Effective January 1, 2016, Medicare revised its “incident to” billing rules requiring that incident to services are billed under the physician who directly supervises the auxiliary personnel (i.e. the person performing the incident to service).


Most incident to services require direct supervision (defined below) of auxiliary personnel providing the incident to services.  When a physician’s billing number is used on a claim form, the physician is stating that he or she performed the service or directly supervised the auxiliary personnel performing the service.

The Final Rule does not change the fact that the physician supervising the auxiliary personnel need not be the same physician upon whose professional service the incident to service is based.  It simply means that when the claim form is submitted, the incident to services are billed under the number of the physician who supervises the auxiliary personnel.


As a reminder, incident to services in the physician office setting must meet all of the following requirements:


  • The services do not have their own benefit category under the Social Security Act.  For instance, vaccines/immunizations, EKGs, laboratory tests, and radiology procedures have their own benefit categories and cannot be billed as incident to services;


  • The services and supplies must be furnished in a setting that is not a hospital or skilled nursing facility;


  • The services are an integral, though incidental, part of the physician’s service in the diagnosis or treatment of an injury or illness;


  • The services and supplies must be commonly furnished without charge or included in the physician’s bill;


  • The services and supplies must be of a type that are commonly furnished in the office or clinic of a physician;


  • The services are furnished under the direct supervision of a physician eligible to bill and directly receive Medicare payment.  “Direct supervision” means present in office suite and immediately available to furnish assistance and direction throughout the procedure;


  • The services represent an expense to the physician’s practice (i.e. services provided by W-2 employee, leased employee, or an independent contractor); and


  • The services are furnished in accordance with applicable state law.


Please note these are CMS billing requirements.  State law may provide different supervision requirements based on the specific situation.


Next Steps


Physician practices should update their billing practices and policies and educate staff about these new incident to billing requirements.  Practices will need to review claims submitted from the effective date of January 1, 2016 and after to ensure incident to services were properly billed under the supervising physician.


Written by: Samantha Prokop, Healthcare Attorney