Medicare Incident-to Billing Rules, Pitfalls

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In today’s busy rheumatology practices, the services of nurse practitioners, physician assistants, occupational therapists and clinical nurse specialists are a great asset for patient flow, as well as increased revenue. As the growth of nonphysician providers (NPPs) in rheumatology practices has evolved, it has become increasingly important to understand the incident-to rules and avoid the pitfalls of Medicare’s coding and billing guidelines.

Incident-to billing is a specific method of billing developed by the Centers for Medicare and Medicaid Services (CMS) for NPPs working in physician practices. Under incident-to billing, outpatient services by an NPP may be billed and reimbursed under the physician’s name and provider ID as if the physician personally performed the service. The Medicare Benefit Policy Manual defines incident-to as, “services or supplies furnished as an integral, although incidental, part of a physician’s personal professional service” and reimbursable at 100% of the Medicare fee schedule under the physician.¹

Although office visits are perhaps the most commonly billed service under the incident-to guidelines, incident-to services are not limited to a specific set of procedure codes or services. As long as the NPP is performing services within the scope of their license, the procedure code description requirements are met, and the incident-to requirements are fully met, the services may be billed to CMS as an incident-to claim.

Key Criteria

For claims billed to Medicare as incident-to services, an NPP must meet specific criteria, including:

• The NPP must be licensed or certified to provide professional healthcare services in the state where he/she practices;
• The NPP must be a full-time, part-time or leased employee of the organization or employee of the legal entity that employs the supervising qualified Medicare provider;
• The service must be an integral, although incidental, part of the physician’s service;
• The service must be commonly rendered without charge or included in the physician’s bill;
• The service must be commonly furnished in a physician’s office or clinic;
• The service must be in the scope of practice of the NPP; and
• The NPP must provide the services under the direct supervision of the physician (unless otherwise specified by state requirements).

If the above rules are not met, the NPP can still perform the service, but it should not be billed as incident-to. The claim would have to be billed under the NPP’s NPI number, and reimbursed at 85% of the Medicare fee schedule.

The foundation of proper incident-to billing is that any incident-to service must be an integral part of the physician’s services. The guidelines indicate that the physician must initially assess and create a treatment plan for the patient whom the NPP is treating incident to the physician’s services. This requirement does not mean the physician has to see the patient at subsequent visits, but he or she must remain actively involved in the course of treatment.² Rather, the NPP will oversee and manage an ongoing course of treatment initiated by the physician. However, if an established patient reports a new chief complaint or problem during an office visit, the physician would then have to see the patient again for the new issue in order to be able to bill for the NPP’s services as incident-to.

The guideline for a separate and distinct new complaint or problem is often overlooked when treating established patients. This is an issue the Medicare program focuses on when auditing and reviewing claims. As a result, rheumatology practices should develop policies and procedures to ensure that all incident-to services are billed appropriately.

Direct vs. General Supervision

One of the most misunderstood aspects of the incident-to billing rules is the requirement for direct physician supervision. Many state laws permit advanced registered nurse practitioners (ARNPs) and physician assistants (PAs) to furnish healthcare services to patients without a physician’s on-site presence or direct supervision. Some state laws also permit general physician supervision (each practice will need to verify what is or is not permitted in their state). General supervision is defined as, “the procedure [or service] is furnished under the physician’s overall direction and control, but the physician’s presence is not required during the performance of the procedure.”³

However, under CMS regulations, incident-to services must be furnished under a physician’s direct supervision. Direct supervision means a physician must be immediately available to provide assistance and direction while an NPP is providing services that will be billed as incident-to. Although the physician does not have to be in the same room, the physician must be in the same office suite. By far, this is the incident-to billing requirement that physicians and their group practices misunderstand and fall prey to in audits. Unfortunately, the confusion is when practices comply with their state law supervision requirements instead of CMS’s direct supervision requirements for incident-to billing. For example, in Florida, ARNPs and PAs can practice under the general supervision of a physician; unfortunately, the general supervision requirements for ARNPs or PAs under Florida law (and most likely in many other states as well) don’t satisfy the direct supervision requirements for incident-to billing under the Medicare program. Therefore, it’s imperative rheumatologists and their office staff understand the difference between general and direct supervision.

Additionally, practices must ensure that their NPPs are licensed or certified to practice in the applicable state before they permit them to render services and bill them as incident-to.

Policies, Procedures & Compliance Plans

To prevent billing mistakes and problems in regard to incident-to services, physician practices should develop specific policies and procedures for coding and billing and make them part of their yearly compliance plans. Although the incident-to billing requirements appear to be simple and easy, there’s an increase in federal and state healthcare regulatory agencies tasked with overseeing the Medicare programs involving allegations of improper billing for incident-to services.

Keep in mind, the incident-to billing guidelines were developed by Medicare, and private insurance carriers do not necessarily follow this process. Some commercial carriers have specific guidelines that require all practitioners (physicians, NPs and PAs) to bill under their own name and provider identification number.

CMS’s incident-to requirements and guidelines may be found in the CMS Claims Processing Manual, the CMS Benefit Policy Manual, the CMS website, CMS transmittals, MedLearn Matters, etc., at www.cms.gov.

See this month’s Coding Corner for an example of incident-to billing. For additional information or assistance with coding and billing guidelines, contact ACR practice management staff via e-mail at [email protected].

References

1. CMS. Medicare Benefit Policy Manual. Chapter 15—Covered Medicare and Other Health Services. Dec. 31, 2014.
2. CMS. “Incident to” Services. April 9, 2013.
3. CMS. CMS Manual System. March 1, 2013.