New Reimbursement Laws Q & A
December 1999
In August of 1997, President Clinton signed the Balanced Budget Act of 1997 (BBA) into law. Among many other provisions, the BBA included Section 4511, providing for Medicare coverage of nurse practitioner (NP) and clinical nurse specialist (CNS) services, regardless of geographic area. That law went into effect on January 1, 1998.
Medicare is administered by the Health Care Financing Administration (HCFA), an agency within the U.S. Department of Health and Human Services (HHS). As part of this responsibility, HCFA interprets and clarifies Medicare law. The November 2, 1998 Federal Register published final regulations issued by HCFA on Medicare reimbursement for NPs and CNSs. These regulations are codified in Title 42 of the Code of Federal Regulations, Sections 410.75 and 410.76 and went into effect on January 1, 1999.
The final rule for the Medicare Physician Fee Schedule for the calendar year 2000, which was published in the Federal Register on November 2, 1999, includes the required qualifications for NP participation as reimbursable Part B providers in the Medicare program. The final rule goes into effect January, 1, 2000.
The passage of Medicare reimbursement for nurse practitioners and clinical nurse specialists, regardless of geographic setting, is an historic advance for all of nursing. Many NPs and CNSs have specific questions about the new law and regulations, and how they can work to ensure that Medicare beneficiaries have access to NP and CNS services. The following are some frequently asked questions, along with answers supplied by the American Nurses Association.
Q. What did Section 4511 of the BBA do?
A. Under this section of the law, effective January 1, 1998, "physicians' services" under Medicare will now include:
services which would be physicians' services if furnished by a physician . . . and which are performed by a nurse practitioner or clinical nurse specialist . . . working in collaboration with a physician . . . which the nurse practitioner or clinical nurse specialist is legally authorized to perform by the State in which the services are performed, and such services and supplies furnished as an incident to such services as would be covered under subparagraph (A) if furnished incident to a physician's professional service, but only if no facility or other provider charges or is paid any amounts with respect to the furnishing of such services.
Q. What does that mean?
A. It means that services provided by NPs and CNSs can be eligible for Medicare reimbursement if those services would be reimbursable when provided by a physician and the services are within the scope of practice of the NP or CNS.
Q. But weren't some of those services already covered by Medicare?
A. Yes, but with significant restrictions: services of NPs provided in a nursing home were covered, as were NP and CNS services provided in a "rural area," which was narrowly defined to mean a non-Metropolitan Statistical Area (non-MSA) county. Those restrictions have been eliminated. Services are covered regardless of geographic area or setting.
Q. Are there restrictions as to the type of setting in which covered services can be provided?
A. No. According to the regulations, payment can be made to an NP or a CNS for professional services provided "in all settings in both rural and nonrural areas." (42 CFR Sections 410.75(c ), 410.76(c ) and 410.150(16).) As noted above, payment is made "only if no facility or other provider charges, or is paid, any amount" for furnishing the NP's or CNS's services. No specific type or class of setting is specifically excluded under the law or regulations, however.
Q. What does that language about covering NP and CNS services "only if no facility or other provider charges or is paid any amounts with respect to the furnishing of such services" mean?
A. It means that NP and CNS services can be paid for only once. ANA continues to work with the Health Care Financing Administration to clarify this language. ANA's position is that this language should not preclude coverage for hospital-based NPs and CNSs, as long as they are providing Part B services and as long as their salary costs are not also paid by Medicare. This issue will require further discussion and clarification, and ANA will issue further information on it as it becomes available.
Q. Does direct coverage of NP and CNS services mean that "incident to" coverage has been eliminated?
A. No. "Incident to" coverage remains available for services of NPs and CNSs. Of course, the same service cannot be billed twice -- i.e., billed by the physician as an "incident to" service and billed by the NP or CNS directly. In the long run, it remains to be seen what changes may be made in "incident to" billing. As a result of the new law, however, since NPs and CNSs can bill directly for their services, they are assured that coverage of their services will not be threatened by changes, if any, that may be made in "incident to" billing in the future. In addition, NPs and CNSs may now bill for "incident to" services provided by their own employees.
Q. How does billing for services "incident to" those of an NP or CNS work?
A. According to the regulations, such services can be covered if:
- They would be covered if furnished by a physician or as incident to a physician's professional services.
