CMS Pub. 100-04, ch. 30, § 40.2.2

A. Responsiveness to Inquiries

A notifier must answer any questions from a beneficiary regarding the written notice.

This includes requests for further information and/or assistance in understanding and

responding to a notice. The Medicare contractor will hold that a beneficiary did not

receive proper written notice in any case where it finds that the notifier refused to answer

inquiries.

B. Dealing With Beneficiary Refusals

A beneficiary who has been given a written notice may decide to receive the item(s)

and/or service(s). In this case, the beneficiary should indicate that s/he is willing to be

personally and fully responsible for payment. When a beneficiary decides to decline an

item or service, s/he should so indicate. If a beneficiary refuses to sign a valid written

notice, 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 written notice

indicating the circumstances and persons involved. The notifier should have the

annotation witnessed.

• Claims to Which LOL Provisions Apply - If the beneficiary demands the item

or service and refuses to pay, the notifier should have a second person witness the

provision of the written notice and the beneficiary’s refusal to sign. Where there

is only one person on site (e.g., in a “draw station”), the second witness may be

contacted by telephone to witness the beneficiary’s refusal to sign the written

notice by telephone and may sign the written notice annotation at a later time. An

unused patient signature line on the written notice form may be used for such an

annotation; writing in the margins of the form is also permissible. The notifier

should file its claim as having given the written notice. The beneficiary will be

held liable in case of a denial.

• Claims to Which RR Provisions Apply - if the physician or supplier does

furnish the item or service, the beneficiary’s signature is meant to attest both to

receipt of the written notice and to the beneficiary’s agreement to pay. The

beneficiary must receive a valid written notice so that s/he is “on notice” (that is,

the beneficiary “knew, or could reasonably have been expected to know, that

payment could not be made”) and must agree to pay. The beneficiary has the

same two legitimate choices as the cases of claims to which LOL provisions

apply. If the beneficiary demands the item or service and refuses to pay (will not

sign or else marks out the agreement to pay language), the physician or supplier

must take into account the fact that it will not be able to collect from the

beneficiary in deciding whether or not to furnish the items or services. Although

there would be little point in having a second person witness the provision of the

written notice and the beneficiary’s refusal to agree to pay (because the

requirement that the beneficiary agree to pay still would not be fulfilled), the

physician or supplier may annotate the written notice. If the items or services are

furnished despite the beneficiary’s refusal to pay, the physician or supplier should

file the claim as not having obtained a signed written notice. The Medicare

contractor will not hold the beneficiary liable and will hold the physician or

supplier liable.

NOTE: In either case, the beneficiary who does receive an item or service, of course,

always

has the right to a Medicare determination and the claim must be filed with Medicare.

C. Routine Notice Prohibition

In general, the “routine” use of written notices is not effective and therefore is not an

acceptable practice. By “routine” use, CMS means giving written notice to beneficiaries

where there is no specific, identifiable reason to believe Medicare will not pay. Notifiers

should only give written notices to beneficiaries when there is some genuine doubt that

Medicare will make payment. If the Medicare contractor identifies a pattern of routine

notices in situations where such notices clearly are not valid, it will write to the notifier

and remind it of these standards. While in general, routine written notices are invalid and

will not protect the notifier from liability, there are some exceptions.

• Generic Written Notices – “Generic written notices” are routine written notices

to beneficiaries which do no more than state that Medicare denial of payment is

possible, or that the notifier never knows whether Medicare will deny payment.

Such “generic written notices” are not considered to be acceptable evidence of

written notice and will not protect the notifier from liability. The written notice

must specify the item and/or service and a genuine reason that denial by Medicare

is expected. Written notice standards likewise are not satisfied by a generic

document that is little more than a signed statement by the beneficiary to the

effect that, should Medicare deny payment for anything, the beneficiary agrees to

pay for the item and/or service.

• Blanket Written Notices - Giving written notices for all claims or items or

services (i.e., “blanket written notices”) is not an acceptable practice. Notice must

be given to a beneficiary on the basis of a genuine judgment about the likelihood

of Medicare payment for that individual’s claim.

• Signed Blank Written Notices - A notifier is prohibited from obtaining

beneficiary signatures on blank written notices and then completing the written

notices later. In order for a written notice to be effective, it must be completed

before delivery to the beneficiary. The Medicare contractor will hold any written

notice that was blank when it was signed to be an invalid notice that will not

protect the notifier from liability.

• Routine Written Notice Prohibition Exceptions - In general, routine written

notices will not be considered valid. There are, however, a few limited

circumstances when a routine notice can be given to a beneficiary and considered

effective.

Exception Description

Items or Services Which Are Always

Denied for Medical Necessity

In any case where a national coverage

decision provides that a particular item or

service is never covered, under any

circumstances, as not reasonable and

necessary under §1862(a)(1) of the Act

(e.g., at present, all acupuncture services

by physicians are denied as not reasonable

and necessary), a written notice that gives

as the reason for expecting denial that:

“Medicare never pays for this

item/service” may be routinely given to

beneficiaries, and no claim need be

submitted to Medicare. If the beneficiary

demands that a claim be submitted to

Medicare, the notifier should submit the

claim as a demand bill.

Experimental Items and Services When any item or service which Medicare

considers to be experimental (e.g.,

“Research Use Only” and “Investigational

Use Only” laboratory tests) is to be

furnished, since all such items or services

are denied as not reasonable and

necessary under §1862(a)(1) of the Act

because they are not proven safe and

effective, the beneficiary may be given a

written notice that gives as the reason for

expecting denial that: “Medicare does not

pay for items or services which it

considers to be experimental or for

research use.” Language with respect to

“Medicare coverage for clinical trials”

may be substituted as the reason for

expecting denial.

Frequency Limited Items and Services When Medicare has established a

frequency limit for any item or service, a

routine written notice can be given. This

is applicable anytime a frequency

limitation is made through statute or

regulation, through medical national

coverage determinations, or on the basis

of the Medicare contractor’s local

Exception Description

coverage determinations. In any such

routine written notice, the notifier must

state the frequency limitation as the

reason for expecting denial (e.g.,

“Medicare does not pay for this item or

service more often than frequency limit”).

Medical Equipment and Supplies

Denied Because the Supplier Had No

Supplier Number or the Supplier Made

an Unsolicited Telephone Contact

Given that Medicare denials of payment

under §1834(j)(1) of the Act, and under

§1834(a)(17)(B) of the Act, apply to all

varieties of medical equipment and

supplies and to all Medicare beneficiaries

equally, the usual prohibition on routine

notices to all beneficiaries does not apply

in these cases.

NOTE: A routine written notice, like any other written notice, is valid only for the

denial reason specified on the notice. A written notice will not be considered a valid

notice in the case of any Medicare denial of the claim for any reason other than that

specified on the notice.