Practice Management Alert

Using advance beneficiary notices (ABNs) properly with Medicare patients can mean the difference between collecting from patients on items Medicare denies as medically unnecessary and having to write off the charge. ABNs are essential to educate patients on their financial responsibilities and to ensure that your practice can recoup its entitled revenues. 2002 Changes Affect ABN Usage CMS introduced standardized forms for the ABN in 2001. Forms CMS-R-131-G for general use and CMS-R-131-L for laboratory tests, with Medicare Carriers Manual (MCM) instructions, are to be fully implemented in September 2002 after the former model, HCFA-R-131, expires on Aug. 31, 2002.

The new forms, written in English and Spanish, and the implementing carrier instructions were submitted to the Office of Management and Budget (OMB) in January 2002. You should note the following changes that impact your billing and collections department: ABN-X for exclusions is abandoned. CMS had proposed an ABN for services excluded from Medicare coverage. Practices were to use Form CMS-R-131-X when they knew for a fact that Medicare does not cover the services they planned to render. The ABN-X was to remind patients of their financial responsibility for noncovered Medicare services, says Kim Pollock, RN, MBA, a consultant with Karen Zupko & Associates in Chicago. Because of questions and complaints about the proposed form, CMS withdrew it from its final submission to OMB and its instructions to carriers, citing it as "an unnecessary complication of the ABN process."

Despite CMS' withdrawal of the form, the premise is a good one. "For exclusions, such as routine physicals, hearing aids, and eyeglasses for which Medicare never pays, most practices don't have a problem with patients refusing to pay for the services. Billing staff generally know what's excluded from coverage and collect cash up front," Pollock explains. "But, for a patient who pays on a budget plan, you should have the patient sign some type of practice-developed financial agreement that serves as a binding contract for the services." If you ever have to take the patient to court to collect payment, the ABN will serve as evidence. ABN for exclusions not required. CMS says ABNs are not required for Medicare exclusions. Practices should not use the forms for this purpose because they contain language asking for a claim to be submitted to Medicare. Generally, no claims should be filed for services that are excluded from Medicare coverage. The carrier instructions state: "In situations in which ABNs are not required, physicians and suppliers are neither required nor prohibited from voluntarily giving some sort of notice to beneficiaries anyway, as a prudent customer service." Generic and blanket ABNs are prohibited. The new forms require the physician to: 1. state what items or services Medicare [...]