Intricacies of Billing with Nurse Practitioners, Physician Assistants, and Residents

November 9, 2023


The healthcare industry is facing a significant and growing crisis – a shortage of physicians and non-physician providers that threatens the accessibility and quality of healthcare services to communities across the country. As the gap between the supply of healthcare providers and the demand for their services continues to widen, it has become increasingly urgent to address this issue to ensure that individuals across the nation receive the medical care they require.  This shortage has been exacerbated by a combination of factors, including an aging population with increasing healthcare needs, a rising demand for primary care services, and challenges in recruiting and retaining healthcare professionals.  These factors coupled with dramatic wage inflation has focused health systems on developing care models that address escalating costs while creating a financially sustainable environment.  As a result, health systems are using advanced practice providers (APPS), auxiliary providers, and residents to provide care.  This piece will outline key aspects to ensure compliance when billing for services involving these non-physician providers (NPPs).


Given that “incident to” billing is not permitted in facility (e.g., hospital) settings, the only way that a physician and a nonphysician practitioner (NPP) in a facility can “share” a visit and have their combined work considered when billing for professional services is when split (or shared) visit requirements are satisfied.  A split/shared visit are those that are furnished:

  • In a facility setting: the facility setting is defined as an institutional setting in which payment for services and supplies furnished incident to a physician or practitioner’s professional services is prohibited under the regulations on incident to billing (42 CFR § 410.26(b)(1)).
  • By a physician and an NPP in the same group.
  • In accordance with applicable law and regulations such that the evaluation and management (E/M) visit could be billed by either the physician or the NPP if it were furnished independently by only one of them in the facility setting (rather than as a split/shared visit).

The current guidance for split / shared visits (other than for critical care visits) is based on the billing provider performing the “substantive portion” of the visit.  The new definition of “substantive portion” is based on the provider performing more than half of the total time spent, however, the use of this definition has been delayed until December 31, 2024.  For visits other than critical care visits furnished in CY 2023 forward a temporary policy has been set the defines “substantive portion” as either more than half of total time for the service, or the level of medical decision-making.  It is critical to understand that if the physician performs the substantive portion, the visit is billed at 100% of MPFS, whereas if the NPP performs the substantive portion, the visit is billed at 85% of MPFS.

Under the 2022 Medicare Physician Fee Schedule (MPFS)[1], CMS provided changes to Split/Shared Visit Guidance.  These changes were:

  • New definition of “substantive portion”

The “substantive portion” was defined as being more than half of the total time spent by the physician and NPP performing the visit. Only the physician or NPP who performs the substantive portion of the split/shared visit should bill for the visit.  The distinct time of service spent by each physician or NPP furnishing a split/shared visit should be aggregated to determine total time. Physicians and NPPs must document what they separately contributed, and which practitioner provided the substantive portion (and therefore, bills for the visit).

One of the practitioners must have had face-to-face (in person) contact with the patient, but this does not necessarily have to be the physician nor the practitioner who performs the substantive portion and bills for the visit (i.e., the billing practitioner does not necessarily have to perform the face-to-face work).

  • Change to Allow Split/Shared Visits for New Patients

Under the new guidance, CMS will now allow split/shared visits to be billed for new patients for initial and subsequent split/shared visits.

  • Split/Shared Visits for Critical Care Visits

A critical care visit is defined as direct delivery by a physician(s) or other qualified health care professional (QHP) of medical care for a critically ill/injured patient in which there is acute impairment of one or more vital organ systems, such that there is a probability of imminent or life-threatening deterioration of the patient’s condition.  The rules above related to split/shared services will apply to critical care services, but the substantive portion must be determined based on time only. (there is no temporary CY 2022 and 2023 policy for Critical Care Services). CMS has finalized that the total critical care service time provided by a physician and NPP in the same group on the same day can be aggregated, with the practitioner who furnishes the substantive portion of the total critical care time billing for the critical care services.

For Critical Care Services, the qualifying activities that would be counted toward the total cumulative time are the qualifying activities included in CPT codes 99291 and 99292, rather than the qualifying activities for E/M code level selection.

