Medicare Part B 101 Manual

Medicare Part B 101 Manual

Advance Beneficiary Notice of Noncoverage for Not Reasonable and Necessary Denials

Table of Contents

Limited Coverage

Coverage of certain procedures is limited by the diagnosis. If the diagnosis listed on the claim is not the same as one of those listed as covered for the procedure, the procedure is denied.

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Medical Necessity

Medical necessity is defined as those 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.

Medicare notifies providers of limited coverage and medical necessity in the MMR. Providers can retrieve copies of past MMR publications and coverage determinations in the Education tab on our website.

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Expectations

Despite the fact that some physicians, providers or suppliers may have a limited degree of contact with a beneficiary, they are expected to be aware of both national coverage policy and current LCDs. In the absence of national coverage policy, LCDs indicate which items/services will be considered reasonable, medically necessary and appropriate. In most cases, the availability of this information indicates that the physician, provider or supplier knew, or should have known, that the item/service would be denied as not medically necessary.

If there is a question regarding the number of times a service has been furnished to the beneficiary within a specific period, the physician, provider or supplier should clarify this information with either the beneficiary or the physician who ordered the tests.

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ICD-10-CM Coding

All services reported to the Medicare Program by health care professionals must demonstrate medical necessity through the use of ICD-10-CM diagnostic coding carried to the highest level of specificity for dates of service on or after 10/1/2015. Visit CMS ICD-10 web page for additional information.

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Reasons for Noncoverage

Services denied by the Medicare Program as not medically necessary or reasonable fall into these general categories:

  • Experimental and investigational or considered “research only”
  • Not indicated for diagnosis and/or treatment in this case
  • Not considered safe and effective
  • More than the number of services Medicare allows in a specific period for the corresponding diagnosis.

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Beneficiary Responsibility

Services that are denied by the Medicare Program as not medically necessary can be billed to the beneficiary if the physician, provider or supplier had the beneficiary sign a proper ABN prior to the service(s) being furnished.

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Medicare Program Exclusions

Services that are considered to be Medicare Program exclusions do not require an ABN. If an ABN is given voluntarily for a Program exclusion, modifier GX may be indicated.

Examples of Medicare Program exclusions include:

  • Personal comfort items
  • Self-administered drugs and biologicals (i.e., pills and other medications not administered by injections)
  • Cosmetic surgery (unless required for prompt repair of accidental injury or for improvement of a malformed body member)
  • Eye exams for the purpose of prescribing, fitting or changing eyeglasses or contact lenses in the absence of disease or injury to the eye
  • Routine immunizations (except COVID-19, influenza vaccine, pneumococcal vaccine and hepatitis B vaccine)
  • Physicals, laboratory test, and X-rays performed for screening purposes (except screening mammograms, screening pap smears and various other mandated screening services)
  • X-rays and physical therapy provided by chiropractors
  • Hearing aids and hearing examinations
  • Routine dental services (i.e., care, treatment, filling, removal or replacement of teeth)
  • Supportive devices for the feet
  • Routine foot care (i.e., cutting or trimming corns or calluses, unless inflamed or infected; routine hygiene or palliative care of trimming of nails)
  • Custodial care
  • Services furnished or paid by government institution
  • Services resulting from acts of war
  • Charges made to the Medicare Program for services furnished by a physician or supplier to his/her immediate relatives or members of his/her household

The following relationships are included in the definition of immediate relative:

  • Husband and wife
  • Natural parent, child, and sibling
  • Adopted parent, child and sibling
  • Step-parent, stepchild, stepbrother, stepsister
  • Father-in-law, mother-in-law, son-in-law, daughter-in-law, brother-in-law and sister-in-law
  • Grandparent and grandchild
  • Spouse of grandparent or grandchild

By definition, members of the household include those persons sharing a common abode with the physician as part of a single family unit, including those related by blood; marriage or adoption, domestic employee and others who live together as part of a single family unit.

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What Is the ABN?

