The ABN: The Most Misunderstood and Underutilized Document in Healthcare

There’s a new ABN form required to be in use in January 2012 – read about it here in my article “Everybody’s Favorite Form: New Advance Beneficiary Notice of Noncoverage (ABN) Form Begins in 2012″

Note from Mary Pat: The Advance Beneficiary Notice of Noncoverage (ABN) is a collection tool that many medical practices do not know how to implement.  It is particularly difficult to determine who has ownership of this process, because the form must be completed and signed by the patient before the service is provided.  The patient is in the exam room or the lab, ready for the service or test, and a knowledgeable staff person must step in, explain the rules and pricing and obtain the patient’s signature.

Blogger Charlene Burgett does a great job of explaining the ins and outs of using the ABN, and has agreed to share an article originally published on her blog “Conundrum” with MMP readers.


The use of the ABN is required by Medicare to alert patients when a service will not be paid by Medicare and to allow the patient to choose to pay for the service or to refuse the service.

If the practice does not have a signed ABN from the patient and Medicare denies the service, the charge must be written off and the patient cannot be billed for it. The only exception is for statutorily excluded services (those that Medicare never covers like cosmetic surgery and complete physicals for example). In this case, a practice can bill the patient for the non-covered service despite not having an ABN.  It is, however, a good idea to have the ABN signed for non-covered services so the patient is made aware that they are responsible.

If the patient signs the ABN and is made aware of their financial responsibility you may require the patient to pay for this service on the date the service is provided. You may also charge the patient 100 percent of your fee. You do not have to reduce your charge to the Medicare allowable.

With a signed ABN, the practice has proof of the patient’s informed consent to provide the service and their agreement to be financially responsible for the service. In the past, Medicare had a “Notice of Exclusion of Medicare Benefits” (NEMB) that we could provide to the patient (no signature required) to alert them of Medicare’s non-covered services. The ABN has replaced the NEMB.

The typical reasons that Medicare will not cover certain services and that would be applicable are:

  1. Statutorily Excluded service/procedure (non-covered service)
  2. Frequency Limitations
  3. Not Medically Necessary

Statutorily Excluded items are services that Medicare will never cover, such as (not a complete list):

  • Complete physicals (excluding Welcome to Medicare Screenings, with caveats)
  • Most immunizations (Hepatitis A, Td)
  • Personal comfort items
  • Cosmetic surgery

For these items, it is a good idea (not a requirement) to complete the ABN and have the patient check the appropriate box under options and sign the ABN. For the sake of the billing department, I strongly encourage the use of ABN’s for statutorily excluded items.

Frequency Limitations are for services that have a specific time frame between services. For example, Medicare allows one pap smear every 24 months if the pap is normal.  If the patient wants one every 12 months for their peace of mind, Medicare will pay for year one and the patient will pay for year two and that pattern continues. The ABN needs to be on file for the year that the patient is responsible for paying.  If the patient fits Medicare’s guidelines for “high risk” they are allowed to have the pap every 12 months and no ABN is required.

Services that are not considered Medically Necessary are those that do not have a covered diagnosis code based on Local Coverage Determinations (LCD).  One example is for excision of a lesion. If the lesion is being removed because the patient just doesn’t like how it looks, that is considered cosmetic surgery. If the lesion is showing some changes (i.e. bleeding, growing, changing color, etc), then it is considered medically necessary because it potentially can be malignant. The removal needs to have diagnosis coding to substantiate the medical necessity and Medicare has Local Coverage Determinations that list all the codes/coding combinations that Medicare will approve for payment.

A rule of thumb in trying to discern the necessity of ABNs is to ask yourself if there may be some times that the service isn’t covered by Medicare.  The times the service isn’t covered, an ABN is required. To illustrate this point, here are two examples:

  • EKGs are covered for certain cardiac and respiratory conditions. The only time an EKG is covered for preventive screening is during the patient’s first year enrolled in the Medicare program and when being done during the Welcome to Medicare screening.  After that time, Medicare will never cover an EKG for preventive screening. To notify the patient of this and to show that the patient agrees to be financially responsible for the EKG, an ABN should be completed.


