals.

Simple Definition

Modifier GZ is used when:

The provider expects Medicare to deny an item or service because it is not reasonable and necessary, and an ABN was not signed by the beneficiary.

In practical billing terms, GZ tells Medicare that the provider knows the service is expected to fail Medicare’s reasonable-and-necessary requirements and that the required advance notice of non-coverage was not obtained.

CMS identifies GZ specifically for this situation. :contentReference[oaicite:1]{index=1}

Easy Way to Remember

Think:

“GZ = Not reasonable & necessary + No ABN.”

The most important question is not simply: “Was the claim denied?”

Ask: “Why is Medicare expected to deny the service?”

If the reason is reasonable-and-necessary criteria and there is no ABN on file, GZ may be appropriate.

The 3 Core Elements of Modifier GZ

All three concepts are important when determining whether GZ applies.

Medicare Benefit

The service is within a Medicare benefit category rather than being a statutorily excluded service.

Not Reasonable & Necessary

The provider expects Medicare to deny the service because it does not meet applicable reasonable-and-necessary requirements.

No ABN

The provider did not obtain the required Advance Beneficiary Notice before providing the service.

Important

GZ should not be selected merely because a Medicare claim was denied. The actual reason for the expected denial must be reviewed. CMS distinguishes GZ from GY, which applies to statutorily excluded services or services that do not meet the definition of a Medicare benefit. :contentReference[oaicite:2]{index=2}

GZ vs GA — The Most Important Difference

The ABN status is the key distinction.

Modifier	Expected Denial	ABN Status	Basic Meaning
GZ	Not reasonable and necessary	No ABN obtained	Provider expects Medicare denial for medical necessity and did not obtain an ABN.
GA	Not reasonable and necessary	ABN obtained	Provider expects Medicare denial and has the applicable ABN/waiver-of-liability documentation.
GY	Statutorily non-covered / no Medicare benefit	Different coverage concept	Service is statutorily excluded or does not meet the definition of a Medicare benefit.
GX	Non-covered service for applicable reasons	Voluntary notice	Indicates a voluntary notice of liability was issued in applicable circumstances.

Memory Trick

GZ = No ABN

GA = ABN on file

GY = Statutorily excluded / no Medicare benefit

GZ vs GY — Do Not Mix Them Up

Both can result in non-payment, but the reason is completely different.

Not Reasonable & Necessary

The service is a Medicare benefit category, but the provider expects Medicare to deny it because the service does not meet reasonable-and-necessary requirements.

Medical necessity issue
No ABN obtained
Expected denial

Statutorily Excluded

The service is statutorily excluded or does not meet the definition of a Medicare benefit.

Statutory exclusion
No Medicare benefit category
Different from medical necessity

When Is Modifier GZ Used?

GZ is appropriate only when the underlying situation supports its definition.

Medicare Benefit Category

The service is not being treated as a statutory exclusion or complete absence of a Medicare benefit.

Medical Necessity Concern

The provider expects Medicare to determine that the service is not reasonable and necessary.

No ABN

The provider did not obtain a signed ABN from the beneficiary for the expected denial.

Expected Denial

The provider anticipates Medicare will deny the service based on reasonable-and-necessary requirements.

Appropriate Code

The appropriate CPT or HCPCS code should be reported according to the applicable billing rules.

Policy Verification

Current CMS and applicable MAC guidance should be checked before billing or correcting the claim.

Common Medical Necessity Situations Behind GZ

These are educational examples. The actual coverage determination depends on the applicable Medicare policy and documentation.

LCD

LCD Requirements Not Met

The documentation or clinical circumstances may not satisfy the applicable Local Coverage Determination requirements.

NCD

NCD Criteria Not Met

The service may fail applicable National Coverage Determination criteria.

Diagnosis Does Not Support

The diagnosis and clinical documentation may not support the medical necessity requirements for the service.

DOC

Insufficient Documentation

The medical record may not contain enough information to support the service.

FREQ

Frequency Limitation

The service may exceed a frequency limitation established by the applicable coverage policy.

AGE

Coverage Criteria

Age, clinical status, treatment requirements or other policy criteria may affect reasonable-and-necessary coverage.

Important Coding Reminder

A particular diagnosis or documentation issue does not automatically mean GZ should be added after a denial. Modifier selection must reflect the billing situation and applicable Medicare instructions.

Modifier GZ Billing Workflow

A practical step-by-step workflow for billing teams.

1 Identify the service being provided.

2 Verify the CPT/HCPCS code.

3 Review the applicable Medicare coverage policy.

4 Determine whether the service is expected to fail reasonable-and-necessary requirements.

5 Determine whether an ABN was obtained.

6 If no ABN was obtained and the expected denial is for reasonable-and-necessary reasons, evaluate GZ.

7 Verify whether GA would instead apply if an appropriate ABN was obtained.

8 Verify that the service is not actually statutorily excluded, which would point toward GY.

9 Submit the claim according to the applicable Medicare billing instructions.

Modifier GZ Practical Examples

Real-world style scenarios for medical billing and AR training.

