CMS-1500(02-12)-Supporting_StatementPart_A

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Supporting Statement for the CMS-1500 (02-12) (Health Insurance Claim Form)
And Supporting Regulations in 42 CFR Part 424 Subpart C and CMS-1490S (01/05)
April 2012
A. Background
The Form CMS-1500 answers the needs of many health insurers. It is the basic form
prescribed by CMS for the Medicare program for claims from physicians and suppliers.
The Medicaid State Agencies, TRICARE, Blue Cross/Blue Shield Plans, the Federal
Employees Health Benefit Plan, and several private health plans also use it; it is the de
facto standard “professional” claim form.
The National Uniform Claim Committee (NUCC) currently governs form CMS-1500.
Within the NUCC, the form is assigned to the CMS-1500 Subcommittee, which is
responsible for maintaining the form.
B. Justification
1. Need and Legal Basis
Section 1861(s) of the Social Security Act lists the services covered by the
Supplementary Medical Insurance Program (SMI). The CMS-1500 is used to bill for
services covered under section 1861(a)(1) by persons entitled to payment for such
services in accordance with section 1832(a)(1) of the Social Security Act. Benefits
are paid either to the physician/supplier under an agreement, the beneficiary on the
basis of an itemized bill per section 1842(b)(3)(B)(i) and (ii) of the Social Security
Act, or to an organization authorized to receive payment per 1842(b)(6).
42 CFR 424 Subpart C sets out the procedures and policies for implementing section
1861(s), 1832(a)(1), 1833, and 1842(b)(3)(B)(i) and (ii). These procedures require
that for payment to be made to the beneficiary, a written request for payment must be
submitted together with an itemized bill. For payment to the person who provided the
services, the provider must accept assignment, agree to accept the reasonable charge
for the services as the full charge and agree not to charge the beneficiary for more
than any unpaid deductible and the 20 percent coinsurance.
Per 42 CFR 424.44(a), the request for payment must be submitted no later than the
close of the calendar year following the year in which the services were furnished.
CMS, in order to ensure that proper payment is made for any medical and other health
services listed under section 1861(s) of the Social Security Act, needs to elicit a
description of the services and the charges from the individual beneficiary or from the
physician or supplier for the Medicare Administrative Contractor. The CMS-1500
and CMS-1490S meets this need.

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2. Information Users
Medicare Administrative Contractors use the data collected on the CMS-1500 and the
CMS-1490S to determine the proper amount of reimbursement for Part B medical and
other health services (as listed in section 1861(s) of the Social Security Act) provided
by physicians and suppliers to beneficiaries. The CMS-1500 is submitted by
physicians/suppliers for all Part B Medicare. Serving as a common claim form, the
CMS-1500 can be used by other third-party payers (commercial and nonprofit health
insurers) and other Federal programs (e.g., TRICARE, RRB, and Medicaid).
The advantage of a common claim form is that physicians and suppliers no longer
need to stock a variety of forms and thus are able to increase their office efficiency
through continual utilization of the same form. Specific instructions for completion
of the form are contained in the Medicare Internet Only Manual, Pub 100-04, Chapter
26. Periodically, the Medicare Administrative Contractors furnish informational
materials to the physicians and suppliers as to how to complete the form.
As the CMS-1500 displays data items required for other third-party payers in addition
to Medicare, the form is considered too complex for use by beneficiaries when they
file their own claims. Therefore, the CMS-1490S (Patient‟s Request for Medicare
Payment) was explicitly developed for easy use by beneficiaries who file their own
claims. The CMS-1490S form can be obtained from any Social Security office or
Medicare Administrative Contractors.
When the CMS-1490S is used, the beneficiary must attach to it his/her bills from
physicians or suppliers. The form is, therefore, designed specifically to aid
beneficiaries who cannot get assistance from their physicians or suppliers for
completing claim forms.
In sum, the CMS-1500 and CMS-1490S result in less paperwork burden placed on the
public. The CMS-1500 provides efficiency in office procedures for physicians and
suppliers; the CMS-1490S provides beneficiaries with a relatively easy form to use
when filing their claims. Without the collection of this information, claims for
reimbursement relating to the provision of Part B medical services/supplies could not
be acted upon. This would result in a nationwide paralysis of the operation of the
Federal Government‟s Part B Medicare program, and major problems for the other
health plans that use the CMS-1500, inflicting severe physical and financial hardship
on providers/suppliers as well as beneficiaries.
3. Improved Information Technology
These forms are continually reviewed for potential burden reduction through
improved technology. The format of the CMS-1500 has been standardized so that all
payers (not just Medicare) can uniformly receive and process claims. The CMS-1500
has been designed to be scannable by those payers that have imaging and optical

