Overview
The Advance Beneficiary Notice of Noncoverage, commonly called the ABN, is the CMS Form R-131 mechanism by which a provider notifies a Medicare Fee-for-Service beneficiary, in writing, that a planned service or item is expected to be denied by Medicare as not reasonable and necessary, statutorily excluded, or otherwise noncovered. A properly executed ABN gives the beneficiary an informed choice among three options — receive and pay for the service, receive the service and have the claim submitted without billing the patient, or refuse the service — and transfers financial liability to the beneficiary if Medicare ultimately denies.
ABNs apply specifically to Medicare Part B professional services, outpatient therapy, DMEPOS, and certain Part A home health and SNF scenarios. They do not apply to Medicare Advantage (those plans have their own pre-service organization-determination notices), and they are not used for care that is always noncovered as a matter of benefit category (e.g., cosmetic surgery). When the service is expected to be denied for medical necessity — most commonly because the CPT/HCPCS code does not match an ICD-10 code on the payer's LCD or NCD — an ABN is the tool that makes the patient financially responsible.
Validity rules are strict. The ABN must be the current CMS form, completed in the patient's preferred language, include a plain description of the service, a specific reason why Medicare is expected to deny (not a generic "may not be covered"), and a good-faith estimate of patient cost. It must be delivered in advance — not at checkout — so the beneficiary has meaningful opportunity to decline. The beneficiary must select an option box and sign; routine pre-signed ABNs held on file are considered invalid and result in financial liability defaulting back to the provider.
When the ABN has been signed and the claim is submitted, the provider reports modifier GA (ABN on file, patient responsible), GX (voluntary ABN issued), GY (statutorily excluded), or GZ (ABN should have been issued but wasn't). Modifier GA is the workhorse: it tells Medicare "we expect you to deny this, and if you do, we're billing the patient because we have a signed ABN." GZ is the modifier of regret — the service will be denied and the provider cannot bill the patient.
Revenue cycle implications are meaningful. Services without a valid ABN that are denied become write-offs. Services with blanket ABNs are a compliance risk. The highest-performing organizations train clinicians and schedulers to identify ABN-trigger services (mostly medical-necessity risks for E/M, labs, diagnostics, and DMEPOS) before the encounter, deliver the ABN at check-in, and auto-attach the signed form to the charge record so that billing can apply the correct modifier.
Industry benchmark
CMS Medicare Claims Processing Manual, Chapter 30. Organizations with a mature ABN program typically have ABN-modifier usage on 1–3% of Medicare claims (depending on specialty) and a downstream patient-responsibility collection rate on ABN-covered balances above 70%.
Worked example
A primary-care office orders a vitamin D screening for a patient with no diagnosis code on the Medicare LCD for that test. The front desk delivers an ABN listing the test, the reason for expected denial (no supporting diagnosis per LCD L36692), and an estimated out-of-pocket of $48. The patient selects Option 1 and signs. The claim is submitted with modifier GA; Medicare denies; the office bills the patient $48 with the signed ABN as supporting documentation.
Frequently asked questions — Advance Beneficiary Notice
When is an ABN required?
Before furnishing a Medicare-covered service that is likely to be denied for medical necessity, frequency limits, or specific LCD/NCD non-coverage. ABNs are not required for services that are statutorily excluded (those may use a voluntary ABN with modifier GX) or for Medicare Advantage members (separate MA notice rules apply).
Can we have patients sign ABNs routinely?
No. CMS treats blanket ABNs — those used for every patient or every service — as invalid. An ABN must name a specific service and a specific reason denial is expected. Routine ABN use is a common audit finding and shifts liability back to the provider.
What is the difference between ABN modifiers GA, GX, GY, and GZ?
GA: ABN signed, beneficiary responsible if Medicare denies. GX: voluntary ABN issued for a statutorily excluded service. GY: service is statutorily excluded (no ABN needed, but reported to inform denial). GZ: service expected to be denied and ABN should have been issued but was not — provider cannot bill patient.
How long should ABNs be retained?
CMS requires signed ABNs be retained for at least five years from the date of discharge or service. Many compliance programs retain them for the longer of five years or the life of the provider's medical record retention policy, stored with the encounter record.
Disclaimer
This glossary entry is operational reference for revenue-cycle and medical-billing professionals. It is not legal, clinical, or contractual advice. Industry benchmarks cite named public sources where available; always verify against the current guidance from the authority body before relying on a number in a contract, policy, or compliance filing.