  • Another example is for the Tetanus immunization.  Medicare will cover tetanus when medically necessary; if the patient has cut themselves and the tetanus is provided due to that injury.  If the tetanus is provided to the patient because it has been ten years since the last tetanus and the tetanus is not in response to a recent injury, then it will be non-covered because it is not “medically necessary” and the ABN will need to be on file.

ABNs need to be completed in their entirety.  The “Options” box can only be completed by the patient and it states that “We cannot choose a box for you”.  That would appear to be coercion.

A “blanket” ABN, one that is signed by the patient for all services provided within a certain time period, is not acceptable and is illegal.

In addition, there is a small area to provide additional information that can be used by either the patient or the provider’s office. This could be anything pertinent to the information that the ABN covers. The bottom of the form is where the patient signs and dates. We keep the original ABN in the chart behind the progress note for that day. Providers MUST provide a copy of the signed ABN to the patient.

The current ABN form with instructions can be found here.

If a service is denied by Medicare and the physician does not have a signed ABN prior to the service being rendered, the service can not be billed to the patient and will need to be written off.  Sometimes a patient may refuse to sign the ABN – if this happens it is appropriate for the physician to document the refusal and sign, along with having a witness sign.  Medicare will accept this and the patient can be billed for the service if denied by Medicare.

How does Medicare know whether or not you have a signed ABN?  You tell them, by adding a modifier to the CPT code when completing the claim form.  The appropriate modifiers are:

GA:  The ABN is signed, but the service may not be covered.

GY:  A “statutorily excluded” service.

GZ:  The service is expected to be denied as not reasonable or necessary.  This is typically used when there is a secondary payer that requires the Medicare denial before they pay benefits.

The use of the ABN is often misunderstood; however, it is the only way a patient can be informed about their financial responsibility prior to agreeing to a service being rendered.  This is an issue that the OIG has reportedly been interested in investigating for fraud and abuse.

Charlene Burgett, MA-HCM

Note: Readers, how do you make the ABN work in your practice?  Do you train the clinical staff, the physicians, or other staff to recognize the “ABN Moment”?  How do you make it work? Please share your ideas by responding with a comment.

Posted in: Collections, Billing & Coding, Day-to-Day Operations, Medicare & Reimbursement

Leave a Comment (87) ↓


  1. sarah November 16, 2013

    Mary Pat
    My laboratory has a number of nursing home clients. Some of the testing is client billed back to the home/facility but much of the testing is 3rd party billed to medicare. Can you comment getting a signed ABN on these patients? Should the phlebotomist be responsible for presenting the ABN? And if so how would they be able to access if the patient is able to sign for such procedures?
    Do you have “best practice” solutions for this issue?
    Thank you

  2. steve November 19, 2013

    I am a PT and bill under Part B. Some secondary insurances used to pay after Medicare reached the 1900.00 cap. I used to get a PR-119 (patient responsibility) I bill the same way and get a CO-119 (Contractual Obligation…in which the provider is liable). The secondaries dont pay with the C0-119. I was thinking of having those patients sign an ABN (the ones that would pay anyway out of pocket). Will I get a PR-119 if I use a GA modifier in lieu of a CO-119?

  3. Mary Pat Whaley November 21, 2013

    Hi Steve,

    You are correct. You will need to get an ABN signed and add the GA modifier to the claim, and you should get a PR-119.

    The rules now state:

    The provider/supplier must issue a valid, mandatory ABN to the beneficiary before providing services above the cap when the therapy coverage exceptions process isn’t applicable. The ABN informs the beneficiary why Medicare may not or won’t pay for a specific item or service and allows the beneficiary to choose whether or not to get the item or service and accept financial responsibility. ABN issuance allows the provider to charge the beneficiary if Medicare doesn’t pay. If the ABN isn’t issued when it is required and Medicare doesn’t pay the claim, the provider/supplier will be liable for the charges.

    Best wishes,

    Mary Pat

  4. Mary Pat Whaley November 21, 2013

    Hi Christina,

    This does sound correct if you are talking about services that exceed the PT annual cap. If so, then you do have to have the patient sign an ABN and use the GA modifier so the patient knows that they are responsible for paying if primary and secondary do not pay.

    Best wishes,

    Mary Pat

  5. Mary Pat Whaley November 21, 2013

    Hi Sarah,

    I am wondering what types of lab services are getting denied for patients in the nursing home? I have not heard of this issue very often in this setting.

