Incident to, revisited

By Alexander Miller, MD, October 1, 2018

Since the last Cracking the Code article on “incident to” services in June 2014, integration of non-physician practitioners (NPPs) — typically physician assistants (PAs) and nurse practitioners (NPs) — in dermatology practices has continued its upward trend. Recently, I have been receiving questions about appropriate billing for NPP services. I have noticed that when a few people pose questions, many more have similar concerns, but have not voiced them. In this article, I will endeavor to answer these questions, and more.

Incident to services are those that are provided under the direction/supervision of a physician or NPP. When qualifying criteria are met and these services are provided by a NPP under physician supervision, the services may be billed under the physician’s National Provider Identifier (NPI) and are reimbursed by your Medicare Administrative Contractor (MAC) at 100% of the Medicare fee schedule. When the criteria are not met, the services are billed under the NPPs NPI and are adjudicated at 85% of the physician fee schedule.

Clearly, there is a financial distinction in reimbursement that may lead to scrutiny of frequently submitted incident to claims by the MAC. Just as clearly, one should strive to avoid focused claim audits by adhering to appropriate incident to interpretations, which are not always shiningly obvious.

The June 2014 issue of Cracking the Code (staging.aad.org/dw/monthly/2014/june/billing-medicare-for-incident-to-services) lists conditions that must be met for billing incident to services under the physician’s NPI. I have reiterated the points that seem to cause the greatest confusion and concern below. Since all of the questions that I have received about incident to billing concern criteria for physician supervision of NPPs, I will limit this discussion to such scenarios.

General criteria for office incident to services under physician supervision:

• Physician must have initiated the treatment, and must remain “actively involved” in the patient’s treatment
  
  
• The NPPs may be employees, leased employees, or independent contractors of a physician or group
  
  
• Physician must be “immediately available” to supervise:

• Immediately available means “without delay”
• The physician must be physically present in the office suite (not the same room; must be on the same floor within the suite) where incident to care is being provided
• Any physician member of a physician group practice may supervise
• Document in patient record that physician was present in office suite

• In a physician-directed clinic setting, the supervising physician does not have to be the same one who ordered a service
  
  
• Incident to services are billed under the employing or supervising physician’s NPI when appropriate criteria have been met
  
  
• NPPs (PAs and NPs) must accept Medicare assignment of benefits

• Corollary: Incident to services billed under the physician’s NPI are also treated as assigned and are reimbursed as such

• General incident to billing criteria:

• When an established patient is seen by a NPP, incident to billing may be done if the established problem is ongoing, with no changes or new manifestations that may be construed as new problems, and no new treatments are prescribed
• Established patient, established problem, seen by NPP only: May qualify for incident to billing under physician’s NPI
• Established patient, new problem, seen by NPP only: Bill under NPP’s NPI
• Established patient, new problem, seen by NPP and new problem evaluated by physician: May qualify for incident to billing under physician’s NPI. Document the following:

• New problem evaluated by physician face to face
• Physician initiated treatment
• Physician must sign chart entry

• Any individual state-mandated criteria for supervision and record keeping must be met

Incident to, or not?

Scenario 1: Established patient is evaluated and treated for an established problem by a NPP located in an office suite. The supervising physician is in an accredited surgical center adjacent to the office suite. The service is billed as incident to under the physician’s NPI.

Answer: Incorrect. The supervising physician must be physically present in the office suite. An adjacent surgical center is considered to be a separate entity, not part of the office. Service should be billed under the NPPs NPI.

Scenario 2: You, the physician, biopsy a clinically atypical nevus. The pathology reveals a compound nevus with severe atypia. You schedule the patient for an excision. Your PA therapeutically excises the nevus while you are present in the office suite. The excision and repair are billed under your physician’s NPI.

Answer: Correct. Since the patient is an established patient with an established problem and established plan of care, and the supervising physician is physically present in the office suite, billing as an incident to service is appropriate.

Scenario 3: A new patient’s cheek lesion is evaluated by a dermatologist, who suspects a basal cell carcinoma and determines a need for a biopsy. The biopsy is delegated to the practice’s PA, who does the biopsy on the same day while the supervising physician is in the office suite. The biopsy is billed under the physician’s NPI and reimbursed at 100% of the Medicare fee schedule.

Answer: Correct. The physician initiated the evaluation and the course of treatment, which was then carried out during the same encounter time by the PA incident to the physician’s direction.

Scenario 4: An established patient with psoriasis vulgaris is evaluated by a NP working in a dermatology group practice. The NP examines the patient, modifies the treatment drug plan, and assigns a follow-up visit. In the patient’s medical record, the physician has not documented how and when the patient’s drug treatment plan can be modified. The visit is billed as incident to, under the supervising physician’s NPI.

Answer: Incorrect. Although the patient has an established problem, the change in the prescribed treatment means that a new treatment plan has been established. When the plan of care is changed and the physician has not documented how and when the patient’s drug treatment plan can be modified the visit does not qualify as an incident to service. Billing should be done under the NP’s NPI.

Scenario 5: A busy two-physician and three-PA practice commonly delegates established patient care to PAs. An established patient with a history of malignant melanoma — initially evaluated and treated two years ago by a dermatologist in the practice — comes in for regular complete skin examinations and lymph node basins palpations done by a PA. As the examination consistently reveals no changes, the E/M visits are billed to Medicare as incident to, under the initial physician’s NPI.

Answer: Incorrect. The Medicare Benefit Policy Manual, 60.2, states the following: “there must be subsequent services by the physician of a frequency that reflects the physician’s continuing active participation in and management of the course of treatment.” A Medicare auditor may question whether a two-year time span of physician non-participation in the patient’s care conforms to the definition of “active participation.”

Scenario 6: A dermatologist diagnoses an eczematous dermatitis on the legs and arms and prescribes appropriate topical treatment. A PA in the practice sees the patient two weeks later and notes substantial improvement, but also new eczematous lesions on the trunk. The PA advises to apply the prescribed topical steroid ointment to the additional eczematous lesions. The visit is billed under the PA’s NPI.

Answer: Correct. Although the diagnosis as well as the treatment remain the same, the appearance of eczematous lesions in a new anatomical area is interpreted as a new problem. Consequently, the visit does not qualify as an incident to service. Similarly, if an established patient with psoriasis, seborrheic dermatitis, actinic keratosis, or inflamed seborrheic keratoses, etc., develops lesions at new sites not previously noted, such lesions are interpreted as new problems, and incident to billing is not appropriate.

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