  • Split/Shared Visits for Certain SNF/NF Visits

CMS will allow split/shared visits for certain Skilled Nursing Facility (SNF/NF) E/M visits that are not required to be performed in their entirety by a physician.

  • Prolonged E/M Visit as a Split/Shared Visit

CMS will allow practitioners to bill for a prolonged E/M visit as a split/shared visit if the time threshold for reporting prolonged services is met.

  • Same Group Requirement

A physician and NPP must be in the same group in order for them to bill a split/shared visit. If the physician and the NPP are in different groups, CMS expects that they will bill independently only for the services that they each specifically fully furnish.

Documentation in the medical record must identify the individual practitioners who performed the visit, and the individual who performed the substantive portion (and therefore bills the visit) must sign and date the medical record. CMS has created a modifier for split/shared visits (Modifier -FS) that must be appended to claims for these visits irrespective of whether the physician or NPP bills for the visits. The modifier will allow CMS to identify claims for split/shared visits more efficiently than previously, where the only way to identify such visits has been through medical record review. 


Medicare pays for certain services and supplies under Medicare Part B when they are furnished “incident to” the services of a physician or nonphysician practitioner[2].  Services and supplies may qualify to be billed “incident to” if they are “commonly furnished in physicians’ offices and are commonly either rendered without charge or included in the physicians’ bills.”[3]

  • Practitioners besides physicians who are permitted to bill for incident to services include physician assistants, nurse practitioners, clinical nurse specialists, nurse midwifes, and CPs.
  • Definition of Auxiliary Personnel: Auxiliary personnel means “any individual who is acting under the supervision of a physician (or other practitioner), regardless of whether the individual is an employee, leased employee, or independent contractor of the physician (or other practitioner) or of the same entity that employs or contracts with the physician (or other practitioner), has not been excluded from the Medicare, Medicaid and all other federally funded health care programs by the Office of Inspector General or had his or her Medicare enrollment revoked, and meets any applicable requirements to provide incident to services, including licensure, imposed by the State in which the services are being furnished.” 42 C.F.R. § 410.26(a)(1).

The following are requirements for “incident-to” billing for services and supplies. They must be:

  • Furnished in a noninstitutional setting to noninstitutional patients.
  • An integral, though incidental, part of the service of a physician (or other practitioner) in the course of diagnosis or treatment of an injury or illness.
  • Commonly furnished without charge or included in the bill of a physician (or other practitioner).
  • Of a type that are commonly furnished in the office or clinic of a physician (or other practitioner).
  • Under the direct supervision of the physician/qualified practitioner with limited exceptions.
  • Furnished by the physician, practitioner with an incident to benefit, or auxiliary personnel.
  • Furnished in accordance with sate law.

The following are requirements for Medicare Part B to pay for therapeutic hospital and CAH services/supplies furnished incident to an MD’s/NPPs services. They must be furnished:

  • By hospital or CAH or under arrangements
  • As an integral although incidental part of a physician’s or NPP’s services
  • In the hospital or CAH or a provider-based department (except for mental health services furnished to beneficiaries in their homes through the use of communication technology)
  • Under general supervision (or other level supervision as specified by CMS for the particular service) of a physician or NPP
  • In accordance with applicable State law.

For purposes of this section, NPP means clinical psychologist, licensed clinical social worker, physician assistant, clinical nurse specialist, or certified nurse-midwife.

Exceptions to the direct supervision requirement:

  • Designated care management services (e.g., Remote Patient Monitoring, Chronic Care Management) – “general supervision”.
  • Certain behavioral health services – “general supervision” if the auxiliary personnel (such as licensed professional counselors and marriage / family therapists) providing the services meet all other “incident to” requirements including state law licensure requirements.
  • General supervision requires the service to be furnished under the physician’s (or other practitioner’s) overall direction and control, but unlike direct supervision, presence in the office suite and immediate availability to furnish direction and assistance throughout the service is not required.
  • PHE flexibility allowing direct supervision immediate availability through virtual presence- expires December 31, 2023


Residents provide a significant volume of healthcare services in conjunction with their teaching physician in the course of their training.  In most circumstances, CMS will not allow billing or payment under the Medicare Physician Fee Schedule (PFS) for services furnished by interns and residents within the scope of approved training programs.  Instead, the Medicare program generally pays physicians who are not residents under the Medicare PFS for professional services, and pays for medical education through direct graduate medical education (DGME) and indirect medical education (IME) payments made to the hospital. Generally, to be eligible for Medicare PFS payment for services provided in a teaching setting, the services must be personally furnished by a physician who is not a resident.  The longstanding regulatory requirement is that a teaching physician can only bill under the Medicare PFS for services furnished with a resident in a teaching setting if the teaching physician is present during the key portion of any service or procedure in which a resident participates (unless the primary care exception[4] applies).

