On May 2, 2008, CMS issued transmittal R87BP, a "clarification" to its "incident to" policies for physicians and non-physician practitioners (NPPs). This clarification will be effective on June 2, 2008. See Medicare Benefit Policy Manual, Chapter 15, § 60. While many of the revisions are consistent with current CMS policy or reflect changes that CMS has been discussing informally, much of the content has not been previously published in writing by CMS. The newly published provisions clarify the meaning of the terms "integral" and "incidental" and itemize many of the documentation requirements for reimbursement purposes. In lieu of detailed guidance, the transmittal supplies Medicare contractors with broad discretion to examine specific factual circumstances for compliance with the manual provisions.

The newly published provisions:

Clarify that the services and supplies furnished incident to services provided by a "qualified non-physician practitioner" ("NPP") are subject to the rules. The term "qualified non-physician practitioner" includes nurse practitioners, clinical nurse specialists, physician assistants and certified nurse midwifes to the extent that such practitioners are allowed to provide services under state and local laws.
Define "integral" services as "related to an initial covered service and both essential and connected to the physician's/NPP's delivery of care related to the initial service."
Define an "incidental" service as:
- An important part of the initial covered treatment; and
- Subsidiary or supplementary; and
- Not a significant or substantive service of its own (as interpreted by CMS manuals and Medicare contractors); and
- Not a service for a new symptom or different condition than the one initially treated.
Give Medicare contractors significant discretion to determine most matters under the manual provisions. While the new manual provisions flesh out the "incident to" rules more thoroughly than the existing provisions, many of the issues will turn on specific factual circumstances. The new provisions identify many such factual issues, such as the complexity of the service, the proximity and availability of the supervising physician/NPP and the qualifications of ancillary personnel, which will turn on the contractors' discretion. CMS has declined to offer specific guidance to contractors with respect to the factors they should consider when applying their discretion. Providers should look to their local contractors for guidance in the form of local coverage determinations or other guidance.
Define the term "member of the group" as a physician/NPP "whose services are billed under the same group PIN/NPI (or legacy number if still allowable), and who has filled out an 855R reassigning his/her benefits to the group." § 60.1.F. Note that this definition is not consistent with the treatment of the same term under the Stark self-referral rules, which define a member of the group as an owner or employee.
Provide further detail to the list of "basic requirements" to qualify for reimbursement incident to a physician/NPP's services.
Detail the documentation required to evidence "incident to" services and supplies for reimbursement purposes.

Ober|Kaler's Comments: Physicians and other practitioners should review these new manual provisions carefully and ensure that they are complying with both the supervision and documentation requirements, as fleshed out in these manual revisions. In addition, there is the potential that contractors may begin to develop guidance through local coverage determinations based on the revised manual provisions.