The ABN is a written notice that a provider/supplier gives to a Medicare beneficiary before items or services are rendered to convey that Medicare is not likely to provide coverage in a specific case for a particular reason, such as the services are not considered medically necessary.

ABNs should only be provided to fee-for-service Medicare beneficiaries. The ABN allows the beneficiary to make an informed decision about whether or not to receive services that he or she may be financially responsible for paying. The ABN serves as proof that the beneficiary had knowledge prior to receiving the service that Medicare might not pay. If a provider does not deliver a proper ABN to the beneficiary, then the beneficiary cannot be billed for the service.

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ABN Requirements

Proper advance written notice to the beneficiary must:

  • be on the approved Advance Beneficiary Notice of Noncoverage (CMS-R-131) form;
  • clearly identify the particular item or service so the beneficiary can understand;
  • state the provider believes Medicare will probably deny payment for the particular item or service;
  • give the reason the provider believes payment is likely to be denied. The reasons must be sufficiently specific to allow the beneficiary to understand the basis for denial;
  • include a reasonable cost estimate for all services listed on the ABN;
  • have either Option 1, 2 or 3 personally selected by the beneficiary or authorized representative; and
  • be signed and dated by the beneficiary or authorized representative prior to the service being rendered.

Note: The HCPCS/CPT codes by themselves are not acceptable as descriptions.

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Proper Use of the ABN (CMS-R-131)

When an ABN Should Be Given

An ABN should only be given when Medicare is expected to deny payment (entirely or in part) for the item or service because it is not reasonable and necessary under Medicare Program standards.

When an ABN Should Not Be Given

  • If the provider expects Medicare to pay
  • If the provider “never knows whether or not Medicare will pay”
  • If the item or service is not a Medicare benefit (refer to section titled “Medicare Program Exclusions”)

Who the ABN Should Be Given To

  • A Medicare beneficiary, or
  • The Medicare beneficiary’s authorized representative (refer to the section titled “Definition of Authorized Representative” and “Beneficiary Cannot Comprehend ABN”)

How an ABN May Be Given

Delivery of an ABN occurs when the beneficiary or authorized representative have received the notice and can comprehend its contents. An incomprehensible notice, or a notice that the beneficiary or authorized representative is incapable of understanding due to particular circumstances (even if others may understand), is invalid (refer to section titled “Beneficiary Cannot Comprehend ABN”).

Routine Notices Prohibition

Providers should not give ABNs to a beneficiary unless the provider is certain that Medicare is likely to deny the services based on the reason(s) stated on the ABN.

Do not:

  • give routine notices for all claims or services;
  • give “generic” notices that state that denial is possible, or the provider never knows whether Medicare will deny payment; or
  • have the beneficiary sign blank ABNs.

Routine Notice Prohibition

Medicare prohibits you from issuing ABNs on a routine basis (that is, where there is no reasonable basis to expect that Medicare may not cover the item or service). You must ensure a reasonable basis exists for noncoverage associated with the issuance of each ABN. As long as proper evidence supports each ABN use, you will not be violating the routine notice prohibition.

Some Exceptions to the Routine Notice Prohibition

ABNs may be routinely issued in the following circumstances:

  • Experimental items and services
  • Items and services with frequency limitations for coverage
  • Medical equipment and supplies denied because the supplies had no supplier number or the supplier made an unsolicited telephone contact or
  • Services that are always denied for medical necessity

Issuing the ABN When Multiple Entities Render Care

When multiple entities render care, Medicare does not require you to issue separate ABNs. Any party involved in the delivery of care can issue the ABN when:

  • there are separate “ordering” and “rendering” providers (for example, a physician orders a laboratory test and an independent laboratory delivers the ordered tests);
  • one health care provider delivers the “technical” component and the other the “professional” component of the same service (for example, radiological test that an independent diagnostic testing facility renders and a physician interprets); or
  • the entity that obtains the signature on the ABN differs from the entity that bills for the service (for example, when one laboratory refers a specimen to another laboratory, which then bills Medicare for the test).