    The responsibility typically rests with the person who ordered the test to let the patient know that Medicare will or may not cover the test, so there can be a discussion and the patient can decide if they want the test of not and sign the ABN. I am assuming if the phlebotomist presents the ABN, there can be no discussion of the pros and cons of having the test with the person who ordered the test.

    Unfortunately, most physicians are unclear when they are ordering tests that may not be covered by Medicare, so it can be difficult to bring them into the conversation.

    If I were you, would provide the physicians with pre-filled ABNs with all the appropriate information for the tests and ask the physicians/nursing home to get the ABN filled in the patient’s information, signed and send it with the specimen.

    Best wishes,

    Mary Pat

  6. Jim M December 5, 2013

    Hi — thanks for your Blog! I have a question re: vaccines and counseling. Suppose a patient w/private insurance i traveling to Brazil, and I determine that they need a few vaccines. Their insurance covers ony a part of the fee. If my patient signs an ABN, can I balance bill that person for my fees?

  7. Mary Pat Whaley December 8, 2013

    Hi Jim,

    You can balance bill as long as you don’t have a contract with the payer stating that you will accept what they will pay. In that case, you can only collect the patient’s deductible, co-insurance, co-pay and any services that the patient’s plan doesn’t cover.

    If you do not have a contract with the patient’s insurance plan, you should expect the patient to pay anything their insurance company does not up to your full charge. Whether or not you use an ABN is up to you. If you do not have a contract with the patient’s plan, I suggest you collect in full from the patient at the time of service and assign the insurance benefits to the patient.

    Best wishes,

    Mary Pat

  8. Wallace February 24, 2014

    Geisinger is billing me for a tetnaus shot and I was not aware it was not covered by Medicare. THe nurse asked me if I would like a shot and I said sure. I did not sign and ABN form. Year later I am still receiving bills. Geisinger stated an ABN from is not required for a shot. Is this ture and should I pay?
    Thank you,

  9. Mary Pat Whaley February 25, 2014

    Hi Wallace,

    If a tetanus shot is related to the care – for instance, if you stepped on a rusty nail – Medicare will cover it. If it is a tetanus shot for the sake of getting a tetanus shot and there is no related injury, Medicare will not typically pay for it.

    I always encourage practices to discuss what Medicare will and will not cover with patients. If Medicare NEVER covers a service, practices are not required to get an ABN signed. It could be that the practice was using that rule of thumb and so did not give you an ABN. Have you contacted Medicare and asked them if you should have received an ABN? That should settle the question for you and the practice.

    Best wishes,

    Mary Pat

  10. Tammy March 19, 2014

    Does the ABN have to be signed on the exact day of service to be valid? For example, a patient is scheduled to have labs which include an A1c (fasting) but they forget and eat. The A1c has an ABN prepared because of frequency issues. The ABN also contains other labs that are not expected to be covered by Medicare because of LCD/NCD issues. The patient is unable to have the A1c draw done that day, but returns a few days later for that particular draw. Will the initial ABN that was signed and dated for date of service by the patient be valid? I have received conflicting information on that issue.

  11. Christine March 19, 2014

    Hi Mary Pat,
    We have patient’s covered by Blue Cross Commercial Plan and Medicare secondary. Blue Cross is applying coinsurance or deductible and it is being billed to Medicare. Medicare is denying for medical necessity and we have no ABN on file since we only screen primary for Med Nec. Can we bill the patient the coinsurance due?

  12. Mary Pat Whaley March 21, 2014

    Hi Tammy,

    if you change the date on the original form and have the patient initial it, you should be fine. Technically, the patient must sign before the service is provided, so you are fine there, but it should also reflect the correct date when the service was provided. I suggest either a new ABN with the correct date, or the previous ABN with the date lined through, the new date inserted and the patient’s initial and date of initialing.

    Best wishes,

    Mary Pat

  13. Mary Pat Whaley March 26, 2014

    Hi Christine,

    You can not charge Medicare patients for anything that Medicare denies due to medical necessity. You may have to start screening for Medicare secondary and get the ABN.

