Medicare Part B covers certain services that are billed by physicians but are performed by nonphysician practitioners "incident to" the services of a physician. According to the HHS Office of Inspector General (OIG), "incident to" services are vulnerable to overutilization and may put beneficiaries at risk of receiving services that do not meet professionally recognized standards of care.

The OIG Study

A recent study by the OIG of "incident to" services performed by nonphysician personnel found that "unqualified" nonphysician personnel performed 21 percent of the services that physicians did not perform personally. Nonphysician personnel in the study sample included technicians, nurses, licensed or certified assistants, therapists and other employees who were not licensed or certified but instead had received other formal medical training, on-the-job training, or no formal medical training whatsoever. According to the OIG, these nonphysician personnel lacked the necessary licenses or certifications, had no verifiable credentials or lacked the training to perform the service at issue. The OIG also found that unqualified personnel performed seven percent of invasive services that physicians did not perform.

Recommendations for CMS

As a result of the study, the OIG recommended that the Centers for Medicare and Medicaid Services (CMS):

  • Seek revisions to the "incident to" rule, to require that physicians who personally do not perform services they bill to Medicare ensure that such services are performed by other licensed physicians or are performed under the direct supervision of a licensed physician by nonphysicians who have the necessary training, certification and/or licensure to perform the services;
  • Require physicians who bill services to Medicare that they do not personally perform to identify the services on their Medicare claims by using a service code modifier, which would allow CMS to monitor claims to ensure that physicians are billing for services performed by nonphysicians with appropriate qualifications; and
  • Take action to address the claims that were detected that were billed by physicians and performed by nonphysicians that were not "incident to" services and were for rehabilitation therapy services performed by nonphysicians who did not have the training of a therapist.

CMS agreed with the OIG's first recommendation, noting that it was in the process of clarifying manual policies addressing "incident to" billing, including guidance for documenting the qualifications of a person performing services "incident to" the services of a physician. As to the second recommendation, CMS agreed in principle but contended it would be difficult to implement operationally. As a result, CMS has promised to study the issues involved in adding code modifiers to services furnished exclusively by staff other than the billing physician. CMS also concurred with the third recommendation and agreed to share the OIG report with the Medicare Administrative Contractors (MACs).

Intensified Scrutiny by CMS

It appears that CMS's scrutiny of "incident to" services will intensify; therefore, all providers should begin to take actions to verify and ensure that nonphysician personnel who are rendering services incident to those of a physician have the appropriate qualifications to do so. See the OIG report.