Medicare has defined policy under which an Advance Beneficiary Notice of Noncoverage (ABN), signed by the patient, is required before the Medicare beneficiary can be billed for a test denied by Medicare as not medically necessary or not a covered service.
II. Medicare Policy:
1. Medicare will only pay for panels if all tests in the panel are medically necessary. Physicians should consider multiple ICD-9 codes when ordering panels.
2. Any of the tests for which Medicare has a National Coverage Determination (NCD) or Local Coverage Determination (LCD) require an ABN if an appropriate diagnosis code is not provided for the test. Refer to the UCL "Medicare Medical Necessity For Labs" book for the list of tests with an LCD/NCD and the covered ICD-9 codes. This list is updated as federal and local policies are revised.
3. Medicare has frequency limits for certain tests. Check the UCL "Medicare Medical Necessity For Labs" booklet for a list of test that have frequency limits. An ABN is required if any of the tests ordered has a frequency limit.
Complete the standardized CMS-R-131 (03/11). UCL staff must verbally review the ABN with the beneficiary or their representative before asking them to choose an option and sign the form.
1. Write the patient's name and the patient Identification number in the space provided at the top of the form in section A. Do not use the patient’s Medicare or Social Security Number. Include the Accession #, Date of Service and the Ordering physician.
2. Reason for possible denial:
A. If the test may be denied for inappropriate/non payable ICD-9 code(s), write the test name and ICD-9 code provided in condition area of section D and section E.
B. If the test has a frequency limit, check the appropriate box provided in the too frequent area of section D. and Section E.
3. Estimated Cost:
Refer to the Outpatient/3rd Party Fee Schedule and write in the cost of the tests that may be denied in the space provided.
Ask the patient to choose either Option 1, Option 2 or Option 3 in section G. Verbally review all options before asking for a decision. Instruct the patient to indicate their choice by marking the appropriate box.
A. OPTION 1: I want the test(s) listed above. You may ask to be paid now, but I also want Medicare billed for an official decision on payment, which is sent to me on a Medicare Summary Notice (MSN). I understand that if Medicare doesn’t pay, I am responsible for payment, but I can appeal to Medicare by following the directions on the MSN. If Medicare does pay, you will refund any payments I made to you, less co-pays or deductibles.
B. OPTION 2: I want the test(s) listed above, but do not bill Medicare. You may ask to be paid now, as I am responsible for payment. I cannot appeal if Medicare is not billed.
C. OPTION 3: I don’t want the test(s) listed above. I understand with this choice I am not responsible for payment, and I cannot appeal to see if Medicare would pay.
Instruct the patient to sign and date the ABN in section I. whether option 1, 2 or 3 is chosen.
A. Option 1 or 2: If Option 1 or 2 is chosen, send the signed ABN to the UCL Insurance Department with a copy of the physician order.
B. Option 3: If the patient chooses Option 3 (I don’t want the test(s) listed above), send the original, signed ABN to the Insurance Department and remind the patient that it is their responsibility to notify their physician if they chose not to have the laboratory tests ordered.
C. If the patient refuses to sign the ABN, write and initial on the ABN “Patient refused to sign” and have it witnessed by another staff member. Testing is not done. Give a copy of the ABN to the patient and remind them it is their responsibility to inform their physician that the testing was not done.
1. September 1997 M.J. Bonifas
2. May 2000 M.J. Bonifas (Revised)
3. September 2002 M.J. Bonifas (Revised: for CMS form)
4. August 2004 M.J. Bonifas (Revised: remove ABN for all CBCs)
5. July 2008 M.J. Bonifas (Revised: for new CMS form-3 options)
6. January 2012 M.J. Bonifas (Revised: for 2012 form)