CMS Pub. 100-04, ch. 30, § 50.17

A. Obligation to Bill Medicare

Upon receipt of an ABN, beneficiaries always have the right to ask the notifer to submit a

claim to Medicare for an official payment decision. A beneficiary must receive the

item/service described in the ABN and choose Option 1 in order to request Medicare

claim submission.

Healthcare providers or suppliers should refer to Publication 100-4, Chapter 1, Section 60

for instructions on submitting claims for statutorily non-covered items or services.

Note: Healthcare providers or suppliers will not violate mandatory claims submission

rules under Section 1848 of the Social Security Act when a claim is not submitted to

Medicare at the beneficiary’s request by their choice of Option 2 on the ABN.

B. Dually Eligible Individuals (Has a Qualified Medicare Beneficiary (QMB)

Program and/or Medicaid coverage)

Dually Eligible beneficiaries must be instructed to check Option Box 1 on the ABN in

order for a claim to be submitted for Medicare adjudication.

The provider must strike through Option Box 1 as provided below:

□ OPTION 1. I want the (D) 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.

These edits are required because the provider cannot bill the dual eligible beneficiary

when the ABN is furnished. Providers must refrain from billing the beneficiary pending

adjudication by both Medicare and Medicaid in light of federal law affecting coverage

and billing of dual eligible beneficiaries. If Medicare denies a claim where an ABN was

needed in order to transfer financial liability to the beneficiary, the claim may be crossed

over to Medicaid or submitted by the provider for adjudication based on State Medicaid

coverage and payment policy. Medicaid will issue a Remittance Advice based on this

determination.

Once the claim is adjudicated by both Medicare and Medicaid, providers may only

charge the patient in the following circumstances:

• If the beneficiary has QMB coverage without full Medicaid coverage, the ABN could

allow the provider to shift financial liability to the beneficiary per Medicare policy.

• If the beneficiary has full Medicaid coverage and Medicaid denies the claim (or will

not pay because the provider does not participate in Medicaid), the ABN could allow

the provider to shift financial liability to the beneficiary per Medicare policy, subject

to any state laws that limit beneficiary liability.

Note: These instructions should only be used when the ABN is used to transfer potential

financial liability to the beneficiary and not in voluntary instances. More information on

dual eligible beneficiaries may be found at: https://www.cms.gov/Outreach-and-

Education/Medicare-Learning-Network-MLN/MLNProducts/downloads/Medicare_Beneficiaries_Dual_Eligibles_At_a_Glan

ce.pdf

C. Ambulance Transports

Emergency or urgent situations In general, a notifier may not issue

an ABN to a beneficiary who has a

medical emergency or is under

similar duress. Forcing delivery of

an ABN during an emergency may

be considered coercive. ABN

usage in the ER may be

appropriate in some cases where

the beneficiary is medically stable

with no emergent health issues.

Non-emergent/urgent ambulance

transport

If the provider or supplier wants to

transfer liability to the beneficiary,

issuance of the ABN is mandatory for

ambulance transport services if all of

the following 3 criteria are met::

1. The service being provided is a

Medicare covered ambulance

benefit under §1861(s)(7) of the SSA

and regulations under this section as

stipulated in 42 CFR

§410.40 -.41;

2. The healthcare provider or

supplier believes that the service

may be denied, in part or in full, as

“not reasonable and necessary”

under § 1862(a)(1)(A) for the

beneficiary on that particular

occasion; and

3. The ambulance service is

being provided in a non-emergency situation. (The

patient is not under duress.)

ABN issuance is mandatory only when a beneficiary’s covered ambulance transport is

modified to a level that is not medically reasonable and necessary and will incur

additional costs. If an ambulance transport is statutorily excluded from coverage because

it fails to meet Medicare’s definition of the ambulance benefit, a voluntary ABN may be

issued to notify the beneficiary of his/her financial liability as a courtesy.

D. Hospice

Mandatory use of the ABN is very limited for hospices. Hospice providers are

responsible for providing the ABN when required as listed below for items and services

billable to hospice. Hospices are not responsible for issuing an ABN when a hospice

patient seeks care outside of the hospice’s jurisdiction.

The three situations that would require issuance of the ABN by a hospice are:

• Ineligibility because the beneficiary is not determined to be “terminally ill” as defined

in §1879(g)(2) of the Act; or

• Specific items or services that are billed separately from the hospice payment, 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.

Note: It is the hospice’s responsibility to issue an ABN when a beneficiary who has

elected the hospice benefit chooses to receive inpatient hospice care in a hospital that is

not under contract with the hospice. The hospice may delegate delivery of the ABN to

the hospital in these cases.

End of all Medicare covered hospice care –

When it is determined that a beneficiary who has been receiving hospice care is no longer

terminally ill and the beneficiary is going to be discharged from hospice, the hospice may

be required to issue the Notice of Medicare Non-coverage (NOMNC), CMS 10123. If

upon discharge the patient wants to continue receiving hospice care that will not be

covered by Medicare, the hospice would issue an ABN to the beneficiary in order to

transfer liability for the non-covered care to the beneficiary. If no further hospice

services are provided after discharge, ABN issuance would not be required.

ABNs are not required for Hospice Services in these situations:

• Revocations - Hospice beneficiaries or their representatives can revoke the hospice

benefit. Revocations are not considered terminations under liability notice policy

since the beneficiary is exercising his/her own freedom of choice. Therefore, no

ABN is required.

• Respite Care Beyond Five Consecutive Days - Respite care is limited to five

consecutive days under the Act. When respite care exceeds five consecutive days, an

ABN is not required since additional days of respite care are not part of the hospice

benefit. CMS encourages hospice providers to give the ABN as an optional notice to

inform patients of financial liability when more than five days of respite care will be

provided.

