🏥 “Incident To” Billing Explained: Compliance Guide for Small Healthcare Practices
“Incident to” billing is one of the most misunderstood Medicare billing rules—and one of the riskiest when applied incorrectly. While it can boost reimbursement by allowing non-physician practitioners (NPPs) to bill at the higher physician rate, compliance mistakes can lead to audits, recoupments, and even fraud allegations.
If you’re a small practice billing under a physician’s NPI, this guide will help you understand the rules, avoid common pitfalls, and stay audit-ready.
💡 What Is “Incident To” Billing?
“Incident to” billing allows a nurse practitioner (NP), physician assistant (PA), or other non-physician practitioner to provide services and bill them under a supervising physician’s NPI—at 100% of the Medicare physician fee schedule.
But it only works if very specific conditions are met.
✅ Medicare Requirements for “Incident To” Billing
To bill Medicare “incident to,” the following must all be true:
Initial visit or treatment plan was created by the physician
The NPP is providing follow-up care as part of that treatment plan
The physician is physically present in the office suite and immediately available during the visit
The service is part of the patient’s normal course of treatment
The NPP is an employee or contracted staff, not an independent entity
The service must be billable under the physician’s scope of practice
Important: “Incident to” rules are a Medicare-specific billing mechanism. Medicaid and commercial insurers may not follow the same guidelines.
🚫 Common “Incident To” Billing Mistakes
Incorrect use of “incident to” is a top target in payor audits. Watch out for these compliance risks:
❌ Billing for new patients under “incident to” (not allowed)
❌ No physician onsite during the visit
❌ Using “incident to” with payors that don’t recognize it
❌ Missing documentation of the initial plan of care
❌ Billing for services that are outside the NPP’s state scope of practice
🧾 Why It Matters: The Risk of Non-Compliance
Misapplying “incident to” billing can result in:
Audit-triggered recoupments
Potential Medicare fraud allegations
Denied claims and repayment demands
Increased exposure to False Claims Act liability
🛡️ Compliance Tips for Safe “Incident To” Billing
To reduce risk and stay compliant:
✔️ Train all providers and billers on Medicare’s specific rules
✔️ Confirm your payer mix—not all insurers allow “incident to”
✔️ Document the initial physician encounter and treatment plan
✔️ Track the supervising physician’s presence during visits
✔️ Use a compliance checklist before submitting “incident to” claims
📋 Sample Compliance Checklist (Medicare “Incident To”)
Physician initiated treatment plan (Y/N)
NPP is billing under that existing plan (Y/N)
Physician was in the office suite during the encounter (Y/N)
Patient is not new (Y/N)
Services provided within state scope of practice (Y/N)
Clear documentation of supervision and continuity (Y/N)
🧠 Final Thoughts
“Incident to” billing is a powerful way to improve practice efficiency and reimbursement—but only if you get it exactly right. Don’t rely on outdated advice or assumptions. If your team is unsure about billing protocols, or if you're using “incident to” regularly, it’s time for a compliance review.
A single billing error can cost thousands—or more. A 30-minute legal consult can save your practice far more in the long run.
Hurley Law Group
Healthcare Law for Small & Midsized Providers
📞 308-383-1867
🌐 hurleylawgroup.com
✉️ eric@hurleylawgroup.com