Example 1 — No ABN + Expected Medical Necessity Denial

The provider determines that Medicare is likely to deny the service because it does not meet reasonable-and-necessary requirements.

No ABN was obtained from the beneficiary.

Example 2 — ABN Was Obtained

The provider expects Medicare to deny the service as not reasonable and necessary, but an appropriate ABN was obtained.

The situation is different from GZ because the ABN requirement has been addressed.

Example 3 — Statutory Exclusion

The service is statutorily excluded or does not meet the definition of a Medicare benefit.

Do not use GZ simply because the service is non-covered.

Example 4 — Documentation Does Not Support Medical Necessity

The service is a Medicare benefit, but the provider expects the documentation will not support reasonable-and-necessary requirements and no ABN was obtained.

Verify the specific Medicare policy before billing.

Example 5 — Incorrectly Treating Every Denial as GZ

A claim is denied because of a duplicate claim edit.

REVIEW

A duplicate denial does not automatically establish that GZ is appropriate.

Example 6 — Coding Error

The payer denies a service because the submitted CPT/HCPCS code does not accurately represent the service.

REVIEW

Correct the underlying coding issue rather than automatically adding GZ.

Example 7 — Coverage Policy Criteria

A service is covered only when specified clinical criteria are met. The provider expects those criteria are not met and no ABN was obtained.

Confirm the applicable LCD, NCD or other Medicare policy.

Example 8 — AR Caller Finds GZ Denial

The ERA shows a denial related to medical necessity and the claim contains GZ.

AR REVIEW

Review the denial code, policy, medical records and ABN status before deciding whether correction or appeal is appropriate.

Common Modifier GZ Denials & Issues

Common problems AR callers encounter when working Medicare medical-necessity denials.

Issue 01

Medical Necessity Denial

Medicare determines that the service does not meet applicable reasonable-and-necessary requirements.

Issue 02

No ABN on File

The provider expected a medical-necessity denial but did not obtain an ABN before the service.

Issue 03

GZ vs GA

The billing team must determine whether an ABN was actually obtained before deciding between GZ and GA.

Issue 04

GZ vs GY

The service may actually be statutorily excluded rather than denied for medical necessity.

Issue 05

Documentation Insufficient

The medical record may not contain enough information to demonstrate medical necessity.

Issue 06

Diagnosis Does Not Support

The diagnosis and documentation may not support the applicable coverage policy.

Issue 07

LCD Criteria Not Met

The claim may not satisfy the conditions of an applicable LCD.

Issue 08

Frequency Limitation

The service may exceed a frequency limitation under applicable Medicare policy.

Issue 09

Incorrect Modifier

The payer may indicate that GZ does not correspond to the actual reason for the claim denial.

Issue 10

Wrong CPT/HCPCS

The underlying code may not accurately describe the service that was performed.

Issue 11

Appeal Without Policy Review

An appeal may fail when the team does not identify the exact medical-necessity requirement that was not satisfied.

Issue 12

Poor AR Documentation

Missing payer references, denial codes and policy details can result in repeated or incorrect follow-up.

Modifier GZ Denial Resolution Workflow

A practical AR workflow before rebilling or appealing.

1 Review the ERA/EOB and identify the exact denial reason.

2 Capture the CARC and RARC codes.

3 Confirm whether GZ was reported on the claim.

4 Determine whether the denial is actually related to medical necessity.

5 Verify the applicable LCD, NCD or Medicare coverage policy.

6 Review the patient’s diagnosis and clinical documentation.

7 Verify whether an ABN was obtained.

8 Determine whether GA or GZ is appropriate based on ABN status.

9 Confirm that the service is not actually statutorily excluded, which would point toward GY.

10 Determine whether documentation supports an appeal.

11 Submit a corrected claim or appeal when supported.

12 Document payer response, reference number and next action.

AR Caller Script for Modifier GZ

Practical questions to ask the Medicare representative.

“I’m calling regarding a Medicare claim that was submitted with Modifier GZ.”

“Could you please provide the exact denial reason for the claim line?”

“Can you provide the CARC and RARC codes associated with the denial?”

“Is the denial specifically related to the service not being reasonable and necessary?”

“Can you identify the Medicare coverage policy or medical-necessity requirement that was not met?”

“Is this denial based on an LCD, NCD or another Medicare coverage policy?”

“Can you confirm whether Modifier GZ is appropriate for this claim line?”

“If an ABN had been obtained, would Modifier GA have been applicable?”