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character recognition capabilities. Scanning allows them to significantly reduce their
data entry and other administrative costs.
Electronic data interchange is a technology alternative to the submission of paper
claim forms. All of the data collected by the CMS-1500 can also be collected
electronically. The electronic equivalent to the CMS-1500 form is the ANSI X12N
837 Professional claim (837P), which further reduces costs and increases efficiency
for providers and suppliers. Legislation has also been enacted which mandates claims
be submitted electronically to Medicare. The Administrative Simplification
Compliance Act amendment to section 1862(a) of the Act prescribes that “no
payment may be made under Part A or Part B of the Medicare Program for any
expenses incurred for items or services” for which a claim is received in a nonelectronic form. Consequently, absent an applicable exception, paper claims received
by Medicare will not be paid. Entities determined to be in violation of the statute or
this rule may be subject to claim denials, overpayment recoveries, and applicable
interest on overpayments.
4. Duplication/Similar Information
There are no duplicative efforts to capture the information found on these forms.
5. Small Business
There is no significant impact on small business.
6. Less Frequent Collection
In order for reimbursement to proceed in a timely and accurate manner, claims for
reimbursement should be submitted soon after the provision of service.
Consequently, there is no coherent or beneficial approach regarding the submitting of
claims on a less frequent basis. Moreover, extended delays in the processing of Part
B claims would increase the probability of errors while potentially imposing cash
flow problems on physicians/suppliers as well as beneficiaries.
7. Special Circumstances
--Requiring respondents to report information to the agency more often than
quarterly.
Physicians and suppliers submit claim forms “on occasion.” In most circumstances,
this is more often than quarterly. Submission of claim forms is necessary for
reimbursement.
--Including a pledge of confidentiality that is not supported by authority established
in statute or regulation, that is not supported in disclosure and data security policies
that are consistent with the pledge, or which unnecessarily impedes sharing of data

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with other agencies for compatible confidential use; or requiring respondents to
submit proprietary trade secret or other confidential information unless the agency
can demonstrate that it has instituted procedures to protect the information’s
confidentiality to the extent permitted by law.
Any information reported on these forms is protected and held confidential in
accordance with 20 CFR 401.3. Refer to item 10 for additional information regarding
confidentiality.
8. Federal Register Notice/Outside Consultation
A 60-day Federal Register Notice was published on May 29, 2012.
General collection guidelines:
This collection of information is conducted in a manner consistent with the guidelines
in 5 CFR 1320.6.
Outside consultation:
The CMS-1500 was developed based upon consultation with the Uniform Claim Task
Force members. The task force was co-chaired by the AMA and CMS (then HCFA).
The task force was comprised of representatives of the Blue Cross/Blue Shield
Association, CHAMPUS, the Department of Labor, the Health Insurance Association
of America, the Railroad Retirement Board, and the National Association of State
Medicaid Directors. This task force was replaced by the National Uniform Claim
Committee (NUCC).
Most recently, the NUCC has revised the CMS-1500. The NUCC began revision
work on the 1500 Claim Form, version 02/12 in 2009. The goal of this work was to
align the paper form with some of the changes in the electronic Health Care Claim:
Professional (837), 005010X222 Technical Report Type 3 (5010) and
005010X222A1 Technical Report Type 3 (5010A1). During the revision work,
consideration was given to different approaches to revising the form. The NUCC
decided to proceed with making "minor changes" to the current form, which was
defined as no physical changes to the existing form lines or underlying layout of the
form. The following changes were made and were reflected in the CMS-1500, 02/12
a. Header, Replaced 1500 rectangular symbol with black and white two-dimensional
Quick Response Code (QR Code);
b. Header, Added “(NUCC)” after “APPROVED BY NATIONAL UNIFORM
CLAIM COMMITTEE”;
c. Header, Replaced “08/05” with “02/12”;
d. Box 1, Deleted “CHAMPUS” and changed “(Sponsor‟s SSN)” to “(ID#/DoD#)”;
e. Box 1, Under “GROUP HEALTH PLAN,” changed “(SSN or ID)” to “(ID#)”;
f. Box 1, Under “FECA BLK LUNG,” changed “(SSN)” to “(ID#)”;