In these situations, you may enter the names of more than one entity in the header of the ABN as long as the beneficiary can clearly identify whom to contact for billing questions.

Note: Regardless of who issues the ABN, Medicare holds the billing entity responsible for effective issuance.

Delivery of the ABN

Delivery of an ABN occurs when the beneficiary or authorized representative (the person acting on behalf of the beneficiary) have received the ABN and can comprehend its contents.

Copying the ABN

A copy of the ABN should be made immediately available after the beneficiary signs it. The copy should be given to the beneficiary or authorized representative and the original should be retained by the provider.

Beneficiary Cannot Comprehend ABN

The beneficiary or authorized representative must be able to comprehend the notice in order to be capable of receiving the ABN. The ABN must be delivered to an authorized representative if the beneficiary is:

  • comatose;
  • confused (e.g., experiencing confusion due to senility, dementia, Alzheimer’s disease);
  • legally incompetent;
  • under great duress (e.g., in a medical emergency); or
  • not able to understand and act on his/her rights.

Some beneficiaries may not be able to comprehend an ABN that is delivered in the usual manner. In the absence of an authorized representative, the provider must take other steps to deliver the ABN so that the beneficiary can comprehend it. Note: This is not an all-inclusive list.

  • The beneficiary cannot read the language in which the ABN is written.
  • The beneficiary cannot read at all or is functionally illiterate to read any notice.
  • The beneficiary is blind or otherwise visually impaired and cannot see the words on a printed page.
  • The beneficiary is deaf and cannot ask questions about the printed word without the aid of a translator.

Questions

The provider must attempt to answer any questions the beneficiary or authorized representative may have about the ABN including help in understanding the notice and the basis for the provider’s belief that the services may be denied.

Timely Notification

The ABN must be delivered to the beneficiary far enough in advance for the beneficiary to make an informed decision without feeling undue pressure, and before the beneficiary is already committed to receiving the service. The ABN delivery should take place before:

  • the procedure is initiated; or
  • physical preparation of the beneficiary (e.g., disrobing, placement in or attachment of diagnostic or treatment equipment) begins.

The ABN may still be delivered after the beneficiary has entered an examination room, draw station, etc., and is ready to receive services. If during an encounter with the beneficiary, a provider sees the need for a previously unforeseen service, expects that Medicare will not pay for it, and wishes to be given an ABN, he/she may do so if the beneficiary is able to comprehend the ABN and can act on it (e.g., the beneficiary is not under general anesthesia).

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Laboratory Tests

If the provider draws a test specimen and sends it to a laboratory for testing without giving the beneficiary an ABN, the laboratory may contact the beneficiary and give him/her an ABN as long as testing of the specimen has not begun.

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How the ABN Protects the Provider

When a valid ABN has been given, the provider is free to bill the beneficiary for the denied services. If an ABN is not valid, the provider may not bill the beneficiary for the services. When an ABN has been properly delivered to the beneficiary, Medicare does not limit the amount that the provider may collect from the beneficiary. Medicare charge limits will not apply to either assigned or nonassigned claims, participating or nonparticipating providers. ABNs may not be used to bill beneficiary for services that are denied as bundled into other payments. Providing an ABN is not in violation of the HIPAA, Section 231(e)(4), which provides for civil monetary penalties when claims are submitted “for a pattern of medical or other items or services that a person knows or should know are not medically necessary.” This law is not related to the use of ABNs.

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Definition of Authorized Representative

An authorized representative is a person who is acting on the beneficiary’s behalf and in the beneficiary’s best interests, and who does not have a conflict of interest with the beneficiary when the beneficiary is temporarily or permanently unable to act for him/herself. If a situation arises in which the beneficiary cannot receive an ABN and there is no authorized representative, the beneficiary is not liable for the services.

An authorized representative can be:

  • an individual authorized under state law to make health care decisions, e.g., a legally appointed representative or guardian of the beneficiary, or an individual exercising explicit legal authority on the beneficiary’s behalf; and/or
  • an individual who has the beneficiary’s best interests at heart.

