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

Carolyn Buppert, NP, JD


January 31, 2002

In This Article

More Billing Considerations: NP Services in Various Settings

Billing Home Visits Conducted by an NP

Because NPs are authorized by law to perform both nursing and physician services, it is important to keep the distinction clearly in mind when an NP provides a home visit. If an NP is performing a service billable to Medicare Part B as a physician service -- in general, a service described by a code found in CPT[5] made necessary by a diagnosis described by an ICD-9 code,[6] to a patient who is homebound -- the NP does not need a physician's order to perform the visit, and could bill Medicare under the NP's provider number.

However, if an NP is providing nursing services -- billable under Medicare Part A -- the NP would need a physician's order for the home visit, the visit would need to be conducted through a home care agency enrolled as a Medicare provider, and the bill would be submitted by and paid to the agency under the prospective payment system.

Billing Nursing Home Visits Conducted by an NP

An NP may bill Medicare for physician services the NP performs in a nursing home with the following 4 provisos:

  1. An NP may do the admission evaluation only if state law authorizes an NP to perform that function and only if a physician delegates that function to an NP. Otherwise, a physician must do the admission evaluation.

  2. An NP may conduct all "required physician visits" (ie, a visit every 30 days for the first 90 days after admission, then once every 60 days) if the state authorizes NPs to do so, and if the NP is not employed by the nursing facility and if the NP is working in collaboration with a physician.

  3. If the state does not authorize NPs to conduct all required physician visits, but a physician responsible for the visits delegates the visits to an NP, then an NP may alternate required visits with a supervising physician.

  4. An NP may conduct and bill for visits to evaluate and manage illnesses, as medically necessary.

Billing hospital visits and procedures conducted by an NP

In recent years, hospitals and physician groups have been hiring NPs to take care of hospitalized patients, and programs that educate acute care NPs have proliferated. An NP may provide physician services to a hospitalized patient if the services are within the scope of practice of an NP under state law, or if a physician delegates to the NP the authority to perform the services. See the section, "NP Services as Defined by Medicare."

Generally, evaluation and management of acute and chronic illnesses are within an NP's scope of practice under state law. States may also authorize NPs to perform diagnostic and therapeutic procedures. Where state law is silent or unclear, an NP may perform procedures specifically delegated by a physician. For state law, contact the state board of nursing.[9]

NPs are not free to take over the care of hospitalized patients on their own, however, even in permissive states like Oregon. A physician must be involved in the process of care for hospitalized patients, because, under federal law governing hospitals, a hospital must require that "every patient be under the care of a physician."

The general conditions for billing Medicare for physician services performed by NPs in hospitals are:

  1. The services must be billed under the NP's provider number. There is no opportunity for incident-to billing in the hospital setting.

  2. If an NP is an employee of a hospital and the NP's salary is included in the hospital cost report, and if the hospital receives reimbursement from Medicare under the cost report, then the services of that NP may not be billed to Medicare under Part B.

  3. If the services an NP is providing are part of a surgical or maternity package, reimbursed under a global fee, and if a surgeon or obstetrician has billed the global fee, then the NP's services may not be billed, as the surgeon or obstetrician already has billed those services. However, when a service is reimbursed under a global fee, there are mechanisms for transferring care and for separating the components of the global fee, which would allow an NP's services to be billed.

Reimbursement Under Medicare + Choice

The laws addressing Medicare + Choice (the Medicare managed care program) do not specifically address NPs. Reimbursement from Medicare to an MCO and from an MCO to a physician or physician group is made under the terms of contracts -- between Medicare and MCO and between MCO and physician group. Generally, an MCO reimburses only those providers admitted to the organization's provider panel. Some managed care plans admit NPs to provider panels; others do not. Some managed care plans will pay for services rendered by NPs if delegated by a physician who is on the provider panel; others will not. See the section on "Commercial MCOs' Coverage of NP Services," below.

