Billing Nurse Practitioner Services: FAQs for Physicians and Other Employers

Carolyn Buppert, MSN, JD

Disclosures

April 21, 2020

The medley of "who, what, when, and how much" rules for billing for nurse practitioner (NP) services can be daunting. Here are some of the most frequently asked questions about NP billing, with answers from healthcare attorney Carolyn Buppert. (What should you know before hiring an NP? See The Business Case for Hiring a Nurse Practitioner. For the rules on billing NP services, see How to Bill for Nurse Practitioner Services: The Basics.)

Carolyn Buppert, MSN, JD, Healthcare attorney

If an NP is working under an independent contract with a physician, can the NP's services be billed under the physician's provider number, to get 100% of the Physician Fee Schedule rate?

Answer: Yes, under Medicare rules, if the other parts of the "incident-to" billing rules are followed (ie, the physician is present in the suite and the physician has conducted the initial visit, which reflects his or her active participation in the management of the course of treatment).

Keep in mind that the rules on incident-to billing are Medicare's rules. Other insurers may or may not require adherence to Medicare's incident-to rules. Physicians and practice managers who want to submit bills under a physician's provider number for services performed by an NP must read the policies of and contracts with each insurer and managed care plan with which the practice does business. If they find nothing to address the practice's provider arrangement, query the payer, in writing, before assuming that all bills submitted under a physician's name will be paid.

Is a physician required to be on-site or available within any specific time frame while an NP is working?

Answer: It depends on the provider under whose name and number the visit will be billed, the state where the services are provided, and the insurer. For example, if billing Medicare under an NP's provider number, a physician need not be on site, unless state law requires physician presence. However, if billing Medicare under a physician's provider number, that physician must be on site, within the suite of offices where the NP is practicing.

State law may require the presence of a physician or availability within a specific time frame. Insurers other than Medicare may or may not require physician presence, although in general, these insurers do not require physician presence. For state law requirements, query the state board of nursing.

Is a physician required to read and/or cosign an NP's history and physical, progress note, or other documentation?

Answer: No, unless specifically required by state law or payer policies. For a state's requirements, query the state board of nursing.

I am a physician, and I employ an NP. She takes the history and performs the physical examination, then we discuss the diagnosis and treatment plan, and she implements the plan. I cosign the chart. Will my signature suffice in getting reimbursement under my name?

Answer: A physician's cosignature, absent substantive documentation, usually is not useful in obtaining reimbursement. If billing Medicare under the incident-to rules, a physician must follow those rules, which say nothing about cosignature. For example, if an NP conducts a visit with a new patient, the practice must make a choice: bill the visit under the NP's provider number, or bill the visit under the physician's provider number and have the physician, not the NP, perform and document the portions of the evaluation relevant to the choice of procedure code. With a new patient visit, the physician's signature or writing "agree" on an NP's evaluation will not suffice, for Medicare, to justify billing incident-to. When the visit is with an established patient, in order to bill incident-to, the physician would need to be in the suite, have conducted the initial visit, and remain involved in the care of the patient. Again, the cosignature isn't on the list of things to do. However, some Medicare Administrative Contractors recognize a physician cosignature as documentation that the physician was present in the suite. Other insurers may have different rules.

Can services provided by NPs in a hospital outpatient department or emergency department be billed to Medicare under a physician's provider number?

Answer: Yes, if the rules on shared visits are followed. These rules require the NP and physician to be in the same group, and for the physician to have and document a face-to-face visit with the patient that calendar day.

I am a specialist physician, in solo practice. I want to engage an NP under an independent contract to provide hospital visits, an occasional home visit, an occasional nursing home visit, and see patients in my office on days when I am in the office and on some days when I am off. I want to bill all visits under my own provider number. I may have the NP do some in-office procedures, as well. Can I do this?

Answer: You can engage an NP as an independent contractor. Payments can come to you, under the terms of your contract with the NP. However, to bill Medicare for the NP's services, you will need to change your status with Medicare from sole practitioner to group practice.

Under Medicare rules, NPs can perform nursing home, hospital, and office visits, and can perform procedures, as long as the scope of practice for an NP under state law authorizes diagnosis, treatment, and diagnostic procedures. In some states, you can delegate those functions to the NP under your collaborative agreement. You must bill the following visits conducted by the NP to Medicare under the NP's provider number:

  • Home visits;

  • Nursing home visits (unless you rent space in a nursing home and are in that rented space at the time NP sees patients there);

  • Office visits when you are not present in the office suite; and

  • Hospital visits, unless following Medicare's rules on shared visits.