The order of priority of authorized representatives should be:

  • the spouse (unless legally separated),
  • an adult child,
  • a parent,
  • an adult sibling,
  • a close friend if none of the above are available (close friend is defined as “an adult who has exhibited special care and concern for the beneficiary, who is familiar with the beneficiary’s personal values, and who is reasonably available”),
  • someone who has no relevant conflict of interests with the beneficiary,
  • anyone that the beneficiary indicates to act for him/her or
  • a disinterested third party (e.g., public guardianship agency).

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ABNs and an Extended Course of Treatment

A single ABN covering an extended course of treatment is acceptable if the ABN identifies all items and services for which the provider believes Medicare will not pay. If additional services for which the provider believes Medicare will deny are furnished during the course of treatment, a separate ABN is needed. A single ABN for an extended course of treatment is valid for one year. If the course of treatment extends beyond one year, a new ABN is needed for the remainder of the course of treatment. Once the ABN has been signed by the beneficiary, it cannot be modified or revised. When the beneficiary needs to be notified of new information, a new ABN must be given.

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ABNs and Medical Emergencies

An ABN should not be obtained from a beneficiary in a medical emergency or otherwise under great duress (i.e., when circumstances are compelling and coercive). The provider should furnish the services he believes to be medically necessary and reasonable. If Medicare denies the services for medical necessity, the beneficiary is not liable for the services.

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Services Provided in A Skilled Nursing Facility

SNFs may not give ABNs to beneficiaries in the case of “middle-of-the-night” emergencies, since the beneficiary is under duress and unable to make an informed decision, and authorized representatives are unlikely to be readily available for such emergencies. SNF staff may not sign ABNs for beneficiaries as their authorized representatives. Standing orders may be obtained ahead of time in preparation for emergencies, based on the probable needs of the specific beneficiary. However, an ABN obtained for a standing order is only effective for one year.

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Completing the Form

Beginning 3/1/2009, the CMS-R-131 Advance Beneficiary Notice of Noncoverage (ABN) is the only acceptable form. The form can be downloaded in both English and Spanish languages at Beneficiary Notices Initiative (BNI).

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Completing the Notice

OMB-approved ABNs are located on the CMS Beneficiary Notices Initiative (BNI) web page. Notices placed on this site can be downloaded and should be used as is, as the ABN is a standardized OMB-approved notice. However, some allowance for customization of format is allowed as mentioned for those choosing to integrate the ABN into other automated business processes. In addition to the generic ABN, CMS will also provide alternate versions with certain blanks completed for those not wishing to do additional customization as permitted, including a version illustrating laboratory-specific use of the notice.

ABNs must be reproduced on a single page. The page may be either letter or legal size, with additional space allowed for each blank needing completion when a legal-size page is used.

Sections and Blanks

There are ten blanks for completion in this notice, labeled from (A) through (J), with accompanying instructions for each blank below. We recommend that the labels for the blanks be removed before use. Blanks (A)−(F) and blank (H) may be completed prior to delivering the notice, as appropriate. Entries in the blanks may be typed or handwritten, but should be large enough (i.e., approximately 12-point font) to allow ease in reading. (Note that 10-point font can be used in blanks when detailed information must be given and is otherwise difficult to fit in the allowed space.) The Option Box, Blank (G), must be completed by the beneficiary or his/her representative. Blank (I) should be a cursive signature, with printed annotation if needed in order to be understood.

Header

Blank (A) Notifier

Notifiers may elect to place their logo at the top of the notice by typing, handwriting, preprinting, use of a label or other means. At a minimum, the name, address, and telephone number (including TTY when appropriate) of the notifier must appear, whether incorporated into the logo or not, to ensure the beneficiary’s ability to follow-up with additional questions. The title for Blank (A)—that is, “Notifier”, may be completely removed during reproduction to accommodate letterhead type logos that go across the entire page. If appropriate, the name of more than one entity may be given in the notifier area, such as when the ordering and rendering providers differ, as long as this is clearly conveyed to the beneficiary for purposes of responding to questions.