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g. Box 1, Under “OTHER,” changed “(ID)” to “(ID#)”;
h. Box 8, Deleted “PATIENT STATUS” and content of field. Changed title to
“RESERVED FOR NUCC USE”;
i. Box 9b, Deleted “OTHER INSURED‟S DATE OF BIRTH, SEX.” Changed title
to “RESERVED FOR NUCC USE”;
j. Box 9c, Deleted “EMPLOYER‟S NAME OR SCHOOL.” Changed title to
“RESERVED FOR NUCC USE”;
k. Box 10d, Changed title from “RESERVED FOR LOCAL USE” to “CLAIM
CODES (Designated by NUCC)”;
l. Box 11b, Deleted “EMPLOYER‟S NAME OR SCHOOL.” Changed title to
“OTHER CLAIM ID (Designated by NUCC).” Added vertical, dotted line in the
left-hand side of the field to accommodate a 2-byte qualifier;
m. Box 11d, Changed “If yes, return to and complete Item 9 a-d” to “If yes, complete
items 9, 9a, and 9d”;
n. Box 14, Changed title to “DATE OF CURRENT ILLNESS, INJURY, or
PREGNANCY (LMP)”. Removed the arrow and text in the right-hand side of the
field. Added “QUAL” and a vertical, dotted line to accommodate a 3-byte
qualifier;
o. Box 15, Changed title from “IF PATIENT HAS HAD SAME OR SIMILAR
ILLNESS. GIVE FIRST DATE” to “OTHER DATE” Added “QUAL” with two
dotted lines to accommodate a 3-byte qualifier;
p. Box 17, Added a vertical, dotted line in the left-hand side of the field to
accommodate a 2-byte qualifier;
q. Box 19, Changed title from “RESERVED FOR LOCAL USE” to
“ADDITIONAL CLAIM INFORMATION (Designated by NUCC)”;
r. Box 21, Added “ICD Ind.” and two vertical, dotted lines in the upper right-hand
corner of the field to accommodate a 1-byte indicator;
s. Box 21, Added 8 additional lines for diagnosis codes. Evenly spaced the
diagnosis code lines within the field;
t. Box 21, Changed labels of the diagnosis code lines to alpha characters (A – L);
u. Box 21, Removed the period within the diagnosis code lines;
v. Box 22, Changed title from “MEDICAID RESUBMISSION” to
“RESUBMISSION”;
w. Box 24E, Captures letters as diagnosis pointers instead of numbers;
x. Footer, language, Removed OMB approval numbers and added “OMB
APPROVAL PENDING.” OMB approval number will be added after approval
has been granted;
y. Back, language REFERS TO GOVERNMENT PROGRAMS ONLY replaced
with “MEDICARE AND TRICARE PAYMENTS: A patient‟s signature requests
that payment be made and authorizes release of any information necessary to
process the claim and certifies that the information provided in Blocks 1 through
12 is true, accurate and complete. In the case of a Medicare claim, the patient‟s
signature authorizes any entity to release to Medicare medical and nonmedical
information and whether the person has employer group health insurance,
liability, no-fault, worker‟s compensation or other insurance which is responsible
to pay for the services for which the Medicare claim is made. See 42 CFR

