When Payment is in Doubt: Anesthesia Examines ABNs

Summary: The particulars of when and how to use an advance beneficiary notice can be complex. Sometimes the notice is required, but occasionally its usage is voluntary. Today's article addresses some of the key regulations governing the issuance of an ABN when Medicare is expected to deny payment.

Nothing is more frustrating for the entrepreneur than providing an extraordinary service and getting jilted on the payment. Vincent van Gogh was a Dutch artist who sold or bartered his avant-garde paintings for next to nothing and ended up dying penniless. Today, his works sell for millions. Most of us would rather not wait until our demise to obtain our rightful recognition and remuneration. We'd like to be appropriately compensated in a timely fashion. That is certainly true of those who labor long and hard in America's operating suites.

While it doesn't happen often, there are those times when an anesthesia provider performs a service that is not covered by the patient's insurance. On those occasions, the provider doesn't have to be left holding the bag. There is a remedy. In the case of a Medicare beneficiary, that remedy involves the issuance of an advance beneficiary notice (ABN).

Causal Conditions

The primary condition that triggers the use of an ABN is when you, as the provider, believe that a service being sought by the patient will be denied due to it lacking "medical necessity," based on your understanding of Medicare guidance. If you choose to move forward with the requested care, you can present the patient with an ABN form.

At this point, we must distinguish between the above scenario and others. There are two types of situations that may prompt the use of an ABN. One is mandatory and the other is voluntary. Let's begin with the latter.

If a service fails to meet the definition of a medical benefit pursuant to §1861 of the Social Security Act or is specifically itemized in §1862 of that act as a non-covered service, then an ABN is not necessary. That is, you can bill the patient your full charge without going through the ABN process. However, you are encouraged to issue the patient an ABN form as a courtesy, so that they are aware of the estimated charge prior to the proposed service. Again, use of an ABN in this circumstance is optional, rather than mandatory. Examples of items that are deemed statutorily excluded from Medicare coverage are personal comfort items, routine physicals, as well as routine eye and foot care. These are specified services that are expressly excluded, by statute, from coverage.

To follow up on this point, the Medicare Claims Processing Manual (MCPM), Ch 30, Sec 50.2.1, provides guidance on when it is appropriate to provide only a voluntary ABN (not mandated). That section states as follows:

• ABNs are not required for care that is either statutorily excluded from coverage under Medicare (i.e., care that is never covered) or most care that fails to meet a technical benefit requirement (i.e., lacks required certification).

Conversely, if a service is likely to be denied due to medical necessity reasons—as opposed to statutory preclusions—then the issuance of an ABN to the patient is mandatory where the provider wishes to proceed with performing the service and billing the patient. The MCPM, Ch 30, Sec 50.2, explicitly states that the mandatory use of an ABN applies when the service is "not reasonable and necessary."

An example of this circumstance is when an anesthesia service is provided in connection with a facet intervention case, and the mode of anesthesia is a general. Medicare has published a medical policy indicating that "General anesthesia is considered not reasonable and necessary for facet joint interventions." So, while the anesthesia code used in facet cases under MAC, for example, may be payable, that same code appears to be not payable where the anesthesia technique is a general. That service and its associated anesthesia code are not listed in any statute as never being a covered service. The Social Security Act does not specifically tick off "anesthesia for facets" as one of the several non-covered services. Rather, a medical policy is in view—a policy which is making a medical necessity determination. Again, this is where an ABN would be mandatory if you wish to proceed and get paid (by the patient).

Effect of the Form

The ABN contains a page of information and options that you should go over with the patient. Among other elements, it tells the patient that the service they seek (a) will, or is likely to be, denied, and (b) that the patient will be on the hook for the entire charge if, in fact, Medicare does not pay. Medicare has published a set of instructions on what your responsibilities are relative to the issuance of the ABN. For example, you should present the form at a time that will allow the patient a sufficient opportunity to consider their options. In other words, it should not be presented immediately before the scheduled surgery.

The form contains three options from which the patient should choose. They are as follows:

• * OPTION 1. I want the ________listed above. You may ask to be paid now, but I also want Medicare billed for an official decision on payment . . . . I understand that if Medicare doesn't pay, I am responsible for payment . . . . If Medicare does pay, you will refund any payments I made to you, less co-pays or deductibles.
• * OPTION 2. I want the ________listed above, but do not bill Medicare. You may ask to be paid now as I am responsible for payment. I cannot appeal if Medicare is not billed.
• * OPTION 3. I don't want the ________listed above. I understand with this choice I am not responsible for payment, and I cannot appeal to see if Medicare would pay.

These options must not be pre-filled, and you should not try to coerce the patient into selecting one option over the other. Let the patient/representative decide. The ABN instructions, separately published by Medicare, state the following:

• The beneficiary or his or her representative must choose only one of the three options listed in Blank (G). Under no circumstances can the notifier decide for the beneficiary which of the 3 checkboxes to select. Pre-selection of an option by the notifier invalidates the notice.

The "notifier" here is you, the provider. Unfortunately, the above options and instructions lead us to a potential glitch in the process, which some of our clients are currently encountering and which the following section attempts to describe.

The Classic Conundrum

So, you've issued the ABN, knowing that Medicare has indicated that it won't pay when a general is used in a facet injection procedure. The patient chooses option 1, basically saying, "I'll pay you up front, but I still want you to bill Medicare." We submit the claim and ABN to Medicare, using the GA modifier (indicating a mandatory ABN was executed). So far, so good.

The problem arises when Medicare ends up paying! Why would they do that? It may be because their automated payment system correctly recognizes the anesthesia code as payable, though the system logic may not be differentiating between anesthesia techniques. Remember that the code is potentially payable when techniques other than general are used. So, they mistakenly go against their own policy and pay the claim. The hitch is that the rules require you, at this point, to pay back the patient whatever they paid you up front, minus the applicable copay/deductible. A 2021 Medicare Learning Network (MLN) article on ABN usage states the following:

• If we pay all or part of the items or services claim the patient paid, you must refund the patient the proper amount in a timely manner.

You're thinking, "alright, well, at least I got paid by Medicare." Down the line, however, Medicare may audit that service and, upon discovering that a general was used, they could come back and demand a remittance. We've actually had a Medicare contractor recently tell us that they can do this. So, potentially, you could be left in the lurch from a reimbursement perspective as it pertains to these facet-related services. What do you do?

You can, at this point, try to go back to the patient for what they now (once more) owe you, but what are the odds of you getting paid after the fact? And, since it may be running afoul of the rules to overtly instruct or require the patient to select option 2 ("don't bill Medicare") prior to the service, you have to sweat it out while watching to see which option the patient ultimately selects. If it's option 1, you're stuck. Perhaps the better option is to simply avoid performing these specific case types altogether, advising the patient to seek out another provider if they insist on anesthesia in connection with such pain procedures.

Medicare's ABN instructions can be found here: ABN Form Instructions (cms.gov). If you have further questions concerning ABNs, please contact your account executive or you can go to the following link: info@anesthesiallc.com.