What You Should Know
An Advance Beneficiary Notice (ABN) should be obtained whenever a provider has reason to believe a procedure could be denied as not reasonable and necessary. The diagnosis or ICD-CM is used by Medicare to determine if the test is reimbursable in accordance with the National and Local Medicare Limited Coverage Policies. Therefore, diagnosis codes are required for all laboratory orders to document medical necessity of the testing. Only the ordering provider is authorized to determine the reason that the test is ordered, and the diagnosis codes submitted with the ordered tests must be consistent with documentation in the patient’s medical record.
The laboratory is not allowed to routinely accept orders where Advance Beneficiary Notices (ABNs) are not collected when necessary, or routinely write off tests where an ABN is not obtained. This may be considered "inducement" under government regulations.
Generally, services necessitating a signed ABN are those that are reimbursable in some instances, but not reimbursable in others. These can include:
- Tests deemed not medically necessary
- Laboratory tests for which Medicare has established either a National Coverage Determination (NCD) or for which a Medicare Administrative Contractor (MAC) has established a Local Coverage Determination (LCD) with limitations due to diagnosis or condition.
- Laboratory tests that are specifically excluded by the Medicare program. (e.g., General Health Panels).
- Screening Tests
- Tests that might be ordered as part of a routine exam, if the patient does not exhibit evidence of a particular disease, are not covered.
- Other such screening services are not typically covered by Medicare.
- Experimental ("Investigational") Tests
- Tests designated by the manufacturer as "for research or investigational use," and thus considered experimental or investigational.
- Laboratory tests which are not yet FDA-approved.
- Tests Performed Too Frequently
- Laboratory tests for which Medicare has established either a National Coverage Determination (NCD) or for which a Medicare Administrative Contractor (MAC) has established a Local Coverage Determination (LCD) with limitations on frequency of ordering.
Our ABN Request software should be used to assist with determining which lab services require proof of medical necessity.
A successfully completed ABN must be of the most current version as outlined by CMS and contain these components:
- Patient’s name
- Date of birth or other unique identifier as Identification Number. Do not use Medicare number (HICN) or SSN.
- Specific tests the patient was advised could be denied must be listed in the appropriate column.
- The reason these tests may be denied must be listed in the appropriate column.
- The estimated cost of the test(s), to the best of your knowledge, must be provided in the appropriate column.
- Patient selection of Option 1, Option 2, and or Option 3.
- Patient indicating the date of notification in the appropriate field.
- Patient’s signature in the appropriate field.
Please provide the laboratory with an Advance Beneficiary Notice when you have reason to believe Medicare may deny a procedure. Do not obtain a Medicare ABN for every Medicare patient, but only for those who may be held liable for the service.
Advance Beneficiary Notice Forms
Request an Advance Beneficiary Notice