Specialty-Specific Variations

  • E/M services: For E/M services furnished with a resident, the teaching physician must be present in person during the portion of the service that determines the level of service billed.
  • Diagnostic Radiology/Diagnostic Tests: Teaching physician must personally perform or review any interpretation performed with the resident.  If teaching physician countersigns only, he/she may not bill for this interpretation.
  • Psychiatric Services: The presence requirement for psychiatric services also may be satisfied by observation of the service by use of a one-way mirror, video equipment, or similar device.
  • OB/GYN: The teaching physician must be present for the delivery to bill for the procedure.  For the global obstetrical care, the teaching physician must be present for the minimum number of visits indicated in the code description in order to bill for the global procedure.
  • Overlapping Surgeries: To bill for 2 overlapping surgeries the teaching surgeon must be present during the critical and key portions of both operations.  If teaching physician is not present during non-critical or non-key portions of the procedure, and is participating in another procedure, s/he must arrange for another qualified surgeon to provide backup to immediately assist the resident, as needed.  Teaching physician may not bill Medicare for participation in 3 concurrent surgical procedures.  Teaching physician must document required presence in the medical record.  Higher standard for “surgical high risk and other complex procedures” performed with residents – teaching physician must be present for key portions and immediately available during the entire service/procedure.
  • The Primary Care Exception: Services must be furnished at a Primary Care Center.  The Primary Care Center must be considered the patient’s primary location for health services.  Residents must have completed > six months of an approved residency program.  Teaching physician must be immediately available to the residents and may not supervise > four residents at once.  CMS finalized the temporary policy to allow the teaching physician to use A/V communications technology to direct care and review services furnished by residents under the Primary Care Exception for rural training sites outside of an MSA.  Teaching physician must have no other responsibilities when services are furnished and must participate in review and direction of services performed by the resident.  Teaching physician must review the beneficiary’s medical history, examination, diagnosis and tests/therapies with the resident immediately after each visit.

If the teaching physician is not physically present, only Level 1-3 E/M Codes may be billed:

  • 99201 to 99203 (for new patients) and 99211 to 99213 (for established patients)
  • G0402 (for initial preventive physical examinations and face-to-face services provided to new beneficiaries)
  • G0438 to G0439 (for annual wellness visit, including the personal preventive plan first visit and subsequent visit)

If the complexity of the patient’s visit warrants a Level 4 or 5 E/M Code, teaching physician must be physically present, or Medicare cannot be billed.

  • Effective January 1, 2022, teaching physicians only may use MDM for purposes of E/M visit level selection when billing E/M visits under the Primary Care Exception

Primary care centers do not need prior approval to furnish services under the exception, but their documentation must demonstrate that the training site, the residency program, the services furnished, and the teaching physician’s involvement satisfy the requirements of the exception.

Documentation Needed to Bill Medicare for services performed with Residents:

  • Documentation must clearly reflect that the teaching physician was present with the resident during the key or critical portions of services.
  • This means the medical record should indicate the extent of the teaching physician’s participation in the service.
  • If the Primary Care Exception applies, the documentation should indicate that the teaching physician reviewed the medical history, examination, diagnosis, and tests/therapies with the resident immediately after each visit.


By:  Chip Hutzler, Partner | HMS Valuation Partners

Allison Cohen, Shareholder | Baker, Donelson, Bearman, Caldwell & Berkowitz, PC


[1] 42 CFR § 415.140

[2] 42 U.S.C. § 1395x(s)(2)(A); 42 C.F.R. § 410.26.

[3] Ibid.

[4] 42 C.F.R. § 415.174.

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Chip Hutzler

Partner—JD, MBA, CVA

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