MedPAC: Eliminate “Incident to” Billing for ARNPs and NPs

If Congress adopts the Medicare Payment Advisory Commission’s (MedPAC), most recent recommendations, “incident to” billing could become a thing of the past for Advanced Registered Nurse Practitioners (ARNPs) and Physician Assistants (PAs).

The recommendation to eliminate “incident to” billing for these providers was made in MedPAC’s biennial report issued in June. MedPAC is an independent congressional agency established in 1997 to advise the U.S. Congress on issues affecting the Medicare program.

Rather than “incident to billing,” which allows ARNPs and PAs to bill under the national provider identifier (NPI) of a supervising physician, MedPAC recommends these clinicians bill Medicare directly. Such a move would update Medicare’s payment policies to better reflect current clinical practice, according to MedPAC.

Those conditions under which these providers may bill “incident to” include:

  • The services are rendered under the direct supervision of the physician. Direct supervision means the physician must be present in the office suite and immediately available to furnish assistance and direction. The physician does not need to be present in the room when the service is furnished.
  • The services are furnished as an integral, although incidental, part of the physician’s professional services in the course of the diagnosis or treatment of an injury or illness.
  • The physician must initiate treatment and maintain active involvement in the patient’s case. This includes new and established patients being seen for new problems.
  • Non-physician providers can bill Medicare using their own NPI in certain circumstances. However, Medicare will only pay the provider 85 percent of the fee schedule rate.

MedPAC noted that total Medicare fee-for-service allowed charges billed by ARNPs and PAs reached nearly $7.3 billion in 2017, more than doubling from 2010 to 2017. Eliminating “incident to” billing is expected to reduce Medicare program spending by $50 million to $250 million in the first year and by $1 billion to $5 billion over the first five years compared with current law, according to MedPAC.

While eliminating “incident to” billing would help to reduce beneficiaries’ financial liabilities, some practices that employ ARNPs and PAs might experience a decline in revenue, according to MedPAC.

Eliminating “incident to” billing in favor of billing under their own NPI would change Medicare’s billing policies “so that claims better reflect which clinicians deliver care, thus enhancing transparency and improving program integrity,” according to the recommendation.

The “incident to” billing rules were first created long before ARNPs and PAs had become as popular as they are today. One reason for their increased use is that states have increasingly given these clinicians more authority and autonomy. While many initially worked in the area of primary care, helping to take up the slack in regions where there was a dearth of primary care physicians, this has changed. Recent estimates suggest that only half of NPs and 27 percent of PAs work in primary care today.

Because Medicare collects little up-to-date information regarding the specialty in which ARNPs and PAs practice, Medicare’s knowledge regarding who these clinicians treat is obscured by “incident to” billing, according to MedPAC.

As a result MedPAC also is recommending that Medicare’s specialty designations for ARNPs and PAs be refined so as to better identify in what areas they are working. This would give the Medicare program “a fuller accounting of the breadth and depth of services provided by ARNPs and PAs and improve policymakers’ ability to target resources toward primary care,” the recommendation states.

The Health Law Offices of Anthony C. Vitale advises medical practices and licensees on compliance matters associated with these billing rules. Give us a call at 305-358-4500 or send an email to info@vitalehealthlaw.com and let’s discuss how we might be able to assist you.

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