Medicare Changes Rules for Payment of Lab Tests
The next time you visit your doctor, you may have a new form to sign called the Advance Beneficiary Notice. Why might your doctor give this to you? Two years ago, Medicare made some changes in the tests for which they will pay as part of an effort by the government to contain Medicare costs.
Why the changes?
Medicare is under the jurisdiction of the Health Care Financing Administration (HCFA). HCFA sets the rules for payment of services to Medicare beneficiaries and then hires companies, called carriers, to process claims, carry out HCFA regulations and monitor the Medicare program. Historically, the laboratory billed the carrier for your tests and the carrier reimbursed the laboratory. Usually, the laboratory was required to accept the amount as full payment and was not able to bill the patient or co-insurer for any additional charges.
Two years ago this changed when independent laboratories were told that they had to bill for tests not covered by Medicare reimbursement. At the end of 1996, hospital laboratories were also told that they were required to start charging patients for tests not covered by Medicare.
Which tests are no longer covered?
Medicare does not cover services when:
- they are part of a routine physical exam or screening for early detection of disease;
- you have had the same test more often than Medicare regulations allow;
- the test is approved for research or experimental use only;
- the test is not medically necessary; based upon your doctor’s diagnosis.
Until recently, hospital laboratories were not required to bill Medicare patients for these denied services. However, this has recently changed and we are now required by law to bill patients for any tests which Medicare denies.
How will you know if a test may be denied?
If your doctor thinks there is a possibility that Medicare will not pay for a test, he or she will explain which tests may be denied and why. You will then be asked to sign the Advance Beneficiary Notice (ABN). The ABN will list the tests and the reason that Medicare is likely to deny payment.
When you sign the ABN, it means that you understand that you are responsible for payment of this test if the claim is denied. Your doctor should give this form to you before the sample is taken so you can have a choice about whether or not to have the test done. If you decide to have the test, you will receive a bill from the laboratory for any procedure not covered by Medicare.
If you have concerns about the changes in the Medicare reimbursement, please write to your Representative or Senator.
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