Pulmonology Coding Alert

Tip:  ABNs are your solution for payment on services Medicare won't cover

If you aren't obtaining advance beneficiary notices (ABNs) from patients who undergo treatments that Medicare may not deem medically necessary, your office could lose thousands of dollars each year. Follow this expert advice on getting a signed ABN, so you can collect payment directly from the patient.

Here's What Makes an ABN So Important

There are two main reasons you would want to obtain an ABN, says Stacie L. Buck, RHIA, LHRM, president and founder of Health Information Management Associates Inc. in North Palm Beach, Fla. "The first is to increase your revenue, and the second is to reduce your risk or the compliance implications associated with ABNs," she says.

If your pulmonologist recommends a treatment or procedure to a patient that Medicare may not cover, based on the reported indications, you should request that the patient sign an ABN. The document will help the patient decide whether he wants to proceed with the service even though he may have to pay for it, and, once signed, the ABN also ensures that your office will receive payment directly from the patient if Medicare won't pay on it.

Example: Your pulmonologist evaluates a return patient for his chronic obstructive bronchitis (491.20) and orders a complete blood count (85025, Blood count; complete [CBC], automated [Hgb, Hct, RBC, WBC and platelet count] and automated differential WBC count).

The pulmonologist's diagnosis of chronic obstructive bronchitis does not provide medical necessity for 85025. The physician would have to provide some other justification for the CBC, such as anemia (285.9). You should have the patient sign an ABN if the pulmonologist had no other medical necessity but insisted on obtaining the CBC.

Don't Skip the Details

Be sure the ABN clearly identifies the service/procedure the pulmonologist plans to provide, the estimated charge for the service, and why Medicare may not provide coverage. This way the patient knows exactly what he will be responsible for and why he can expect that his Medicare coverage won't apply to the procedure.

An ABN affects only those services/procedures you've specifically listed for a single encounter date. You should therefore list all services your physician thinks Medicare may deny. You should also include your reasoning for why you think Medicare may deny the service, such as details from Medicare's coverage plan or examples of similar claims that have been denied. Services your pulmonologist provides on a separate encounter date require a separate ABN. You're also prohibited from using blanket notices.

Tip: You'll want one copy of each signed ABN for your records and one copy for the patient.

Except under extremely rare circumstances, the physician should give the patient the ABN before performing the service. In some circumstances, you may not know for certain if Medicare will cover the service. If you're unsure, err on the side of caution and ask the patient to sign an ABN.

You need to give the patient the opportunity to understand his options. He can: 1) be financially responsible for the exam by signing the ABN; 2) cancel the procedure; 3) reschedule the exam for a future date when he can afford it; 4) refuse to sign the ABN and request that the pulmonologist perform the procedure anyway. If the patient chooses not to sign the ABN and have the procedure done anyway, your physician should document the situation in detail in the patient's record. Moreover, the patient will still be financially responsible for the exam.

Give Medicare the Heads-Up With Modifier GA

Append modifier GA (Waiver of liability statement on file) to a procedure code when you think Medicare won't cover the service and you have a signed ABN. When Medicare sees modifier GA, it will send an explanation of benefits (EOB) to the patient confirming that he is responsible for payment. If you don't append the modifier, Medicare will not inform the patient of his responsibility.

You don't need to ask the patient to sign an ABN when the pulmonologist performs procedures or services that Medicare never covers. Services such as preventive medicine (99381-99397) are the sole responsibility of Medicare beneficiaries, unless a secondary insurer is willing to pay.

In cases when you know Medicare never covers that service, you should report the appropriate CPT code for the surgeon's services with modifier GY (Item or service statutorily excluded or does not meet the definition of any Medicare benefit) appended. Medicare will generate a denial notice for the claim, which the patient may use to seek payment from secondary insurance.

Don't overlook: If you believe that Medicare will reject your claim but you failed to have the patient sign an ABN, you should append modifier GZ (Item or service expected to be denied as not reasonable and necessary) to the CPT code describing the noncovered service the physician provided.

"You don't want to be in the position to use modifier GZ, because it means that you probably won't get paid for the service," says Joyce Ludwick, compliance consultant with Park City Solutions Group in Ann Arbor, Mich. "However, by notifying Medicare using modifier GZ, you reduce the risk of allegations of fraud or abuse when filing claims that are not medically necessary."

Bonus resource: Visit the CMS Web site at www.new.cms.hhs.gov/BNI/Downloads/CMSR131G.pdf for a sample ABN.

An advance beneficiary notice (ABN) is a written notice that informs the beneficiary that Medicare may not cover a particular service or procedure. By signing the waiver, the patient acknowledges that he will pay for the procedure or service if Medicare does not.