'Incident To' Billing: Is It Worth It for Medical Practices?

January 21, 2014

Is billing for an "incident to" service really worth the extra 15 percent in reimbursements? In my opinion, there are more pitfalls than benefits.

I think most employees think the term is "incident 2." It might be better if it were known as "incidental to," since in theory the midlevel provider is working in a capacity that is incidental to the work of the physician. But no matter what you call it "incident to" can be one of the more confusing concepts for medical practice employees and physicians alike to grasp.

When Medicare is billed "incident to" for nonphysician practitioner (NPP) services, the bill goes out under the physician's NPI number, even though the midlevel has performed the work. Reimbursement is 100 percent of the Medicare fee schedule, as opposed to 85 percent when the service is billed under the midlevel's own number.

There are certain criteria that must be met in order to bill "incident to." According to CMS, NPP services may be billed under the physician's NPI when the service is part of your patient's normal course of treatment, during which a physician personally performed an initial service and remains actively involved in the course of treatment. The physician does not have to be physically present in the patient's treatment room while these services are provided, but must provide direct supervision. This means that the physician must be present in the office suite to render assistance if necessary. The patient visit documentation should show that the essential requirements for incident to services were met.

The previous paragraph raises all sorts of problems and pitfalls with getting that extra 15 percent reimbursement. One of these pitfalls is that in order to bill "incident to," the physician must see the patient first and initiate a plan of care, which the midlevel provider can then carry out. Employees must know not to put a new patient, or an established patient with a new problem, on the midlevel's schedule if billing is being done "incident to." If the patient brings up a new problem during the course of the visit, it cannot be billed "incident to." But how does this get communicated to the billing staff? Remember, NPPs can see new patients or new problems to the extent allowed under their state licensure. They just have to bill the new patient or new problem under their own NPI. This can be very confusing to staff members who you are depending on to get the right provider number on the bill.

In my opinion, the biggest problem when billing "incident to" is the direct supervision requirement. This is a considerable problem in a practice such as a surgery group, where physicians are regularly in the operating room rather than the office. The rules on "incident to" are very clear that having the physician in the same building is not adequate to fulfill the "direct supervision" condition. Having the doctor at the operating room in an adjacent building on the same medical campus is not good enough. When some doctors are in on one day, and some are in on another it creates a very confusing situation for the biller in knowing whose provider number to bill under. And if the bill is going out under the name of whichever doctor is in the clinic that day, does it really meet the requirement for the physician initiating treatment to be actively involved in the care?

Or what happens if the physician runs over to the hospital to do rounds while the NPP continues to see patients? The mid-level's services cannot be billed "incident to" while the doctor is not in the office suite, requiring the staff to switch provider numbers for billing during certain periods of time. This creates a situation where the staff may not know the doctor is not in, especially if the assignment of provider numbers has to be done by the biller after the fact.

Another issue I have had with "incident to" billing is confusion on the part of the patient, who gets an explanation of benefits from Medicare or another payer showing that they saw Dr. X, when they actually saw the NPP. This is especially confusing if the NPP's service was billed under whichever doctor happened to be at the clinic at that time, and whom the patient may never have seen at all.

In my practices, I have chosen not to bill NPPs under "incident to" because there are so many inflexible requirements and administrative burdens. Each individual practice will have to make the decision as to whether the extra 15 percent reimbursement is worth the risk of error and penalties if those errors are discovered in an audit.