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411.24(a). If item 9 is completed, the patient‟s signature authorizes release of the
information to the health plan or agency shown. In Medicare assigned or
TRICARE participation cases, the physician agrees to accept the charge
determination of the Medicare carrier or TRICARE fiscal intermediary as the full
charge and the patient is responsible only for the deductible, coinsurance and noncovered services. Coinsurance and the deductible are based upon the charge
determination of the Medicare carrier or TRICARE fiscal intermediary if this is
less than the charge submitted. TRICARE is not a health insurance program but
makes payment for health benefits provided through certain affiliations with the
Uniformed Services. Information on the patient‟s sponsor should be provided in
those items captioned in “Insured”; i.e., items 1a, 4, 6, 7, 9, and 11”;
z. Back, language SIGNATURE OF PHYSICIAN OR SUPPLIER
(MEDICARE, CHAMPUS, FECA AND BLACK LUNG) replaced with “In
submitting this claim for payment from federal funds, I certify that: 1) the
information on this form is true, accurate and complete; 2) I have familiarized
myself with all applicable laws, regulations, and program instructions, which are
available from the Medicare contractor; 3) I have provided or will provide
sufficient information required to allow the government to make an informed
eligibility and payment decision; 4) this claim, whether submitted by me or on my
behalf by my designated billing company, complies with all applicable Medicare
and/or Medicaid laws, regulations, and program instructions for payment
including but not limited to the Federal anti-kickback statute and Physician SelfReferral law (commonly known as Stark law); 5) the services on this form were
medically necessary and personally furnished by me or were furnished incident to
my professional service by my employee under my direct supervision, except as
otherwise expressly permitted by Medicare or CHAMPUS; 6) for each service
rendered incident to my professional service, the identity (legal name and NPI,
license #, or SSN) of the primary individual rendering each service is reported in
the designated section.
For services to be considered "incident to" a physician's professional services, 1)
they must be rendered under the physician's direct supervision by his/her
employee, 2) they must be an integral, although incidental part of a covered
physician service, 3) they must be of kinds commonly furnished in physician's
offices, and 4) the services of non-physicians must be included on the physician's
bills.
For TRICARE claims, I further certify that I (or any employee) who rendered
services am not an active duty member of the Uniformed Services or a civilian
employee of the United States Government or a contract employee of the United
States Government, either civilian or military (refer to 5 USC 5536). For BlackLung claims, I further certify that the services performed were for a Black Lungrelated disorder.
No Part B Medicare benefits may be paid unless this form is received as required
by existing law and regulations (42 CFR 424.32).

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NOTICE: Anyone who misrepresents or falsifies essential information to receive
payment from Federal funds requested by this form may upon conviction be
subject to fine and imprisonment under applicable Federal laws.
aa. Back, language Privacy Act Statement revised to “We are authorized by CMS,
TRICARE and OWCP to ask you for information needed in the administration of
the Medicare, TRICARE, FECA, and Black Lung programs. Authority to collect
information is in section 205(a), 1862, 1872 and 1874 of the Social Security Act
as amended, 42 CFR 411.24(a) and 424.5(a) (6), and 44 USC 3101;41 CFR 101 et
seq and 10 USC 1079 and 1086; 5 USC 8101 et seq; and 30 USC 901 et seq; 38
USC 613; E.O. 9397.
The information we obtain to complete claims under these programs is used to
identify you and to determine your eligibility. It is also used to decide if the
services and supplies you received are covered by these programs and to insure
that proper payment is made.
The information may also be given to other providers of services, carriers,
intermediaries, medical review boards, health plans, and other organizations or
Federal agencies, for the effective administration of Federal provisions that
require other third parties payers to pay primary to Federal program, and as
otherwise necessary to administer these programs. For example, it may be
necessary to disclose information about the benefits you have used to a hospital or
doctor. Additional disclosures are made through routine uses for information
contained in systems of records.
FOR MEDICARE CLAIMS: See the notice modifying system No. 09-70-0501,
titled, „Carrier Medicare Claims Record,‟ published in the Federal Register, Vol.
55 No. 177, page 37549, Wed. Sept. 12, 1990, or as updated and republished.
FOR OWCP CLAIMS: Department of Labor, Privacy Act of 1974,
“Republication of Notice of Systems of Records,” Federal Register Vol. 55 No.
40, Wed Feb. 28, 1990, See ESA-5, ESA-6, ESA-12, ESA-13, ESA-30, or as
updated and republished.
FOR TRICARE CLAIMS: PRINCIPLE PURPOSE(S): To evaluate eligibility for
medical care provided by civilian sources and to issue payment upon
establishment of eligibility and determination that the services/supplies received
are authorized by law.
ROUTINE USE(S): Information from claims and related documents may be given
to the Dept. of Veterans Affairs, the Dept. of Health and Human Services and/or
the Dept. of Transportation consistent with their statutory administrative
responsibilities under TRICARE/CHAMPVA; to the Dept. of Justice for
representation of the Secretary of Defense in civil actions; to the Internal Revenue
Service, private collection agencies, and consumer reporting agencies in

