All About Incident To Billing Guidelines for Nurse Practitioners (2026 Update)

Billing and coding is essential to getting paid for the care you provide, but it can also be a confusing and tedious process—especially for new NPs! In particular, incident to billing can seem a little puzzling. And while the core rules haven’t changed much, CMS has issued important clarifications and updates to the incident to billing guidelines in 2025 that every NP should understand.

In this post, we’ll offer a quick review of the basics of incident to billing and then explain what’s new so you can take the guesswork out of using it in practice.

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What is incident to billing?

Let’s recap what “incident to” billing is before we get into the 2025 updates!

Incident to billing is when services provided by a nurse practitioner are billed under the supervising physician’s NPI number, allowing for 100% reimbursement under the Medicare Physician Fee Schedule.

Why is that important? The Centers for Medicare & Medicaid Services (CMS) reimburses physicians at 100% of the fee schedule for covered Medicare services.

However, non-physician clinicians (i.e. nurse practitioners, certified nurse midwives, clinical nurse specialists, and physician assistants)—are typically reimbursed at only 85% of the fee schedule when billing under their own NPI.

That 15% difference is why incident to billing can feel appealing because better reimbursement means more money for the employer or healthcare system —but it comes with strict requirements.

Important reminders:

1. Incident to billing rules apply to Medicare only. Some private insurers allow incident to billing, but they often have their own policies. When in doubt, always check with your clinic’s billing and coding specialist.

2. Most visits with NPs don’t qualify for incident to billing, making it the exception, not the norm. 

What are the need-to-know incident to billing guidelines?

To qualify for incident to billing under Medicare, all of the following must be met:

1. The service must be completed in a non-institutionalized setting, or someplace other than a hospital or skilled nursing facility.

There are exceptions to this with certain services started in the hospital or with a partial hospitalization, but you should consult with a billing and coding specialist.

2. The patient must have been first evaluated for the concern by the supervising physician.

Incident to billing is used in the follow-up care of patients, but the patient must have been first evaluated for the condition by a physician who has outlined the plan of care.

3. Throughout the course of care, the supervising physician needs to actively participate in the patient’s care.

This is determined by state licensure requirements, but an example would be that the physician must see the patient for every third visit. This ensures that the physician maintains their role in the care of the patient.

4. The physician must be physically present in the office building at the same time the non-physician clinician is conducting the visit.

This doesn’t mean that the physician has to be in the same room and directly supervise the other clinician, but being in the building allows for immediate assistance if needed.

5. The non-physician clinician and the supervising physician are employed by the same entity, or company.

Also, any physician of that group can be physically present in the building. So, with rule #4, it does not have to be the same physician that saw the patient for the first visit. As long as a physician from the same group is physically present while the non-physician clinician provides follow-up care, then rules #4 and 5 are met.

6. The care provided for the diagnosis is suitable to the office setting and is within the standard of care. 

This means that the non-physician clinician needs to be qualified to continue with the plan of care. If additional visits or care are needed that are outside of the scope of practice of the non-physician clinician, then that does not qualify for incident to billing. 

If any of these criteria are not met—such as addressing a new problem, adding a new diagnosis, or practicing without proper supervision—the visit must be billed under the NP’s own NPI.

What are some examples of incident to billing for nurse practitioners?

Alright, we’ve got a few scenarios here. Which one qualifies for “incident to” billing?

Scenario #1: The nurse practitioner is seeing a patient for a new concern while the supervising physician is in the office suite. 

Scenario #2: The nurse practitioner conducts a follow-up appointment for a patient with hyperlipidemia. The supervising physician established care at the last visit, but is currently out of the office today at a conference, and no other group physician is available.

Scenario #3: The nurse practitioner is providing follow-up care for a patient with diabetes. They follow the outlined plan of care, and then the NP adjusts medications and educates the patient accordingly. The supervising physician is in the office suite.

Scenario #4: The nurse practitioner is providing follow-up care for a patient with hypertension. They are following the outlined plan of care, and then the patient reports a new, unrelated concern. The NP orders labs and testing. The supervising physician is in the office suite.

Which scenario qualifies for “incident to” billing?

Scenario #3! Here, the NP was seeing a patient for whom the supervising physician already established care and a management plan. It’s ok that medication was adjusted during the visit, since it still pertains to the original diagnosis and management plan outlined by the physician. Plus, the physician was physically available in the building.

As for the other choices: in Scenario #1, the NP was establishing a plan of care for a new concern; in Scenario #2, the physician was not present in the office building; and in Scenario #4,  since the NP was working up a new concern during that same visit, then “incident to” can no longer be used. 

Major Updates and Clarifications for Incident To Billing Guidelines in 2025

While the core framework has not changed, CMS has issued important clarifications and updates to incident to billing guidelines in 2025 (and previous years) that directly affect NP practice.

1. Reinforced Emphasis on Initial Physician Involvement

CMS continues to stress that incident to billing is intended for physician-directed care, not independent NP management billed under a physician’s name.

The physician must:

1. Perform the initial visit
2. Establish the plan of care
3. Remain meaningfully involved over time

If the NP substantially changes the plan of care or addresses a new problem, the visit no longer qualifies (regardless of whether the physician is available).

2. Clarification on Which Physician Can Bill Incident To

CMS clarifies that incident to services must be billed under the NPI of the physician who is actually supervising the visit.

It is not sufficient for:

– A physician to be listed as supervising “on paper”
– A different physician in the group to bill if they were not available to supervise

This clarification has been particularly important for multi-provider practices and has become a common audit focus.

3. Direct Supervision via Telehealth (Effective 2026!)

This is one of the most significant updates and took effect January 1, 2026.

CMS now allows direct supervision to be met through real-time audio-video technology, rather than requiring the physician to be physically present in the office suite.

This means:

– The supervising physician must still be immediately available
– Availability may be virtual (must include both audio & visual), as long as it is synchronous and interactive
– Practices must clearly document supervision arrangements

This change is huge and modernizes incident to billing to align it with evolving hybrid and telehealth-enabled workflows—but it does not relax the other incident to requirements.

What are Medicare Administrative Contractors (MACs)?

Even when CMS rules are clear, how they are interpreted and enforced can vary by region. Medicare Administrative Contractors (MACs) are responsible for processing claims and issuing local guidance, and they may:

– Interpret supervision requirements more strictly
– Apply documentation standards differently
– Focus audits on specific incident to risk areas

For this reason, it’s critical that practices follow both CMS policy and MAC guidance. When there is uncertainty, the safest approach is to bill under your own NPI and consult your billing and compliance team before using incident to billing.

Final Thoughts

Understanding the basics, staying current with CMS updates, and recognizing the role of MACs will help you bill compliantly and protect both your license and your practice as an NP. Don’t forget that strong documentation, clear supervision workflows, and collaboration with billing specialists are also essential to staying compliant!

When in doubt, bill under your own NPI—and always check with your practice’s billing and coding team for the most up-to-date guidance.

Looking for more (free!) NP content? Check out these other posts and podcasts at SMNP Reviews!

• Billing and Coding Review: All About Medical Decision-Making
• Ep #126: Top Charting Tips for New NPs from Erica D the NP Charting Coach
• New ACC/AHA Hypertension Guidelines for 2025: What to Know for Nurse Practitioners