Understanding Enrollment Status, Assigned vs. Non-Assigned, and the ABN

Published in Member Communities on July 23, 2021

Ronda and Dan by Ronda Buhrmester, Senior Director of Payer Relations and Reimbursement, VGM & Associates and Dan Fedor, Director of Reimbursement and Education, U.S. Rehab

A major part of business development is understanding your payer mix and which products and services should be reimbursable versus cash sale items. What could you bundle together in your offering to expand business—specifically items that can be sold for retail alongside your reimbursable items? You might not necessarily offer everything right now, but these are the areas you can look to expand into. This resource outlines how to navigate reimbursement to help grow your business.

Understanding the Two Types of Enrollment Status: Participating and Non-Participating

Being enrolled as a participating supplier means that the supplier accepts the Medicare fee schedule and will bill all claims on an assigned basis. Meanwhile, enrollment as a non-participating supplier means there are options for the supplier to either submit the claim on an assigned basis or on a non-assigned basis. With the current reimbursement rates, having the options for claim submission is key for maintaining business operations as well as keeping a healthy bottom line. Open enrollment is Nov. 15th through Dec. 31st for the next calendar year, so now is the time to think through your options.

It’s important for hospital-based DME suppliers to know that the enrollment status follows the tax ID. Many hospital-based DME suppliers are under the hospital’s tax ID, which means the DME supplier follows the enrollment status of the hospital which is participating. To change to non-participating status, the hospital-based DME supplier would have to get a separate tax ID.

For suppliers located within a competitive bid area (CBA), having a competitive bid contract does not direct the enrollment status. A supplier with a CB contract can be enrolled as non-participating and can submit claims as non-assigned for those items not included in competitive bid. Having a contract under the Medicare CB programs simply states a supplier must accept assignment on those products within the contract.

Suppliers located in a CBA that do not have a contract for CB items would not get reimbursed for CB items on any claim—assigned or non-assigned. If the beneficiary chooses to use a non-contracted supplier and waive their Medicare benefits, the item would be a cash transaction. In such a case, the supplier should make sure to use an Advance Beneficiary Notice of Non-Coverage (ABN).

Myths About Assignment and Non-Assignment

A participating supplier gets reimbursed at a higher rate.
False. This applies to physician services, not DMEPOS suppliers.
There are many advantages to being enrolled as a participating supplier.
False. The only reward for being enrolled as a participating supplier is getting listed in the supplier directory.
On non-assigned claims, there is a limiting charge to the beneficiary.
False. There is not a limiting charge for DMEPOS suppliers.
With non-assigned claims, there is not any liability for the suppliers.
False. The liability still exists with that claim. It does not matter if the claim is being submitted as assigned or non-assigned; the supplier can still get a denial and still get an audit on a non-assigned claim.

ABN

What Is the Purpose of the ABN?

The ABN, CMS-R-131 form, is specific to Medicare fee for service (FFS). The purpose of an ABN is to inform a beneficiary in advance (prior to delivery) of the detailed reason Medicare may not pay for the service/equipment being provided and shifting the financial liability from the supplier to the beneficiary. There are several situations in which to use an ABN

When an ABN Is Used

Lack of medical necessity
Same or similar equipment
The quantity exceeds the allowed amount
Upgrades (not within the same code)

It is important to understand that the reason for denial must be specific to the situation with that beneficiary and include detailed information.

When an ABN Would Be Considered Invalid

An ABN cannot be used across the board. That is called a blanket ABN and will end with the supplier getting backed out of the transaction and refunding money.

An ABN cannot list generic reasons for the denial, such as “Medicare may not pay for this item,” or “If there is similar equipment on file, Medicare will not pay for another one.” These are just a few examples of generic statements that can back a supplier out of transaction, essentially refunding any money paid back to Medicare and the beneficiary.

An ABN is not used for a claim that is being submitted as non-assigned. The reason for implementing an ABN for a non-assigned claim cannot be “claim is being submitted as non-assigned.” With a non-assigned claim, there still is financial liability, meaning the supplier needs to make sure the coverage criteria have been met according to the medical policy. If the coverage criteria are not met, this is when an ABN is implemented, whether it’s being submitted as an assigned claim or a non-assigned claim.

Remember, the ABN speaks to the beneficiary, making sure they understand the information documented on the form. The ABN allows the beneficiary to make an informed consumer decision about whether or not to receive the services for which they may have to pay out of pocket.

ABNs are chosen for review and audits. If not used properly and completed as instructed, an ABN will cause an unfavorable decision in an audit or be denied in a review.

This article was originally featured in the VGM Playbook: Growing Your Business in Today's Environment. To read the rest of the article, download your copy of the playbook today!