What billing procedure should a hospital use when we think some of the outpatient services are covered, and some are not? Should an ABN be given to the patient?
The Medicare Claims Processing Manual (Chapter 1—General Billing Requirements) mentions a few important points about this situation. It also refers to Chapter 30 of the MCPM, which says that advance beneficiary notices (ABNs) may not be used to shift liability to a beneficiary in the case of services or items for which full payment is bundled into other payments. In other words, the beneficiary would otherwise not be liable for payment for the service or item because bundled payment is made by Medicare. Using an ABN to collect a charge for an individual item or service from a beneficiary where full payment is made for that and other care on a bundled basis constitutes double billing.
Explanation of this policy continues in section 60.4.3 (Liability Considerations for Bundled Services) of chapter 1 at https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/clm104c01.pdf.