Blank (B) Patient Name

Notifiers must enter the first and last name of the beneficiary receiving the notice. Include the beneficiary's middle initial if it's also listed on their Medicare card. (Note that the ABN will not be invalidated by a misspelling or missing initial, as long as the beneficiary or representative recognizes the name listed as that of the beneficiary.)

Blank (C) Identification Number

Notifiers should enter an identification number for the beneficiary that helps to link the notice with a related claim when applicable. This field is optional, and choosing not to enter a number does not invalidate the ABN. The beneficiary’s MBI or Social Security Number should not appear on the notice.

Body

The body of the notice consists of the text below the header, the box to record the items and services, reasons coverage is not expected and estimated cost, and the remaining text above the options box. Consistent with past policy, ABNs can be used for a single item or service or multiple items or services. However, when there are multiple items or services at issue, the name of each item or service, the reason it is not covered by Medicare and the estimated cost must be presented in a parallel format that enables the beneficiary or representative to match particular items or services with the applicable reason and cost information. Gridlines may be used across the box for this purpose. A standard letter-size downloadable ABN allows for entry of at least six lines across the box containing items, reasons and costs at 12-point font.

Note that it is permissible for multiple items or services to all be explained by one reason or bundled under one cost, in which case the same information would not have to be entered multiple times. Itemized costs may be totaled but this is not required. If more items or services need to be described than fit onto the one-page ABN, use of an attached sheet is permissible. In such cases, the presence of an attachment should be noted in the box on the first page, and the attachment should again allow for clear matching of the items or services in question with the reason and cost information. The attachment should be retained along with the first page of the ABN. Note that common or high-volume items or services, reasons and costs may be preprinted in the notice, though “blank” ABNs should also be available to allow for less commonly performed procedures.

Note that a box must appear around the items and services, reasons and costs, and that each of these sections must be clearly labeled with the proper heading. However, the shading included in this box is not mandatory. As a general rule, shading and shadowing is not required anywhere on the notice, although it is recommended if possible, since consumer testing has shown such shading to be useful in assuring beneficiaries’ attention. Similarly, other limited formatting modifications are permissible to accommodate automated business processes—for example, vertical lines are recommended but do not have to appear between the columns and the width and length of the entire box can be adjusted on the page.

Blank (D) Title Unfilled

Though these instructions use the default term “items and services”, consistent with the Medicare statute, the label “Blank (D)”—which is used in various parts of the ABN—may vary in its wording. The most appropriate of the following choices can be inserted by the individual notifier in preparing the ABN before it is delivered (i.e., in preprinting the notice):

  • Item(s)
  • Service(s)
  • Item(s) or service(s)
  • Laboratory test(s)
  • Test(s)
  • Procedure(s)
  • Care
  • Equipment

Note the variable “s” may or may not appear, or a space can be left so that an “s” can be entered when appropriate, or appear and be crossed out when not appropriate. CMS will also post at least one version of the notice with Blank (D) filled in for those wishing just to download a notice needing only the individual case-specific information to be entered.

In filling in the column under Blank (D) in the body of the ABN, notifiers must enter the name/description of all items or services that are the subject of the notice. The description may include a date, if that is relevant. Whenever possible, language that is easy for beneficiaries to understand should be used. If technical language must be used, it must be explained verbally to the beneficiary or representative. It is never permissible to add items or services to Blank (D) after the beneficiary or representative has signed the notice. The ABN is only effective for items and services clearly described on the notice at the time it is signed by the beneficiary or representative.

Blank (E) Reason Medicare May Not Pay

Under the heading for this blank, notifiers must explain, in beneficiary-friendly language, why they believe the care that is the subject of the notice is not covered by Medicare. There must be at least one reason applicable to each item or service listed, although, as mentioned above, the same reason can apply to multiple things. Commonly used reasons for noncoverage are:

  • “Medicare does not pay for these tests for your condition”
  • “Medicare does not pay for these test as often as this (denied as too frequent)”
  • “Medicare does not pay for experimental or research use tests”

These reasons are still appropriate for use in Blank (E) of this ABN. Note there are many other possible valid reasons in addition to the examples given above.

