Incident-to billing is one of the most misunderstood reimbursement rules we see in day-to-day billing operations—especially among nurse practitioners (NPs) working in small and solo practices. On paper, it sounds straightforward. In reality, it’s one of the fastest ways for well-run clinics to fall into avoidable denials, reprocessing delays, or post-payment audits if the rules aren’t followed precisely.
In our billing work with small practices across multiple states, incident-to errors rarely stem from bad intent. More often, they arise from providers’ incomplete understanding of payer-specific incident-to billing policies and requirements, combined with workflow gaps—such as supervision assumptions, documentation shortcuts, EHR default settings, or staff turnover—that quietly undermine compliance over time.
What Is Incident-To Billing?
Incident-to billing allows certain services provided by a nurse practitioner to be billed under a supervising physician’s NPI at 100% of the Medicare Physician Fee Schedule, instead of the NP’s NPI at 85%, only when strict Medicare supervision, setting, and documentation requirements are met.
Incident-to is governed by Centers for Medicare & Medicaid Services (CMS) rules and applies primarily to Medicare Part B. Medicaid programs and commercial payers may follow different standards—or not recognize incident-to at all.
This is not a coding trick. It’s a billing construct tied to how care is delivered, not just who delivered it.
Who Can Use Incident-To Billing?
Incident-to billing is limited to services performed by qualified non-physician practitioners (such as NPs or PAs) that are part of a physician-initiated plan of care, provided in a non-facility outpatient setting, with the physician present in the office suite and actively supervising.
Eligible clinicians (under Medicare rules)
- Nurse Practitioners (NPs)
- Physician Assistants (PAs)
- Clinical Nurse Specialists (CNSs)
- Certain auxiliary staff (under tighter limitations)
Key eligibility realities we see in practice
- The physician must already be involved in the patient’s care
- The service must be part of an established plan, not a new problem
- The physician must be physically present in the office suite at the time of the appointment
If any one of those elements fails, the claim cannot be billed incident-to—even if the visit was clinically appropriate.
Incident-To vs Direct NP Billing
The main difference between incident-to billing and direct NP billing is reimbursement and compliance risk. Incident-to pays 100% under the physician’s NPI but has strict supervision rules, while direct NP billing pays 85% under the NP’s NPI with fewer operational constraints.
Comparison table: what we see operationally
| Factor | Incident-To Billing | Direct NP Billing |
|---|---|---|
| Reimbursement | 100% MPFS | 85% MPFS |
| Billing NPI | Physician | NP |
| New patient allowed | ❌ No | ✅ Yes |
| New problem allowed | ❌ No | ✅ Yes |
| Physician onsite required | ✅ Yes | ❌ No |
| Audit exposure | Higher | Lower |
| Workflow complexity | High | Moderate |
In smaller practices, the extra 15% reimbursement often gets erased by denials, rework, and delayed A/R when incident-to is used inconsistently.
Medicare’s Core Incident-To Requirements
For Medicare, incident-to billing requires: a physician-established plan of care, an established patient visit, no new problems addressed, services performed in an office setting, and direct physician supervision with the physician physically present in the office suite.
From a billing operations standpoint, these are the five failure points we most often encounter:
- Plan of care not clearly established by the physician
- Physician not onsite at time of service
- New symptoms addressed during the visit
- EHR defaults billing under the physician’s NPI without validation
- Staff were unaware that the visit had changed mid-encounter
Once a visit drifts outside incident-to rules, it must be billed under the NP’s NPI—even if the visit started incident-to compliant.
A Real-World Scenario We See Frequently
In small practices, incident-to billing often fails when visits evolve unexpectedly. A routine follow-up can quickly become a new-problem visit, invalidating incident-to eligibility even though the provider and staff may not recognize the change until claims begin denying weeks later.
Anonymized example from actual billing operations
A two-provider internal medicine practice uses Athenahealth.
The physician sees the patient initially. Follow-ups are scheduled with the NP and billed incident-to.
During one visit, the patient reports new shortness of breath. The NP evaluates it appropriately, orders testing, and documents thoroughly.
What went wrong:
- The visit was still billed under the physician’s NPI
- The physician was in the building but not involved in the new issue
- Claim was paid initially, then recouped during a payer audit
Result:
- Six months later: repayment demand + chart review
- Downstream A/R cleanup
- Staff retraining and payer reprocessing
Clinically correct care. Billing-wise, incorrect execution.
