Taking the Guesswork out of Correct Billing

More and more health organizations are hiring midlevel providers to perform services that were formerly thought to be appropriate exclusively for medical physicians. While it is less costly to hire Physician Assistants, Nurse Practioners, and Certified Nurse Midwives, it’s imperative that institutions familiarize themselves with the rules regarding billing for these midlevel professionals. Not only must we follow rules to meet compliance, it’s also important that we understand maximum allowable reimbursement rates for midlevel providers in order to responsibly plan for the financial health of the group. While Medicare sets the national standards for professional fee-for-service reimbursement, private payers are permitted to set their own fees. Additionally, most insurance carriers do not recognize Medicare’s “Incident-To” billing option. Medicare routinely updates their policies, guidelines, and provider fee schedules on quarterly basis. This information is accessible from their website CMS.gov. However, private payers may not publicly post their rules.   We recommend that you contact specific carriers to inquire about their reimbursement policies and fees.

Advize Health is pleased to highlight and summarize Medicare’s rules for your convenience.

The Centers for Medicare and Medicaid Services (CMS) recognizes the following healthcare professionals as Mid-Level Providers, Physician Extenders, or Non-Physician Practitioners (NPPs):

Certified Registered Nurse Anesthetists (CRNA) [under own NPI, billed at 80% of the MPFS]

  • Physician Assistant (PA) [under own NPI, billed at 85% of MPFS]
  • Nurse Practitioner (NP) [under own NPI, service is billed at 85% of MPFS]
  • Certified Nurse Specialists (CNS) [under own NPI, service is billed at 85% MPFS]
  • Certified Nurse-Midwife (CNM) [under own NPI, service is billed at 80% of MPFS]


If the following requirements are met, a physician may bill an NPP’s service to a Medicare beneficiary under the physician’s NPI for reimbursement at 100% of the Medicare Physician Fee Schedule (MPFS)”.

If any of the following criteria is not met, the service can only be billed under the performing NPP’s NPI at 85% of the MPFS:

  • This service is recognized only by Medicare and not by commercial carriers.
  • It only applies in two settings: 1) in the outpatient clinic setting (POS 11), or; 2) in Home Services (POS 12) the physician must have performed the initial service.
  • The patient must be established to the practice (under the physician’s specialty) when the NPP first sees the patient.
  • The patient must have been previously diagnosed by the physician and have a plan of care previously planned by the physician.
  • The NPP must carry out the previous plan of care and not evaluate any new or different problems.
  • The physician should perform and document subsequent services with a frequency that demonstrates active participation and management of the patient’s condition during this course of treatment.
  • The NPP must furnish the service under “direct supervision” of the physician: the physician must be on the premises and immediately available during the encounter in the outpatient clinic, or must be accompanying the NPP during home care.
  • A physician’s co-signature is not required on the NPP’s note. The physician must sign his or her name at the end of his or her hand-written or dictated note only.

Split/Shared E/M Service:

The physician and an NPP each perform a substantial key portion of an E/M service (History, Exam, or Medical Decision Making), in which each one is face-to-face with the patient, during the same date of service. Medicare rules are as follows:

  • This only applies to the Hospital Inpatient and Discharge (POS 21), Hospital Outpatient or Hospital Observation (POS 22), Emergency Department (POS 23), and Outpatient Office non-facility/clinic services (POS 11).
  • This does not apply to a Nursing Facility (POS 32) or a Skilled Nursing Facility (POS) 31 setting.
  • The physician and the NPP must be of the same group practice or employed by the same employer.
  • Does not apply to consultations, critical care services, or procedures performed.
  • If the E/M is split/shared in the office (the physician does not perform all key components of the encounter), then the encounter may still be billed under the physician’s NPI if the requirements for “incident-to” are met—if not, the split/shared service should be billed under the NPP’s NPI.
  • If the E/M is split/shared in either the Inpatient Hospital, Outpatient Hospital, or Emergency Department setting, and the physician and the NPP are under the same group and specialty, and each perform a key portion of the face-to-face encounter on the same date of service—the service may be billed under either the physician’s or the NPP’s NPI and reimbursement will be paid at the appropriate percentage of the MPFS. Each provider must sign his or her own note.
  • If the physician either does not perform any portion, or, if the physician was not physically face-to-face with the patient during a key portion of the encounter, the service can only be billed under the NPP’s NPI at 85% of the MPFS

Surgical Assistant NPPs:

This applies only to Nurse Practitioners (NPs), Physician Assistants (PAs), and Certified Nurse Specialists (CNS) who assist a physician surgeon (MD or DO) during a medically reasonable and necessary surgical procedure.

  • The NPP Surgical Assistant must be legally authorized and qualified to perform “Assistant-at-Surgery” services in the state that he or she is licensed.
  • The NPP Surgical Assistant must be authorized to furnish the “Assistant-at-Surgery” service.
  • The NPP Surgical Assistant must perform the “Assistant-at-Surgery” service in collaboration with the physician surgeon.
  • Not all surgical procedures allow for an “Assistant-at-Surgery”. Those surgical procedures that Medicare lists as Assistant Surgeon allowed must be billed using modifier “AS” at the end of the same CPT code billed by the physician surgeon.
  • NPP Assistant Surgeons do not require a dictation of their own note, but must be mentioned in the operative report and the portion performed by the Assistant Surgeon must be detailed or the Assistant Surgeon’s service is not billable.
  • NPPs assisting in surgery must have the Supervising Physician identified on the billing claim form.
  • NPPs who provide an allowable “Assistant-at-Surgery” service will be reimbursed at 85% of 16% of the MPFS fee for the surgical procedure [example: CPT xxxxx = $1,000 at the MPFS fee. The PA would receive $136.00 or 13.6% of the MPFS surgical fee for this CPT code].
  • Multiple Procedure Payment Reduction (MPPR) applies when more than one CPT code is billed during the same surgical encounter [the first CPT code is reimbursed at 100% of the MPFS and each additional CPT code is reimbursed at 50%, however, “add-on” CPT codes and “modifier-51 exempt” CPT codes are not subject to MPPR]. Often Medicare will request the operative note for manual review when more than five surgical codes are billed.
  • MPPR does not apply to E/M codes or supply codes, but does apply to procedures performed in the office setting. 


  1. https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/se0441.pdf
  2. http://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/Downloads/Medicare-Information-for-APRNs-AAs-PAs-Booklet-ICN-901623.pdf
  3. http://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/clm104c12.pdf