Why Understanding the ABN is Essential for Providers and Medicare Beneficiaries

Why Understanding the ABN is Essential for Providers and Medicare Beneficiaries

The Advance Beneficiary Notice (ABN), Form CMS-R-131, provided by the Centers for Medicare & Medicaid Services (CMS, is vital for healthcare providers, revenue cycle teams, and Medicare beneficiaries.

What is an ABN?

An ABN is a formal notice provided to Medicare Fee-for-Service (FFS) beneficiaries prior to the start of an outpatient service such as labs, imaging, physical therapy, or observation services, particularly when a service or item may not be covered by Medicare.  To confuse things more, ABNs are used as well for some Part A benefits such as hospice, home health, and religious non-medical health care institutions (RNHCIs).  ABNs are not used for Medicare Advantage, Managed Medicaid, commercial, or Part D plans.

These plans, however, may have similar forms that often fall under the prior authorization process in the form of an Integrated Denial Notice (IDN).

ABNs are utilized prior to or during the continuation of services that Medicare does not cover when services exceed Medicare frequency coverage guidelines, or when services are deemed not medically necessary. It serves as an alert to the patient that they may be responsible for payment if Medicare denies coverage for the specific service or item. It also informs the patient of services that are always outside of current Medicare coverage determinations. The form provides an opportunity for what the estimated costs are for the service or item if Medicare denies coverage.  The form allows for the patient to acknowledge receipt of this information but also consider the financial impact should they proceed with the service. The form allows for an opportunity to stop and communicate with the patient to ensure they can make an informed decision regarding services they did not know were potentially not medically necessary or approved by Medicare.  

There are two types of ABNs, mandatory and voluntary.  Mandatory ABNs are issued when the provider thinks Medicare may not cover a service or item.  In this case, the patient can choose whether they want to proceed and agree to financial liability should Medicare deny coverage. 

Voluntary ABNs are issued when Medicare does not pay for a particular service, such as cosmetic procedures. This ABN informs the patient up front of Medicare coverage guidelines and ensures that patient is aware of the full cost.

Why Are ABNs Important?

ABNs ensure transparency between healthcare providers and Medicare beneficiaries. They inform patients about potential costs and empower them to make informed decisions regarding their care. It clarifies the financial responsibility of the patient in cases where Medicare may not cover certain services or items such as custodial care. For non-covered services or items, issuing an ABN is a legal requirement. It also helps protect providers and healthcare organizations from financial loss if Medicare denies coverage.

ABNs are often issued by the patient registration or financial services staff; however, they are also included as a form that can be delivered under by provider professionals and are a part of the Utilization Review Committee.

How are ABNs reported?

The billing office will report the following modifiers regarding ABN utilization on the claim to notify the MACs that the notice has been provided or not, communicating potential patient financial liability.

  • GA is used when the mandatory ABN has been completed.
  • GX is used when the voluntary ABN has been completed.
  • GY is used when the service falls outside Medicare statutory guidelines (think services Medicare never pays)
  • GZ is used when you expect the service to be denied and failed to provide an ABN. (i.e., self-denial).

ABNs ensure transparency and informed decision-making while clarifying the financial responsibilities of the patient. Understanding the purpose and significance of ABNs is essential for both providers, patients, utilization review, case management, billing staff, and especially patients in navigating the complexities of healthcare services and coverage.

Facebook
Twitter
LinkedIn

Tiffany Ferguson, LMSW, CMAC, ACM

Tiffany Ferguson is CEO of Phoenix Medical Management, Inc., the care management company. Tiffany serves on the ACPA Observation Subcommittee. Tiffany is a contributor to RACmonitor, Case Management Monthly, and commentator for Finally Friday. After practicing as a hospital social worker, she went on to serve as Director of Case Management and quickly assumed responsibilities in system level leadership roles for Health and Care Management and c-level responsibility for a large employed medical group. Tiffany received her MSW at UCLA. She is a licensed social worker, ACM, and CMAC certified.

Related Stories

I am Just a Bill

I am Just a Bill

Today is election day.  I wanted to talk about the process by which laws are passed and regulations created in healthcare. Recently, the fall of

Read More
Washington Carries On

Washington Carries On

As the November elections neared, you might have expected Washington to slow to a crawl amidst campaigning and uncertainty about the future. However, the show

Read More

Leave a Reply

Please log in to your account to comment on this article.

Featured Webcasts

Enhancing Outcomes with CDI-Coding-Quality Collaboration in Acute Care Hospitals

Enhancing Outcomes with CDI-Coding-Quality Collaboration in Acute Care Hospitals

Join Angela Comfort, DBA, MBA, RHIA, CDIP, CCS, CCS-P, as she presents effective strategies to strengthen collaboration between CDI, coding, and quality departments in acute care hospitals. Angela will also share guidance on implementing cross-departmental meetings, using shared KPIs, and engaging leadership to foster a culture of collaboration. Attendees will gain actionable tools to optimize documentation accuracy, elevate quality metrics, and drive a unified approach to healthcare goals, ultimately enhancing both patient outcomes and organizational performance.

