Secondary Logo

Journal Logo

DEPARTMENTS: Payment Strategies

FAQs: How to Use the Correct ABN Correctly

Schaum, Kathleen D. MS

Author Information
doi: 10.1097/01.ASW.0000695076.19544.f8
  • Free

Since the beginning of the year, this author has received an unusually high number of questions, from wound/ulcer management professionals and providers, about Advance Beneficiary Notices of Noncoverage (ABNs). Even though ABNs have been required by Medicare for more than a decade, the questions lead one to believe that ABNs may be used incorrectly, or not at all! Therefore, this article will address a few of the frequently asked questions about ABNs.

Q: I heard that a new ABN became effective on August 31, 2020. I found the new ABN online, but it looks identical to the one I am currently using. What is different about the new ABN, and am I required to switch to the new ABN form?

A: You heard correctly. The ABN, Form CMS-R-131, and the form instructions must be reviewed and approved by the Office of Management and Budget (OMB) every 3 years. When the OMB approves the ABN and instructions, they change the expiration date on the bottom left corner of the document. The old ABN form you are using has an expiration date of 03/2020.

The many issues arising from the novel coronavirus 2019 (COVID-19) at the beginning of 2020 delayed the OMB’s review of the ABN and its instructions, which expired March 2020; the OMB provided guidance on using the expired ABN form and instructions until the review was completed. The OMB released the revised ABN form and instructions on June 24, 2020, which became mandatory on August 31, 2020 (Figure). The expiration date on the revised form is 06/30/2023. Therefore, by the time of this article’s publication, wound/ulcer management professionals and providers should have switched to using the new ABN form and its new instructions.1

Figure
Figure:
REVISED 2020 ABN FORM

While the expiration date is the only change on the ABN form itself, the OMB made multiple changes to the eight pages of instructions that accompany the ABN. Although wound/ulcer management professionals and providers should completely read the revised instructions, the following are a few revisions that this author wishes to point out:

  • The “notifiers,” who must present the ABN to beneficiaries to convey that Medicare is not likely to provide coverage in a specific case, are clearly listed:
  • - “physicians, providers (including institutional providers like outpatient hospitals), practitioners, and suppliers paid under Part B (including independent laboratories),
  • - hospice providers and religious non-medical healthcare institutions (RNHCIs) paid exclusively under Part A; and
  • - home health agencies (HHAs) providing care under Part A or Part B.”
  • All references to the Medicare Claims Processing Manual, Chapter 30, for instructions to complete the ABN form have been removed.
  • Notifiers are reminded not to use Medicare numbers (HICNs), Social Security numbers, and new Medicare beneficiary identifiers (MBIs) in the optional Blank (C) identification number field.
  • The cost example was removed from the Blank (F) Estimated Cost instructions.
  • Special guidance is provided to edit Blank (G) Option Box 1 for people who are dually enrolled in both Medicare and Medicaid. These edits are required because the notifier cannot bill the dual eligible beneficiary pending adjudication by both Medicare and Medicaid. Professionals and providers who manage wounds/ulcers for dually eligible individuals should carefully read this new section of the instructions.

Q: I understand that the instructions on “how” to complete the ABN are found on the Centers for Medicare & Medicaid website. Where can I find the guidelines for “when” to use the ABN?

A: Guidelines for when to issue an ABN can be found in Section 50 of the Medicare Claims Processing Manual, 100-4, Chapter 30 (PDF).2

Q: At the beginning of 2020, our billing company instructed our front-office personnel to present every patient with a blank ABN and require them to sign it when they checked in for appointments. This new process caused a lot of chaos because our office had never presented our wound/ulcer management patients with ABNs until then. In addition, the ABNs did not specify what was not covered, the reasons for noncoverage, and the estimated costs. Because many patients refused to sign the blank ABNs, they left without receiving care since front-office personnel informed them that care could not be provided without signed ABNs. Before leaving, some patients declared that the office was not compliantly using the ABNs. Who was correct—the billing company or the patients?

A: The patients were correct. In fact, Medicare informs beneficiaries enrolled in Original Medicare that their physicians, healthcare provider, or supplier may provide them with an ABN if the physician, healthcare provider, or supplier is under the impression that Medicare probably (or certainly) will not pay for the item or service they are considering. They are clearly informed that the ABN should list the items or services that Medicare is not expected to pay for, along with an estimate of the costs for the items and services and the reasons why Medicare may not pay. The beneficiaries are instructed that they will be asked to choose one of three options and sign the ABN to indicate that they read and understand it. Following are the instructions that Medicare provides beneficiaries about their three options when presented with an ABN:

Option 1. You want the items or services that may not be paid for by Medicare. Your provider or supplier may ask you to pay for them now, but you also want them to submit a claim to Medicare for the items or services. If Medicare denies payment, you are responsible for paying, but because a claim was submitted, you can appeal to Medicare. If Medicare does pay, the provider or supplier will refund any payment you made (minus the copayments and deductibles you paid).