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connection with recoupment claims; and to Congressional Offices in response to
inquiries made at the request of the person to whom a record pertains. Appropriate
disclosures may be made to other federal, state, local, foreign government
agencies, private business entities, and individual providers of care, on matters
relating to entitlement, claims adjudication, fraud, program abuse, utilization
review, quality assurance, peer review, program integrity, third-party liability,
coordination of benefits, and civil and criminal litigation related to the operation
of TRICARE.
DISCLOSURES: Voluntary; however, failure to provide information will result in
delay in payment or may result in denial of claim. With the one exception
discussed below, there are no penalties under these programs for refusing to
supply information. However, failure to furnish information regarding the medical
services rendered or the amount charged would prevent payment of claims under
these programs. Failure to furnish any other information, such as name or claim
number, would delay payment of the claim. Failure to provide medical
information under FECA could be deemed an obstruction.
It is mandatory that you tell us if you know that another party is responsible for
paying for your treatment. Section 1128B of the Social Security Act and 31 USC
3801-3812 provide penalties for withholding this information.
You should be aware that P.L. 100-503, the “Computer Matching and Privacy
Protection Act of 1988”, permits the government to verify information by way of
computer matches.
bb. Back, language PRA disclosure statement replaced with “According to the
Paperwork Reduction Act of 1995, no persons are required to respond to a
collection of information unless it displays a valid OMB control number. The
valid OMB control number for this information collection is 0938-XXXX . The
time required to complete this information collection is estimated to average 10
minutes per response, including the time to review instructions, search existing
data resources, gather the data needed, and complete and review the information
collection. If you have comments concerning the accuracy of the time estimate(s)
or suggestions for improving this form, please write to: CMS, 7500 Security
Boulevard, Attn: PRA Reports Clearance Officer, Mail Stop C4-26-05, Baltimore,
Maryland 21244-1850. This address is for comments and/or suggestions only.
DO NOT MAIL COMPLETED CLAIM FORMS TO THIS ADDRESS.”
9. Payment/Gift to Respondent
The CMS-1500 must be used to receive payment for the provision of health care
services or supplies. The use of the form itself does not convey payments or gifts to
respondents; many conditions must be met before payment can be made.
10. Confidentiality

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The information provided on these forms is protected and held confidential in
accordance with 20 CFR 401.3. The information provided on these forms will
become part of the Medicare contractors‟ computer history, microfilm, and hard copy
records‟ retention system as published in the Federal Register, Part VI, “Privacy Act
of 1974 System of Records,” on September 20, 1976 (HI CAR 0175.04).
The following statement appears on the reverse of the CMS-1500: “No Part B
Medicare benefits may be paid unless this form is received as required by existing
law and regulations (42 CFR 424.32).”
The following statement appears on the front of the CMS-1490S: “No Part B
Medicare benefits may be paid unless this form is received as required by existing
law and regulations (20 CFR 422.510).”
The following statement required by the Privacy Act of 1974 (USE 55(a)(3)) is
included on the reverse of the CMS-1500:
PRIVACY ACT STATEMENT
We are authorized by CMS, TRICARE and OWCP to ask you for information needed in the administration
of the Medicare, TRICARE, FECA, and Black Lung programs. Authority to collect information is in
section 205(a), 1862, 1872 and 1874 of the Social Security Act as amended, 42 CFR 411.24(a) and
424.5(a) (6), and 44 USC 3101;41 CFR 101 et seq and 10 USC 1079 and 1086; 5 USC 8101 et seq; and 30
USC 901 et seq; 38 USC 613; E.O. 9397.
The information we obtain to complete claims under these programs is used to identify you and to
determine your eligibility. It is also used to decide if the services and supplies you received are covered by
these programs and to insure that proper payment is made.
The information may also be given to other providers of services, carriers, intermediaries, medical review
boards, health plans, and other organizations or Federal agencies, for the effective administration of Federal
provisions that require other third parties payers to pay primary to Federal program, and as otherwise
necessary to administer these programs. For example, it may be necessary to disclose information about the
benefits you have used to a hospital or doctor. Additional disclosures are made through routine uses for
information contained in systems of records.
FOR MEDICARE CLAIMS: See the notice modifying system No. 09-70-0501, titled, „Carrier Medicare
Claims Record,‟ published in the Federal Register, Vol. 55 No. 177, page 37549, Wed. Sept. 12, 1990, or
as updated and republished.
FOR OWCP CLAIMS: Department of Labor, Privacy Act of 1974, “Republication of Notice of Systems of
Records,” Federal Register Vol. 55 No. 40, Wed Feb. 28, 1990, See ESA-5, ESA-6, ESA-12, ESA-13,
ESA-30, or as updated and republished.
FOR TRICARE CLAIMS: PRINCIPLE PURPOSE(S): To evaluate eligibility for medical care provided by
civilian sources and to issue payment upon establishment of eligibility and determination that the
services/supplies received are authorized by law.
ROUTINE USE(S): Information from claims and related documents may be given to the Dept. of Veterans
Affairs, the Dept. of Health and Human Services and/or the Dept. of Transportation consistent with their
statutory administrative responsibilities under TRICARE/CHAMPVA; to the Dept. of Justice for
representation of the Secretary of Defense in civil actions; to the Internal Revenue Service, private

