Case Management

CMW Tip of the Week: How to handle Advance Beneficiary Notices of Noncoverage

Case Management Weekly, January 28, 2009

This week’s tip comes from Jackie Birmingham, RN, BSN, MS, CMAC.

A Medicare beneficiary (or authorized representative) who has been given an Advance Beneficiary Notice of Noncoverage (ABN) may elect to receive the item or service anyway. In this case, the beneficiary should indicate that he or she is willing to be personally and fully responsible for payment by marking options 1 or 2 in box G on the ABN form. This new version of the ABN is used before services are rendered (as the name implies) and it may be given by outpatient department staff.  

Here are some more tips regarding filling out the ABN:

  • Option 1 indicates the beneficiary or representative will pay for the service out of pocket, but the hospital will also bill Medicare to see whether Medicare will pay for the item or service. If Medicare does not pay, the patient has the opportunity to appeal, but there is no guarantee Medicare will pay for the item or service.
  • Option 2 indicates the individual accepts full financial responsibility for the item or service. Medicare will not be billed, and the beneficiary cannot appeal. This option requires that the patient be informed of the cost of the service prior to receiving the service.
  • When a beneficiary decides to decline an item or service, he or she should indicate this by marking option 3 in box G on the ABN form. Counseling the patient on this decision and documenting the discussion is important. The service has been ordered based on the patient’s physician’s advice, and if the patient declines the item or service, it is important to be sure that he or she is fully informed of the consequences of the decision.  
  • The beneficiary cannot refuse to sign the ABN and still demand the item or service.
  • If a beneficiary refuses to sign a properly executed ABN, the notifier should consider not furnishing the item or service, unless the consequences (health and safety of the patient, or civil liability in case of harm) are such that this is not an option.
  • Additionally, the notifier may annotate the ABN, and have the annotation witnessed, indicating the circumstances and persons involved.


For additional information, the CMS Web site contains notices, manuals, and instructions on how to use the ABN.

Have a tip or tool you’d like to share? Or maybe a question for our experts? E-mail it to editor Julie McGinley at jmcginley@hcpro.com.Your thoughts could be featured in the next issue of Case Management Weekly!

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