Advance Beneficiary Notice of Noncoverage (ABN) - JA DME
Advance Beneficiary Notice of Noncoverage (ABN)
The annual renewal requirement has been removed. Per CR12242, an ABN remains effective after valid delivery so long as there has been no change in:
- Care from what is described on the original ABN.
- The beneficiary’s health status which would require a change in the subsequent treatment for the non-covered condition; and/or
- The Medicare coverage guidelines for the items or services in question (i.e., updates or changes to the policy of an item or service).
Note: If any of the above changes during the course of treatment, a new ABN must be issued.
For items or services that are repetitive or continuous in nature, notifiers may issue another ABN to a beneficiary after one year for subsequent treatment for the non-covered condition. However, this is not required unless any of the conditions described above apply to the given situation.
Notifiers may give a beneficiary a single ABN describing an extended or repetitive course of non-covered treatment provided that the ABN lists all items and services that the notifier believes Medicare will not cover. If applicable, the ABN must also specify the duration of the period of treatment. If during the course of treatment additional non-covered items or services are needed, the notifier must give the beneficiary another ABN.
ABN
An ABN is a written notice a supplier gives to a Medicare beneficiary before providing an item and/or service. It must be issued when the health care provider (including independent laboratories, physicians, practitioners, and suppliers) believes that Medicare may not pay for an item or service which is expected to be denied by Medicare based on one of the following statutory exclusions.
- Lack of medical necessity
- Prohibited, unsolicited telephone contacts
- No supplier number
- Denial of an Advanced Determination of Medicare Coverage (ADMC) request
- Non-contract supplier furnishing an item listed in a Competitive Bid area
- Frequency limitations have been exceeded
An ABN gives a beneficiary the opportunity to make an informed decision prior to the item or service being provided to decide whether to receive it and accept financial responsibility (out of pocket or through another insurance) if denied by Medicare and serves as proof that the beneficiary had knowledge prior to receiving the item/service that Medicare might not cover. If the provider does not deliver a valid ABN to the beneficiary when required, the beneficiary cannot be billed for the service and the provider may be held financially liable.
Form
For an ABN form to be acceptable, it must:
- Be on approved CMS-R-131 form.
- Clearly identify item and/or service; and
- Give reason(s) for belief that Medicare is likely (or certain) to deny payment for item and/or service
ABNs apply to assigned and non-assigned claims, as there are financial liability provisions under Medicare law for both claim types.
Limitations of Liability (LOL)
Applies to assigned claims for DMEPOS services disallowed because of medical necessity, due to prohibition on unsolicited telephone calls, no supplier number, or no ADMC. Under LOL, a beneficiary can be held liable for a service denied due to reasons cited on the ABN.
The financial liability protections (FLP) provisions of the Social Security Act (the Act) protect beneficiaries and health care providers (physicians, practitioners, suppliers, and providers) under certain circumstances from unexpected liability for charges associated with claims that Medicare does not pay. The FLP provisions include:
- LOL under Section 1879(a)-(g) of the Act.
- Refund Requirements (RR) for Non-assigned Claims for Physicians Services under Section 1842(l) of the Act.
- Refund Requirements (RR) for Assigned and Non-assigned Claims for Medical Equipment and Supplies under Sections 1834(a)(18), 1834(j)(4), and 1879(h) of the Act.
Refund Requirements (RR)
Apply to assigned and non-assigned claims for DMEPOS services allowed because of medical necessity, due to prohibition on unsolicited telephone calls, no supplier number, or no ADMC. If the beneficiary was not properly notified of possible disallowed Medicare claims, the RR state that suppliers must refund any amounts collected. The RR provisions require that a beneficiary is notified and agrees to the financial liability.
Prior to rendering a service in which Medicare may consider not medically necessary, a supplier should notify the beneficiary, in writing, that Medicare will likely deny his/her claim and that he/she will be responsible for payment. The supplier will submit the appropriate HCPCS and append modifier GA (Waiver of Liability statement on file).
Example Statements Which Provide Reasons Suppliers Believe Medicare May Deny Claim
- Medicare does not usually pay for this many treatments or services
- Medicare usually does not pay for this service
- Medicare does not pay for this because it is a treatment that has yet to be proved effective (experimental)
- Medicare does not pay for this many services within this period
- Medicare does not pay for such an extensive treatment
General statements, such as "Medicare may not pay," are not acceptable.