• Transfers - Beneficiaries are allowed one transfer to another hospice during a benefit

period. However, subsequent transfers within the same benefit period are not

permitted. In either case, an ABN is not required.

• Failure to Meet the Face to Face Requirement - The ABN must not be issued when

the face to face requirement for hospice recertification is not met within the required

timeframe. Failure to meet the face to face requirement for recertification should not

be misrepresented as a determination that the beneficiary is no longer terminally ill.

• Room and Board Costs for Nursing Facility Residents - Since room and board are

not part of the hospice benefit, an ABN would not be required when the patient elects

hospice and continues to pay out of pocket for long term care room and board.

E. Comprehensive Outpatient Rehabilitation Facility (CORF)

Since Comprehensive Outpatient Rehabilitation Facility (CORF) services are billed under

Part B, CORF providers must issue the ABN according to the instructions given in this

section. The ABN is issued by CORFs before providing a service that is usually covered

by Medicare but may not be paid for in a specific case because it is not medically

reasonable and necessary.

When all Medicare covered CORF services are going to end, CORF’s are required to

issue a notice regarding the beneficiary’s right to an expedited determination called a

NOMNC, CMS 10123. Upon termination of all CORF care, the ABN would be issued

only if the beneficiary wants to continue receiving some or all services that will not be

covered by Medicare because they are no longer considered medically reasonable and

necessary. An ABN would not be issued if no further CORF services are provided.

F. Home Health Agency (HHA)

The following chart summarizes the statutory provisions related to ABN issuance for

LOL purposes:

Application of LOL for the Home Health Benefit

Citation

from the

Act

Brief

Descripti

on of

Recommen

ded

Explanation

§1862(a)(1)(

A)

Care is not

reasonable and

necessary

Medicare does not

pay for care that is

not medically

reasonable and

§1862(a)(9) Custodial care is

the only care

delivered

Medicare does not

usually pay for

custodial care,

§1879(g)(1)

(A)

Beneficiary is

not homebound

Medicare requires

that a beneficiary

cannot leave home

(with certain

exceptions) in order

to cover services

§1879(g)(1)

(B)

Beneficiary does

not need skilled

nursing care on

an intermittent

basis

Medicare requires

part-time or

intermittent need for

skilled nursing care

in order to cover

Triggering Events for ABN issuance by HHAs*

HHAs may be required to provide an ABN to an Original Medicare beneficiary when a

triggering event occurs.

EVENT DESCRIPTION EXAMPLE

Initiation An ABN must be issued to the

beneficiary prior to receiving

care that is usually covered by

A beneficiary

requires

skilled nursing

Medicare, but in this particular

instance, it is not covered or

may not be covered by

Medicare because the care is

not medically reasonable and

necessary, the beneficiary is

not confined to his/her home

(considered homebound), or

the beneficiary does not need

skilled nursing care on an

intermittent basis, or the

beneficiary is receiving

custodial care only.

wound care 3

times weekly;

however, she

is not confined

to the home.

She wants the

care done at

her home by

the HHA.

Reduction Reductions involve any decrease in

services or supplies, such as frequency,

amount, or level of care, provided by

the HHA and/or care that is part of the

POC.

If a reduction occurs for an item or

service that will no longer be covered

by Medicare but the beneficiary wants

to continue to receive the care and

assume the financial charges, the HHA

must issue the ABN prior to providing

the non-covered items or services.

The beneficiary

requires physical

therapy (PT) for gait

retraining 5 times per

week for 2 weeks,

then reduce to 3

times weekly for 2

weeks. After 2 weeks

of PT, the beneficiary

wants to continue

therapy 5 times a

week even though

this amount of

therapy is no longer

medically reasonable

and necessary. The

HHA would issue an

ABN to the

beneficiary so that he

understands the

situation and can

consent to financial

responsibility for the

PT not covered by

Medicare.

Termination When an HHA expects that Medicare

coverage will end for all items and

services in total.

*If the beneficiary does not want the item or service that is being initiated, reduced, or

terminated, no ABN is required.

When an HHA performs an initial assessment of a beneficiary prior to admission but does

not admit the beneficiary, an ABN is not required if there is no charge for the assessment.

However, if an HHA charges for an assessment, the HHA must provide notice to the

beneficiary before performing and charging for this service.

Since Medicare has specific requirements for payment of home health services, there may

be occasions where a payment requirement is not met, and therefore, the HHA expects

that Medicare will not pay for the services. The HHA cannot use the ABN to transfer

liability to the beneficiary when there is concern that a billing requirement may not be

met. For example, a home health agency can’t issue an ABN at initiation of home care

services in order to charge the beneficiary if the healthcare provider face to face

encounter requirement is not met.

When all Medicare covered home health care is terminated, HHAs may sometimes be

required to deliver the NOMNC, CMS- 10123. The NOMNC informs beneficiaries of

the right to an expedited determination by a Quality Improvement Organization (QIO) if

they feel that termination of home health services is not appropriate. If a beneficiary

requests a QIO review upon receiving a NOMNC, the QIO will make a fast decision on

whether covered services should end. If the QIO decides that Medicare covered care

should end and the patient wishes to continue receiving care from the HHA even though

Medicare will not pay, an ABN must be issued to the beneficiary since this would be an

initiation of non-covered care.

HHA Exceptions to ABN Notification Requirements

ABN issuance is NOT required in the following HHA situations:

• initial assessments (in cases where beneficiaries are not admitted) for which HHAs do

not charge;

• care that is never covered by Medicare under any circumstances (i.e., an HHA offers

complimentary hearing aid cleaning and maintenance);

• telehealth monitoring used as an adjunct to regular covered HH care; or

• non-covered items/services that are part of care covered in total under a Medicare

bundled payment (e.g., HH prospective payment system (PPS) episode payment).