Blank (F) Estimated Cost

Notifiers must enter a cost estimate under the heading for Blank (F) for any items or services described in Blank (D). As noted above, there is flexibility in listing individual or total cost. The revised ABN will not be considered valid absent a good faith attempt to estimate cost. CMS will be flexible in defining what a good faith estimate is, particularly in consideration of cases where the ordering and rendering providers may be different.

Option Box and Additional Information

Options (G)

The beneficiary or his or her representative must choose only one of the three options listed. Medicare does not permit you to make this selection. However, home health agencies caring for dual eligibles may direct beneficiaries an option selection in accordance with state directives. 

If the beneficiary chooses Option 1: The beneficiary wants to get the item or services at issue and accepts financial responsibility. He or she agrees to make payment now, if required. You must submit a claim to Medicare that will result in a payment decision that the beneficiary can appeal. Note: If the beneficiary needs a Medicare claim denial for a secondary insurance plan to cover the service, the beneficiary should select Option 1.

If the beneficiary chooses Option 2: The beneficiary wants to get the item or services at issue and accepts financial responsibility. He or she agrees to make payment now, if required. When the beneficiary chooses this option, you do not file a claim, and there are no appeal rights. You will not violate mandatory claims submission rules under Section 1848 of the Social Security Act (the Act) when you do not submit a claim to Medicare at the beneficiary’s written request.

If the beneficiary chooses Option 3: The beneficiary does not want the care in question and cannot be charged for any items or services listed. You do not file a claim, and there are no appeal rights.

Blank (H) Additional Information

Space is provided below the Option Boxes for additional information to be inserted on the ABN. Notifiers are permitted to use this space for additional clarification that will be of use to beneficiaries. Possible uses of this space by notifiers include:

  • The former ABN-L language, “[You should] notify your doctor who orders these laboratory tests you did not receive them”
  • Providing context on Medicare payment policy applicable to a specific benefit
  • Information on other insurance coverage for beneficiaries needing immediate reassurance of additional coverage

Note that the ABN no longer includes an “Other Insurance” blank. Instead, the body of the notice now indicates that the notifier may help the beneficiary to access any other insurance, although not required by the Medicare Program. In addition, as noted above, notifiers may use the “Additional Information” space to record other payer information if they so choose. Under the “Additional Information” section, the ABN now alerts beneficiaries that the ABN conveys the notifier’s opinion, not an official Medicare decision, and also that the 1-800-MEDICARE number is available for additional help when needed.

Signature Box

Blank (I) Signature

The beneficiary or representative must sign the notice, with his or her own name, in this box simply labeled “Signature,” to allow maximum space for making the written entry. The signature indicates that he or she has received the notice and understands its contents.

Blank (J) Date

The beneficiary or representative must enter the date he or she signed the ABN.

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Services Ordered

In situations where a supplier is merely furnishing items/services (i.e., tests) ordered by another physician, if the ordering physician provides the beneficiary with proper advance notice that the ordered item/service may not be medically necessary, that notice would relieve the physician, provider, or supplier furnishing the item/service from liability for the charge.

However, if the question of knowledge were to arise, the physician, provider, or supplier would have to submit to Medicare a copy of the ABN that was given to the beneficiary by the ordering physician. If the ABN is determined to be unacceptable, the provider or supplier would not be protected by that notice and can be held liable.

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Services Referred

In cases where a physician makes a referral to another provider, any advance notice that was given to the beneficiary by the referring provider concerning the likelihood of denial on the basis of medical necessity cannot provide the entity to which the beneficiary is referred with protection against liability for the items/services it furnishes to the beneficiary. In such cases, the furnishing provider is in the best position to evaluate the likelihood of Medicare coverage or denial of the items/services and, therefore, is responsible for giving proper advance notice to the beneficiary. To be protected under the limitation of liability provision, the furnishing provider must give his/her own proper ABN to the beneficiary for any item/services that he/she believes are likely to be denied as not medically necessary.

