Pulmonology Coding Alert

If MedPAC has its way, this billing mechanism could go away.

If your practice utilizes “incident-to” billing for care administered by nurse practitioners (NPs) and physician assistants (PAs), you may be looking at a Medicare pay cut down the road. 

Reminder: Currently, when an advanced practice provider (APP) performs an incident-to service, the APP can bill Medicare under the supervising physician’s National Provider Identifier (NPI), resulting in 100 percent reimbursement for the care. But if APPs file services under their own NPIs, they are paid at only 85 percent reimbursement for the same service.

As the policy stands, it prevents a pay reduction for many practices. Done correctly, incident-to billing can preserve 15 percent of a practice’s bottom line when an APP performs an incident-to service, explains Jean Acevedo, LHRM, CPC, CHC, CENTC, president and CEO of Acevedo Consulting Incorporated in Delray Beach, Florida.

Review MedPAC’s Reasoning and Recommendations

Last month, the Medicare Payment Advisory Commission (MedPAC) recommended that Congress get rid of incident to, and instead have NPs and PAs bill Medicare directly for their services at the 85 percent rate, notes MedPAC’s quarterly report. The reasoning behind this policy suggestion is threefold and surrounds billing transparency, boosting primary care, and saving CMS money.

“Given the growing roles of NPs and PAs and their shift away from primary care, Medicare’s ‘incident-to’ rules and lack of specialty data create several problems, including obscuring important information on the clinicians who treat beneficiaries and inhibiting Medicare’s ability to identify and support clinicians furnishing primary care,” MedPAC says.

Breakdown: According to the Commission, there are three things that factor into its recommendation to cut incident to. Firstly, between 2010 and 2017, the use of NPs — particularly APRNs — and PAs billing Medicare “more than doubled.” Plus, fewer students pursue primary care medicine as a career choice than in the past, and MedPAC is concerned about the “pipeline of future primary care physicians,” the report indicates. Lastly, MedPAC insists that the numbers are fuzzy, and that background details on incident-to billing are “limited” and require more study.

“Surprisingly, MedPAC didn’t focus on the money, but on the lack of transparency of treatment data as a result of ‘incident-to’ billing and the migration of NPs/PAs to specialty care,” counsels attorney Rhonda Frey, with law firm Frost, Brown, Todd LLC in Florence, Kentucky.

Frey adds, “It seems MedPAC believes that the expansion by NPs/PAs from primary care to specialty practices was not contemplated when incident to was introduced; and elimination of incident to may, thus, be a backdoor way to stop that migration.”

Even though money wasn’t the overarching factor in MedPAC’s recommendation, the change could significantly cut Medicare’s spending, and that could prompt CMS to “take MedPAC’s recommendation to eliminate incident-to billing for midlevel providers seriously,” explains partner attorney Adam Robison, in the Houston office of King & Spalding LLP.

Robison adds, “First, MedPAC estimated that this recommendation would save the Medicare program $50 to $250 million in the first year. Second, in MedPAC’s opinion, there is not likely to be a reduction in the quality of care or clinical outcomes for Medicare beneficiaries.”

Could This Change Be Around the Corner?

This isn’t the first time MedPAC’s discussed problems with incident to. In fact, the June quarterly report doubles down on issues covered in the Commission’s December meeting. However, the feds don’t always follow through on MedPAC suggestions, and sometimes they slow walk implementation of unpopular recommendations. Yet, if Congress does decide to cut incident to, expect a quick turnaround, experts warn.

“It’s hard to predict timing when it comes to the government, but I’d look for them to move on this pretty quickly, if that’s the direction they choose to go, since making this change doesn’t need to change anything from a clinical perspective,” says Frey.

Robison agrees. “As to whether CMS will include the change in the 2020 [Medicare Physician Fee Schedule] MPFS may depend on a variety of factors,” he says. “For example, this may require a statutory change by Congress as incident-to services are permitted medical services under the Social Security Act. If this is the case, then CMS would not be permitted to include this change in the 2020 MPFS unless Congress intervenes in the interim.”

The public would also need to weigh in on a billing change like this, too, and that is likely to impact both the timing and context of the policy. “We would anticipate that various physician organizations and associations will strenuously oppose any such rulemaking,” cautions Robison.

Practices May Take a Financial Hit If Incident to Is Cut

If your staff includes a fair number of PAs and NPs, you may feel the fiscal crunch if incident to goes away.

If CMS takes up MedPAC’s suggestion and “eliminates incident-to billing, midlevel providers will be required to bill for services performed under their own NPIs, which are paid at 85 percent of the fee-for-service schedule,” points out Robison. “Therefore, if the recommendation ends up being adopted, physician practices would see reductions in revenue.”

Future hires: This Medicare payment cut may cause some physician practices to steer away from hiring APRNs and PAs and decrease “their use of midlevel practitioners,” suggests Robison.

Frey agrees, “I would guess that some physicians whose primary motivation is reimbursement will begin to see NPs/PAs as less useful to them if they can’t obtain reimbursement at 100 percent. But for those more focused on patient care or those in rural areas or locations where it’s difficult to attract physicians, there probably will be no change in perspective.”

Medicare Compliance & Reimbursement will continue to monitor the feds reaction to MedPAC’s recommendation and any policy changes that follow.

Resource: See MedPAC’s quarterly report at  www.medpac.gov/docs/default-source/reports/jun19_medpac_reporttocongress_sec.pdf?sfvrsn=0.