How, when and who qualifies for 'incident to billing'

May 1, 2006

Are you thinking about hiring a physician extender? Or did you justhire one? If so, be sure you know how to bill payers for theservices that these nonphysicians provide in your dermatologypractice.

In the industry, the phrase "incident to" describes the billing process for physician extenders. It's important to note that the concept of incident to for billing purposes is specific to the programs administered by the Centers for Medicare and Medicaid (CMS). Although many other payers follow CMS' incident to guidelines, which are presented in this article, recognize that some payers do not. Contact your payers' provider representatives to determine what their rules are.

What it means

The reason you want to know if a service qualifies as incident to is because if it does, then that service can be billed at 100 percent of your physician fee. Services provided by physician extenders that fail to qualify as incident to may be billed at the extender's rate, which is only 85 percent of the physician's allowance. That's if the CMS physician supervision and management rules are also met and if the service is within your state's scope of practice for that extender. Otherwise, it's possible that service would not be reimbursable at all.

'Integral, although incidental'

CMS rules state that incident to services are those "services or supplies (that) are furnished as an integral, although incidental, part of the physician's personal professional services in the course of diagnosis or treatment of an injury or illness."

The rules also say that incidental services must be "part of the physician's personal services in the course of diagnosis or treatment of an injury or illness." CMS clarifies that "such a service or supply could be considered incident to when furnished during a course of treatment where the physician performs an initial service and subsequent services of a frequency which reflect his/her active participation in and management of the course of treatment."

For example, you may commence the care of a new patient, and then schedule subsequent appointments with your physician extender. "Active participation" is, unfortunately, not defined. Some Medicare carriers require the dermatologist to see the patient every third visit. Check with your carrier to understand its definition of "active participation."

How to bill for it

When billed incident to the dermatologist, CMS allows the claim to be billed under the dermatologist's name without mention of the physician extender. The reimbursement is for 100 percent of the physician fee schedule. Only by pulling and reviewing the documentation of the encounter would you know that it was a physician extender who performed the service.

For internal tracking purposes, discuss implementing a series of identifiers for categories per dermatologist. For example, Dr. Jones may be issued a number, such as 100, to identify what services he performs. Another number, such as 101, can identify services a physician extender performs incident to his services.

When to bill it

Physician extenders can apply for provider numbers, perform services and bill on their own.