Billing algorithm recognizes work of NPs, PAs

Created and tested by a nurse practitioner and physician assistant, this new billing algorithm encourages health systems, outpatient clinics and practices to use nurse practitioners and physician assistants to the fullest extent of their licenses, education and experience. Participate in this forum.

A billing algorithm created and tested by a nurse practitioner and physician assistant at the Medical University of South Carolina improved advanced practice provider/physician teams’ utilization and efficiency; reduced compliance errors; and increased all providers’ relative value units (RVUs) and collections.

That’s not to mention that it simplified a previously complicated billing system, according to Paula Brooks, D.N.P., F.N.P.-B.C., M.B.A., R.N.F.A., director of Advanced Practice Nursing and the Advance Practice Provider (APP) Best Practice Center at Medical University of South Carolina.

Brooks and Megan E. Fulton, M.S.P.A.S., P.A.-C, director of Physician Assistant Practice at Medical University of South Carolina, coauthored a paper published February 2019 in both the Journal of the American Association of Nurse Practitioners and the Journal of the American Academy of PAs. Accepted as a dual publication, this manuscript details the health system’s experience with implementing a new advanced practice provider algorithm, according to Brooks.

Brooks says that each department at the Medical University of South Carolina had a different billing system for nurse practitioners (NPs) and physician assistants (PAs)

“There were 13 different ways that one could close an encounter in Epic (Epic Systems Corporation), our electronic medical record (EMR). So, we really wanted to standardize the process for the APPs because they needed to be recognized for the work that they were providing,” Brooks says.

The health system has since rolled out the new standardized algorithm that complies with Medicare shared guidelines. It simplified the process from 13 versions to a standard a one-page, two-column billing algorithm. One column is for when PAs and NPs see patients independently and bill for the visit. The other column applies if the advanced practice provider sees a patient with the physician in a shared visit, in which the physician documents some portion of the physical exam and/or documents some portion of the medical decision making, according to Brooks.

The algorithm, while built for the Epic EMR could be transferred to other EMRs. It could also work in the private practice or group practice setting, according to Brooks.

“What we’re describing here is really just the principle of a two-column algorithm,” she says.

When the paper’s authors compared data from outpatient clinics in primary care, specialty medicine and surgical teams a year after implementing the algorithm to the year prior to implementation, they found APP RVUs and collections increased dramatically in all groups. In general internal medicine specifically, APP RVUs spiked 608%. There also was a 3% RVU increase among internal medicine attending physicians. Attending physicians saw a 5% increase in collections and APPs realized a 769% increase in collections, according to the study.

RVUs are important and APPs should understand why, according to Brooks.

“Work RVUs, a national standard used for measuring productivity, budgeting, allocating expenses and cost benchmarking, are a measure of value used in the Medicare reimbursement formula for provider services,” the authors write.

The algorithm allows NPs and PAs to be recognized for their work, Brooks says.

“Many were billing ‘incident to,’ in which they were billing under the physician, which would make the advanced practice provider invisible and the physician would be recognized as the one billing and obtaining the RVUs for the visit,” Brooks says.

Having a standardized algorithm helps address the need for more effective and efficient utilization of NPs and PAs in team-based care, better accounting for APPs’ productivity. And it encourages health systems, outpatient clinics and practices to use NPs and PAs to the fullest extent of their licenses, education and experience, according Brooks.

Dermatology and other practices that use PAs and NPs should have organizational plans for standardizing advanced practice provider billing practices, according to Brooks.

The first step is to establish a practice or institution taskforce charged with developing and testing the algorithm. The algorithm must follow Centers for Medicare and Medicaid Services (CMS) guidelines. And it must have buy-in from everyone in the practice, according to the paper.

“Billing under this specific algorithm helps attribute  the work. Practices can run parallel clinics in which advanced practice providers can see patients independently and bill for those visits, and the physician can see their patients independently,” she says. “This will help to increase access and when you look at contribution margin of the physician and APP working together. It’s a cost-effective way to utilize an APP because you’re seeing an increased  number of patients.”