Provider Billing Compliance: Is your practice getting it right or wrong?

The original version of this article was written by Stephanie Allard RHIT, CPC, CMPA, and this edited and updated version was posted with permission from Stephanie Allard Consulting, LLC.

A frequently overlooked healthcare billing risk is reporting services under the wrong provider. Even when organizations know claims should name the clinician who delivered the care, many still routinely bill under a physician’s National Provider Identifier (NPI) for work performed by another practitioner. These choices are often driven by reimbursement rather than compliance, increasing exposure to audits and payment recoupments.

This is particularly troubling because the practice can become routine over time. What starts as a short-term workaround or a misread of payer rules can turn into a default process in which most visits are billed under the same supervising provider, regardless of who treated the patient. From CMS and commercial Special Investigations Unit (SIU) viewpoints, these patterns are increasingly easy to spot through analytics, utilization trends, and outlier reviews.

Organizations often confuse credentialling requirements with billing rules such as incident-to. Many assume that employing a physician assistant or nurse practitioner automatically allows the practice to bill that work under the physician’s National Provider Identifier (NPI). In reality, compliance depends on payer enrollment and credentialing policies, state scope-of-practice laws, and supervision requirements. Incident-to billing is also not a stopgap for credentialing delays. Practices sometimes will attempt to bill under a physician’s NPI while waiting for payer enrollment of a new Advanced Practice Provider (APP), but incident-to does not care about incomplete credentialing. When a payer requires individual credentialing and enrollment, organizations cannot bypass that requirement by billing under another physician or another provider. Remember, credentialing is a form of “vetting” that new provider.

It’s important to note that incident-to billing is a CMS construct. It doesn’t automatically apply to commercial insurers just because a practice prefers to use it. Because each payer has its own credentialing and payment policies, organizations should follow payer policy manuals and provider enrollment instructions – not assumptions – before billing under another clinician.

Basics of Incident-To Billing 42 CFR §410.26 – Core Coverage Scope:

Must have been a prior physician service to:
1. evaluate/address and diagnose the problem &
2. initiate a management plan/treatment course
“Physician” must be in office suite and immediately available (if you are allowing VDS- you must have a compliance plan outlining your workflow to meet the “immediately available” criteria under incident-to) to provide assistance and direction if needed.
Physician must provide subsequent services of a frequency that reflects the physician’s continuing active participation in/management of course of treatment.
(While Centers for Medicare & Medicaid Services does not explicitly define a strict “12-month rule,” its guidance does require that the physician’s involvement reflect ongoing, active participation in the patient’s course of treatment.)
That said, legal and compliance experts consistently caution that if a physician has not personally seen a patient within 12–24 months, billing subsequent non-physician practitioner (NPP) visits as “incident to” may present elevated audit risk.)
The NPP must represent an expense to the provider (or the entity billing on behalf of the provider) – employee, leased employee, 1099 independent contractor.

To understand payer policies in general, when a physician employs a nurse practitioner, the physician doesn’t get to choose whether claims can be filed under the physician’s NPI (unique provider number). The payer decides if the NP must be separately credentialed and enrolled. More and more commercial insurance payers are requiring individual enrollment for advanced practice providers, questioning the assumption that their services can automatically be billed under the physician.

Organizations also treat incident-to as a reimbursement strategy, but it comes with strict CMS compliance requirements. To bill incident-to under a physician, the physician must first see the patient as a new patient and establish the plan of care or treatment plan. Follow-up visits with the NPP/APP must be consistent with that documented plan. MBPM (Medicare Benefit Policy Manual) Ch.15 § 60.1.B.

A frequent error happens when an advanced practice provider sees a patient independently, develops a new plan of care and then “discusses” it with the supervising physician. Many practices assume the physician’s agreement in that plan is enough to bill incident-to. It isn’t. Review or concurrence alone does not satisfy incident-to rules. If the visit includes a new workup for a new complaint, a new assessment, or any change to the current physician treatment plan, the physician must personally see the patient and document their own services to bill under the physician’s NPI.