The answers to the preceding questions may differ when the insurer is Medicaid, a commercial indemnity plan, a commercial managed care plan, or a private business.

Medicaid Rules on Billing NP Services

Medicaid rules do not mimic Medicare rules. The Medicaid program is administered by the states, and state regulations vary regarding the billing of NP services. For example, federal law mandates that states reimburse family NPs and pediatric NPs for services provided to patients covered by Medicaid, but does not mention adult NPs, geriatric NPs, or NPs with other specialties. States may elect to broaden federal law and reimburse adult NPs and geriatric NPs as well as pediatric and family NPs. Some states have elected to reimburse all types of NPs and other states reimburse only pediatric NPs and family NPs.

Medicaid reimbursement is further complicated by the fact that many Medicaid recipients are enrolled in managed care plans. Managed care plans' policies on reimbursement differ from the state and federal rules governing reimbursement when the patient is not enrolled in managed care.

Billing NP Services Under Medicaid Fee-for-Service

An NP who has a Medicaid provider number may bill Medicaid on a fee-for-service basis for physician services provided to a patient covered by Medicaid if the patient is not enrolled with a managed care plan. In most states, Medicaid pays NPs 100% of the physician's fee. In some states, Medicaid reimburses NPs at a reduced rate. For details of each state's policies, contact the state Medicaid agency. For a list of contacts by state, see

NP Reimbursement and Medicaid Managed Care Plans

If a patient is enrolled with a Medicaid managed care plan, the plan's policies and contracts will determine who may be reimbursed for physician services. In general, managed care plans reimburse only those providers admitted to the plan's provider panel. Medicaid MCO policies on empanelment of NPs vary, and include:

  • Admitting NPs to provider panels and

  • Declining to admit NPs to provider panels but allowing NPs to provide services for patients on a physician's panel.

A practice wishing to have an NP admitted to a managed care provider panel must query each managed care plan regarding its policies.

Billing Commercial Indemnity Insurers for NP Services

Indemnity insurers reimburse healthcare providers on a fee-for-service basis. Each company has its own policy regarding reimbursement of NP-provided services. The policies vary, and include:

  1. Payment at the same rate as physicians without requirement for admission to a provider panel,

  2. Payment at a reduced rate,

  3. Payment for NP-provided services when billed under a physician employer's name, and

  4. Denial of payment for services provided by NPs.

Some states' laws require commercial indemnity insurers to reimburse NPs for physician services. Other states' laws are silent on the matter. Commercial insurers may adopt Medicare's rules and guidelines on billing NP services, or may adopt completely different policies. Each practice must query each insurer about the insurer's policies. Practice managers may find it useful to prepare grids that track the various insurers' policies.

Commercial MCOs' Coverage of NP Services

In general, MCOs reimburse only those providers admitted to the plans' provider panels. MCOs do not admit every physician to provider panels and may or may not admit NPs to provider panels. Commercial MCO policies on empanelment of NPs vary, and include:

  1. Admitting NPs to provider panels,

  2. Declining to admit NPs to panels but allowing NPs to provide services for patients on a physician's panel, and

  3. Declining to admit NPs to provider panels and permitting only those on provider panels to see patients.

Some MCO contracts allow a designated primary care provider (PCP) -- a provider admitted to an MCO's panel of providers -- to delegate to his or her employees the authority to provide services. Other contracts are silent on delegation. Some contracts may require that a designated PCP provide the patient services. If so, an MCO may consider it fraud for someone other than that PCP to provide physician services.

If an MCO will not credential a group's NPs, and if the contract between MCO and the practice is silent on the issue of PCP delegating the care of patients to an NP, and if the practice intends to offer care by NPs to an MCO's patients, then the practice should ask the MCO for written authorization, as part of the contract, for NPs to provide services and receive reimbursement.

Businesses Contracting With NPs or Practices Directly

A business wanting an NP to provide health services to employees may contract with a practice or NP under whatever financial terms satisfy both parties. State law requirements for NP practice would need to be fulfilled.


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