The effective use of physician assistants (PAs) and nurse practitioner (NPs) in an orthopaedic practice requires an understanding of key billing rules that apply to these nonphysician providers (NPPs). Compare your practice's internal procedures to the following common questions and answers. The guidelines referenced are for Medicare claims; other payers may have different rules. The Medicare scenarios and guidelines described in this article apply the same way to both PAs and NPs.

Incident-to services
Q. Our PA is credentialed with Medicare. What is the advantage of reporting her office services incident to one of our physicians, instead of reporting them in her own name?

A. It's all about reimbursement. Medicare allows for services that are reported incident-to at 100 percent of the physician fee schedule (PFS), whereas services billed direct by a PA or an NP are allowed at 85 percent of the PFS. If the requirements for incident-to reporting are met, the practice comes out ahead reporting services that way.

New patients and NPs
Q. Our office-based NP usually sees established patients with established problems, and the supervising physician is onsite. What should we do if the NP sees a new patient or a returning patient has a new problem?

A. The practice has two options. First, the NP could simply bill that visit using the direct method (under the NP's name). Alternately, a physician could see the new patient to set the plan of care, with the visit reported by the physician. Remember, for a new patient or new problem seen in the office setting, the physician cannot use the documentation elements already captured by the NP; code assignment would be based only on the work the physician performs and documents.

Split/shared visit
Q. In our office, the physicians use our PA as they would residents. The PA sees the patient first, performs an examination, and then discusses the case with the physician. The physician also sees the patient, but doesn't repeat everything the PA has done. Can this be reported in the physician's name?

A. It depends. This scenario is termed a split/shared visit, because neither the PA nor the physician did
everything; they each performed a portion of the work and combined it. In the office setting, incident-to rules must be considered before applying split/shared rules, which do allow an NPP and a physician to combine their work when it is performed and individually documented on the same day.  If the patient has an established problem, with a plan of care that was set previously by a physician, then the combined work can be reported in the physician's name, and it will be allowed at 100 percent of the physician rate. However, a new patient or a new problem cannot be reported as split/shared for the combined work. One option is to report the visit in the PA's name and accept 85 percent of the allowable; alternatively, the visit can be reported in the physician's name, but only for the work that the physician performed.

Keep in mind, Medicare and other payers use place of service code 11 to designate services performed in a physician office. In academic- and hospital-based settings, a physician may instead use place of service code 19 or code 22, which are handled differently.

Work with an NP
Q. My NP starts my new office visits for me, including taking the history of present illness and examining the patient. I do a brief exam and the medical decision-making myself. The NP records everything in the electronic health record and indicates she is acting as a scribe. Someone told me I can't report this in my own name; why not?

A. An NPP cannot perform elements of an evaluation and management service and be treated as a scribe for the same encounter. This is a split/shared encounter with a new patient. Because the incident-to billing guidelines were not met, it must be reported in the NP's name.

Onsite physicians
Q. Our group practice reports incident-to services in the name of the physician who saw the patient originally, even if he's not in the office. (Another physician is present instead). Is that appropriate?

A. No. Medicare guidelines for incident-to services state that the claims must be reported in the name of the physician who provided onsite supervision. According to Chapter 26 of the Medicare Claims Processing Manual, "When the ordering physician or non-physician practitioner is not supervising the service, then enter the signature of the physician or nonphysician practitioner providing the direct supervision in item 31." Item 31 is the billing provider name field in the bottom left corner of the 1500 claim form. Similar language has been in place since 2004.

Hospital settings
Q. What are the differences in billing PA or NP services in a hospital setting versus a practice setting?

A. Several of these billing guidelines change in a hospital setting. First, incident-to billing is not allowed in the hospital setting; surgical assistance should always be reported in the PA's or NP's name as a direct service. When the PA or NP works on the hospital floor, billing options depend on whether the physician also sees the patient (and documents the visit) on the same day. If so, the NPP and physician can combine their work (split/shared) and report it in the physician's name, even for a new patient or problem. If not, the hospital visit is billed direct in the NPP's name.

Place of service
Q. One of the offices in our academic practice uses place of service code 22 for Medicare claims. Does that change billing for NPPs?

A. Effective Jan. 1, 2016, the definition of place of service code 22 changed as follows: "A portion of a hospital's main campus which provides diagnostic, therapeutic (both surgical and nonsurgical), and rehabilitation services to sick or injured persons who do not require hospitalization or institutionalization." 

Termed an "on-campus–outpatient hospital" setting, place of service code 22 office services are different for NPP reporting. Although the setting may look and feel to patients just like an office (place of service code 11), it is considered hospital space. Refer to the hospital's compliance department for guidance on incident-to and split/shared rules in this setting.

Joint injections
Q. When my PA performs joint injections, can we report those services under the incident-to billing rules?

A. If the PA scope of practice regulations in your state allow PAs to perform joint injections, the determining factor is whether the incident-to billing rules are met. If you previously set the plan of care for joint injections, they could be reported as incident-to. If the PA made the decision to perform the injection independently, it should be reported as a direct service.

Signing notes
Q. Do I have to sign each of my NP's notes that are reported incident-to?

A. The guidelines for reviewing and signing NPP documentation are set by each state in its scope of practice regulations. Each practice must research those requirements individually. But as an employer, you are responsible for the care provided by the NP, and reviewing and signing off on the notes may be an efficient method for keeping tabs on patient treatment.

PAs as scribes
Q. All of these billing rules seem very confusing. Should I just use my PA as a scribe, and forget about using NPPs to see patients independently?

A. Each physician must make his or her own choices on how to use NPPs, but this is a very expensive approach that doesn't make the best use of the PA's training and skills. For more insight on the use of PAs and NPs, see the online version of this article for links to additional materials.

Reporting
Q. Do I need to use a modifier to tell the payer that I am reporting a service incident-to or split/shared?

A. Medicare does not require use of modifiers for this purpose. Many practice management systems allow separate reporting fields for rendering and billing provider, which allows the practice to track the NPP's productivity for services that are billed in a physician's name.

Sarah Wiskerchen, MBA, CPC, is a senior consultant with KarenZupko & Associates, Inc. Information in this article has been reviewed by the members of the AAOS Coding, Coverage, and Reimbursement Committee.

References:

1. Wiskerchen S: Billing Essentials for Using a PA or NP in Orthopaedics. AAOS Now, February 2015.
2. Murray TJ: Making the Most of PAs and NPs. AAOS Now, January 2015.
3. Marriott T: Medical Scribes, PAs, Take Note. PA Professional, February 2014.