    Best wishes,

    Mary Pat

  14. John Schwark April 8, 2014

    My brother has been in Las Ventanas rehab hospital in Las Vegas since the first week in January. He transferred there from Summerlin Hospital. They called me a couple weeks ago and told me he is been on private pay since sometime in February because wasn’t Medicare eligible after that date in February. The reasoning is a bit unclear to me. However, Las Ventanas did not effect a ABN. They have been pressuring me for immediate payment but I recently found out about the ABN, which was never presented to my brother and therefore never signed. They told me today they are sending a statement. Can you tell me how to respond? Thank you for being here… John Schwark, Battle Creek, Michigan… 269-317-7157

  15. Niki Hooper April 11, 2014

    We are a travel immunization clinic. When we have a medicare patient come in they read and sign a statement that says the following:





    The question: Should we stop using this statement and go with a ABN?

    Niki G.

  16. Mary Pat Whaley April 12, 2014

    Hi John,

    Without having more information, I cannot be sure of your brother’s situation, but Medicare requires an ABN to be signed any time benefits that a patient has been receiving have run out. I would ask the facility if they have an ABN that was signed by your brother before he received services that were not covered under Medicare.

    Best wishes,

    Mary Pat

  17. Mary Pat Whaley April 12, 2014

    Hi Niki,

    Technically, if a service is never covered under Medicare, an ABN is not required, however I usually recommend that practices use the ABN to be sure the patient understands that the service is not covered by Medicare and that they will be required to pay the full amount at the time of service. Having someone sign a statement as you are currently doing may not be as clear as having someone sign an ABN where each of the services is listed with the corresponding price.

    Best wishes,

    Mary Pat

  18. Lorena April 19, 2014

    My question is if a patient is presented with a ABN on date of service signed and for some reason is lost by the time charges need to be billed, can the patent return the next day to resign? Can a write on new form that original was misplaced therefore a new form was necessary/ My understanding is the ABN must be signed and completed before the services are provided.

  19. Mary Pat Whaley May 3, 2014

    Hi Lorena,

    Doing this once might pass muster, but if you lose the ABN routinely you might get in a very sticky situation with Medicare.

    Best wishes,

    Mary Pat

  20. Andria May 29, 2014

    Mary Pat,

    Are ABN’s strictly for Medicare patients? If my patient has BCBS and we are in network but they only pay $500 towards our claim, can we will the patient for the difference if we have a signed ABN?

    Thank you,

  21. Mary Pat Whaley June 1, 2014

    Hi Andria,

    If you have a contract with BCBS, you can only charge a patient according to the contract you’ve signed. For instance if you charge $1000, and you’ve agreed by contract to accept the BCBS allowable of $500, you cannot bill the remaining $500 to the patient. If, however, BCBS allows $500, but pays you $400 and expects you to collect $100 from the patient, you may indeed bill the patient for the $100.

    The purpose of the ABN is to guarantee payment from the patient when you either KNOW or PREDICT that their contracted insurance will not pay. We use ABNs for non-Medicare payers although very few commercial payers require one. I recommend using an ABN for elective, non-covered services as it reinforces to the patient what their financial commitment is.

    Best wishes,

    Mary Pat

  22. Kay June 4, 2014

    If a patient has Secure Horizon or AARP are they required to sign an ABN?

  23. Sherry June 19, 2014

    I am currently covering the office at an Home Health & Hospice Agency in Illinois. Our nurses here are getting confused on when to use an ABN.
    1. When are we supposed to issue an ABN?
    2. Is it done at every Discharge and Recertification, and Resumption?

    I need it explained plain a simple.

  24. Gina July 8, 2014

    We have a Medicare patient that signed an ABN on a denied line and therefore, we billed Medicaid secondary. Medicaid also denied the procedure. Is the patient still responsible for the denied procedure even though they have Medicaid secondary?

  25. Mary Pat Whaley July 13, 2014

    Hi Gina,

    It depends on whether or not the service is a covered service under Medicaid. If you have a signed ABN and Medicare denied on the basis listed on the ABN and Medicaid also denied it as a non-covered service, you may collect from the patient. Much depends on what the service was and why it was denied.

