Notification for Beneficiaries Exceeding Financial Limitations

10.5 - Notification for Beneficiaries Exceeding Financial Limitations (Rev. 2736, Issued: 06-28-13, Effective: 10-01-12, Implementation: 10-07-13) A. Notice to Beneficiaries Contractors will advise providers/suppliers to notify beneficiaries of the therapy financial limitations at their first therapy encounter with the beneficiary. Prior to 2013, Medicare instructed providers/suppliers to inform beneficiaries that beneficiaries were responsible for 100 percent of the costs of therapy services above each respective therapy limit (cap), unless this outpatient care was furnished directly or under arrangements by a hospital when outpatient hospital therapy services were excluded from the limitation. The American Taxpayer Relief Act (ATRA) of 2012 amended §1833(g)(5) of the Social Security Act (the Act) providing limitation of liability protections (under §1879 of the Act) to beneficiaries with respect to outpatient therapy services that exceed therapy cap amounts, furnished on or after January 1, 2013. Thus, effective January 1, 2013, assignment of liability has changed for therapy services exceeding the cap that don’t qualify for a coverage exception. The provider/supplier is financially responsible when Medicare denies payment for therapy services above the cap that don’t qualify for a coverage exception unless a valid Advance Beneficiary Notice of Noncoverage (ABN), Form CMS-R-131, was issued per CMS guidelines. Providers were previously encouraged to use either a form of their own design or a voluntary ABN when providing therapy above the cap where no exception was applied; however, this instruction is no longer valid. When providing therapy services above the cap that don’t qualify for the exceptions process, the provider/supplier must now issue a mandatory ABN in order to transfer financial responsibility to the beneficiary. When the ABN is used as a mandatory notice, providers must adhere to the ABN form instructions and guidance published in Chapter 30, Section 50 of this manual. The ABN and instructions can be found at: http://www.cms.gov/Medicare/Medicare-General- Information/BNI/ABN.html. When issuing the ABN for therapy in excess of therapy caps, the following language is suggested for the “Reason Medicare May Not Pay” section: “Medicare won’t pay for physical therapy and speech-language pathology services over (add the dollar amount of the cap) in (add the year or the dates of service to which it applies) unless you qualify for an exception to this cap amount. Your services don’t qualify for an exception. ” Providers should use similar language for occupational therapy services when appropriate. A cost estimate for the services should be included per the ABN form instructions. Therapy cost estimates can be listed as a cost per service or as a projected total cost for a certain amount of therapy provided over a specified time period. ABN issuance remains mandatory before the cap is exceeded when services aren’t expected to be covered by Medicare because they are not medically reasonable and necessary. When the clinician determines that skilled services are not medically necessary, the clinical goals have been met, or there is no longer potential for the rehabilitation of health and/or function in a reasonable time, the beneficiary should be informed. If the beneficiary will be getting services that don’t meet the medical necessity requirements for Medicare payment, the ABN must be issued prior to delivering these services. The ABN informs the beneficiary of his/her potential financial obligation to the provider, allows him/her to choose whether or not to get the services, and provides information regarding appeal rights. When a provider/supplier expects that Medicare will deny payment on a claim for therapy services because they are not medically reasonable and necessary, regardless of whether or not therapy limits are met, the ABN must be issued before providing the services in order to transfer financial responsibility to the beneficiary.