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Medicare “Incident To” Billing – CY 2016 Clarifications

Posted in Centers for Medicare and Medicaid Services-CMS

The billing physician must be the supervising physician.

The final CY (calendar year) 2016 Medicare physician payment rule is out and published in the November 16, 2015 Federal Register. In that rule, CMS (Centers for Medicare & Medicaid Services) made two changes clarifying Medicare’s Part B “incident to” billing rule found at 42 CFR 410.26. The amended regulatory language becomes effective on January 1, 2016.

The first of the two incident to rule changes relates to auxiliary personnel. Physicians and certain “other practitioners” (clinical psychologists, physician assistants, nurse practitioners, clinical nurse specialists, certified nurse-midwives) may bill incident to for services and supplies provided by auxiliary personnel under their supervision. “Auxiliary personnel” means any individual acting under the supervision of a physician (or other practitioner) and can be employees, leased employees, or independent contractors. 42 CFR 410.26(a)(1). Auxiliary personnel must meet state law requirements, including licensure, for providing the service or supply. The final CY 2016 Medicare payment rule adds language specifying that auxiliary personnel must not be excluded from Medicare, Medicaid or any other Federal health program or had enrollment revoked at the time the incident to service or supply is provided. This new language clarifies what already is a Medicare billing requirement.

The second incident to rule change relates to supervision of auxiliary personnel. Only the physician (or other practitioner) who directly supervises the auxiliary personnel providing the service or supply can bill incident to for that service or supply. The physician (or other practitioner) providing direct supervision to auxiliary personnel can be, and very well may be, different from the physician (or other practitioner) treating the patient “more broadly.” Nonetheless, only the supervising physician (or other practitioner) is permitted to bill incident to for services and supplies provided by auxiliary personnel. 42 CFR 410(b)(7).

This revised regulatory language clarifies CMS’ longstanding but sometimes misunderstood position. In its comments to the final rule, CMS explains: “[B]illing practitioners should have a personal role in, and responsibility for, furnishing services for which they are billing and receiving payment as an incident to their own professional service.” In cases, then, where a beneficiary’s treating physician refers the beneficiary to another physician and where auxiliary personnel provide services to that beneficiary under the supervision of the second physician, only the second physician, not the referring physician, is authorized to bill incident to. The second physician’s billing number is reported on the claim form. Although the referring physician has a connection to the services, “we believe the physician or other practitioner directly supervising the incident to service assumes responsibility and accountability for the care of the patient that is provided by auxiliary personnel.”

Medicare’s expectations for “direct supervision” sometimes cause misunderstandings of their own. For purposes of incident to billing, “direct supervision” requires physician (or other practitioner) to be present in the office suite and immediately available to furnish assistance and direction to auxiliary personnel when providing the service or supply; direct supervision does not require the supervising practitioner’s presence in the same room. 42 CFR 410.32(b)(3)(ii). By way of note, only general supervision is required when services or supplies are provided by clinical staff incident to transitional care or chronic care management. 42 CFR 410(b)(7), 42 CFR 410.32(b)(3)(i).

In closing, in comments to its incident to rule changes, CMS noted stakeholder suggestions that it clarify by way of a CPT code listing those services that can or cannot be billed incident to. Medicare law dictates that only services and supplies of the kind commonly furnished in physicians’ offices without charge or included in a physician’s charge may be billed incident to; regulations provide additional specificity but not a listing of services appropriate for incident to billing. 42 CFR 410.26(a)(7), 42 USC 410.26(b)(1-4). CMS said it would take this suggestion under advisement in issuing future guidance on Medicare incident to billing.