Medicare Compliance & Reimbursement

Form changes went into effect on June 21 with advice for both providers and beneficiaries.

Advanced Beneficiary Notice (ABN) rules are confusing. Updated ABN form guidance from CMS, however, makes it an excellent time to revisit the guidelines and ensure you’re using these documents properly in your practice. Failing to do so can make your practice liable for charges that patients won’t be responsible for paying, costing you big money.

Background: CMS has updated its ABN form effective June 21. “While there are no changes to the form itself, providers should take note of the newly incorporated expiration date on the form,” CMS says on its Fee For Service Advance Beneficiary Notice of Noncoverage web page (Medicare Compliance and Reimbursement, Vol. 43, No. 13).

The new form also adds closing language that informs patients that CMS doesn’t discriminate in its programs and activities and offers a website and phone number for beneficiaries to request the ABN in an alternate format such as in large print type or a different language if desired.

What it does: An ABN is a form that you should get a patient to sign when your practice provides a service that Medicare might not cover completely, or at all. You can bill the patient for the service if you have a signed ABN but you must also append the correct modifier to the service when the claim is submitted. Without the ABN and modifier appendage, you have no billing recourse if Medicare doesn’t pay for part or all of a patient’s service.

Check out the following three ABN tips to make sure your ABN usage is top-notch.

Tip 1: Know When to Utilize the ABN

The first step to ABN usage is knowing when you should have the patient sign one, and when you shouldn’t. “A practice is not required to have a signed ABN for services that are never covered by Medicare,” said Laurie Troemel, CPC, CPMA, operations director with Medical Practice Management Services. “However, for those services that are normally a covered benefit but may not be covered due to medical necessity, frequency, etc., a signed ABN is required to obtain reimbursement from the beneficiary.”

You must issue the ABN when:

• You believe Medicare may not pay for an item or service;
• Medicare usually covers the item or service; or
• Medicare may not consider the item or service medically reasonable and necessary for this patient in this particular instance.

Although not required, some experts do also recommend getting an ABN even when you know Medicare statutorily doesn’t cover a particular service because it engenders patient good will. This way, you notify the patient up-front that she will be responsible for a charge and how much she’ll expect to pay, ensuring that everyone is on the same page financially.

“ABNs used for non-covered services provide the documented proof that the patient made an informed choice to proceed with the service,” says Carol Pohlig BSN, RN, CPC, ACS, senior coding and education specialist at the Hospital of the University of Pennsylvania.

You also must provide the patient with a copy of the ABN and the office should keep the original ABN on file. Be sure the language contained in the ABN is easily understood by the patient (don’t use CPT^® codes and diagnosis codes — instead, use a verbal description) and in terms the patient recognizes. Be sure to estimate the cost of the services that will be rendered as well. The patient must select an option and sign the ABN. In the case where the patient refuses to choose an option, the form must be annotated with this information. Often, these forms are incorrectly completed and are deemed invalid by Medicare.

Avoid “routine” ABNs: Some practices give patients ABNs for the majority of their services to cover them “just in case” Medicare denies the service, but that constitutes an inappropriate use of the form. “Providers and suppliers must be sure that there is a reasonable basis for noncoverage associated with the issuance of each ABN,” CMS says in its publication, “Advance Beneficiary Notice of Noncoverage (ABN).”

Tip 2: Know Your ‘G’ Modifiers

Depending on which payment situation you expect, you’ll use a different one of Medicare’s “G” modifiers on your claim to explain to the insurer whether an ABN is on file, and if so, why.

Append the appropriate G modifier, as follows, to give the payer more information:

• GA (Waiver of liability statement issued as required by payer policy, individual case): Use this modifier to indicate you’ve issued a mandatory ABN for a service as required, and it is on file.
• GX (Notice of liability issued, voluntary under payer policy): Use this modifier when you give a patient an ABN for a service that Medicare never covers. In certain situations, you can also use this modifier in combination with modifier GY (see next page).
• GY (Item or service statutorily excluded, does not meet the definition of any Medicare benefit or, for non-Medicare insurers, is not a contract benefit): Use this modifier to when Medicare excludes the item or service; or the item or service does not meet the definition of any Medicare benefit. In certain situations, you can also use this modifier in combination with modifier GX.
• GZ (Item or service expected to be denied as not reasonable and necessary): Use this modifier when you think Medicare will deny payment due to lack of medical necessity, and you didn’t issue an ABN.

Know What to Do Next

If the service is never covered by Medicare, you can collect from the patient on the date of service. However, you do not have the option to collect money from the beneficiary up-front if the patient signs the ABN because you suspect that the claim may be denied. Instead, in this case, you’ll wait for the denial from Medicare and then you’ll bill the patient.

In some cases, practices will erroneously charge patients up-front for services they assume won’t be covered due to what they’ve misinterpreted as non-coverage, and then the insurer will reimburse the charge after all. “In the event that Medicare pays all or part of the claim for which the beneficiary previously paid, CMS requires the provider refund the beneficiary for any overpayment,” Troemel says.

Therefore, you should first check whether a procedure is statutorily non-covered — in which case you can charge the patient up-front, or not — and if that’s not the case, do not charge the patient until you get your remittance advice from the payer. The Medicare Physician Fee Schedule can identify whether a service is actively covered (Status A) or statutorily excluded (Status E or N), Pohlig advises.

Resource: To download the latest ABN form, along with instructions on how to use it, visit www.cms.gov/Medicare/Medicare-General-Information/BNI/ABN.html.