- They are of the type that are commonly furnished in a physician's office and are either furnished without charge or are included in the bill for an NP's or CNS's services.
- They are an integral part of the professional service performed by the NP or CNS; and
- They are performed under the direct supervision of the NP or CNS; in other words, the NP or CNS must be physically present and immediately available. Although the regulations do not provide further clarification of this, it should be presumed for now that this means that the NP or CNS must be physically present in the office suite, but not necessarily in the room where services are being provided. (This would be consistent with current interpretation of services provided incident to a physician's professional services.)
Q. Does HCFA require specific educational or certification requirements to be met by NPs or CNSs in order for their services to be eligible for reimbursement under Medicare?
A. Yes. The regulations include more specific requirements than are present in the law. The nurse practitioner qualifications require progressively enhanced qualifications but provides lead time for experienced nurse practitioner to obtain and maintain a Medicare billing number under the earlier nurse practitioner qualifications which did not require a master's degree. The final rule also includes a transition time period to enable nurse practitioners applying for the first time for a Medicare number to achieve national certification or earn a master's degree.
Q. What are the Required NP Qualifications?
A. The final rule revises 42 CFR Sec. 410.75 (b) so that for Medicare Part B coverage of his or her services a nurse practitioner must:
(1) (i) Be a registered professional nurse who is authorized by the State in which the services are furnished to practice as a nurse practitioner in accordance with State law; and
(ii) Be certified as a nurse practitioner by a recognized national certifying body that has established standards for nurse practitioners; or
(2) Be a registered professional nurse who is authorized by the State in which the services are furnished to practice as a nurse practitioner in accordance with State law and have been granted a Medicare billing number as a nurse practitioner by December 31, 2000; or
(3) Be a nurse practitioner who, on or after January 1, 2001, applies for a Medicare billing number for the first time and meets the standards in paragraph (b) (1) (i) and (b) (1) (ii); or
(4) Be a nurse practitioner who, on or after January 1, 2003, applies for a Medicare billing number for the first time must possess a master's degree in nursing and meets the standards for nurse practitioners as defined in paragraphs (b) (1) (i) and (b) (1) (ii).
(These revised NP qualifications take effect January 1, 2000 and will replace the required NP qualifications that were published in the Federal Register, November 2, 1998).
Q. But I'm an NP without a Masters degree. I have been practicing for years and in fact I already have been providing services to Medicare beneficiaries. Will I have to get a Master's degree to get a Medicaid number?
A. The final rule will allow nurse practitioners, who meet the earlier established requirements, to apply for a Medicare number for a period of time ending on December 31, 2000. The earlier criteria were set forth in regulations under the rural health clinic conditions for certification (42 CFR 491.2) and as part of the Medicare Carriers Manual, Section 2158. The new qualifications beginning January 1, 2000, would apply only to those NPs applying for Medicare numbers for the first time. Therefore, an NP would be subject only to the qualifications requirements under which he or she received the initial Medicare number.
Q. What about requirements for CNSs
A. A CNS must be an RN who is licensed and is authorized to perform the services of a CNS in the state in which she or he practices; holds a masters degree in a defined clinical area of nursing from an accredited educational institution; and be certified by ANCC.
Because the masters degree in nursing is commonly accepted as a requirement for CNS practice, the new regulations have not generally been seen as problematic. The technical correction noted above applies only to the NP requirements. The CNS requirements remain in effect.
Q. CNS must be "authorized to practice"? But my state does not recognize CNSs as a separate category.
A. If you are in a state that does recognize CNSs separately, you must meet your state's requirements. If you are a CNS in a state without specific requirements for CNSs, you are most likely "authorized" to practice under the same laws that apply to other RNs. This should not preclude your services from being covered under Medicare, as long as you are practicing within your state-defined scope of practice. Similarly, some states may recognize psychiatric/mental health CNSs, but not other categories of CNSs. This should not preclude coverage of their services under Medicare-again, as long as they are practicing within their scope of practice.
Q. The new law requires that, in order for their services to be covered, an NP or CNS must be "working in collaboration with a physician." What does that mean?
A. The HCFA regulations contain an explanation of this requirement. "Collaboration" is defined as a process in which the NP or CNS works with one or more physicians to deliver health care services within the scope of the practitioner's expertise, with medical direction and supervision as provided for in jointly developed guidelines or other mechanisms as provided by the law of the State in which the services are performed.