On days that you are present in the office suite at the time the NP is working, you may bill office visits conducted by the NP under your own provider number, if you have conducted the initial visit and if you remain involved in the care of the patient. For Medicare, you would bill the NP's work under his or her provider number. As for other insurers—commercial indemnity insurers and managed care plans—you will need to ascertain the policies of each of these insurers regarding reimbursement of your contractor's services.

Our hospital employs NPs who provide services to surgeon's patients to improve the flow of admission and discharge. The NPs also perform some diagnostic procedures in the hospital, for the surgical service. Can the hospital bill for the NP's services?

Answer: Yes, the hospital, as employer, has the right to bill for an employed NP's services. However, if a surgeon is billing the global fee for a surgery, that fee covers the surgical preoperative evaluation, the surgery, the postoperative surgical evaluation and management, and removal of drains. If the hospital-employed NPs are providing services covered by the global fee, and the surgeon is not employed by the hospital, that can be a Stark law/kickback problem. The hospital's compliance department should analyze that situation and correct a situation where the hospital is giving a referring physician nonmonetary compensation in the form of NP services. And, if the NP is performing diagnostic procedures, the NP's employer—the hospital—should be billing for those services.

The basic principles that apply here, under Medicare's rules, are:

  • An NP's services in a hospital must be billed under the NP's own number, unless the rules on shared visits are followed.

  • Only the NP or the NP's employer has the right to bill for the NP's services.

  • Only one bill may be submitted for any given service to any given patient on any given day.

  • The global fee for surgery is billed by the surgeon (this includes intensive care unit visits by the surgeon; preoperative visits; intraoperative services; and postoperative visits related to recovery from the surgery, pain management, complications, dressing changes, local incisional care, and removal of sutures and drains). The global fee does not include the initial surgical consultation, services of other physicians, visits unrelated to the surgical diagnosis, treatment for an underlying condition, diagnostic tests, clearly distinct surgical procedures, or treatment for a postoperative complication that requires a return to the operating room.

An application of these rules to the question yields the following conclusions:

  • If the NP, rather than the surgeon, is performing some significant parts of the surgeon's work for which the surgeon is seeking payment under the global fee, and the surgeon has not formally transferred the care to the NP, then the surgeon may be billing for services he or she did not render. If so, the surgeon is risking a charge of erroneous billing.

  • If the surgeon is billing the NP's visits with patients in his office under his own number, presumably under the incident-to rules, the payments for the NP's work have to go to the NP's employer, under the reassignment rules.

  • Finally, if the surgeon is billing and receiving payment for work done by the NP, then the hospital, as employer of the NP, is subsidizing the surgeon's practice. Such a subsidy could be a kickback and Stark law violation, which is illegal under federal law.

A series of contracts between surgeon, hospital, and NP could correct the legal problems inherent in this example.

Which type of business relationship—employer/employee, independent contractor, or equity shareholder—between an NP and physician is best for the NP? For the physician?

Answer: One arrangement is not inherently better than another for either physician or NP. The most appropriate and satisfying business structure and employment relationship will depend upon the individuals and the specifics of the practice. An experienced attorney can, using the facts and the business objectives, provide advice letter on how the relationships should be structured and which form the business should adopt.

Do NPs and physicians ever do business as partners, shareholders of a professional corporation, or members of a limited liability company? Is that legal?

Answer: Partnership is becoming less common for all professionals, because partnership, as a choice of business structure, has drawbacks. (For example, each partner is personally responsible for the debts and liabilities of the other partners.) The most common business forms for professionals are professional corporations, professional associations, and limited liability companies. Many attorneys now recommend that professionals form a limited liability company, which has some similarities to a partnership, without the drawbacks. NPs and physicians have formed limited liability companies.

In some states, professionals holding differing classes of licenses cannot join together to own professional corporations. In other states, professionals with different licenses can form only one type of company; for example, they may form a limited liability company but not a professional corporation. NPs and physicians wanting to share equity should seek the advice of a local attorney who specializes in business and healthcare law.

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