Medicare Compliance & Reimbursement

Tip: Be careful about which services you let NPPs perform.

You want to bring in additional income and free up physician time to focus on complex cases by hiring a non-physician practitioner (NPP) but suddenly find yourself in the crossfire of audits and fraud investigations. Terrifying prospect? You can avoid it by taking a look at these four criteria that you must meet to avoid scrutiny and denials.

Capture an Extra 15 Percent

Under incident-to rules, qualified NPPs can treat certain patients and still bill the visit under the physician’s provider number (NPI), bringing in 100 percent of the assigned fee (i.e., what the payer would have allowed if the physician had personally performed the service), says Elin Baklid-Kunz, MBA, CHC, CPC, CCS, director of physician services for a large health system in Florida, during her recent audioconference “2014 Risk Areas for NPPs and Incident-To,” sponsored by The Coding Institute affiliate AudioEducator.com.

To qualify for incident-to, you must first ensure the visit meets a few criteria, as established by the Center for Medicare and Medicaid Services (CMS):

1. The NPP performs the service in a physician’s office.
2. The NPP performs the service within the scope of her practice and in accordance with state law.
3. The physician should establish the care plan for the new patient to the practice or any established patient with a new medical condition. NPPs may implement the established plan of care.
4. The physician must be on site (direct supervision) when the NPP is rendering the service.

Private payers: The above rules are based on Medicare requirements, but most private payers follow that lead when creating incident-to rules. Cigna’s policy, for instance, states, “For services to be considered as incident-to a physician’s professional service, 1) they must be rendered under the physician’s immediate personal supervision by his/her employee, 2) they must be an integral, although incidental part of a covered physician’s 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.”

Let’s take a closer look at each of the four criteria.

Determine Encounter Place of Service

As noted in the first criterion, you should not report services rendered in a hospital — either outpatient, inpatient, or in the emergency department — or skilled nursing facility setting as incident-to, Baklid-Kunz says. Medicare doesn’t allow it.

In addition, any NPP providing incident-to services must represent a “direct financial expense” to the physician, according to Medicare guidelines that most private insurers adopt. This means that the NPP must be an employee or independent contractor of the physician’s practice.

Check Your State’s Scope of Practice Rules

In its release of the 2014 Medicare Physician Fee Schedule, CMS amended its incident-to regulations to directly require that personnel performing “incident-to” services meet any applicable state law requirements to provide the services, including licensure.

What it means to you: “So what this does, if you look at the language, is it provides a clear basis to deny claims and to help ensure there is a recourse to recover Medicare dollars when the services are not furnished in compliance with the state laws,” Baklid-Kunz warns. “We may see additional audits for incident-to where the focus may be more on the registered nurse or even LPN to see if the work that they’re doing incident-to a physician is within the scope of what they are allowed to furnish to Medicare patients.”

Save New Problems for the Physician

The third criterion to check for is that the physician must have seen the Medicare patient during a prior visit and established a clear plan of care. If the NPP is treating a new problem for the patient, or if the physician has not established a care plan for the patient, then you cannot report the visit incident-to.

Remember: If you find the service does not meet incident-to billing requirements, you don’t have to forego payment altogether in many cases. If a Medicare credentialed NPP provides the service, you can bill under his own NPI.

In that case, you’ll usually receive 85 percent of the normal global fee found in the Medicare Physician Fee Schedule, says Jill Young, CPC, CEDC, CIMC, owner of Young Medical Consulting in East Lansing, Mich. For example, a physician assistant (PA) can see a patient with a new problem such as strep throat, but you just can’t bill the service incident-to the physician at the 100 percent fee.

Differentiate Supervision Types

Finally, if a physician does not directly supervise the NPP for the encounter, the incident-to rules do not apply. Direct supervision means a supervising physician must be immediately available in the office suite during the service. The supervising physician, however, does not need to be the physician who initiated the treatment plan.

You should bill in the name of the physician present in the office suite and providing the supervision at the time of the NPP visit, whether or not he initially saw the patient and developed the plan of care.

“The billing must reflect this difference,” Young says. “The physician supervising in the office goes in box 33. The physician who wrote the plan of care for the visit goes in 17” of CMS Form 1500.

Caution: If a member of your auxiliary staff, such as a medical assistant (MA), provides a service when there is no direct supervision, you cannot bill for the service.