Advance Beneficiary Notice: 7 Essential Rules for Practices

An advance beneficiary notice is the form a practice gives an Original Medicare patient before a service that Medicare is likely to deny, so the patient can decide whether to go ahead and accept the charge. Issue a valid one and the financial responsibility can shift to the patient. Skip it, or issue a defective one, and the practice absorbs the cost. That is the whole mechanism, and for practices running diagnostic testing in the office it comes up more often than most billing staff expect.

Two things changed in 2026. CMS reissued Form CMS-R-131 with a new expiration date of March 31, 2029, and set a hard transition deadline of May 12, 2026, after which the old version is no longer acceptable. The cost estimate instruction also changed in a way that most published guidance has not caught up with yet. Both are covered below.

What is an advance beneficiary notice?

The advance beneficiary notice of non-coverage, Form CMS-R-131 (OMB approval number 0938-0566), is a written notice issued to a patient with Original Medicare when the provider believes Medicare will not pay. Per the CMS form instructions, the notifiers required to use it include physicians, practitioners and suppliers paid under Medicare Part B, independent laboratories, home health agencies, hospices, and religious non-medical health care institutions.

The legal effect of an advance beneficiary notice is narrow and specific. It documents that the patient was told, in advance and in writing, that payment was in doubt and why. The Medicare Claims Processing Manual, Chapter 30 is blunt about where the burden sits: if the correct notice is not used, the notifier can be found liable, “since the burden of proof is on the notifier to show that knowledge was conveyed to the beneficiary according to CMS instructions.”

One limit trips people up constantly. The advance beneficiary notice belongs to Original Medicare fee-for-service. The manual states plainly that it “is not used for items or services provided under the Medicare Advantage program.” Medicare Advantage plans run their own organization determination and denial process, so an ABN in that setting accomplishes nothing.

When does an in-office diagnostic test need an advance beneficiary notice?

The trigger is a specific, defensible belief that Medicare will deny the service as not reasonable and necessary. For practices performing vascular and autonomic studies in the office, three situations account for most of it.

• The patient’s documented diagnosis is not on the covered indication list in your MAC’s local coverage determination.
• The study is being repeated sooner than the frequency limit in that policy allows.
• The clinical picture does not support medical necessity on its own terms, for example a patient with no documented symptoms or risk indications.

That last one deserves emphasis, because an advance beneficiary notice is not a workaround for it. If a study is not medically necessary, the correct answer is usually not to perform it. The notice exists for genuine coverage doubt, not for propping up testing that documentation does not support. Practices running the codes associated with in-office vascular and autonomic testing, including 93923 for multi-level extremity physiologic studies, 95921 for cardiovagal testing and 95923 for sudomotor testing, should confirm their own MAC’s policy before deciding an ABN is warranted. Our complete billing guide for ABI CPT code 93923 walks through the coverage conditions in detail, and coding the CMAT encounter covers how the codes report together on one visit.

CMS offers three sample non-coverage reasons in the form instructions, and they are worth copying almost verbatim because they are already written in plain language: “Medicare does not pay for this test for your condition,” “Medicare does not pay for this test as often as this (denied as too frequent),” and “Medicare does not pay for experimental or research use tests.” For the notice to be valid, at least one reason must apply to each item listed.

What changed on the advance beneficiary notice form in 2026?

The form is a formal information collection under the Paperwork Reduction Act, which means it goes back through public comment and re-approval every three years. CMS states that with the latest submission, “changes have been made for plain language, improved usability and reduced burden for notifiers.” The reissued form carries an expiration date of March 31, 2029.

The practical deadline was May 12, 2026. Practices could keep using the expired version up to that date, and after it the current OMB-approved form is the only acceptable one. If your intake packet or EHR template still produces the older layout, that is worth checking today rather than at the next audit, because a notice on a superseded form invites exactly the liability finding quoted above.

The changes themselves are presentational rather than structural. The wording is more patient-facing than it used to be. Where the older instructions spoke of the “beneficiary” and of an “item or service,” the current form and instructions speak of the “patient” and of an “item, test, service or care.” Nothing about the three options, the signature requirement or the modifier logic changed with it.

What cost estimate does an advance beneficiary notice require?

This is the item most published ABN guidance still gets wrong. For years the form instructions told notifiers the estimate should fall within $100 or 25 percent of the actual cost, whichever was greater, and that figure is still repeated across billing blogs and training decks.

It is not in the current instructions. The version now posted on the CMS site sets a qualitative standard instead: notifiers “must make a good faith effort to insert a reasonable estimate” for every item listed, and “an estimate that substantially exceeds the actual cost would generally still be acceptable, since the patient wouldn’t be harmed if actual costs were less.” Items that are routinely grouped can carry a single bundled estimate, the way a basic metabolic panel does. If a cost genuinely cannot be projected at the time of delivery, the notifier may say so on the form, though CMS notes it does not expect that to be routine.

The practical read: err high rather than low, and never leave the field blank without a stated reason.

How do the three advance beneficiary notice options work?

The patient or their representative must check exactly one box.

• Option 1. The patient wants the service and wants Medicare billed for an official decision. A claim goes out, a determination comes back on the Medicare Summary Notice, and appeal rights exist.
• Option 2. The patient wants the service but does not want Medicare billed, and pays out of pocket. No claim, so no appeal rights.
• Option 3. The patient declines the service. No charge, and no appeal rights because nothing was furnished.

The most common way a practice destroys its own notice is by helping too much. CMS states it directly: “Pre-selection of an option by the notifier invalidates the notice.” A pre-checked box on a template, or a front desk habit of ticking Option 1 before handing the clipboard over, undoes the entire protection the form was supposed to provide.

