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Advance Beneficiary Notice of Noncoverage (ABN)

Medicare Claims Processing Manual (Pub. 100-04, Ch. 30, § 50.15.4 and § 50.15.5External PDF).

For services under the Home Health Prospective Payment System (HH PPS) the Advance Beneficiary Notice (ABN) (CMS-R-131) is designed to protect the beneficiary and the home health agency (HHA). It informs the beneficiary of an expectation that Medicare will not pay for the care, and allows them to make an informed decision about whether to continue care. An ABN must be given to the beneficiary when the care is physician-ordered and a Medicare denial is expected for one of the following statutory reasons:

  • Services not medically reasonable and necessary (under § 1862(a)(1) of the Act);
  • Services are for custodial care only (under § 1862(a)(9) of the Act);
  • Beneficiary is not homebound (under § 1879(g)(1)(A) of the Act);
  • Beneficiary does not meet intermittent care requirements (under § 1879(g)(1)(B) of the Act).

There are three triggering events for which an ABN must be given:

  • Initiation of Services, when you determine at the start of care, that an item and/or services may not be covered by Medicare.
  • Reduction of Services, to inform the beneficiary of cessation of one discipline when another is continuing, or an unplanned decrease in number of visits provided.
  • Termination of Services, when the HHA determines the services may no longer be covered and the beneficiary asks to continue services.

An ABN cannot be used to transfer liability to the beneficiary when there is a concern that a billing requirement may not be met. (For example, an ABN cannot be issued at initiation of home care services if the provider face-to-face encounter requirement is not met.)

ABN requirements also apply to a beneficiary who is eligible for both Original Medicare and Medicaid (dually eligible) or is covered by Original Medicare and another insurance program or payer. For additional information about the use of ABNs for dually eligible beneficiaries, refer to the Medicare Claims Processing Manual, Pub. 100-04, Ch. 30, §50.15.4.C.External PDF

ABN For Outpatient Therapy Services

Section 603 (c) of the American Taxpayer Relief Act (ATRA) amended § 1833 (g)(5) of the Act to provide protection to beneficiaries receiving outpatient therapy services (home health type of bill 34X) on or after January 1, 2013, when services are denied and are in excess of therapy cap amounts and don't qualify for a therapy cap exception.

If a beneficiary will be receiving noncovered therapy services because the services are not medically necessary and reasonable, an ABN must be issued before the services are provided so that the beneficiary can choose whether to get the services and accept financial responsibility for them.

When the goals of the plan of care (POC) have been met, but the patient wants continued therapy, the ABN is required, regardless of whether the therapy services exceed the cap amount. If the goals in the POC have not been met, and continued therapy is medically reasonable and necessary, the ABN is not required.

A home health agency can be held liable if the ABN is determined to be invalid. Refer to the Invalid ABNs and HHCCNs web page for scenarios of when an ABN would be considered invalid.

Additional Resources

Updated: 4.17.17

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