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What Is an Advance Beneficiary Notice (ABN)? Purpose and Setting
An Advance Beneficiary Notice of Noncoverage (ABN), officially designated by the Centers for Medicare & Medicaid Services (CMS) as Form CMS-R-131 (OMB Approval No. 0938-0566), is a standardized written notice that healthcare providers, physicians, and suppliers issue to Original Medicare (Fee-for-Service Part A and Part B) beneficiaries before furnishing an item or service that Medicare is expected to deny. Under Section 1879 of the Social Security Act (42 U.S.C. § 1395pp; 42 CFR § 411.404), a properly completed and signed ABN waives the beneficiary’s statutory Limitation on Liability protection and legally transfers financial responsibility to the patient if Medicare denies the claim.
In hospital outpatient clinics, diagnostic laboratories, durable medical equipment (DME) suppliers, and academic clinical research sites, Form CMS-R-131 is the primary compliance instrument governing pre-service financial disclosure. Without a valid ABN on file for a medical-necessity denial, the provider must absorb the cost and is barred from billing the Medicare beneficiary.
Form CMS-R-131 Completion and Issuance Checklist Table
Per the CMS Medicare Claims Processing Manual, Chapter 30 (Financial Liability Protections), Section 50, Form CMS-R-131 contains ten lettered sections (Blanks A through J) that must be completed accurately before the item or service is delivered. Altering the standardized OMB-approved form text invalidates the notice.
| Form Element / Stage | Required Content or Quantity Guidance | Why It Is Required (CMS Chapter 30 Rule) | Operational & Compliance Notes |
|---|---|---|---|
| Header & Notifier(s) (Blank A) | Entity name, address, and telephone number (TTY if applicable) | Identifies the specific provider or supplier issuing the notice | May be pre-printed, stamped, or EHR-populated at the top of the form |
| Patient Name (Blank B) | Beneficiary’s full first and last name (middle initial optional) | Ties the liability waiver to the individual beneficiary | Must match the Medicare card; never issue an unnamed or generic form |
| Identification Number (Blank C) | Optional internal medical record or account number | Facilitates EHR chart matching without exposing restricted identifiers | Never enter the patient’s Medicare Beneficiary Identifier (MBI), HICN, or Social Security Number (SSN) |
| Item or Service (Blank D) | Plain-language description of the specific test, procedure, equipment, or supply | Ensures the beneficiary understands exactly which service may not be covered | If listing CPT/HCPCS codes, a plain-English description must accompany every code |
| Reason Medicare May Not Pay (Blank E) | Patient-specific clinical or policy reason why denial is expected | Prohibits generic ‘blanket’ notices; explains the specific coverage rule at issue | Examples: ‘Medicare does not pay for this test for your condition’ or ‘Medicare does not pay for this test this often’ |
| Estimated Cost (Blank F) | Good-faith dollar estimate for each listed item or service | Mandatory field; allows informed financial choice before receiving care | CMS requires the estimate to be within $100 or 25% of the actual cost, whichever is greater |
| Options 1, 2, or 3 (Blank G) | Exactly 1 box checked by the beneficiary (or authorized representative) | Records whether the patient wants the care and whether Medicare must be billed | The provider or staff must never pre-select Option 1, 2, or 3 for the beneficiary |
| Additional Information (Blank H) | Optional context (e.g., secondary insurance details or refusal witness note) | Documents special circumstances or annotations | Used to record witness signature if a patient refuses to sign after receiving the notice |
| Signature & Date (Blanks I & J) | Signature of beneficiary (or representative) and date signed | Proves notice was delivered and acknowledged prior to service delivery | Must pre-date or match the date of service prior to the clinical encounter |
| Copy Delivery & Retention | 1 copy given to beneficiary immediately; 1 copy retained by notifier for 5 years | Mandated by CMS Chapter 30, Section 50.6.5 and Section 50.14.3 | Electronic capture is permitted if the patient is offered a paper copy to keep |
How the Three ABN Options Map to Claim Modifiers (GA, GX, GY, GZ)
When the beneficiary reviews Blank G of Form CMS-R-131, they must select one of three options. That choice—combined with whether the service is subject to a mandatory medical-necessity trigger or a statutory exclusion—dictates whether a claim is submitted to Medicare and which HCPCS level II liability modifier (GX, GY, GZ, or GA) is appended to the claim line.
