Getting Paid For Medical Care Outside The Hospice Bundle By Using The GW Modifier

Background

When a patient elects the Medicare hospice benefit, they receive comprehensive palliative care for their terminal illness and related conditions. Medicare reimburses the hospice provider through a fixed daily per diem payment under Part A. This bundled rate covers most services, including nursing, medications, supplies, and physician oversight related to the terminal prognosis—meaning providers typically cannot bill Medicare separately for those elements without risking denial or improper payment recovery.

However, services unrelated to the terminal condition (or related conditions) fall outside this hospice bundle. These can be billed to Medicare Part B for separate reimbursement, often at standard fee-for-service rates that exceed what the per diem would cover for equivalent care. The key mechanism enabling this is the HCPCS modifier GW (“Service not related to the hospice patient’s terminal condition”).

The Role of Modifier GW in Claims Processing

Modifier GW signals to Medicare that the billed service or procedure addresses a condition independent of the patient’s terminal illness. Without it, claims during an active hospice period are often denied as bundled into the hospice per diem or considered provider liability. When properly applied:

• The claim bypasses hospice-related edits.
• Payment processes under normal Part B rules (subject to deductibles, coinsurance, and fee schedules).
• Reimbursement can be significantly higher than if absorbed into the hospice’s daily rate—especially for procedures, durable medical equipment (DME), or specialist visits unrelated to the terminal diagnosis.

Examples include:

• A hospice patient (terminal cancer) treated for a broken hip from a fall → orthopedic services with GW.
• Dental work or routine eye exams unrelated to the terminal prognosis.
• DME for a co-morbid condition not tied to the hospice diagnosis.
• Podiatry Care

CMS guidelines (e.g., Medicare Claims Processing Manual, Chapter 11) and Medicare Administrative Contractors (MACs) like Novitas, Palmetto GBA, and CGS emphasize that GW must be appended when criteria are met. Claims missing it for eligible unrelated services are denied, with effective dates for strict enforcement (e.g., denials without GW since 2019 in some jurisdictions).

Automated Edits: Streamlining Higher-Reimbursement Claims

Revenue cycle management systems, clearinghouses, and payer-side claim processing tools must incorporate automated “edits” (rule-based logic) to optimize hospice claims. Intelligent editing maximizes reimbursements while removing costly and unreliable manual editing:

• Trigger: Payer is any Medicare Administrative Contractor (MAC).
• Action: The system automatically queries Medicare eligibility (via real-time eligibility checks or batch queries) to confirm the patient’s active hospice election period.
• Condition: If the claim’s dates of service fall within the patient’s hospice period (inclusive of admission through revocation/discharge).
• Outcome: The edit appends modifier GW to every claim line.

Results of This Automation:

• Eliminates manual review for GW eligibility on every line.
• Prevents denials from missing modifiers.
• Maximizes reimbursement by routing unrelated services for separate Part B payment.

Such edits represent a compliance and revenue integrity tool. They reduce underpayments from overlooked unrelated services while avoiding audits for improper GW use (e.g., OIG reports have flagged overpayments when GW was misapplied to related care).

Benefits and Compliance Considerations

These automated processes help providers capture legitimate additional revenue beyond the hospice per diem—particularly valuable in value-based environments where margins are tight. For instance, a facility-based claim for an unrelated acute issue (e.g., infection treatment) could yield far more than the hospice daily rate covers.

However, accuracy is critical:

• GW applies only to truly unrelated services; misapplication risks audits, recoupments, or fraud allegations.
• Providers must verify hospice status (via eligibility tools) and document why the service is unrelated.
• Recent CMS edits (e.g., outpatient claim comparisons to hospice diagnoses) further scrutinize overlaps to curb improper payments.

In summary, automated edits like this transform hospice claim processing from reactive to proactive. By intelligently inserting GW where Medicare hospice periods overlap, they ensure unrelated care receives appropriate, higher reimbursement—balancing palliative focus with fair payment for non-terminal needs. This reflects broader efforts in healthcare billing to leverage technology for compliance and financial optimization.

 

How TKSoftware Automates the GW Edit for Optimal Results

Leading revenue cycle management (RCM) platforms, such as TKSoftware‘s advanced medical billing and claims processing system, incorporate sophisticated automated edits like this to handle this requirement seamlessly. TKSoftware performs this intelligent edit before claims are transmitted to the payer, embedding compliance and revenue optimization directly into the workflow.

Here’s how the process works in TKSoftware:

• Real-Time or Batch Eligibility Verification: When preparing a claim (professional, institutional, or otherwise), the system automatically initiates an eligibility inquiry to Medicare. This pulls the patient’s current enrollment status, including any active hospice election period, directly from the payer’s records.
• Hospice Period Check: TKSoftware cross-references the claim’s dates of service against the eligibility response. If the dates fall within an inclusive hospice period (from election through revocation, discharge, or end of benefit), the system flags the claim as requiring GW handling.
• Automatic Modifier Application: The edit then appends modifier GW to every applicable claim line on the outgoing claim. This occurs transparently during the claim scrubbing and validation stage—no manual intervention needed.
• Pre-Submission Scrubbing Integration: This GW logic integrates with TKSoftware’s broader claim scrubbing engine, which already checks for errors, missing data, and payer-specific rules, ensuring the modified claim meets Medicare Administrative Contractor (MAC) requirements before submission.

Time, Effort, and Dollar Savings for Practices

This automation delivers substantial operational benefits to medical practices, hospitals, and other providers:

• Eliminates Manual Eligibility Checks: Staff no longer need to log into Medicare portals, run individual queries via tools like the myCGS portal or IVR, or manually verify hospice status for every patient encounter during an active period.
• Removes Tedious Modifier Entry: Coders and billers avoid the repetitive task of reviewing each claim line, determining GW applicability, and manually adding the modifier—reducing keystrokes, review time, and the risk of oversight.
• Reduces Denials and Rework: By proactively applying GW where eligibility confirms hospice enrollment, claims bypass common Medicare edits that deny unrelated services without the modifier (a policy enforced by MACs like Novitas, Palmetto GBA, and CGS since updates around 2019–2020). This minimizes rejections, appeals, and delayed payments.
• Improves the Bottom Line:  Reworking and refilling claims is expensive and time-consuming.  Rework cost per claim can range from $25 to $118 per claim.
• Accelerates Reimbursement: Faster, cleaner claim submission means quicker Part B processing for unrelated services, capturing higher fee-for-service revenue (e.g., for procedures, DME, or specialist care) that would otherwise be absorbed into—or lost against—the hospice per diem.
• Enhances Compliance and Audit Readiness: Automated application based on verified eligibility data creates a clear audit trail, helping practices demonstrate proper use of GW and avoid scrutiny from OIG reviews or CMS improper payment reports.

In essence, TKSoftware’s Real-Time claim scrubbing transforms what could be a labor-intensive, error-prone process into a reliable, behind-the-scenes safeguard. Practices using modern platforms like TKSoftware’s ICONIC Pro or similar RCM tools can focus more on patient care and less on billing minutiae, while confidently maximizing legitimate reimbursements beyond the standard hospice daily rate.

This kind of proactive automation exemplifies how TKSoftware’s RCM services bridge compliance gaps, reduce administrative burden, and support financial health in an increasingly regulated hospice environment.