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Pulmonology Coding Alert

Reader Question:

Advance Beneficiary Notice

Published on Sat Dec 01, 2001

Question: We've heard about new rules for the advance beneficiary notice (ABN) under Medicare. When and why should our pulmonology practice issue an ABN?

Arizona Subscriber

Answer: ABNs are not required for noncovered services, which would typically include wellness type services (screening in the absence of signs and symptoms or treatments not included in the Medicare fee-for-service benefit package). But the patient may have a supplementary or secondary insurance policy that will cover the services. In that case, it is important to bill Medicare for noncovered services to get a rejection on the "explanation of benefits" form that will be submitted to the secondary insurer for payment.
 
If you submit a claim to Medicare for statutorily excluded services, add modifier -GY (item or service statutorily excluded or does not meet the definition of any Medicare benefit) on the HCFA 1500 form in item 24D. If the secondary insurer also does not cover the services, the patient is responsible for payment.
 
Note: Modifier -GY replaces modifier -GX (service not covered by Medicare) in January 2002.
 
In June, the Office of Management and Budget approved two new ABNs: a general ABN for all services, and a lab ABN for physician-ordered lab tests. Physicians use the forms before providing a service or item they believe Medicare won't pay for because it may not meet the program's criteria for medical necessity. The beneficiary or representative should sign the form before receiving the service, indicating they agree to accept liability for payment if Medicare denies it. This form has to be completed before each service in question. A "blanket" ABN is not permitted, otherwise the physician will be responsible for the cost of the service or item.  Providers may implement these two new forms using  accompanying instructions or wait until CMS issues finalized instructions to Medicare carriers, which are expected by the end of 2001.
 
The instructions also address the beneficiary who  refuses to sign an ABN but demands the services or items that the provider believes Medicare will not cover. In this case, the physician or supplier can annotate the ABN form to that effect, with the signature of a witness, and then submit the claim with modifier -GA (waiver of liability statement on file) indicating that an ABN was given to the beneficiary to sign. Modifier -GA tells the carrier that the provider does not expect the services to meet medical-necessity criteria and has obtained an ABN.

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