Attend a Webinar

Advance Beneficiary Notice of Noncoverage (ABN)

An ABN, Form CMS-R-131, is a standardized notice that a health care provider/supplier must give to a Medicare beneficiary, before providing certain Medicare Part B or Part A items or services.

Access the below information from this page.

Overview

The ABN must be issued to a beneficiary with enough time prior to the service/procedure for the beneficiary to make an informed decision about whether, or not, to have the procedure/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 because of medical necessity, frequency limitations, discontinued services, experimental and investigational, and not safe or proven effective.

By providing the ABN in advance of the procedure/service, it gives a beneficiary the opportunity to decide whether to receive the service and accept financial responsibility if denied by Medicare. It also serves as proof that the beneficiary was advised of potential financial responsibility. If the provider does not deliver a valid ABN to the beneficiary, the beneficiary cannot be billed.

CMS strongly encourages healthcare providers and suppliers to issue an ABN for care that is never covered. However, an ABN is not required for care that is either statutorily excluded from coverage under Medicare (care that is never covered) or most care that fails to meet a technical benefit requirement (lacks required certification). An ABN must not be used for all services and is not required for services that are statutorily excluded. Such as: vitamins, nutritional counseling, x-rays, office visit, and therapy.

Once an ABN is issued, it is no longer required to be issued annually. An ABN remains effective as long as there is no change in: care from what is described on the original ABN, beneficiary’s health status or Medicare coverage guidelines.

If there are ANY changes, a new ABN is required.

Medical Necessity

Medical Necessity is defined as services that are reasonable and necessary for the diagnosis or treatment of an illness or injury or to improve the functioning of a malformed body member and are not excluded under another provision of the Medicare Program.

Coverage of certain items/services is limited by the diagnosis. If the diagnosis listed on the claim is deemed not medically necessary, the procedure is denied. Limited coverage may be the result of National Coverage Determinations (NCDs) or Local Coverage Determinations (LCDs). The CMS Medicare Coverage Database (MCD) contains all NCDs and LCDs, local policy articles and proposed NCD decisions. View the CMS NCDs. The official versions of LCDs may be viewed by contractor, state or alphabetically.

42 C.F.R.411.406 states that a healthcare provider or supplier that furnished services which constitute custodial care under 411.15(g) or that are not reasonable and necessary under 411.15(k) is considered to have known that the services were not covered if any one of the conditions listed below are met:

  1. Notice from the Quality Improvement Organization (QIO), intermediary or carrier. The QIO, intermediary or carrier had informed the provider, practitioner or supplier that the services furnished were not covered or that similar or reasonably comparable services were not covered.
  2. Notice from the utilization review committee or the beneficiary's attending physician. The utilization review group or committee for the provider or the beneficiary's attending physician had informed the provider that these services were not covered.
  3. Notice from the provider, practitioner or supplier to the beneficiary. Before the services were furnished, the provider, practitioner or supplier informed the beneficiary that
    1. The services were not covered; or
    2. The beneficiary no longer needed covered services.
  4. Knowledge based on experience, actual notice or constructive notice. It is clear that the healthcare provider or supplier could have been expected to have known that the services were excluded from coverage on the basis of the following:
    1. Its receipt of CMS notices, including manual issuances, bulletins, or other written guides or directives from intermediaries, carriers or QIOs including notification of QIO screening criteria specific to the condition of the beneficiary for whom the furnished services are at issue and of medical procedures subject to preadmission review by the QIO.
    2. Federal Register publications containing notice of national coverage decisions or of other specifications regarding non-coverage of an item or service.
    3. Its knowledge of what are considered acceptable standards of practice by the local medical community.

ABN Triggering Events

An ABN is required when an item or service is expected to be denied. This may occur at any one of three points during a course of treatment which are initiation, reduction and termination, also known as "triggering events."

  • Initiation - New patient encounter, start of plan of care or beginning of treatment. These are covered items or services that might be non covered because not reasonable and necessary or frequency if done by another provider
  • Reduction - Decrease in a component of care. Patient request a frequency in care that is no longer considered reasonable and necessary
  • Termination - Discontinued services. Patient request continuation of service that is no longer medically reasonable and necessary

Specialty Tips

Ambulance

  • Never use when patient under duress or emergency
  • Mandatory for usage when the following criteria are met and the provider or supplier wants to transfer liability to the beneficiary:
    • The service being provided is a Medicare covered ambulance benefit
    • Healthcare provider or supplier believes that the service may be denied in part, or in full as not reasonable and necessary
    • Service is being provided in a non-emergency situation
  • Mandatory usage:
    • Beneficiary’s transport is modified to level that is not medically necessary and will incur additional costs.
  • Voluntary usage:
    • Issue when transport is statutorily excluded from coverage because it fails to meet the definition of the Medicare ambulance benefit

Chiropractic

  • Do not bill AT with GA on same code
  • All services except for manipulation are non-covered, so ABN is voluntary

Laboratory

  • All screening lab tests have a set frequency time frame, anything more frequently requires an ABN
  • Physicians should forward ABNs to labs

Podiatry

  • Any service like removal of calluses or toenail trimming are routine and an ABN is not necessary
  • Treatment for mycotic nails is routine unless patient has a systemic condition, so an ABN is required if criteria not met

Outpatient Therapy

Key Points to Remember

  • Section C of the ABN is an optional field, providers may indicate an identifier, such as the medical record number, patient ID or date of birth.  Do not use Medicare Numbers, (Social Security Numbers (SSN)), Medicare ID (Health Insurance Claim Number (HICN) or the Medicare Beneficiary Identifier (MBI)) as CMS upholds this requirement to protect the identity of the Medicare Beneficiary, however, The SSN, HICN or the MBI should not be listed on the ABN.
  • Provider/supplier must issue an ABN to beneficiary prior to providing care that may not be covered by Medicare because it is not medically reasonable and necessary in a particular case
  • After beneficiary signs a properly issued ABN indicating his/her choice to receive item or service and accept financial liability, provider/supplier is permitted to bill beneficiary for care
  • If an ABN is not issued or found to be an invalid notice in a situation where notice is required, provider/supplier is not permitted to bill beneficiary for services and provider supplier may be held liable if Medicare does not cover.
  • Health care providers/suppliers are not permitted to use ABNs to charge a beneficiary for a component of a service when full payment is made through a bundled payment
  • Providers and suppliers are prohibited from using an ABN to transfer liability to beneficiary when items and services would otherwise be covered by Medicare
  • Health care providers/suppliers are prohibited from issuing ABNs on a routine basis (i.e., where there is no reasonable basis for Medicare to not cover). Providers and suppliers must be sure that there is a reasonable basis for non-coverage associated with issuance of each ABN. Some situations may require a higher volume of ABN issuance. As long as there is proper evidence for ABN use, provider will not have violated routine notice prohibition
  • ABNs are not required for care that is statutorily excluded or for services that are never a Medicare benefit; however, CMS does strongly encourage provider/suppliers to provide an ABN for care that they believe may not be covered to the beneficiary as a courtesy to advise of pending financial obligation.
  • It is inappropriate to produce an ABN for all Medicare beneficiaries receiving services for every procedure or office visit

Resources

 

Last Updated Mon, 11 Oct 2021 16:50:25 +0000