The regulations go on to explain that in the absence of State law governing collaboration, collaboration is a process in which an NP or CNS has a relationship with one or more physicians to deliver health care services. Such collaboration is evidenced by NPs or CNSs documenting their scope of practice and indicating the relationships that they have with physicians to deal with issues outside of their scope of practice. NPs and CNSs must document this collaborative process with physicians.
The regulations also explain that the collaborating physician does not need to be present with the NP or CNS when services are furnished or to make an independent evaluation of each patient who is seen by the NP or CNS.
Q. Since my state doesn't require supervision or collaboration by an MD, do these requirements apply to me at all?
A. Yes. The regulations spell out requirements that must be met in order for your services to qualify for Medicare coverage. In many cases, these requirements may go beyond what is required under your state practice act. Because the Medicare reimbursement laws include a requirement for physician collaboration, HCFA determined that such requirements would have to apply to NP and CNS services in order to be Medicare-eligible. However, the regulations do recognize that some states do not require collaboration, and HCFA has provided less restrictive collaboration requirements to apply to NP and CNS services in those states.
Q. What does the new law say about reimbursement rates for NP and CNS services?
A: The new law says the following:
the amounts paid shall be equal to 80 percent of (i) the lesser of the actual charge or 85 percent of the fee schedule amount provided under section 1848, or (ii) in the case of services as an assistant at surgery, the lesser of the actual charge or 85 percent of the amount that would otherwise be recognized if performed by a physician who is serving as an assistant at surgery.
These provisions can also be found at Title 42, Section 410.56(c) of the Code of Federal Regulations.
Q. What does that mean?
A. Essentially, it means that Medicare will pay you 85% of what it pays physicians for providing the same service. This is basically the same payment provision as applies under current law for NPs and CNSs. In addition, there is now an explicit provision covering the services of NPs and CNSs who serve as an assistant at surgery if the services of a physician serving as assistant at surgery would likewise be covered.
Q. 17. Does the new law specifically address billing for mental health services by NPs and CNSs?
A. Generally, the law and the implementing regulations do not speak to specific types of services. They generally allow for coverage of services that would be covered if provided by physicians, as long as all requirements for coverage are met — such as that the NP or CNS is authorized to provide them and that they are provided in collaboration with a physician.
In the text preceding the final regulations (known as the "preamble" to the regulations), however, HCFA does clarify that "if State law authorizes [NPs and CNSs who specialize in mental health] to perform mental health services and evaluation and management services that would otherwise be furnished by a physician or incident to a physician's services, psychiatric nurse practitioners and clinical nurse specialists could bill for psychiatric diagnostic interviews and any of the psychotherapy CPT codes that include medical evaluation and management." (Federal Register, November 2, 1998, page 58873.)
Q. Do the regulations address NPs and CNSs ordering physical therapy, occupational therapy and speech-language pathology services?
A. Yes. The regulations revise Sections 410.60, 410.61and 410.62 of Title 42 of the Code of Federal Regulations to clarify that NPs and CNSs may order these services when they are medically reasonable and necessary and the State in which they are practicing authorizes them to do so. NPs and CNSs can also certify and recertify the plan of treatment for these services if they are authorized by their State to do so.
Q. How do I get a provider number in order to bill Medicare for my services?
A. The first step is to contact the Medicare carrier for your state (or your part of the state) and request a Medicare Part B provider number (a unique identifier that must be included on all claims).
Q. Aside from the law and the regulations, are there other sources of rules or policies that I will need to be aware of?
A. Yes. HCFA issues instructions to the local Medicare carriers — private agencies who contract with HCFA to administer the Medicare program in each state (or, in some instances, portion of a state). These instructions are based on current law or regulation, or provide clarification regarding questions or issues regarding the law or regulations. These include additions or changes to HCFA's Medicare Carriers Manual, which instructs the carriers on how to administer Medicare Part B.
Once you are enrolled as a Medicare provider, you should start receiving regular newsletters and other updates from your carrier, which should include important news such as the content of new carrier instructions or policies. In addition to HCFA instructions to the carriers, the carriers themselves have some latitude in administering Medicare Part B. Again, the carriers themselves will be your primary source of information on new or changed policies. Getting your provider number is an important first step to being "in the loop" for this potentially important information.