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Separately Billed Components

If an ABN is given for a service for which Medicare pays in more than one part to different entities, e.g., for a radiological test with a technical and professional component, if the specification of the service on the ABN reasonably includes both components, that ABN from either party, will serve as evidence of knowledge for both assigned and nonassigned claims. It is not necessary for both providers to give separate ABNs. If the beneficiary asks for a cost estimate, it should include both parts of the service.

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ABNs for Part B Services Furnished in a SNF

Insofar as payment may be made under Part B for certain items and services when furnished by a participating SNF (either directly or under arrangements) to an inpatient of the SNF, if payment for these services cannot be made under Part A (e.g., the beneficiary has exhausted his/her allowed days of inpatient SNF coverage under Part A in his/her current spell of illness or was determined to be receiving a noncovered level of care, or the three-day prior hospitalization or the transfer requirement is not met), regulations regarding the ABN that apply to other Part B claims are applicable (found in this section of the Medicare Part B 101 Manual and the CMS IOM Publication 100-04, Medicare Claims Processing Manual, Chapter 30, Section 50.1-50.7, and Section 150.

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Partial Denials

Providers may give an ABN when they expect Medicare to reduce the level of payment because the more extensive service is considered to be not medically necessary, but payment is allowed for the less extensive service. An excess component means an item, feature or service, and/or the extent of, number of, duration of, or expense for an item, feature or service, which is in addition to, or is more extensive and/or expensive than, the item or service which is reasonable and necessary under Medicare’s coverage requirements.

The ABN must clearly identify in the “Items or Services” box, the excess component(s) of the item or service for which denial is expected (it is the part of the item or service that is expected to be denied that is the subject of the ABN, not the part that is expected to be paid), and must state in the “Because” box the reason that Medicare is expected to deny payment for the specified excess component(s).

Providers may not issue an ABN for charge increases on the basis of purported premium quality services as “excess components” since that would be in violation of payment limits (limiting charge for nonassigned claims, and fee schedule amounts in the case of assigned claims).

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Beneficiary Refuses to Complete or Sign the ABN

If the beneficiary refuses to choose an option or refuses to sign the ABN, you should annotate the original copy of the ABN indicating the refusal to sign or choose an option. You may list any witnesses to the refusal on the ABN, although Medicare does not require this. If a beneficiary refuses to sign a properly issued ABN, you should consider not furnishing the item or service unless the consequences (health and safety of the beneficiary or civil liability in case of harm) prevent this option.

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Disclosure Statement

The disclosure statement is not specific to the ABN but is required by the OMB to appear on applicable information collections. It replaces the previous statement on confidentiality of ABN information.

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Modifiers

The following are claim modifiers associated with ABN use. For specific instructions on filing claims associated with ABNs, refer to CMS IOM Publication 100-04, Medicare Claims Processing Manual, Chapter 1, Section 60.

GA ‒ Waiver of Liability Statement Issued as Required by Payer Policy, Individual Case

  • Use this modifier to report when you issue a mandatory ABN for a service as required and it is on file. You do not need to submit a copy of the ABN, but you must have it available on request.

GX ‒ Notice of Liability Issued, Voluntary Under Payer Policy

  • Use this modifier to report when you issue a voluntary ABN for a service Medicare never covers because it is statutorily excluded or is not a Medicare benefit. You may use this modifier in combination with modifier GY.

GY ‒ Item or Service Statutorily Excluded, Does Not Meet the Definition of Any Medicare Benefit

  • Use this modifier to report that Medicare statutorily excludes the item or service or the item or service does not meet the definition of any Medicare benefit. You may use this modifier in combination with modifier GX.

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

  • Use this modifier to report when you expect Medicare to deny payment of the item or service due to a lack of medical necessity and no ABN was issued.

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Revised 9/29/2023