CMS Pub. 100-02, ch. 9, § 50

Section 1879 of the Act provides beneficiaries with liability protections from unexpected

charges for certain denied claims when items or services are furnished by Medicare Part

A hospice providers. Hospice providers may also be protected from liability under §1879

of the Act when certain conditions apply to a claim denial. The limitation on liability

protections applies when a hospice claim denial is expected because:

• the beneficiary is determined to be not “terminally ill” as defined in §1879(g)(2)

of the Act;

• specific items or services billed separately from the hospice per diem, such as

physician services, are not reasonable and necessary as defined in either

§1862(a)(1)(A) or §1862(a)(1)(C); or

• the level of hospice care is determined to be not reasonable or medically

necessary as defined in §1862(a)(1)(A) or §1862(a)(1)(C), specifically for the

management of the terminal illness and/or related conditions.

A/B MACs (HHH) will apply the usual procedures of the limitation on liability provision

when a claim denial is based upon one of these reasons. When limitation on liability

protections applies, the hospice provider must issue the Advance Beneficiary Notice of

Noncoverage (ABN), Form CMS-R-131, per CMS guidelines in order to transfer liability

to the beneficiary.

See Pub. 100-04, Medicare Claims Processing Manual, Chapter 30, “Financial Liability

Protections," particularly Section 50, “Advance Beneficiary Notice of Noncoverage.”