If there is dissatisfaction with the amount of payment, denial of coverage for services or supplies, or if the original claim was not acted upon within a reasonable time, a beneficiary or his/her representative has the right to appeal a claim decision. A supplier has the right to appeal a claim decision when assignment has been accepted.
Section E Examples
Appropriate
- "The patient does not have the required diagnosis to qualify for this item per the policy."
- "The patient currently has a nebulizer (E0570) paid for by Medicare on 12/2/2013 which is same or similar to this nebulizer (E0570)."
- "There are no test results available to determine the patient qualifies for oxygen equipment under Medicare guidelines."
Not Appropriate
- "Medicare might not pay for this item."
- "Patient might have same or similar item on file."
- "Not enough supporting documentation in the medical record"
Optional ABN Uses
ABNs are not required for care that is either statutorily excluded from coverage under Medicare (i.e., care that is never covered) or most care that fails to meet the definition of any Medicare benefit. However, CMS does encourage an ABN be used in these situations to voluntarily notify Medicare beneficiaries of an expected denial.
When statutorily excluded items are provided to a beneficiary and a voluntary ABN is obtained, the ABN serves as a courtesy to the beneficiary forewarning them of financial obligation. The beneficiary should not choose an option box or be required to sign the ABN.
Statutorily Excluded Items or Situations (Not all inclusive)
- Eyeglasses or contact lenses - except those provided following cataract removal or other cause of aphakia.
- Durable Medical Equipment and related accessories and supplies provided to patients in nursing facilities.
- Personal comfort items.
- Orthopedic shoes or shoe inserts - other than those covered under the therapeutic shoes for diabetics benefit or those that are attached to a covered leg brace.
Items or Situations Which Do Not Meet Definition of a Medicare Benefit (Not all inclusive)
- Parenteral or enteral nutrients that are used to treat a temporary (rather than permanent) condition.
- Enteral nutrients that are administered orally.
- Infusion drugs that are not administered through a durable infusion pump.
- Surgical dressings that are used to cleanse a wound, clean intact skin, or provide protection to intact skin.
- Irrigation supplies that are used to irrigate the skin or wounds.
- Immunosuppressive drugs when they are used for conditions other than following organ transplants.
- Most oral drugs.
- Oral anticancer drugs when there is no injectable or infusion form of the drug.
- Nondurable items (that are not covered under any other benefit category), e.g., incontinent products
- Durable items that are not primarily designed to serve a medical purpose, e.g., exercise equipment
Per Section 1848(g)(4) of the Social Security Act, suppliers are not required to submit a claim to Medicare when an item(s) is categorically excluded from Medicare benefits (e.g., tub/shower stools, personal comfort items, etc.); however, if a beneficiary requests a supplier submit a claim, a supplier must comply. The claim must include the appropriate HCPCS, but modifiers GA or GY are not required. The supplier and the Medicare beneficiary will receive a Patient Responsibility (PR) denial for the noncovered services.
Beneficiary Changes His/Her Mind
If after completing and signing the ABN, a beneficiary changes his/her mind, the notifier should present the previously completed ABN to the beneficiary and request that the beneficiary annotate the original ABN. The annotation must include a clear indication of his/her new option selection along with the beneficiary's signature and date of annotation. In situations where the notifier is unable to present the ABN to the beneficiary in person, the notifier may annotate the form to reflect the beneficiary's new choice and immediately forward a copy of the annotated notice to the beneficiary to sign, date, and return.
In both situations, a copy of the annotated ABN should be provided to the beneficiary as soon as possible. If a related claim has been filed, it should be revised or cancelled if necessary to reflect the beneficiary’s new choice
Providers Not Participating in Medicare Part B Versus DME Suppliers Without a Supplier Number
The ABN is an Office of Management and Budget (OMB)-approved written notice issued by healthcare providers and suppliers for items and services provided under Medicare Part B. With the exception of DME suppliers, only healthcare providers and suppliers who are enrolled in Medicare can issue the ABN to beneficiaries. The ABN is given to beneficiaries enrolled in the Medicare FFS program. It is not used for items or services provided under the Medicare Advantage (MA) Program or for prescription drugs provided under the Medicare Prescription Drug Program (Part D).
Per CMS Internet Only Manual (IOM), Publication 100-04, Medicare Claims Processing Manual, Chapter 30, Section 50.1 if a Part B provider is not participating in Medicare, they cannot utilize the ABN (exception DME).
If a DME supplier does not have a supplier number, they should obtain an ABN.
