Advance Beneficiary Notice of Non-coverage (ABN)

50 - Advance Beneficiary Notice of Non-coverage (ABN) (Rev. 10862; Issued: 07-14-21; Effective: 10-14-21; Implementation: 10-14-21) A. General Statutory Authority - Applicability to Limitation on Liability (LOL) Section 1879 of the Act (where the LOL provisions are located) requires a healthcare provider or supplier (i.e. notifier) to notify a beneficiary in advance of furnishing an item or service when s/he believes that items or services will likely be denied by Medicare for any of the reasons specified in the statutory provision in order to shift financial liability to the beneficiary for the denial. For example, advance notice is required if the item or service may be denied as not reasonable and necessary under §1862(a)(1) of the Act or because the item or service constitutes custodial care under §1862(a)(9) of the Act. Notice (e.g., the ABN) is a way for healthcare providers or suppliers to establish beneficiary knowledge of non-coverage and therefore, shift financial liability for these items or services if Medicare denies the claim. B. Compliance with Limitation on Liability Provisions A notifier who fails to comply with the ABN instructions risks financial liability and/or sanctions. LOL provisions shall apply as required by law, regulations, rulings and program instructions. Additionally, when authorized by law and regulations, sanctions under the Conditions of Participation (COPs) may be imposed. The Medicare contractor may hold any healthcare provider or supplier who either failed to give notice when required, or gave defective notice, financially liable. A notifier who can demonstrate that s/he did not know and could not reasonably have been expected to know that Medicare would not make payment will not be held financially liable for failing to give notice. However, a notifier who gave defective notice may not claim that s/he did not know or could not reasonably have been expected to know that Medicare would not make payment, as the issuance of the notice is clear evidence of knowledge. A notifier who cannot demonstrate that adequate advance notice was furnished to the beneficiary will not be able to use the provisions in section 1879 of the Act to transfer financial liability to the beneficiary. ABN - Quick Glance Guide3 Notice Name: Advance Beneficiary Notice of Non-coverage (ABN) Notice Number: Form CMS-R-131 Issued by: Healthcare providers and suppliers of Medicare Part B items and services; Hospice and Religious Non-medical HealthCare Institute (RNHCI) providing Medicare Part A items and services; and home health agencies(HHAs) for Part A and Part B items and services Recipient: Original Medicare FFS (fee for service) beneficiary; Type of notice: Must be issued: Timing of notice: Optional use: Financial liability notice Prior to providing an item or service that is usually paid for by Medicare under Part B (or under Part A for hospice, HHA, and RNHCI providers only) but may not be paid for in this particular case because it is not considered medically reasonable and necessary Prior to providing custodial care For hospice providers, prior to caring for a patient who is not terminally ill For Durable Medicare Equipment (DME) suppliers For HHA providers, prior to providing care when the individual is not confined to the home or does not need intermittent skilled nursing care. Prior to delivery of the item or service in question. Provide enough time for the beneficiary to make an informed decision on whether or not to receive the service or item in question and accept potential financial liability. Yes. Prior to providing an item or service that is never covered by Medicare (i.e. not a Medicare benefit). 3 This is an abbreviated reference tool and is not meant to replace or supersede any of the directives contained in Section 50.