Incident-To Billing: Why Most Practices Get It Wrong

Introduction

“Incident to” billing is often misunderstood in medical practices. While it can allow services provided by non-physician practitioners to be billed under a physician’s NPI at 100% of the Medicare Physician Fee Schedule, it comes with strict requirements.

Many practices unintentionally fall out of compliance because they assume “incident to” simply means a physician is available or in the office. Unfortunately, that as

This assumption is incorrect.

What “Incident To” Actually Means

Under Medicare rules, “incident to” services are those that are:

• An integral part of a physician’s professional service

• Provided under a physician-established plan of care

• Performed under the appropriate level of supervision

• Properly documented in the medical record

Crucially, the physician must initiate the patient’s care and remain actively involved in management.

Common Ways Practices Get Incident-To Wrong

Here are the most frequent compliance gaps:

1. Physician Did Not Initiate Care

If a nurse practitioner or physician assistant independently evaluates a new problem without physician involvement, the visit does not qualify as incident-to.

2. Incorrect Supervision Level*

Incident-to services require direct supervision, meaning the physician must be present in the office suite and immediately available not off-site or only available by phone. (*Supervision flexibility coming in 2026. More details below)

3. New Problems Are Managed Independently

Incident-to billing applies only to established problems within an existing plan of care. New complaints generally require physician evaluation.EDUCATIONAL DISCLAIMER (Include at Bottom)

This checklist is for educational purposes only and reflects general Medicare incident-to billing principles. Payer rules may vary. Practices should consult current CMS guidance or compliance professionals for practice-specific determinations.

4. Documentation Doesn’t Support Incident-To

Even when supervision is technically met, charts often fail to clearly reflect:

• Physician involvement

• Established plan of care

• Ongoing management

If it isn’t documented, it doesn’t count.

Why This Matters

Improper incident-to billing can lead to:

• Claim denials

• Overpayment demands

• Compliance audits

• Financial risk for the practice

Many practices don’t realize there’s a problem until a payer review or audit occurs.

Best Practices for Compliance

To reduce risk, practices should:

• Clearly define incident-to workflows in writing

• Train providers and billing staff regularly

• Audit charts periodically for documentation consistency

• Default to billing under the rendering provider when unsure

Conservative billing is often safer than aggressive assumptions.

Changes coming in 2026:

As of the most recent CMS Physician Fee Schedule (PFS) final rules, the core requirements for incident-to billing are not changing in 2026. However, how practices may meet the supervision requirement has evolved, and this is where confusion often arises.

What Is Staying the Same:

CMS has not changed the fundamental criteria for incident-to billing. Practices must still meet all of the following:

• A physician must initiate the patient’s care

• The physician must establish the plan of care

• Services must be part of ongoing treatment, not a new problem

• The physician must remain actively involved in management

• Documentation must clearly support all of the above

If these elements are not met, the service does not qualify as incident-to, regardless of supervision flexibility.

What Is Changing: Supervision Flexibility

CMS has finalized policies allowing direct supervision to be met through real-time, interactive audio-video technology, rather than requiring the supervising physician to be physically present in the office suite.

Beginning in 2026, a supervising physician (or other qualified supervising provider, when allowed) may meet the direct supervision requirement virtually, as long as they are:

• Immediately available

• Connected via live, two-way audio-video technology

• Able to intervene if needed

This policy reflects CMS’s continued modernization of supervision standards and aligns with post-pandemic operational realities.

Importantly, audio-only communication does not meet direct supervision requirements.

Final Thoughts

Incident-to billing can be appropriate when done correctly, but it is not a shortcut and not a blanket rule.

Clear policies, training, and documentation protect both the practice and its providers.

Click here for your downloadable incident to checklist!

References

• Centers for Medicare & Medicaid Services (CMS).
  Medicare Benefit Policy Manual, Chapter 15 – Covered Medical and Other Health Services.

• CMS.
  Medicare Claims Processing Manual, Chapter 12 – Physicians/Nonphysician Practitioners.

• CMS MLN Matters®.
  Incident To Services guidance.

• American Academy of Family Physicians (AAFP).
  Understanding Incident-To Billing.

EDUCATIONAL DISCLAIMER

This blog post is for educational purposes only and reflects general Medicare incident-to billing principles. Payer rules may vary. Practices should consult current CMS guidance or compliance professionals for practice-specific determinations.