The ABN protects both the physician and patient from unexpected financial liability. When the physician believes that the service/item may not be covered as medically reasonable and necessary, an acceptable notice of Medicare ’ s possible denial of payment must be given to the patient. If the physician does not give an ABN to the patient, the physician usually cannot hold the patient financially liable for the service/item. Patients must be notified before the service is rendered that payment might be denied or reduced. The patient may then decide if he or she wants the service and is willing to pay for it.
If the physician properly notifies the patient in advance that payment for the service may be denied or reduced, the physician is not held financially liable for the services and may seek payment from the patient.
Specific Criteria for the ABN
An acceptable ABN of the denial or reduction of payment must meet the following criteria:
* The notice must be given in writing on the approved Form CMS-R-131, in advance of providing the service/item.
* The notice must include the patient ’ s name, date and description of service/item, and reason(s) the service/item may be denied or a reduction in payment could occur.
* The patient must sign and date the ABN, indicating that the patient assumes financial liability for the service/item if payment is denied or reduced for the reasons indicated on the ABN.
ABN Modifiers
Assigned or nonassigned claims billed to Medicare Part B must contain modifier GA next to each applicable service for which a proper ABN has been given to and signed by the patient. While the ABN form need not be submitted with the claim, a copy of the signed document must be maintained with the physician ’ s records. Modifier GZ may be used to indicate a physician expects Medicare will deny an item or service as not reasonable and necessary and the beneficiary has not signed an ABN.