Option 2. You want the items or services that may not be paid for by Medicare, but you do not want your provider or supplier to bill Medicare. You may be asked to pay for the items or services now, but because you asked your provider or supplier to not submit a claim to Medicare, you cannot file an appeal.

Option 3. You do not want the items or services that may not be paid for by Medicare, and you are not responsible for any payments. A claim is not submitted to Medicare, and you cannot file an appeal.

Q: I am never sure when an ABN is required. Will you please provide a few wound/ulcer management examples?

A: Following are several wound/ulcer management instances when ABNs are mandatory:

  • If a service/procedure is covered by Medicare for specific diagnoses, but is provided for a noncovered diagnosis, an ABN should be provided because the service/procedure will most likely be denied as not reasonable and necessary. Example: A brand of cellular and/or tissue-based product (CTP) for skin wounds is covered for diabetic foot ulcers, but the physician would like to apply it to an Original Medicare beneficiary’s sacral pressure ulcer. The physician should present the Medicare beneficiary with an ABN because the covered procedure will probably be denied for that patient’s diagnosis.
  • If a service/procedure/item exceeds frequency limitations outlined in a Local Coverage Determination (LCD), an ABN should be provided. Example: A Medicare Administrative Contractor’s (MAC’s) LCD limits the number of debridements that can be performed on a single diabetic foot ulcer, but the physician wants to perform a debridement that exceeds the covered limit. The physician should present the Medicare beneficiary with an ABN because the covered procedure will exceed the frequency limitation in the LCD.
  • If a service/procedure/item is considered experimental by Medicare and the physician/provider/supplier wishes to provide it to a Medicare beneficiary, the beneficiary must be given an ABN. Example: An MAC has an LCD pertaining to the application of CTPs for skin wounds. In that LCD, the MAC lists a few CTPs that it considers experimental. If a physician determines that the CTP is appropriate for his/her patient, the physician should present the patient with an ABN because other CTPs are covered by Medicare for the patient’s condition, but the selected CTP is considered experimental by the MAC.

Q: If the cost of a product is more than Medicare’s allowed amount, can we provide the patient with an ABN and charge the patient the difference between the cost of the product and the Medicare allowable rate?

A: No, this is not a valid reason to initiate an ABN and you cannot charge the patient the difference between the cost of the product and the Medicare allowable rate.

Q: Our staff does not always have time to conduct thorough insurance benefit verifications. Some other practices in our area give ABNs instead of conducting insurance benefit verifications. Do you recommend we use ABNs in that manner?

A: No, I do not recommend that you provide ABNs rather than conducting insurance benefit verifications. ABNs can be deemed “defective” if:

  • They are routinely presented without any specific, identifiable reason to believe that Medicare will not pay.
  • They are generic and state that Medicare “may not pay.”
  • Blanket ABNs are provided for all services, procedures, and items.
  • The beneficiary signs a blank ABN that is completed later.

Q: If an Original Medicare beneficiary’s wound/ulcer could benefit from a procedure or product that is covered by Medicare, but not for the patient’s condition, our physicians just do not offer it to the beneficiary. Therefore, we never use ABNs. Isn’t that the best way to handle the situation?

A: Ask yourself if you or your family member had a chronic wound that would not heal and a procedure or product was available that might change the paradigm of the healing process, wouldn’t you like to be informed about it and given the opportunity to accept or reject it? That is the beauty of the ABN.

Q: Our physicians do not like to discuss ABNs with patients. They often perform procedures or use products that are covered by Medicare, but not covered for the patient’s diagnosis. When the claims are denied, the physicians want us to bill the patients, but we cannot because we did not submit the claim with the appropriate modifier to show an ABN was given to and signed by the patient. Can we just add one of the ABN modifiers to every claim item?

A: That is not a good idea because the claims would most likely be considered fraudulent upon an audit. Instead, now that the revised ABN and instructions have been released, why not take the time to establish an ABN process and to educate the physicians and office personnel on how to use the correct ABN form, how to determine when to present Original Medicare beneficiaries with an ABN, and how to have the ABN completed correctly? Then, if beneficiaries wish to receive and pay out-of-pocket for the procedures and/or products they need, but that are not typically covered by the MAC for their condition/diagnosis, everyone wins—the patients have the opportunity to choose and pay for the care they need and the physicians get paid for their work!

REFERENCES

1. Revised ABN Form Instructions. 2020. https://www.cms.gov/Medicare/Medicare-General-Information/BNI/ABN. Last accessed July 12, 2020.
2. Guidelines for use of ABN. 2020. https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/clm104c30.pdf. Last accessed July 12, 2020.
Copyright © 2020 Wolters Kluwer Health, Inc. All rights reserved.