| Scenario / Beneficiary Selection | Submit Claim to Medicare? | Required Claim Modifier | Financial Liability & Appeal Rights |
|---|---|---|---|
| Mandatory ABN issued + Beneficiary selects Option 1 (Receive service, bill Medicare) | Yes | GA (Waiver of liability statement issued as required by payer policy) | Beneficiary liable upon denial; beneficiary receives an official Medicare Summary Notice (MSN) with full appeal rights |
| Mandatory ABN issued + Beneficiary selects Option 2 (Receive service, do NOT bill Medicare) | No | None (no Medicare claim submitted) | Beneficiary pays out of pocket up front or as billed; beneficiary has no Medicare appeal rights because no claim is adjudicated |
| Mandatory ABN issued + Beneficiary selects Option 3 (Do NOT receive the item or service) | No | None (service is not performed) | No service rendered; zero financial liability |
| Mandatory ABN required, NOT issued (or invalid) | Yes | GZ (Item or service expected to be denied as not reasonable and necessary) | Provider / Supplier liable; claim auto-denies as provider liability and patient cannot be billed |
| Voluntary ABN issued for Statutorily Excluded Service | Yes (if patient requests claim submission) | GX (Notice of liability issued, voluntary) — may be paired with GY | Beneficiary liable; Medicare never covers statutorily excluded items regardless of notice |
| Statutorily Excluded Service, No ABN Issued | Yes (if needed for secondary payer denial) | GY (Item or service statutorily excluded or does not meet definition of any Medicare benefit) | Beneficiary liable automatically by statute |
How Advance Beneficiary Notices Are Used in Clinical Research and Healthcare Settings
Issuance triggers and operational workflows vary significantly across outpatient clinical departments, diagnostic laboratories, and clinical trial research sites.
1. Mandatory Triggers vs. Voluntary Courtesy Notices
Under CMS MLN Booklet Medicare Advance Written Notices of Non-Coverage (MLN006266), an ABN is mandatory whenever a provider expects Medicare to deny an otherwise covered benefit under:
- Section 1862(a)(1) of the Social Security Act: The item or service is not reasonable and necessary for the diagnosis or treatment of illness or injury (for example, failing to meet a National Coverage Determination [NCD] or Local Coverage Determination [LCD] diagnosis requirement, or exceeding frequency limitations such as screening PSA or lipid panels).
- Section 1834(a)(17)(B): Violation of the prohibition on unsolicited telephone contacts for DMEPOS.
- Section 1834(j)(1): Medical equipment and supplies supplier number requirements not met.
- Section 1834(a)(15): Denied advance determination of coverage for DMEPOS.
By contrast, when a service is statutorily excluded from Medicare (such as cosmetic surgery, routine hearing aids, or most self-administered outpatient drugs under Part B), issuing an ABN is voluntary. If a provider chooses to issue Form CMS-R-131 as a financial courtesy for a statutorily excluded service, the beneficiary is not asked to choose Option 1, 2, or 3, and need not sign the form.
2. Clinical Research and Clinical Trial Billing Compliance
In clinical trials governed by the Medicare Clinical Trial Policy (NCD 310.1), research sites perform a Medicare Coverage Analysis (MCA) to separate sponsor-paid research items from routine clinical costs billed to Medicare. As detailed in our dedicated guide to the Advance Beneficiary Notice (ABN) in Clinical Trial Billing, sites must coordinate two documents before ever issuing Form CMS-R-131 to a trial participant:
- Informed Consent Congruence: Under 45 CFR § 46.116 and 21 CFR § 50.25, if the IRB-approved informed consent document states that the sponsor will pay for study-related procedures or makes no mention of patient out-of-pocket liability for a non-covered test, the site cannot use an ABN to override the consent promise and bill the participant.