“Can you confirm whether this service is considered a Medicare benefit rather than a statutorily excluded service?”

“Is there a correction that can be submitted to reconsider the claim?”

“If an appeal is available, what documentation is required?”

“May I have the call reference number and representative ID for our records?”

GZ Denial Appeal Strategy

A GZ denial should be researched before deciding whether an appeal can recover payment.

Identify the Policy

Find the applicable LCD, NCD, Medicare Claims Processing Manual provision or other official policy.

Identify the Criteria

Determine exactly what medical-necessity requirement Medicare says was not satisfied.

Compare Documentation

Compare the medical record with the applicable coverage requirements.

Correct Coding Issues

Verify CPT/HCPCS, modifiers, diagnosis codes, units and other claim information.

Prepare the Appeal

Explain why the service met the applicable Medicare reasonable-and-necessary criteria.

Attach Support

Include relevant medical records and other documentation required by the applicable appeal process.

AR Strategy

Do not write an appeal that simply says “Please reconsider the claim.” Identify the exact policy requirement, explain how the patient’s clinical documentation satisfies that requirement, and connect the documentation to the billed service.

Modifier GZ Documentation Checklist

Documents and information to review during an AR investigation.

Medical Record

Review the clinical documentation supporting the service.

Diagnosis

Confirm the diagnosis supports the applicable coverage policy.

CPT/HCPCS

Verify that the billed code accurately represents the service.

LCD/NCD

Identify applicable Medicare coverage requirements.

ABN Status

Determine whether an ABN was obtained before the service.

GZ Modifier

Confirm that GZ accurately describes the expected denial situation.

ERA/EOB

Capture the exact denial message, CARC and RARC.

Appeal Letter

Explain the medical-necessity argument using the applicable Medicare policy.

AR Notes

Document payer calls, reference numbers, decisions and next actions.

Common Modifier GZ Billing Mistakes

Avoid these common mistakes when working Medicare claims.

Mistake 01

Using GZ for Every Denial

A denial does not automatically mean GZ is appropriate.

Mistake 02

Confusing GZ and GY

GY addresses statutory non-coverage, while GZ addresses expected reasonable-and-necessary denial without an ABN.

Mistake 03

Confusing GZ and GA

The key distinction is whether the applicable ABN was obtained.

Mistake 04

Ignoring LCD/NCD

Medical-necessity decisions should be researched against the applicable Medicare coverage policy.

Mistake 05

No Documentation Review

An appeal without reviewing the medical record may not address the actual reason for denial.

Mistake 06

Incorrect Diagnosis

The diagnosis may not support the coverage requirements for the service.

Mistake 07

Automatically Appealing

Determine whether the documentation actually supports a reasonable-and-necessary appeal before submitting.

Mistake 08

Ignoring ABN Status

The ABN status is essential when distinguishing GZ from GA.

Mistake 09

Poor AR Notes

Always document the payer’s explanation and reference number.

Modifier GZ Decision Tree

Ask these questions before billing or correcting a claim.

1 Is the service a Medicare benefit category?

2 Is the expected denial based on reasonable-and-necessary requirements?

3 Was an ABN obtained?

4 If no ABN was obtained and the expected denial is for medical necessity, evaluate GZ.

5 If an applicable ABN was obtained, evaluate GA instead.

6 If the service is statutorily excluded or has no Medicare benefit category, evaluate GY instead.

7 Verify current CMS/MAC instructions before submitting.

Modifier GZ Claim Audit Checklist

Use this checklist for pre-bill and denial review.

Claim-Level Review

Patient information
Date of service
CPT/HCPCS code
Units
Modifier GZ
Other modifiers
Place of service
Diagnosis codes
Rendering provider
Billing provider

      
        Medical Necessity Review
      
          Is the service a Medicare benefit?
        
          What policy applies?
        
          Are LCD criteria satisfied?
        
          Are NCD criteria satisfied?
        
          Does documentation support medical necessity?
        
          Does diagnosis support the service?
        
          Was an ABN obtained?
        
          Is GZ appropriate?
        
          Would GA apply if an ABN was obtained?
        
          Is GY more appropriate because the service is statutorily
          excluded?

      
        Modifier GZ Quick Cheat Sheet
      
        GZ = Item or service expected to be denied as not reasonable
        and necessary.
      
        GZ is associated with an expected medical-necessity denial.
      
        No ABN was obtained.
      
        GA = expected reasonable-and-necessary denial with applicable
        ABN/waiver-of-liability documentation.
      
        GY = statutorily excluded or does not meet the definition of a
        Medicare benefit.
      
        Do not use GZ simply because a claim was denied.
      
        Verify the exact denial reason.
      
        Review CARC and RARC codes.
      
        Check applicable LCD/NCD requirements.
      
