Incident to billing is a method of providing a service in which a physician or non-physician practitioner is not the individual actually providing the professional services which will later be billed to Medicare or Medicaid. The most popular utilization of “incident to” billing relates to the interactions between nurse practitioners or physician assistants and physicians. In this type of arrangement, a physician will initially treat the patient and then follow up visits will be provided by a nurse practitioner or physician assistant.
What benefit does this offer an organization? Nurse practitioners and physician assistants only get reimbursed 85% of what a physician would otherwise receive in reimbursement. If the “incident to” requirements are met, even though the service was not provided by a physician, the organization would receive 100% reimbursement. Although this revenue opportunity is huge for many practices, the compliance and legal risks are similarly as huge.
Incident To Fraud and Abuse
The Department of Justice alleged that Jacksonville Center for Reproductive Medicine misused incident to billing for services of a nurse practitioner and physician assistant. Specifically, Dr. Michael Fox was alleged to have billed under his NPI for the services even though the “incident to” requirements had not been met. The government claimed that the physician involvement was minimal in that the “incident to” provisions would not apply. The physician and the practice resolved the allegations by settling for nearly $100,000.
What are the Requirements of Incident To Billing?
As stated earlier, incident to billing can take the form of many different types of arrangements. However, incident to billing is primarily used by physicians with nurse practitioners and physician assistants. As noted above, the compliance risks are significant and can result in severe penalties if the requirements for incident to billing have not bee met. There are various sources to assist us in understanding incident to billing but the primary source is found in 42 CFR 410.26. The regulations state that Medicare will pay (100% of the physician fee schedule) for services and supplies that meet the following conditions:
- Services and supplies must be furnished in a noninstitutional setting to noninstitutional patients.
- Services and supplies must be an integral, though incidental, part of the service of a physician (or other practitioner) in the course of diagnosis or treatment of an injury or illness.
- Services and supplies must be commonly furnished without charge or included in the bill of a physician (or other practitioner).
- Services and supplies must be of a type that are commonly furnished in the office or clinic of a physician (or other practitioner).
- Services and supplies must be furnished under the direct supervision of the physician (or other practitioner). The physician (or other practitioner) directly supervising the auxiliary personnel need not be the same physician (or other practitioner) upon whose professional service the incident to service is based.
- Services and supplies must be furnished by the physician, practitioner with an incident to benefit, or auxiliary personnel.
- A physician (or other practitioner) may be an employee or an independent contractor.
So the first issue in these requirements is that the service must have occurred in a noninstitutional setting. A noninstitutional setting means all settings other than a hospital or skilled nursing facility. The second requirement is that the services must be an integral part of the service of a physician. In short, the actual service another practitioner is providing must be a necessary part of the physician’s overall service to the patient. Also, such service must be in the course of diagnosis or treatment of an injury or illness.
This means that a nurse practitioner or physician assistant cannot bill “incident to” if the service is not either in the course of the diagnosis that the physician made or if the service is not in the course of treatment by the physician. This requirement creates serious issues for practices and organizations because if a patient visits a nurse practitioner or physician assistant and discusses issues outside the physician’s diagnosis or treatment, the visit can no longer be billed “incident to.” Operationally, in family practice settings incident to may create significant compliance issues.
In addition to the above mentioned requirements, one of the other problematic requirements relates to direct supervision. Any service that is being billed incident to a physician, such service must be under the direct supervision of a physician. Direct supervision at a minimum means that a physician must be in the same office suite. However, the physician need not be in the same room. Above all, if the physician is not on-site, an organization cannot bill services as incident to the physician.
Can a Nurse Practitioner Bill Incident To?
The Medicare regulations allow a nurse practitioner to have a service or supply billed incident to the nurse practitioner’s NPI. Specifically, 42 CFR 410.75 states that services and supplies are covered only if they:
- Would be covered if furnished by a physician or as incident to the professional services of a physician;
- Are of the type that are commonly furnished in a physician’s office and are either furnished without charge or are included in the bill for the nurse practitioner’s services;
- Although incidental, are an integral part of the professional service performed by the nurse practitioner; and
- Are performed under the direct supervision of the nurse practitioner (that is, the nurse practitioner must be physically present and immediately available).
Learning Points
Although “incident to” billing can provide additional revenue to a practice, it does present substantial risks. Maintaining compliance when billing incident to can be extremely tough especially because at times it may be impossible to have a physician on site. Finally, incident to billing can be problematic in settings in which a patient may come to the office for reasons outside of the initial diagnosis.