Commercial Payers and Incident-To: Don’t Assume Alignment
Commercial payers do not uniformly follow Medicare’s incident-to rules. Some allow it with modifications, others prohibit it entirely, and many default to NP billing regardless of supervision, making payer-specific verification essential before applying incident-to workflows.
In our experience managing claims with Blue Cross Blue Shield, Aetna, UnitedHealthcare, and Cigna:
- Policies vary by state and product line
- Provider manuals often conflict with reps’ verbal guidance
- Some plans require direct billing under the rendering NPI regardless of supervision
This is why payer matrices—not assumptions—matter.
Documentation Standards That Actually Hold Up
Incident-to documentation must clearly show physician initiation of care, continuity of the treatment plan, absence of new problems, and direct supervision. Notes must support incident-to eligibility without relying on billing assumptions or EHR automation.
What we advise practices to explicitly document:
- Reference to the physician’s original plan of care
- A clear statement that no new problems were addressed
- Rendering provider accuracy
- Physician presence confirmation (where appropriate)
Over-documenting doesn’t fix non-compliance. Correct documentation of correct workflows does.
When Incident-To Billing Makes Sense
Incident-to billing can make sense in highly structured, physician-led practices with stable staffing and predictable follow-ups. It often does not make sense for fast-moving, NP-driven clinics where visits frequently address evolving or new patient concerns.
Incident-to may work if:
- The physician is consistently on-site
- Visits are narrowly defined follow-ups
- Staff understand mid-visit billing changes
It often fails when:
- NPs practice independently
- Clinics handle urgent or complex care
- Supervision varies day-to-day
This is why many practices eventually simplify workflows or seek medical billing services for small practices after repeated A/R corrections and payer takebacks disrupt cash flow.
A Practical Incident-To Billing Checklist for Small Practices
A reliable incident-to process requires pre-visit verification, real-time supervision checks, accurate rendering provider selection, and post-visit billing review. Without a checklist, small practices risk inconsistent application and delayed compliance issues.
Operational checklist
- Confirm physician-established plan of care
- Verify the physician onsite before the visit starts
- Flag visit as follow-up only
- Re-evaluate billing if a new issue arises
- Confirm rendering NPI before claim submission
If step #4 occurs, the incident-to ends immediately for that encounter.
Final Takeaway
Incident-to billing is not a revenue shortcut—it’s a compliance-dependent billing method that requires disciplined workflows. For many NP-heavy practices, consistent direct billing under the NP’s NPI produces more predictable revenue and fewer downstream billing disruptions.
From years of hands-on billing operations, the healthiest practices aren’t the ones chasing every possible reimbursement angle. They’re the ones whose documentation, supervision, and billing logic consistently align with payer guidelines and regulatory requirements—day in and day out.
Frequently Asked Questions
What is incident-to billing for nurse practitioners?
Incident-to billing allows certain services performed by a nurse practitioner to be billed under a supervising physician’s NPI at 100% of the Medicare Physician Fee Schedule, instead of 85% under the NP’s NPI—only when strict Medicare supervision, documentation, and setting requirements are met.
Does incident-to billing apply to new patients or new problems?
No. Under Medicare rules, incident-to billing applies only to established patients and established problems. If a nurse practitioner addresses a new complaint, diagnosis, or condition, the visit must be billed under the NP’s NPI, even if the physician is onsite.
Does the supervising physician have to be physically present?
Yes. For Medicare incident-to billing, the supervising physician must be physically present in the office suite during the visit. Availability by phone, video, or being elsewhere in the building does not meet the supervision requirement.
Can incident-to billing be used with commercial insurance?
It depends on the payer. Some commercial insurers partially recognize incident-to billing, others prohibit it, and many default to billing under the rendering provider’s NPI regardless of supervision. Payer-specific policy verification is required before applying incident-to workflows.
What are the most common incident-to billing mistakes?
The most frequent issues include billing new problems incident-to, assuming supervision without verification, relying on EHR default NPIs, and failing to adjust billing when visits evolve mid-encounter. These errors often surface later as denials, audits, or recoupments.
Is incident-to billing always worth using for small practices?
Not always. In many NP-driven or fast-paced practices, the administrative burden and compliance risk outweigh the additional reimbursement. Many clinics find that consistent direct NP billing results in more predictable cash flow and fewer billing corrections.
