Is incident-to billing right for your practice?

It’s natural to want to maximize revenue for your practice. The cost of generating revenue, however, must always be weighed against projected gains.

Consider Medicare’s rules on incident-to billing. They permit an exception to the Centers for Medicare & Medicaid Services (CMS) requirement that the identity of the person who performed the service be reported on the claim. Specifically, they allow 100% reimbursement for services provided by non-physician providers (NPPs) instead of the standard 85% for NPP services — if certain requirements are met.

These requirements play a principal role in determining whether your practice should submit incident-to billing, as do requirements of other payers who don’t necessarily follow the same rules.

It’s important to know and follow CMS rules to the letter. If the requirements are not met, an overpayment of either 15% or 100% could result. If the person performing the service is unlicensed or not credentialed in the group, the overpayment is 100%. If the person performing the service is licensed and credentialed in the group but the remaining requirements are not met, the overpayment is 15%.

Foremost is the requirement that the physician control the management of the patient’s condition. The physician must initiate the care and remain actively involved. Many practices interpret “remain actively involved” as the physician seeing the patient on every third follow-up visit. The physician must be present in the office suite and be immediately available to provide assistance and direction when the NPP is performing services. If a new problem is introduced, the visit is not incident-to and cannot be billed as such.

Documentation of the incident-to service must include the link to the physician’s service to which the service is incidental. Referencing by date and location the initiating provider’s service will support the active involvement of the physician. The NPP’s identity and credentials must be recorded, as well as the name of the supervising physician for the encounter. The supervising physician does not need to be the same provider who ordered the incident-to service. The supervising provider’s number should then be used for billing the service.

Key questions for other payers

Because these rules apply only to Medicare, the rules of your other payers must also be understood. Not following the rules can put your practice at extreme risk for audit, self-disclosure and payback, and allegations of fraud.

Ask your other payers these questions:

• Do you credential NPPs?
• Do you include them in your provider listing?
• Whose name and provider number is required on claims, the NPP’s or the physician’s?
• Do you require any specific level of supervision or protocol?
• If a physician’s name and provider number are required on the claim, do you differentiate between the initiating provider and the supervising provider?
• What is your reimbursement rate for NPP services?

Once you have gathered the answers to these questions, you can begin to analyze whether incident-to billing makes sense for your practice.

Step-by-step analysis

• Determine how payer answers intersect with or diverge from CMS requirements. Documenting the survey results on a spreadsheet will facilitate the determination.
• Determine how much money is at stake. Quantify your most frequently performed services by payer and determine likely revenue by CPT code. For Medicare patients and patients with payers who follow CMS rules, this means excluding revenue for procedures that your practice reserves for physicians, new patient visits, new problem visits and one-third of all follow-up visits. For payers with other rules, apply them accordingly to the projections.
• Assess the difficulty to follow all payer rules and generate an associated administrative cost of adhering to them. You’re looking to secure that extra 15% in reimbursement for the procedures you identified in the previous step, so you need to determine whether it’s worth it.

Although the rules for incident-to billing can be confusing and vary across payers, learning them will enable your practice to decide the best path forward in billing.