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Why You Need An ABN

The Private Medical Practice Academy

Why You Need An ABN

August 24, 2022

Why You Need An ABN

You want to offer a service to a patient but you aren’t sure that Medicare will reimburse you. Is there something you can do to increase the chances of getting paid? The answer is an advanced beneficiary notice of non-coverage (ABN). 

You use an ABN when you are offering a service that is usually reimbursed by Medicare but may not be reimbursed by Medicare in this particular case. 

Voluntary use of an ABN
When you know, in advance, that the service is not covered by Medicare you voluntarily use an ABN to notify the patient.  The ABN puts the patient on notice that they are financially responsible.  

Mandatory use of an ABN
An ABN is required when Medicare covers the service but may not be in this case. For example, Medicare may determine that the service or treatment was not reasonable and medically necessary for this patient. If you know, from the outset that something may potentially not be considered medically necessary by Medicare you must get that ABN signed. 

Importance of local carrier determinations (LCD)

I previously explained Medicare LCDs . LCDs may account for why something is not covered by Medicare.  Understand LCDs can help you navigate when an ABN is required.

For any service or item that Medicare covers but you are concerned that they won’t cover in this case, you will want the patient to sign an ABN.  If you did not get the patient to sign the ABN before the service or item was provided, then you cannot demand payment from the patient.  

Key point– You must have informed the patient before the service  was provided that this is typically paid for by Medicare but that there is a chance in this case that it will not be covered and they and must sign the ABN form. 

The ABN isn’t a blanket form. Avoid the temptation of thinking, “I’m not sure what’s covered so I’m just going to get everybody to sign this form.”  The ABN needs to specific. Identify what service or item is being offered and communicate that to the patient. The patient needs to understand that you will transfer the liability to them for that specific thing if it isn’t covered by Medicare. 

It’s your responsibility to know what is and isn’t covered. changes in what Medicare pays for to you. 

Medicare Advantage plans and commercial insurers do not follow CMS but rather have their own set of rules. Some require an ABN. Some don’t. Others have their own version of an ABN. Read your contracts to  determine what is required. 

If you’d like to hear more tips on how to start, run and grow your practice and related medical businesses, please sign up for my newsletter at https://www.thepracticebuildingmd.com.   

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