    Best wishes,

    Mary Pat

  26. Mary Pat Whaley July 16, 2014

    Hi Sherry,

    Any time there is a service offered that might not be covered by Medicare, you need to have the patient sign an ABN. The ABN states that the patient knows Medicare might not pay for the service, but the patient still wants the service and agrees to pay your regular charge. You are not supposed to issue ABNs on the “off chance” that Medicare won’t pay. You should issue an ABN based on the fact that medical necessity does not exist for the service, or that the benefit has been exhausted. There may be other situations, but those are the two most common that I know of for home health.

    Best wishes,

    Mary Pat

  27. Mary Pat Whaley July 16, 2014

    Hi Kay,

    The patient may be required to sign an ABN if they want services that their insurance plan does not cover.

    Best wishes,

    Mary Pat

  28. Kathi July 21, 2014

    Hi Mary Pat,

    A patient is scheduled to receive a piece of durable medical equipment. Medicare will not cover because the item of DME is considered not medically necessary. It will not meet Medicare criteria for another month and the surgeon would like the patient to start treatment right away. The patient has Medicaid as secondary, but Maine Medicaid will only pay as a cross-over if Medicare pays. Can the patient be billed if he signs an ABN and is informed that both Medicare and Medicaid will not pay (at this time)? Thank you!

  29. Mary Pat Whaley July 21, 2014

    Hi Kathi,

    If Medicare is not going to pay due to medical necessity and Medicaid will not pay if Medicare won’t, then you can explain the situation to the patient and give them the option of signing an ABN and agreeing to pay out-of-pocket for the service. Make sure the ABN is filled out completely and correctly and that the patient has a copy.

    I always flag all my ABN accounts so I am reminded to go back and verify that the payers did not pay anything on the services, just in case any follow-up is needed.

    Best wishes,

    Mary Pat

  30. Mindy McDaniel August 11, 2014

    I have been getting Medicare remits with a CO 5 ( Procedure code inconsistent with place of service on services that we bill when Our doctor sees patients in an assisted living. The LCD does not allow for this service in an assisted living. Is it appropriate for me to have the patient sign an ABN because I know that they will not pay in this place of service? If I have an ABN signed can I then bill the patient for that amount? I have not sent the claim with a GA modifier added. I fi do that will they then change it to patient responsibility?

  31. Christine Williams August 12, 2014

    Hi Mary Pat,

    Can a provider charge a patient who signed an ABN if the provider was not credentialed or contracted with Medicare at the time of service? If Medicare denied services for that reason can you bill the secondary insurance with Medicare’s EOB. Thank you

  32. Mary Pat Whaley August 12, 2014

    Hi Christine,

    What an interesting question! If Medicare denied it because the provider was not contracted with Medicare, then you do not have to follow Medicare rules, meaning that you would not need an ABN, however, having an ABN would not be wrong per se and you can hold the patient responsible for the balance. You can bill the secondary showing that Medicare denied the service, but depending on the type of insurance it may not pay if Medicare did not pay.

    Best wishes,

    Mary Pat

  33. Mary Pat Whaley August 13, 2014

    Hi Mindy,

    Did you use the CPTs for Assisted Living (99339-99340)? If you did not use those codes it would seem to trigger the CO 5. If you used those codes, then CO 5 has me stymied.

    It is entirely appropriate to have the patient sign an ABN and to use the correct modifier, although technically, since Medicare never pays for services in Assisted Living, you are not REQUIRED to issue an ABN.

    I always recommend that practice use the ABN, regardless of the Medicare guideline because I think it helps the patient to understand how much they will be paying (your full fee, unless you reduce it to Medicare level as some do).

    Best wishes,

    Mary Pat

  34. Shelia August 20, 2014

    We have a Medicare patient in Observation status in the hospital. Pt refuses to leave and does not meet medical necessity. Do we issue an ABN for this patient. If so how?

  35. Mary Pat Whaley August 21, 2014

    Hi Sheila,

    This seems like a hospital problem, not a physician problem. Usually, the hospital lets the patient know that further stays in observation will not be covered by their insurer and have them sign a document stating they understand that. Sometimes patients who refuse to leave (depending on the reason they are refusing) are admitted to a psych unit. From the physician’s perspective, they may want to do a courtesy visit daily just to check in, but not deal with any medical issues.

    Why does the patient refuse to leave?

    Mary Pat

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