Another major risk is assuming that a collaborative relationship automatically meets incident-to requirements. Many states require supervision and collaboration between physicians and advance practice providers, but those state-law obligations do not, but themselves, satisfy CMS or payer-specific incident-to rules. Practices need to know those are separate payer standards and assess each one independently.

One of the main rules under the incident-to guidelines practices miss is the requirement for ongoing physician involvement in the patient’s care. CMS does not set specific intervals for how often the physician must see the patient, but organizations should be able to show workflows that document continued physician participating in managing treatment. When a patient has been seen by only an APP/NPP for years with no physician contact. Supporting all elements of incident-to billing is very, very difficult.

When a visit is billed under a physician’s NPI, incident-to supervision rules still apply. The supervising physician typically must be in the office suite and immediately available during the encounter. A physician cannot bill incident-to services while away from the office, traveling between sites, on vacation, out of the state or counter, or in the office for administrative purposes only. There is the exception of VDS (Virtual Direct Supervision), but this is an exception to the rule, and practices who choose to use VDS, must be able to demonstrate the ability of the physician to be “immediately available”, and provide proof that the practice internet works 100% of the time, and the platform they are using is HIPAA approved, and not FaceTime or Skype, or a public facing platform. This is a hard policy to perfect and enforce.

For example, let’s say that an established patient is in clinic, and is being seen by the practice NP for her chronic conditions and set treatment plan by the physician. The physician was not in clinic at the time, and the practice needed to locate her. Via text, the physician was alerted that this is an incident-to visit and needed to log into their EPIC telehealth audio and video platform for VDS. The practice does not get confirmation from the physician that she received the contact or that she will be logging in. The patient ended up having dangerously high blood pressure and needed to be sent to the ER for elevated hospital care. The patient visit was completed by the NP, and the patient was sent to the ER. About 10 minutes later, the physician texted that she was available now to log in to the A/V platform, but that her internet was sketchy. She was told that the patient ended up at the hospital for a BP event, and the visit was over. This office visit must be billed direct, under the NP, not the physician. This is also an example of how the VDS can be at issue when it does not work for the current workflow and/or when there is an event with a patient that needs attention.

Terminology Defined

Immediately Available: CMS has clarified that “immediately available” means “without delay” so Noridian (Medicare Administrative Contractor) considers “immediately available” to mean the supervising physician is in the office suite or patient’s home, readily available and without delay, to assist and take over the care as necessary.
Office Suite: An “office suite” is limited to the dedicated area, or suite, designated by records of ownership, rent or other agreement with the owner, in which the supervising physician or practitioner maintains his/her practice or provides his/her services as part of a multi-specialty clinic.
https://med.noridianmedicare.com/web/jeb/topics/incident-to-services

As payer analytics and SIU activity expand, organizations that do not review billing patterns face greater risk. Payers examine utilization trends, provider-to-provider comparisons, credentialing records, and encounter mixes, to flag service that may be billed under the wrong supervising physician. Findings can lead to repayment demands, extrapolated overpayments, audits, corrective action plans, and potential fraud investigations.

Reducing Audit Exposure and Risk

Reducing this risk starts with strong compliance oversight and an honest review of provider workflows. Organizations should routinely audit encounters billed incident-to under supervising practitioners to confirm that documentation supports all of the incident-to requirements, payer rules, physician involvement, and supervision expectations. Also, track credentialing status’ closely along with new hire APP credentials. You can trust, but also verify.

Billing under the wrong provider is not a minor technical error. It is a serious compliance risk that can affect your reimbursement and billing integrity, payer relationships, and audit outcomes. As oversight and analytics with payers has become more sophisticated, organizations cannot rely on assumptions or reimbursement-first decisions when assigning billing providers. Those that build clear workflows, maintain proper credentialing, and follow payer policies are in a far better position than organizations trying to justify improper billing after an audit or investigation has begun.

References

Terry Fletcher