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The Advanced Beneficiary Notice of Non-coverage (ABN) 

A 67 year old Medicare patient comes into the office for a cosmetic skin procedure. The following day the billing office staff checked and found the reason for service was not medically reasonable as per the Local Coverage Determination. The patient had not been made aware prior to having the procedure performed. No Advance Beneficiary Notice was issued or signed.

The Billing staff member explained to the Provider stating we performed a service that Medicare will not cover, and we didn’t get an ABN. The Provider instructs his staff to send the claim to Medicare, and if it is denied collect the payment from the patient. Is this a proper billing and collection process?

Question: Is this a proper billing and collection process?

 

See answer below


Answer: No

Rationale: If you do not issue an ABN when required by Medicare, or if the ABN is invalid,

you cannot bill the beneficiary for the service.

When billing Medicare for items/ service that are non-covered, and/ or not reasonable and necessary append the appropriate HCPCS modifier. Why is it necessary to append a modifier to a claim that will deny with or without the modifier? Doing so demonstrates your compliance and understanding of the CMS rules.

  • GY: Item or service statutorily excluded, does not meet the definition of any Medicare benefit or, for non-Medicare insurers, is not a contract benefit.
  • GZ: Item or service expected to be denied as not reasonable and necessary.