What is the Advance Beneficiary Notice (ABN) in Medical Billing

Definition of Advance Beneficiary Notice (ABN)

The Centers for Medicare and Medicaid Services (CMS) outlines that “the ABN is a notice given to beneficiaries in Original Medicare to convey that Medicare is not likely to provide coverage in a specific case.” Thus, a physician or a supplier is required to give an ABN notice to a Medicare beneficiary when providing a service or furnishing an item for which Medicare is likely to deny payment.

An ABN is required for services such as an echocardiogram, a pelvic exam for a primary care provider, or a visual field exam for an ophthalmologist. These services are covered only when they are medically necessary.

There are two case scenarios when it comes to the payment of non-coverage services:

• If the physician or supplier fails to give an ABN notice to the beneficiary for the services offered and Medicare refuses to pay for the same, then most likely the beneficiary won’t have to pay at all.
• However, if the beneficiary signs the ABN given by the doctor or supplier before getting the service and Medicare refuses to pay for it, then the beneficiary is required to make the full payment to the doctor or supplier.

It is important to note that ABN notice is applicable only if the beneficiary is in the Original Medicare Plan. It is not applicable if the beneficiary is in a Medicare Managed Care Plan or Private Fee-for-Service Plan.

The guidelines for ABN are given in CMS’ ABN manual—https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads/ABN_Booklet_ICN006266.pdf.

Role of ABN in Medical Billing

The first role of ABN is to get reimbursement for the services provided to the beneficiary of the Original Medicare Plan. If your physician/supplier or medical office fails to get the ABN signed from the beneficiary then you’ll never get compensated for the services that you offered to the beneficiary. Therefore, as a medical institution, you must ensure that your physician/supplier or medical office is getting the ABN signed from the beneficiary.

A signed ABN will ensure that the beneficiary makes the full payment for the services he/she may have received at your medical institution.

Also, your staff should be aware of the services that are categorized as non-coverage services by CMS under the Original Medicare Plan. This will help your staff to pay attention to the services that require an ABN notice for reimbursement.

The second role of ABN is to make the beneficiary aware of the conditions that are necessary to get the medical services under the Original Medicare plan. This means if the beneficiary has the opportunity to accept or refuse services while agreeing to make the full payment if Medicare denies the payment.

Ensuring Reimbursement using ABN

It is correct that ABN notice is beneficial when it comes to reimbursement. However, an incorrectly filled ABN form or incorrectly used ABN may affect your revenue cycle. Therefore as a medical institution, you must ensure that the ABN:

• Must include the patient or beneficiary’s name, service offered and estimated charge amount
• Should not be given to a patient requiring emergency treatment or who is under duress
• Must include correct modifiers