Practice Management Alert

The drop-dead date for using the updated advance beneficiary notice (ABN) just passed, so it's out with the old and in with the new. While the new form was first introduced last year, you haven't been required to use it -- until now. With March 1 behind us, you-re asking for denials if you-re still using the old forms.

You Now Have a Streamlined Form

The new form not only replaces both the previous ABN-G (for physicians) and ABN-L (for laboratories) but also incorporates the Notice of Exclusions from Medicare Benefits (NEMB) form, says Melinda S. Brown, CMBS, insurance biller for a primary-care provider in Kennewick, Wash.

CMS expects the new combination form to -eliminate any widespread need for the NEMB in voluntary notification situations,- according to the new -ABN Form Instructions- document.

Old way: In the past, you used the ABN form only for procedures that Medicare might not cover due to medical necessity. However, the ABN didn't apply to procedures or items that were statutorily excluded from Medicare benefits. For those services, you turned to the NEMB form. You used the NEMB for services beyond the stated limits (that didn't fall under an exception) because Medicare never covered them. NEMB forms were optional, not payer-required.

New way: Now CMS accepts the new ABN for either purpose, noting that -the revised version of the ABN may also be used to provide voluntary notification of financial liability.- This means you can use the new ABN form when you would have used an NEMB in the past, experts explain.

-I like the new combination of NEMB and ABN,- Brown says. -I feel that the patients should be made aware at each appointment what may/may not be covered by Medicare. Before, when the NEMB form was used, it was optional.-

The purpose: A signed ABN ensures that your practice will receive payment directly from the patient if Medicare refuses to pay, says Stephanie Speer, biller with Urgent Care at Lake Lucille in Wasilla, Alaska. Without a valid ABN, you can collect for statutorily excluded services, but you can't hold the patient responsible for charges Medicare denies as not medically necessary.

You can find the new ABN form and filing instructions at www.cms.hhs.gov/BNI. Click on the link for -FFS ABN-G and ABN-L,- then download the forms and instructions for -Revised ABN CMS-R-131.-

Apply the Proper Modifier

When you use an ABN form, you need to attach an informational modifier to your codes, just as you did with the old ABN and NEMB forms. This ensures that Medicare's explanation of benefits (EOB) will properly outline when the patient has to pay. There are three applicable modifiers to choose from:

Option 1: You-ll append modifier GA (Waiver of liability statement on file) to indicate that you expect Medicare to deny a specific service as not reasonable and necessary and that you have an ABN signed by the beneficiary on file, Brown explains.

Option 2: Choose modifier GZ (Item or service expected to be denied as not reasonable and necessary) if you believe the carrier will deny an item or service as not reasonable and necessary and the beneficiary hasn't signed the ABN. In other words, you didn't get the patient to sign an ABN, you expect Medicare to deny the claim, and you will not balance bill the patient for the unpaid claim.

-Billing with this modifier will put the amount to patient responsibility on the explanation of benefits (EOB),- Brown says.

Option 3: Modifier GY (Item or service statutorily excluded, does not meet the definition of any Medicare benefit or, for non-Medicare insurers, it is not a contract benefit) applies when Medicare excludes the service, and you-re using the new ABN as you would have used the NEMB in the past, says Speer.

Caution: Modifier GY is on the Office of the Inspector General (OIG) watch list for 2009. The OIG intends to review the appropriateness of modifier GY use -on claims for services that are not covered by Medicare,- the OIG 2009 Work Plan states.

You-re not required to issue a notification for excluded procedures, and the OIG notes this means beneficiaries may -unknowingly acquire large medical bills that they are responsible for paying.- Additionally, you are not required to submit a claim to Medicare for a service that is not statutorily covered.