Billing For Nurse Practitioner Services: Guidelines for NPs, Physicians, Employers, and Insurers

Carolyn Buppert, NP, JD


January 31, 2002

In This Article

Incident-to Billing

Incident-to Billing: Billing an NP's Service Under a Physician's Provider Number

If an NP and a physician work together to provide physician services, the services can be billed under the physician's provider number, to get the full physician fee, under the Medicare provision for "incident-to billing." However, certain rules must be followed when billing services under the incident-to provision. The rules are:

  1. The services are an integral, although incidental, part of the physician's professional service.

  2. The services are commonly rendered without charge or included in the physician's bill.

  3. The services are of a type commonly furnished in physician's offices or clinics.

  4. The services are furnished under the physician's direct personal supervision and are furnished by the physician or by an individual who is an employee or independent contractor of the physician. Direct supervision does not require the physician's presence in the same room but the physician must be present in the same office suite and immediately available.

  5. The physician must perform "the initial service and subsequent services of a frequency which reflect his or her active participation in the management of the course of treatment."

  6. The physician or other provider under whose name and number the bill is submitted must be the individual present in the office suite when the service is provided.

The incident-to rules are stated in the Medicare Carriers Manual (Part 3, Chapter II, section 2050), available online at


Incident-to Billing -- Appropriate Use

A physician evaluates a patient, and diagnoses hypertension. The physician initiates treatment. The physician employs an NP. The NP conducts follow-up visits with the patient, monitoring and treating the hypertension over weeks, months, or years. The physician sees the patient every third visit, under a policy adopted by the practice. The NP's work may be billed under the physician's provider number, and the practice will receive 100% of the physician's fee schedule rate for the services performed by the NP.

Incident-to Billing -- Appropriate Use Unclear

If the scenario described above continued, but one day the hypertensive patient arrived for a follow-up visit with the NP and announced a new complaint of sinusitis, for example, it is not clear that incident-to billing would be appropriate. There are differing interpretations among clinicians and auditors of the phrase "the physician must perform the initial service," found in the "incident-to" rules. Some clinicians may interpret this rule to mean that only the first visit to the practice must be conducted by the physician. Others interpret "perform the initial service" to mean that when there is a new problem, the NP must either bill under his or her own number or refer the patient back to the physician. The Centers for Medicare & Medicaid Services (CMS) has not defined "initial service." Neither has CMS clarified the phrase "subsequent services of a frequency which reflect [the physician's] active participation in the management of the course of treatment." "Active participation" may mean different things to different clinicians, auditors, and administrators. For example, active participation may mean chart review, or face-to-face visits, depending upon the reader's interpretation.

Incident-to Billing -- Illegal Use

A physician employs an NP to work in a satellite office. The physician is never present. Incident-to billing is inappropriate, as the requirements are not met. However, the NP's services may be billed under the NP's provider number, and Medicare will pay 85% of the physician rate for the services.

Billing an Assistant's Services Under an NP's Provider Number

A medical practice may bill the services of a non-NP incident to an NP's services (ie, bill an assistant's services under an NP's provider number), if the rules for incident-to billing are followed. For example, if an NP sees a patient and orders an electrocardiogram (EKG), and an office technician performs the test, the NP may bill for the EKG as if the NP had performed it, under the incident-to billing provision.


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