November 21, 2024
Comprehensive Inpatient Clinical Documentation Integrity: From Foundations to Advanced Strategies

Comprehensive Outpatient Clinical Documentation Integrity: From Foundations to Advanced Strategies

Optimize your outpatient clinical documentation and gain comprehensive knowledge from foundational practices to advanced technologies, ensuring improved patient care and organizational and financial success. This webcast bundle provides a holistic approach to outpatient CDI, empowering you to implement best practices from the ground up and leverage advanced strategies for superior results. You will gain actionable insights to improve documentation quality, patient care, compliance, and financial outcomes.

September 5, 2024
Advanced Outpatient Clinical Documentation Integrity: Mastering Complex Narratives and Compliance

Advanced Outpatient Clinical Documentation Integrity: Mastering Complex Narratives and Compliance

Enhancing outpatient clinical documentation is crucial for maintaining accuracy, compliance, and proper reimbursement in today’s complex healthcare environment. This webcast, presented by industry expert Angela Comfort, DBA, RHIA, CDIP, CCS, CCS-P, will provide you with actionable strategies to tackle complex challenges in outpatient documentation. You’ll learn how to craft detailed clinical narratives, utilize advanced EHR features, and implement accurate risk adjustment and HCC coding. The session also covers essential regulatory updates to keep your documentation practices compliant. Join us to gain the tools you need to improve documentation quality, support better patient care, and ensure financial integrity.

September 12, 2024

Foundations of Outpatient Clinical Documentation Integrity: Best Practices for Accurate Coding and Compliance

This webcast, presented by Angela Comfort, DBA, RHIA, CDIP, CCS, CCS-P, a recognized expert with over 30 years of experience, offers essential strategies to improve outpatient clinical documentation integrity. You will learn how to enhance the accuracy and completeness of patient records by adopting best practices in coding and incorporating Social Determinants of Health (SDOH). The session also highlights the role of technology, such as EHRs and CDI software, in improving documentation quality. By attending, you will gain practical insights into ensuring precise and compliant documentation, supporting patient care, and optimizing reimbursement. This webcast is crucial for those looking to address documentation gaps and elevate their coding practices.

September 5, 2024

Trending News

Featured Webcasts

Patient Notifications and Rights: What You Need to Know

Patient Notifications and Rights: What You Need to Know

Dr. Ronald Hirsch provides critical details on the new Medicare Appeal Process for Status Changes for patients whose status changes during their hospital stay. He also delves into other scenarios of hospital patients receiving custodial care or medically unnecessary services where patient notifications may be needed along with the processes necessary to ensure compliance with state and federal guidance.

December 5, 2024
Navigating the No Surprises Act & Price Transparency: Essential Insights for Compliance

Navigating the No Surprises Act & Price Transparency: Essential Insights for Compliance

Healthcare organizations face complex regulatory requirements under the No Surprises Act and Price Transparency rules. These policies mandate extensive fee disclosures across settings, and confusion is widespread—many hospitals remain unaware they must post every contracted rate. Non-compliance could lead to costly penalties, financial loss, and legal risks.  Join David M. Glaser Esq. as he shows you how to navigate these regulations effectively.

November 19, 2024
Post Operative Pain Blocks: Guidelines, Documentation, and Billing to Protect Your Facility

Post Operative Pain Blocks: Guidelines, Documentation, and Billing to Protect Your Facility

Protect your facility from unwanted audits! Join Becky Jacobsen, BSN, RN, MBS, CCS-P, CPC, CPEDC, CBCS, CEMC, and take a deep dive into both the CMS and AMA guidelines for reporting post operative pain blocks. You’ll learn how to determine if the nerve block is separately codable with real life examples for better understanding. Becky will also cover how to evaluate whether documentation supports medical necessity, offer recommendations for stronger documentation practices, and provide guidance on educating providers about documentation requirements. She’ll include a discussion of appropriate modifier and diagnosis coding assignment so that you can be confident that your billing of post operative pain blocks is fully supported and compliant.

October 24, 2024
The OIG Update: Targets and Tools to Stay in Compliance

The OIG Update: Targets and Tools to Stay in Compliance

During this RACmonitor webcast Dr. Ronald Hirsch spotlights the areas of the OIG’s Work Plan and the findings of their most recent audits that impact utilization review, case management, and audit staff. He also provides his common-sense interpretation of the prevailing regulations related to those target issues. You’ll walk away better equipped with strategies to put in place immediately to reduce your risk of paybacks, increased scrutiny, and criminal penalties.

September 19, 2024

Trending News

Prepare for the 2025 CMS IPPS Final Rule with ICD10monitor’s IPPSPalooza! Click HERE to learn more

Get 15% OFF on all educational webcasts at ICD10monitor with code JULYFOURTH24 until July 4, 2024—start learning today!

👻Spooky Sale is Back!👻 Get 31% off all three Medlearn brands, using code SPOOKY24.