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BREAKING NEWS: Medicare releases changes to ABN

Patient Financial Services Weekly Advisor, March 14, 2008

CMS releases new ABN

By William Malm, ND, RN

In a much anticipated move, CMS released the new Advance Beneficiary Notice of Noncoverage (ABN) March 3. This form, also known as the ABN-R-131, will be used for all Part B provider and supplier services.

The form replaces the existing ABN-G and ABN-L and it may also be used for voluntary notifications, in place of the Notice of Exclusion from Medicare Benefits (NEMB). It will not replace the SNF ABN (SNFABN-G) form, which is currently under development.

The basics of the new ABN

According to CMS, key features of the form include:

·        a new official title, the "Advance Beneficiary Notice of Noncoverage (ABN)", to more clearly convey the purpose of the notice;

·        a mandatory field for cost estimates of the items/services at issue; and

·        a new beneficiary option, under which an individual may choose to receive an item/service and pay for it out-of-pocket, rather than have a claim submitted to Medicare.

CMS said while providers may use the new form immediately, it will be mandatory beginning September 1, 2008. At this time, CMS only released the English version.

CMS reiterates that the new ABN is approved by the Office of Management and Budget (OMB) and may not be altered except as stated in the instructions for implementation. It is still advised to provide verbal assistance to allow the beneficiary to understand the notice; translation assistance can be found in the "Additional Information" section of the ABN.  

The overall process and notifier(s) responsibilities haven't changed. The ABN must be given to beneficiaries in the "Original Medicare" program to convey that Medicare is not likely to provide coverage in the specific case. It must be provided in advance of the item, test or service. "Notifiers include physicians, providers (including institutional providers like outpatient hospitals), practitioners and suppliers paid under Part B, as well as hospice providers and religious non-medical health care institutions (RNHCIs) paid exclusively under Part A," according to the instructions.

The revisions are part of an ongoing process to subject the form to comment and re-approval every three years. CMS will issue the new detailed instructions on the use of the ABN in the online Medicare Claims Processing Manual, Publication 100-04, Chapter 30, prior to the implementation deadline.

Operational impact at your facility

Generally speaking, the processes that you may already have in place for delivering the ABN will suffice. It's important to note that there are some key changes such as the requirement to provide a reasonable cost estimate. ABNs must still be provided well in advance of the item or service to "consider the options and make an informed choice."

Additionally, CMS reinforced in their instructions that "ABNs are never required in emergency or urgent care situations." The ABN must still be verbally reviewed by the presenter and all questions must be answered in full prior to the patient's signature.

A significant operational change is that the beneficiary chooses from three payment options instead of two:

·        Option 1 states that the beneficiary wants Medicare to review and make a determination. This will require the use of condition codes on the UB-04, specifically condition code 20 in field locator (FL 18-28). This notifies Medicare of the beneficiary's request for a determination. This code will suspend the claim until a medical review has taken place.

·        Option 2 states that the beneficiary wants the item or service, but requests that Medicare won't be billed. Therefore, the beneficiary may be asked to pay but cannot appeal to Medicare.

·        Option 3 states that the beneficiary does not want the item or service and understands that they are giving up the option to have it billed to Medicare. Therefore no determination from Medicare can be made.

The following departments and job functions are specifically affected:

1.      The provision of the patient charge for the item or service can be a new operational challenge for the facility. Generally, this will be generated in some electronic fashion utilizing the pricing within the chargemaster. Therefore, this puts a new burden on the chargemaster coordinator or revenue cycle team to maintain the chargemaster.

2.      Reimbursement and CFOs will need to pay even further attention to pricing ensuring that it is consistent with the facility's policies and procedures for charge determination and that transparency requirements are met.

3.      Information Services should adapt the new form for use within the organization. Blank "A," or the notifier space, may need to be programmed into the information system to ensure the proper organization name, address, and other required identifying criteria are automatically provided on the form. Additionally, if medical necessity software is used to "scrub" for medical necessity then the software will need to be updated to ensure it is compliant with the new form by August 31, 2008.

4.      Patient access staff members will need to be re-trained on the specific requirements of the new form. If CPT codes are not provided by the ordering physician then patient access may have to "look up" the procedure in the chargemaster and ensure that the correct item or service is listed in the "items and services" blanks. This can represent compliance risks and may require additional work with the medical staff to ensure that as much information is provided at time of order. Finally, patient access will require a robust system for contacting the physician when there is a need for any clarification of the test or service in order to arrive at the most accurate CPT in the chargemaster.

In closing

ABNs continue to play a large role in ensuring that the beneficiary has made a conscious informed choice regarding the financial liabilities associated with their healthcare. It's more important than ever for each provider, supplier and/or facility to have formalized ABN policies consistent with Medicare guidance.

Chargemasters must be maintained if used for determining the estimated patient cost. Patient access staff will need to be retrained on the completion of each field and specifically the provision of a cost estimate to the beneficiary. Revenue cycle committees should take the next several months to include all departments (patient access, information systems, nursing, chargemaster, and patient financial services) in a comprehensive review of your current processes and make any necessary adaptations required to be consistent with the guidance.

To obtain the latest information regarding ABNs and view the new forms, follow this link to the CMS site:  http://www.cms.hhs.gov/BNI/02_ABNGABNL.asp

Editor's note: Be sure to read Malm's extended article on the operational impact of the new ABN in next month's Patient Access Advisor.

Malm is practice director for revenue cycle management at HCPro, Inc.

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