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collection agencies, and consumer reporting agencies in connection with recoupment claims; and to
Congressional Offices in response to inquiries made at the request of the person to whom a record pertains.
Appropriate disclosures may be made to other federal, state, local, foreign government agencies, private
business entities, and individual providers of care, on matters relating to entitlement, claims adjudication,
fraud, program abuse, utilization review, quality assurance, peer review, program integrity, third-party
liability, coordination of benefits, and civil and criminal litigation related to the operation of TRICARE.
DISCLOSURES: Voluntary; however, failure to provide information will result in delay in payment or may
result in denial of claim. With the one exception discussed below, there are no penalties under these
programs for refusing to supply information. However, failure to furnish information regarding the medical
services rendered or the amount charged would prevent payment of claims under these programs. Failure to
furnish any other information, such as name or claim number, would delay payment of the claim. Failure to
provide medical information under FECA could be deemed an obstruction.
It is mandatory that you tell us if you know that another party is responsible for paying for your treatment.
Section 1128B of the Social Security Act and 31 USC 3801-3812 provide penalties for withholding this
information.
You should be aware that P.L. 100-503, the “Computer Matching and Privacy Protection Act of 1988”,
permits the government to verify information by way of computer matches.

The following statement required by the Privacy Act of 1974 (USE 55(a)(3)) is
included on the reverse of the CMS-1490S:
COLLECTION AND USE OF MEDICARE INFORMATION
We are authorized by the Centers for Medicare & Medicaid Services to ask you for information needed in
the administration of the Medicare program. Authority to collect information is in section 205(a), 1872,
and 1875 of the Social Security Act as amended.
The information we obtain to complete your Medicare claim is used to identify you and to determine your
eligibility. It is also used to decide if the services and supplies you received are covered by Medicare and
to insure that proper payment is made.
The information may also be given to other providers of services, carriers, intermediaries, medical review
boards, and other organizations as necessary to administer the Medicare program. For example, it may be
necessary to disclose information about the Medicare benefits you have used to a hospital or doctor about
the Medicare benefits you have used.
With one exception, which is discussed below, there are no penalties under social security law for refusing
to supply information. However, failure to furnish information regarding the medical services rendered or
the amount charged would prevent payment of the claim. Failure to furnish any other information, such as
name or claim number, would delay payment of the claim.
It is mandatory that you tell us if you are being treated for a work-related injury so we can determine
whether workmen‟s compensation will pay for the treatment. Section 1877(a)(3) of the Social Security Act
provides criminal penalties for withholding this information.

11. Sensitive Questions
This data collection does not ask questions of a sensitive nature, such as sexual
behavior or religious beliefs.
12. Burden Estimate (Wages and Hours)

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CMS 1500
The figures used to compute the annual burden represent the number of professional
claims processed in CY 2011. During CY 2011, 97.9 percent of the professional
Medicare claims were received electronically. Medicare‟s Office of Financial
Management records for CY2011 indicate that 1,448,346 providers/suppliers were
enrolled in Medicare Part B.

Paper
Electronic
TOTALS

Number of Claims

Burden/Claim

Total Burden

21,221,080
966,783,965
988,005,045

15 minutes
1 minute
N/A

5,305,270 hrs.
16,113,066 hrs.
21,418,336 hrs.