- Non-Covered Routine Care Outside Frequency Limits: When a protocol-required conventional care item is billed as routine care (with modifier Q1) but exceeds an LCD frequency cap for that beneficiary, a specific Form CMS-R-131 may be issued prior to the visit only if the informed consent explicitly discloses potential patient responsibility for non-covered routine services.
Storage, Retention, and Strict Regulatory Prohibitions
- Five-Year Record Retention: Under CMS Medicare Claims Processing Manual Chapter 30, Section 50.14.3, the notifying provider or supplier must retain a copy of the signed Form CMS-R-131 for 5 years from the date of care delivery (unless state law requires a longer period), even when the beneficiary selects Option 2 or Option 3 and no claim is submitted to Medicare.
- Prohibition on Routine or ‘Blanket’ ABNs: Providers may never ask every Medicare patient to sign a generic ABN at registration ‘just in case’ Medicare denies payment. An ABN issued without a specific, documented basis to expect noncoverage is legally defective and will not shift liability in a Medicare Administrative Contractor (MAC) or Recovery Audit Contractor (RAC) review.
- Prohibition in Medical Emergencies or Under Duress: Under CMS Chapter 30, Section 50.3.2, an ABN must never be issued to a patient in a medical emergency or under great duress (including situations governed by the Emergency Medical Treatment and Labor Act [EMTALA] prior to stabilization). Forcing a signature while a patient is prepped on a procedure table or in acute distress invalidates the notice.
- Original Medicare Only (Never Medicare Advantage): Form CMS-R-131 applies solely to Original Medicare Part A and Part B Fee-for-Service beneficiaries. It is invalid for Medicare Advantage (Part C) enrollees, where pre-service coverage disputes must go through the plan’s formal Organization Determination process.
Frequently Asked Questions
What is advance beneficiary notice?
An Advance Beneficiary Notice of Noncoverage (ABN, Form CMS-R-131) is a standardized CMS written notice given to an Original Medicare beneficiary before an item or service is provided when the clinician or supplier expects Medicare to deny payment (typically as not reasonable and necessary under Section 1862(a)(1) of the Social Security Act).
How is advance beneficiary notice used in clinical research and healthcare?
In healthcare and clinical research operations, Form CMS-R-131 documents the specific reason Medicare is expected to deny a test or procedure, gives a good-faith cost estimate (within $100 or 25%), and lets the patient select Option 1 (receive care and bill Medicare with appeal rights, reported with modifier GA), Option 2 (receive care and self-pay without billing Medicare), or Option 3 (decline the service). In clinical trials, it can only be used when consistent with the IRB-approved informed consent cost language.
Does Form CMS-R-131 apply to Medicare Advantage (Part C) enrollees?
No. Form CMS-R-131 applies only to Original Medicare (Fee-for-Service) beneficiaries. Medicare Advantage plans do not recognize Form CMS-R-131 to transfer liability; providers must follow Part C pre-service organization determination rules.
How long must a provider retain a signed ABN on file?
CMS requires providers and suppliers to retain a copy of the completed, signed ABN for 5 years from the date of service (or longer if required by state law), including when the patient chooses Option 2 or Option 3.
Sources
- Centers for Medicare & Medicaid Services (CMS). Medicare Claims Processing Manual, Chapter 30 — Financial Liability Protections (Section 50: Form CMS-R-131 Advance Beneficiary Notice of Noncoverage). https://www.cms.gov/regulations-and-guidance/guidance/manuals/downloads/clm104c30.pdf
- Centers for Medicare & Medicaid Services (CMS), Medicare Learning Network (MLN). Medicare Advance Written Notices of Non-Coverage (MLN Booklet MLN006266). https://www.cms.gov/outreach-and-education/medicare-learning-network-mln/mlnproducts/downloads/abn_booklet_icn006266.pdf
- Electronic Code of Federal Regulations (eCFR). 42 CFR § 411.404 — Criteria for determining that a beneficiary knew that services were excluded from coverage as not reasonable and necessary. https://www.law.cornell.edu/cfr/text/42/411.404
