What to do when health plans are vague about policies on NPs

One approach: The facility sets its own policy

Example: Hospital X has nurse practitioners in their emergency room. While some third-party payers, such as Medicare and Medicaid, clearly have policies which call for reimbursement for physician services performed by nurse practitioners, one health plan is difficult to pin down. When the hospital's billing department submitted bills under a nurse practitioner's name, the claims were denied. When the billing manager appealed the denial, she was told "We don't credential nurse practitioners. You can submit the nurse practitioner's bills under a physician's name, if the nurse practitioner has a collaborative agreement with the physician." The billing manager asked for that policy in writing. Two months passed and nothing came. The billing manager asked again, and three months passed, with nothing in writing. The billing manager knows that under Medicare rules, a nurse practitioner's services must be billed under the nurse practitioner's name. She worries that the oral policy -- "Bill the nurse practitioners' work under the name of the physician collaborator" -- will be impossible to document if the health plan later decides that they follow Medicare's policy. She is worried that the hospital, and she, individually, will be vulnerable to a charge of fraudulent billing.

For the hospital, the legal issues are:

1. If the hospital follows an oral policy -- "Bill nurse practitioner services under a physician's name" -- how can the hospital protect its actions if the health plan decides later that it was inappropriate?
2. Would the collaborative agreement required by the health plan be the same as the collaborative agreement required by the State? Would the bills need to be submitted under the name of the physician named on the collaborative agreement required by the state?
3. Would the physician whose name is on the collaborative agreement need to establish a relationship with each patient?
4. Will a hospital policy under which the hospital notifies health plans that nurse practitioners are providing physician services be sufficient to protect the hospital from allegations of fraud?

Relevant law

No law provides a direct answer to these questions. The applicable law includes:

1. Nurse practitioners in some states must have collaborative agreement with physicians. In the majority of states, a physician need not be on site, but must be available by radio, telephone or telecommunications. For the law in a specific state, visit the Board of Nursing web site.
2. Medicare reimburses physician services when performed by a nurse practitioner, provided the services are within the scope of practice of a nurse practitioner and there is a collaborative agreement with a physician.
3. The laws governing reimbursement under Medicare do not necessarily apply to Medicare managed care, as Medicare managed care is governed by a contractual agreement between the Center for Medicare and Medicaid Services (CMS) and the managed care organization (MCO). MCOs delivering care under contracts may include nurse practitioners on their panels, but are not required to do so.

One approach when health plans or MCOs won't put a policy in writing

It makes little sense for a practice or facility to structure its operation for the least accommodating payer. One approach is to develop a policy regarding how the practice or facility will bill the nurse practitioner's services, and notify the payers of the policy. For example, in the policy, state something like this:

"Physician services in the emergency department at Hospital X may be performed by a qualified nurse practitioner who is practicing under the authority granted by state law. Services provided by the nurse practitioner will be billed under the nurse practitioner's name and provider number or under a collaborating physician's name and provider number, depending upon the requirements of the payer. Hospital X's Director of Billing will query payers by letter, once, and ask for a response stating their requirements or preference about whether the nurse practitioner's services are billed under the nurse practitioner's name or under a collaborating physician's name. The query letter will state that failure to provide written direction or preference will be assumed to be indifference, and, lacking a response from a payer, the hospital billing department will decide whether to bill the nurse practitioner's services under the nurse practitioner's name or under a collaborating physician's name, depending upon previous written policies or oral communications from the payer."

Or, a policy may be stated even more broadly, such as:

"Physician services at Hospital X may be provided by qualified nurse practitioners who meet the requirements of state law. Payers who have specific requirements regarding the class of provider under whose name such services are billed must state those requirements, in writing, to Hospital X's Director of Billing. Lacking written direction from a payer, the Director of Billing will decide whether a nurse practitioner's services are billed under the nurse practitioner's name or under the name of a physician on the health plan's provider panel."

Then, send the policy to the appropriate contact person at each local health plan or managed care organization, with a cover letter which states "This is the hospital policy. If your organization has specific requirements regarding billing of physician services provided by nurse practitioners, please respond to me, in writing, specifying such requirements, within 15 days. If I do not receive specific written directions from your organization by [insert date], Hospital X will assume that this distinction is not important to your organization, and will bill a nurse practitioner's services under one of our physician's names or under the nurse practitioner's name, if the nurse practitioner is on the health plan's panel."

Track and file the responses, and bill accordingly. If there is no response, follow the policy.

Lacking specific directions from a managed care organization, there would be little reason to have a separate collaborative agreements for payers. However, if billing nurse practitioners' services under one or more physicians' names, it would be pragmatic to have written documentation of collaborative agreements between the physicians and the nurse practitioners. And, lacking specific directions from a health plan, it makes little sense for the collaborating physician to establish a relationship with patients evaluated and managed by a nurse practitioner, unless required by state law.

Would such a policy, disseminated to health plans, be sufficient to protect the billing administrators from claims of inappropriate billing?

Yes, in the opinion of the author. Fraud is defined as: "An intentional deception or misrepresentation which the individual knows to be false or does not believe to be true, and the individual is aware that the deception could result in some unauthorized benefit to him/herself or some other person." The hospital in this case is attempting to correctly represent the services being provided, and there would be no deception or misrepresentation.

Copyright 2006, Carolyn Buppert
This article is taken from The Green Sheet, published monthly from the Law Office of Carolyn Buppert. To order, click here.

Site Designed and Maintained by Lazerpro Digital Media Group, ©
Website Design, Website Programming & Ecommerce Solutions.