Collection Concerns Follow These Billing Rules and Guidelines for Non-physician Practitioners

Hiring non-physician practitioners (NPPs) is a great way to meet a growing patient base while still providing quality health care. Most successful and growing medical practices already utilize these health care providers.

Not all, however, are maximizing the opportunities to generate revenue because they are not utilizing these providers most effectively. (See my February column “Work Smarter, Not Harder”). Other practices are not aware of the rules for billing the services of NPPs. The objective of this article is to acquaint you with the rules and opportunities to maximize billing and collections for NPP services.

Ideally, the prospective NPP already has a national provider number (NPI). If not, this has to be applied for immediately. If one already exists, confirm with CMS for any required profile updates, such as change of address, location of service, and reassignment of benefits.

Check with your state laws for the scope of practice permitted, licensure and certification requirements, and prescribing privileges. All NPPs who prescribe controlled substances must be registered with the FDA.

Check with your major third-party payers, which account for about 80{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} of your practice revenues, for policies regarding reimbursement for NPP services, and enroll your NPP with Medicare and insurers that will credential them.

You should also check with hospitals and nursing homes to find out if they permit NPPs to round on patients.

Billing for Services

CMS generally sets the standards for billing, which, unless further restricted by the scope of practice of the licensing state, is generally followed by most insurers. Some payers, however, require ‘incident to’ billing for some or all services, so it is a good idea to know this beforehand.

CMS does not restrict the level of service the NPP can utilize. If supported by the presenting problem(s), and if the complexity or risk of complications associated with the presenting problem supports the medical necessity of a given level of service (1 to 5), the NPP can bill at that level. Note that, on a new or established patient visit, a level 1 is regarded as an office nurse visit and is rarely, if ever, used by a physician or NPP.

CMS also does not restrict NPPs from performing consultations as long as it is within the state scope of practice and the billing requirements are met. In other words, an opinion must be requested by a physician, an opinion must be rendered, and the opinion must be returned to the requesting physician.

Once the E/M service and level of service are determined, there are two ways the service may be billed. One way is the direct billing under the NPP’s name and NPI. The other way is the ‘incident to’ billing under a physician’s name and NPI. If billed direct under the NPP’s name and NPI, CMS (and others) will pay only 85{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} of the allowable fee paid to the doctors. If billed ‘incident to,’ CMS will pay 100{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} of the allowable fee.

In order to bill ‘incident to’ and get the 100{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} allowable payment, certain criteria must be met. First, the CMS supervision requirements must be fulfilled. These are somewhat complex and will be dealt with in a separate article.

Second, the place of service may not qualify for ‘incident to’ service. For example, you cannot generally bill ‘incident to’ for services rendered in a facility setting such as a skilled-nursing facility, a nursing home, or a hospital (inpatient or outpatient). There is an exception to this rule for skilled nursing facilities and nursing homes if you have an office in the facility and if you are present when the service is rendered.

Third, you cannot bill ‘incident to’ for certain services. For example, ‘incident to’ billing cannot be done for new patient visits (99201 to 99205) or for an established patient with a new problem. A patient is an established patient if seen within the last three years by a provider in the practice. Also, consultations cannot be billed ‘incident to’; they must be direct-billed by either the NPP or the physician.

NPPs can perform E/M services in hospitals, such as admissions, visits, and discharges, as long as they have hospital privileges and these allow for such services. As mentioned before, all these must be direct-billed by the NPP (85{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} reimbursement). Skilled-nursing facilities allow NPPs to perform subsequent visits and discharges, but only a doctor can bill for the initial comprehensive assessment. All nursing-facility services must be direct-billed.

For all these reasons, NPPs and support staff need to be trained in chart documentation and coding and how to determine the appropriate level of service, just the same as doctors.

Other Benefits of Employing NPPs

Aside from being able to bill for their services, NPPs also indirectly boost practice earnings by allowing doctors to focus on more complex services or procedures. For example, an NPP can see patients for follow-up visits following a globally billed operation or office procedure, freeing up the doctor to book more surgical procedures.

Learning the ins and outs of NPP billing can make their utilization much more profitable, avoid unnecessary claims denials, and capture revenue that may be falling through the cracks in the billing cycle. A well-informed and well-trained team comprising the doctor, the NPP, and the billing support staff can make this a reality.v

James B. Calnan, CPA, is partner-in-charge of the Health Care Services Division of Meyers Brothers Kalicka, P.C., in Holyoke, certified public accountants and business consultants; (413) 536-8510.