We estimate the cost per hour of burden to average $15.00 per hour. This estimate
takes into account labor and resource cost.
Medicare does not furnish forms to physicians and suppliers. Physicians and
suppliers must purchase the forms. The CMS-1500 form costs on average $0.08 per
claim (two-part form). Medicare does not reimburse providers for their mailing and
handling costs. This costs physicians and suppliers between $.45-.65/claim (or an
average of $ .55/claim).
In order to save costs to the program, Medicare provides free electronic billing
software and support for the electronic equivalent of the CMS-1500. This free
electronic billing software saves time and money for physicians and suppliers, as well
as lowers Medicare‟s administrative claims processing costs.
Labor Costs
21,418,336 hours X $15 = $321,275,040
In addition, physicians and suppliers spend approximately $0.63/claim in resource
cost (this figure includes both form costs and mailing). Therefore, based on these
numbers, physicians and suppliers spend approximately:
Cost of Forms and Mailing of Forms
Number of Claims

Paper
Electronic
Total

21,221,080
966,783,965
988,005,045

Cost/Claim for
Forms and Mailing
*($.63)
**N/A
N/A

Total Annual Cost
for Forms and Mailing
$ 13,369,280
$ 77,342,717
$ 90,711,997

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* This figure was attained by adding $.08/claim cost to an average mailing cost of $
.55.
** This figure was attained by using this formula:
966,783,965 electronic claims X $ .08 (phone line charge) = $ 77,342,717
Variables:
Transmission (line) Costs: $ .08/claim
Total professional electronic claims: 966,783,965
Total Costs:
Labor costs:
+ Cost of forms and mailing of forms:
= Total costs:

$321,275,040
$ 90,711,997
$411,987,037

Current costs:
- Previous costs:
= Difference

$411,987,037
$452,786,074
$- 40,799,037

This represents a cost decrease of $40,799,037 from the previous reporting period.
CMS 1490S
The count of CMS-1490S paper forms is included in the 21,221,080 total and is
therefore reflected in the burden figures above.
13. Capital Costs
There are no capital costs.
14. Cost to Federal Government
Based on FY 2010 figures, the administrative cost to the Federal Government to
administer Medicare Part B (for which the professional claim is used to report
services and obtain reimbursement) was $3,514,000,000 or 1.3 percent of benefit
payments.1 On the average, the unit cost incurred to the Federal Government per
professional claim was $ .382 in FY 2008. This figure includes the direct costs and
overhead cost for claims payment, reviews and hearings, and beneficiary/physician
inquiry lines.
15. Program Changes/Burden Changes
The reported decrease in the costs from the previous reporting period is once again
due in large part to the enforcement of mandatory electronic claim submission
1
2

Source: 2011 CMS Statistics, Table V.1.
Source: 2009 CMS Statistics, Table V.5. (Data not available in 2011 CMS Statistics Table V.5)

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requirements which are part of the Administrative Simplification Compliance Act.
Administrative Simplification Compliance Act (ASCA). Section 3 of the ASCA,
PL107-105, and the implementing regulation at 42 CFR 424.32, requires providers,
with limited exceptions, to submit all initial claims for reimbursement under
Medicare electronically, on or after October 16, 2003. Further, ASCA amendment to
Section 1862(a) of the Act prescribes that “no payment may be made under Part A or
Part B of the Medicare Program for any expenses incurred for items or services” for
which a claim is submitted in a non-electronic form. Consequently, unless a provider
fits one of the approved exceptions, any paper claims submitted to Medicare will not
be paid. ASCA is responsible for the significant increase in the number of claims
being filed electronically as well as the significant decrease in the total receipts of
paper claims.
16. Publication and Tabulation Dates
The purpose of this data collection is to pay providers for Medicare services rendered
and to reimburse beneficiaries when applicable. There are no publication and
tabulation dates.
17. Expiration Date
Previous forms have been cleared without the expiration date present. Placing the
expiration date on the form would require form changes. This would result in
additional printing costs to CMS, and confusion among providers and/or
beneficiaries.
18. Certification Statement
CMS has no exceptions to Item 19,
Submissions, of OMB Form 83-I.

Certification for Paperwork Reduction Act

C. Statistical Methods
These information collection requirements do not employ statistical methods.