        Review medical documentation.
      
        Verify diagnosis and CPT/HCPCS coding.
      
        Document all AR activity.

GZ AR Action Matrix

A quick reference for determining the next AR action.

Situation	First Check	Modifier Direction	AR Action
Expected medical-necessity denial + no ABN	Medicare medical-necessity policy	GZ	Verify policy and documentation
Expected medical-necessity denial + ABN	ABN documentation	GA	Verify ABN and claim reporting requirements
Statutorily excluded service	Medicare benefit category	GY	Verify statutory non-coverage
Diagnosis does not support policy	LCD/NCD	Depends on actual situation	Review coding and documentation
Documentation insufficient	Medical record	Depends on actual situation	Determine whether documentation can support appeal
Duplicate denial	Claim history	Do not assume GZ	Resolve duplicate claim issue

Modifier GZ FAQs

What is Modifier GZ?

Modifier GZ indicates that the provider expects Medicare to deny an item or service as not reasonable and necessary and an ABN was not obtained.

What does GZ mean in medical billing?

GZ means the provider expects Medicare to deny the service because it is not reasonable and necessary, and the beneficiary did not sign an ABN.

Does GZ mean no ABN?

Yes. The key distinction is that GZ is used when the provider expects a reasonable-and-necessary denial and did not obtain an ABN. CMS explicitly defines GZ this way. :contentReference[oaicite:3]{index=3}

What is the difference between GZ and GA?

Both relate to expected reasonable-and-necessary denials. GZ is used when no ABN was obtained, while GA is used when the applicable ABN/waiver-of-liability requirement has been satisfied. :contentReference[oaicite:4]{index=4}

What is the difference between GZ and GY?

GZ relates to an expected denial because the service is not reasonable and necessary. GY relates to a service that is statutorily excluded or does not meet the definition of a Medicare benefit. :contentReference[oaicite:5]{index=5}

Is GZ used when an ABN was signed?

GZ is specifically associated with the situation where the provider expects a reasonable-and-necessary denial and did not obtain an ABN. If an applicable ABN was obtained, GA may be relevant instead.

Is GZ the same as a medical necessity denial?

GZ indicates that the provider expects a medical-necessity denial and did not obtain an ABN. However, not every medical-necessity denial automatically means GZ should be reported. The billing circumstances must support the modifier.

Can GZ be used for a statutorily excluded service?

Generally, no. CMS distinguishes statutorily excluded services or services without a Medicare benefit category from reasonable-and-necessary denials. GY is the relevant modifier for the former situation. :contentReference[oaicite:6]{index=6}

Does GZ automatically mean the patient owes the balance?

Do not assume that. Patient liability depends on the applicable Medicare rules, notice requirements, assignment status and other circumstances. CMS guidance should be reviewed before transferring liability.

Should an AR caller appeal every GZ denial?

No. First determine why Medicare denied the service and whether the medical record satisfies the applicable coverage policy. Appeal only when there is a supportable basis for reconsideration.

What should I check before appealing a GZ denial?

Review the ERA/EOB, CARC, RARC, CPT/HCPCS, diagnosis, documentation, applicable LCD/NCD, ABN status and Medicare billing instructions.

Can GZ be corrected after the claim denies?

It depends on why the claim denied and whether GZ was actually appropriate. Do not simply replace GZ with GA or GY without verifying the underlying facts and applicable Medicare instructions.

What does CMS say about GZ?

CMS defines GZ as an item or service expected to be denied as not reasonable and necessary. CMS’s ABN guidance further states that GZ is reported when the provider expects denial for lack of medical necessity and did not issue an ABN. :contentReference[oaicite:7]{index=7}

What if the service is not a Medicare benefit?

If the service is statutorily excluded or does not meet the definition of a Medicare benefit, CMS guidance points to GY rather than GZ. :contentReference[oaicite:8]{index=8}

Official CMS References

Use official CMS resources when verifying Modifier GZ and ABN requirements.

CMS — Medicare Advance Written Notices of Non-Coverage CMS MLN guidance defining GZ and explaining its relationship to ABNs, GA, GY and other modifiers. CMS — Medicare Claims Processing Manual, Chapter 1 Official Medicare claims-processing guidance containing modifier definitions and billing instructions. CMS Medicare Coverage Database Official CMS resource for Medicare coverage policies, LCDs, NCDs and billing-related articles. CMS Internet-Only Manuals Official CMS collection of Medicare manuals and program guidance.

Coding & Billing Disclaimer

This page is provided for US medical billing, coding and RCM education. Modifier selection and reimbursement depend on the actual service, documentation, Medicare coverage policy, ABN status, CMS guidance and applicable MAC instructions. Always verify current official guidance before billing, correcting or appealing a claim.

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