“Incident to:” Mitigating Widespread Misconceptions

“Incident to:” Mitigating Widespread Misconceptions

While billing for services “incident to a physician’s” comes with challenges, the difficulties are often exaggerated.

First, do you need to have a physician present in the office suite when an “incident to” service is performed? For most of my career, the answer has been a solid “yes,” but not anymore. During the federal public health emergency (PHE), the Centers for Medicare & Medicaid Services (CMS) allowed a supervising physician to be available by a device with audio-visual communication.

The physician didn’t even need to actually activate the real-time audio-visual device; it merely had to be available for use if needed. That provision was set to expire at the end of 2023, but in the 2024 physician fee schedule, CMS extended it through the end of this year.

As long as you’ve got a physician who can take an audio-visual call, you’ve got the requisite supervision. I bet that will extend past 2024, but we shall see. Still, for 2024, you don’t need someone in the office suite.

Next, I want to offer a quick reminder about the purported “new problem.” I know what I am about to say is controversial. Even some consultants I greatly respect assert that you can’t treat new problems under the “incident to” benefit.

But I am confident in my analysis that it is totally proper to treat a new problem “incident to” – as long as that problem is part of the course of treatment. I will put my money where my mouth is: I’ll give 10 hours of free legal help to the first person who can show me a statute, regulation, or Medicare Claims Processing Manual or Benefit Policy Manual provision that even refers to new problems in the discussion of “incident to” billing, let alone limits the ability to treat them “incident to.”

I will posit that you can’t find the words “new problem” next to one another in a discussion about incident to in a regulation or manual. I’ll readily concede that many Medicare Administrative Contractors (MACs) have issued policies indicating you can’t treat “new problems” incident to. Noridian, NGS, and Novitas all have, as well as MACs that don’t start with “N,” such as First Coast. But while these MAC policies are nearly universal, they are still wrong.

The fact that consultants and the trade press routinely echo the assertion that you can’t treat new problems this way does not make it the law. MAC policies are certainly not the law. Statutes and regulations are.

The relevant phrase in the regulation, 42 CFR 410.26(b)(2), is “services in the course of diagnosis or treatment of an injury or illness.” I want to emphasize “diagnosis.” You don’t diagnose old problems. If all  the people claiming you couldn’t treat new problems were correct, that regulation would say “treatment of existing problems” and not “course of diagnosis or treatment.” If you’re reading this and thinking that I’m wrong without independently looking at the regulation and critically thinking about what I am saying, you’re doing yourself and your organization a serious disservice.

This brings me to my final point. I’m amazed at the number of consultants who tell their clients not to do “incident to” billing because it is “too risky.” Times are tough in healthcare. Willfully refusing a 15-percent bump in pay is terrible financial management. Is there risk associated with incident to billing? Of course. But if your view is that you shouldn’t bill for a service in healthcare when there is a risk of doing it wrong, I hope you’re not submitting any claims for any services – because billing risk is omnipresent.

Some organizations may choose to be cautious in their approach to billing any service. But each such decision should be made at the highest levels of the organization, with full understanding of the risks and benefits.

Can things go wrong with incident to billing? You bet. But things go wrong with evaluation and management (E&M) billing, and I’ve never heard anyone say “You might as well just stop coding for those services.” The incident to rule isn’t all that confusing. 

Let me close by summarizing the rule in three sentences. You may bill incident to for services under the name and number of a professional who supervises those services by being available by audio-visual communication when the service occurs. But the service has to be something that’s routinely furnished in a physician office, not in a facility like a hospital or skilled nursing facility. The course of treatment must be initiated by a professional in the group, but it needn’t be the professional providing the supervision.  Incident to billing isn’t nearly as daunting as it may seem. In the words of Jellybean Benitez and Madonna, “you can do it, uh-huh.” Just be grateful I am not singing this message!

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David M. Glaser, Esq.

David M. Glaser is a shareholder in Fredrikson & Byron's Health Law Group. David assists clinics, hospitals, and other health care entities negotiate the maze of healthcare regulations, providing advice about risk management, reimbursement, and business planning issues. He has considerable experience in healthcare regulation and litigation, including compliance, criminal and civil fraud investigations, and reimbursement disputes. David's goal is to explain the government's enforcement position, and to analyze whether this position is supported by the law or represents government overreaching. David is a member of the RACmonitor editorial board and is a popular guest on Monitor Mondays.

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