An Advance Beneficiary Notice (ABN) is form CMS-R-131 that notifies
Medicare patients before delivering services that may be non-covered or
not medically necessary. The patient must sign the ABN before service,
acknowledging the denial risk and accepting financial responsibility.
Without a signed ABN, you cannot bill the patient if Medicare denies the
claim.
Who Does ABN Requirements Affect?
Any provider billing Medicare must use ABNs for services expected to be
denied. This includes physicians, hospitals, therapy clinics, imaging
centers, and DME suppliers. Practices that deliver 100+ services monthly
face high ABN volume. Surgical centers, oncology clinics, and specialty
practices use ABNs frequently due to medical necessity denials.
Compliance failures result in payment withholding and network
deactivation.
Key Requirements
ABN must be obtained BEFORE service delivery. Retroactive ABNs (signed
after service) are invalid for balance billing purposes.
Form CMS-R-131 is the only approved ABN form. State-specific ABNs or
custom forms do not satisfy Medicare requirements.
Each ABN must identify a specific service, diagnosis, and reason for
expected denial. Blanket ABNs covering multiple services or "all
services" are prohibited.
The estimated cost must be stated. Patient must understand the
out-of-pocket amount if Medicare denies the claim.
Patient signature is required. Electronic signatures on ABN are
permitted if your practice maintains digital ABN systems.
If ABN states the service is "not medically necessary," but the
service meets the applicable LCD criteria, Medicare may recover the
payment as an overpayment.
Timeline & Enforcement
CMS audits ABN usage through medical review contractors. Improperly
completed ABNs trigger overpayment demands. CMS Recovery Audit
Contractors (RACs) identify missing ABNs on non-covered service claims
and recoup payments. Enforcement intensity has increased since 2023.
Medicare contractor Jurisdiction 4 reports 18% of therapy denial appeals
fail due to missing or improperly completed ABNs.
How to Comply
Train staff to identify services requiring ABN before scheduling. Use
LCD and NCD guidance to flag high-risk services.
Complete CMS-R-131 with all required fields: patient name, date of
service (or estimated date), specific CPT code, clinical description,
and estimated cost.
Provide ABN to patient and allow time to read. Explain why the service
may be denied (e.g., "outside LCD frequency limits" or "experimental
treatment").
Obtain patient signature before service. Store original in medical
record; attach copy to claim.
Track ABN metrics monthly: volume issued, services covered, denial
rates. High denial rates on certain services signal ABN effectiveness.
Common Questions
When must an ABN be obtained?
ABN must be obtained BEFORE the service is delivered if you believe
Medicare will deny the claim as non-covered or not medically
necessary. You cannot obtain an ABN after service delivery and expect
it to protect you from balance billing.
What happens if ABN is not signed?
Without a valid ABN, you cannot bill the patient for a non-covered
service. If you bill anyway, CMS views it as an attempt to circumvent
Medicare rules. Medicare may deny you network participation or impose
penalties.
Can you use a blanket ABN?
No. CMS prohibits blanket ABNs. Each ABN must be service-specific,
condition-specific, and include estimated costs. Generic forms signed
at intake visits do not satisfy ABN requirements.