Many times, a service is not medically necessary, hence denied coverage by Medicare. This leaves physicians feeling the pinch of lower reimbursements thereby a loss of revenue. Therefore, CMS worked out a solution, revised rules, and has given ABN top precedence. In situations where Medicare could deny reimbursements, the patient is sent an ABN to be signed which ensures payments.
Medicare does not pay for everything. Hence, a ‘waiver of liability’ or ABN (Advance Beneficiary Notice) is sent to the patient by a doctor/provider/ DME supplier when they are made aware that Medicare might not cover the service (care/treatment) or item offered and needs to be paid by the patient. This rule applies only if the patient has an ‘Original Medicare’ plan and not one of ‘Medicare Advantage Privilege Health Plan’ or a Medicare Advantage Plan (Medicare Part C).
ABN is written notice and the patient has to tick several options to ensure that he/she essentially is in need of the particular equipment. This is also done to avoid nasty surprises of long bills later which the patient might have to pay if Medicare doesn’t. Also, if Medicare denies payments for certain items, the patient can submit the bill to other insurers; but if no insurance company pays, the liability of the bill payment rests on the patient.
Also, if a patient is unable to sign the form for some reason, a representative of the patient can. ABN must be agreed upon by the patient prior to receiving the equipment. If not agreed upon, and Medicare doesn’t pay, the bill is written off causing a loss of revenue. A complete ABN should include the patient’s name, services, and charges to be paid. The form must be approved by CMS and cannot be given in cases of emergency treatment.
A few situations where it is best to get an ABN signed are:
1. Ambulance transportation in case of non-emergencies.
2. Certain supplies/equipment like walkers/oxygen supplies where suppliers are not in contract with Medicare (Here, ABN can also be used when supplies are in the Durable Medical Equipment Competitive Bidding Program).
3. Other healthcare services such as a visual field exam (ophthalmologist), a pelvic exam, or an echocardiogram (not medically necessary).
4. Certain lab tests, screening pap smear (more often than two years), screening fecal-occult blood test (more often than one year and patient<50 years.), screening flexible sigmoidoscopy (more often than four years and patient<50 years.), prostate cancer screening test (more often than annually and patient<50 years), tetanus vaccine (prophylactically), and services not meeting the criteria in Local Medical Review Policy.
It is also important to note that a patient shall not be sent an ABN for equipment that Medicare never covers anyway. Examples include long term care, cosmetic surgeries, routine dental care/dentures, acupuncture, hearing aids (and its examination).
ABN isn’t an official rejection of coverage. Nevertheless, to ensure DME Reimbursements, signing of an ABN is always considered a better option for the physician and the patient.