Patients dually enrolled in Medicare and Medicaid follow a separate path. They must be instructed to select Option 1 so the claim is adjudicated, and the practice cannot bill them at the time the notice is delivered. Billing waits until both Medicare and Medicaid have adjudicated.

Which modifier goes on the claim?

The advance beneficiary notice lives in the chart. The claim has to say it exists, and the modifier is how that happens.

GZ is the one to avoid ending up with. It is an honest disclosure that the notice was missed, and it forecloses billing the patient. If your denial reports show GZ appearing regularly on the same code, the fix is upstream in scheduling and intake, not in the billing office. The same logic applies to the professional and technical split on in-office studies, which our guide to modifier 26 versus TC covers.

How long does an advance beneficiary notice stay valid?

Up to one year. A single advance beneficiary notice can cover an extended or repetitive course of non-covered treatment, as long as it lists everything the notifier believes Medicare will not cover and specifies the duration. If the care changes within that year, a new notice is required. If the treatment runs past a year, a new notice is required.

One rule has no flexibility in it at all: a notice issued after care has already been delivered cannot be backdated, and cannot shift liability for anything furnished before it was signed. Care provided before delivery stays the provider’s financial responsibility.

What are the advance beneficiary notice delivery and retention rules?

Delivery is effective when the notice reaches a capable recipient who understands it, on the correct form with all blanks completed, in person where possible, far enough ahead that the patient has real time to consider the options, and explained in full with questions answered. Staff who cannot answer a question should direct the patient to 1-800-MEDICARE. CMS treats a refusal to do either as defective delivery, with the provider liable for the non-covered care.

Electronic issuance is permitted. If the patient would rather have paper, they get paper, and either way they leave with a copy of the signed notice. The practice keeps the original in the record. Retention follows the general Medicare rule of five years from completion of care, absent a longer state requirement, and it applies whether the patient signed, refused an option, or refused to sign at all.

When should you not issue one?

Four situations, and the first two are absolute. CMS states that an advance beneficiary notice is “never required in emergency situations,” and issuing one under duress is treated as improper. They are also not used under Medicare Advantage, as noted above.

The third is routine issuance. Noridian, a Medicare Administrative Contractor, puts it as directly as any source: providers “are prohibited from issuing ABNs on a routine basis (i.e., where there is no reasonable basis for Medicare to not cover),” and it is “inappropriate to produce an ABN for all Medicare beneficiaries receiving services for every procedure or office visit.” A blanket notice attached to every Medicare visit is not caution, it is a compliance finding waiting to happen, and it degrades the value of the notices you actually need.

The fourth is the pre-selected option box already discussed. Between them, these four account for most of the ABNs that fail on review.

Where the notice belongs in a testing workflow

An advance beneficiary notice is the last step in a chain, not the first. Medical necessity gets established and documented first: the symptoms or risk indications that prompted the study, and how the result will inform clinical management. Then coverage gets checked against the MAC policy. Only where genuine doubt remains does the notice come out, before the patient is roomed rather than after the study is finished.

Practices that build the check into scheduling rather than into billing tend to issue fewer notices and defend them better. It is the same documentation discipline that carries a practice through a contractor review, which our guide to Targeted Probe and Educate documentation rules covers, and the same discipline behind sound in-office vascular testing programs. Preventive services have their own coverage rules worth knowing separately, which our breakdown of the annual wellness visit CPT code addresses.

HealthWright Technologies sells diagnostic systems to independent physicians and supports the practices that run them, including training on documentation and coding workflow. Our materials consistently tell practices to confirm coverage with their own MAC rather than rely on a vendor’s summary, because coverage policy is local and it moves. If you are evaluating in-office testing, our CMAT Advantage system page outlines what the package includes.

Frequently asked questions about the advance beneficiary notice

Is an advance beneficiary notice the same as a financial waiver?

Not in the Medicare sense. A general financial waiver or consent-to-pay form signed at registration does not transfer liability for a service Medicare denies as not reasonable and necessary. Only the current Form CMS-R-131, completed and delivered according to CMS instructions, does that.

What happens if the patient refuses to sign?

Annotate the notice to record the refusal, keep the annotated original in the patient’s file, and give the patient a copy. Retention is required whether the patient signed, chose an option, or refused entirely.

Can one advance beneficiary notice cover a series of tests?

Yes, for up to one year, provided the notice lists every item and service expected to be non-covered and states the duration of the treatment period. Any change in the care described, or any extension beyond a year, requires a new notice.

Do Medicare Advantage patients need an ABN?

No. The advance beneficiary notice applies to Original Medicare fee-for-service. Medicare Advantage plans use their own organization determination and appeal process, and each plan sets its own pre-service notice requirements.

Which modifier reports that an ABN is on file?

Modifier GA. It reports that an advance beneficiary notice, a waiver of liability statement, was issued as required by payer policy for a service expected to be denied as not reasonable and necessary. GZ reports the opposite situation, where denial is expected and no notice was issued.

Talk to us about in-office testing workflow

HealthWright Technologies works with independent practices on the operational side of diagnostic testing, from staff training through documentation and coding workflow. Reach us at contact@healthwrighttechnologies.com or (678) 322-7146, or use our contact page, and we will follow up. We are at 60 Bear Creek Marina Road, Mansfield, GA 30055.

This article is general information about Medicare billing administration and is not legal, coding, or medical advice. Coverage policy is set locally by your Medicare Administrative Contractor and changes over time. Confirm current requirements with your MAC and the CMS Beneficiary Notices Initiative before relying on any of it. Consult your healthcare provider before starting any new treatment.

CPT® is a registered trademark of the American Medical Association. CPT codes, descriptions, and other data are copyright the American Medical Association. All rights reserved. Any references to CPT codes in this article are for informational purposes only and do not constitute coding advice or a guarantee of reimbursement.