Importance of Standardized Forms in Billing Reimbursement

Standardized billing forms between insurers allow for faster processing which, in turn, shortens the time required to receive payment. Standardization reduces the probability of errors that come with a variety of forms. Errors in billing can delay reimbursement from private insurance and government programs. Repeated errors due to using a variety of forms can result in errors or even federal penalties.

Preventing Mistakes

• Billing errors can cause delays in reimbursement from federal government programs, such as Medicare, Medicaid, the Veteran's Administration and worker's compensation. Repeated errors can result in audits from any of these entities. Audits cost time and money, even if reimbursement is eventually received. Standardized forms ensure that the same procedures are used to fill out these forms each time. This reduces the risk of staff filling out forms incorrectly, causing delays in receiving payment. Incorrect billing due to incorrect forms can also result in under-payment or denial of payment.

Penalties for Errors

• The Centers for Medicare and Medicaid Services (CMS), previously known as the Health Care Financing Administration (HCFA), ensures standards for medical coding and billing. According to "Critical Care Medicine: Perioperative Management" by Michael James Murray, "if billing is not consistent with the level of service provided, the HCFA (now CMS) will charge the provider with fraudulent billing practices." Repeated errors of the same type create the risk of audits, which cost both time and money. Billing forms that do not meet CMS billing standards or those in the Health Insurance Portability and Accountability Act (HIPAA) can result in non-compliance fines even if the billing itself is found to be accurate.

Legal Risks

• According to "Hospice and Palliative Care Handbook: Quality, Compliance, and Reimbursement" by T. M. Marrelli, clinical documentation "supports insurance coverage or denial, is the evidence of the basis on which patient care decisions were made, and it is the only legal record." Using standardized forms reviewed by legal experts also ensures that all medical and billing records entered with these forms are in accordance with the law.

Standardized Federal Forms

• The two primary claim forms used by insurance billers for Medicare are the CMS-1500 and the CMS-1450 (UB-04). The CMS-1500 was previously known as the HCFA-1500 form. The book "Starting Your Practice: a Survival Guide for Nurse Practitioners" by Jean Nagelkerk notes that "many commercial insurers and MCOs (Managed Care Organizations) have also switched to or allow use of the CMS-1500 form in their claims process, but they also have their own claim forms."