Adding an Advanced Practice Provider to Your Practice; Guidance for the Use of APPs

By Lori Foley, Valerie Rock, and Allison Wilson | PYA Consulting

Are you considering adding an advanced practice provider (APP) to your practice? There are numerous compliance considerations that accompany APP employment, such as payer credentialing, billing, scope of practice, and physician supervision. Start off on the right course by establishing a compliant structure within which to onboard these important professionals. 


When feasible and practical, create and maintain policies and procedures for APP utilization according to the most stringent payer policy governing the use of APPs. Consider the following best practices for structuring APP services and billing:

  1. To increase efficiency, utilize APPs in the most independent fashion payers allow. Carefully determine when and how physicians will render face-toface care to the same patient on the same day. Shared visits—Medicare beneficiaries see both an APP and a physician in the office setting—must meet “incident to” guidelines to bill under the physician. In other words, the APP must be credentialed and bill Medicare when services he or she provides are not following a plan of care established by a physician.
  2. APPs may provide services within their scope of practice per a written protocol and under the supervision required by state law without regard to “incident to” service rules. Medicare services can be billed under the APP, and such independent services may include evaluation for new conditions and new patients. Those services should be billed under the APP’s Medicare billing number, and Medicare will pay 85 percent of the physician’s fee schedule. Other payers’ APP reimbursement varies.
  3. APPs may provide “incident to” services to established Medicare patients in the office (POS 11) and bill under the physician’s Medicare billing number if both of the following criteria are met:
    • The APP is following a physician’s documented course of treatment, including management of commonly anticipated symptoms of the underlying established or chronic condition.
    • The patient presents with no new conditions or symptoms of an unrelated undiagnosed condition at the encounter.
  4. The APP and physician may provide a split/shared service for an established patient’s established problems. Each provider should document his or her services separately; as a best practice, both providers should sign their entries, but at least ensure the billing provider signs. If a new problem is evaluated in the shared service, the visit should be billed under the APP. However, some Medicare Administrative Contractors (MACs) allow for the physician to document a plan of care for a new problem presented during an established patient shared visit, and bill under the physician.
    • Shared/split visits may be billed under the physician’s billing number in the inpatient/outpatient or emergency-room setting.
    • Signed documentation by both the APP and the physician may be used to support the reported code.
    • At minimum, the physician must document a portion of the evaluation and management (E/M) encounter, preferably one of the key elements (history, exam, or medical decision-making), and sign the note to support his or her face-to-face service with the patient.
  5. An APP may serve as a scribe if services he or she performs are documented distinctly and separately from those services he or she is scribing for the physician.
    • When the APP is utilized as a scribe, he or she is not acting independently in E/M service, surgical, or other billable encounters; his or her function is to document the words and actions of the physician with no clinical judgment.
    • Some hospitals, per the Joint Commission’s prior policies, prohibit the use of an individual as both a scribe and a provider in the same encounter. To that end, some electronic medical records (EMRs) have limitations for scribes and practitioner licenses. However, the Joint Commission has now updated its policy (as of August 2018) to allow for the dual roles of scribing and performing clinical responsibilities.1
    • Documentation of scribed services must include the following:
      • Who performed the service.
      • Who recorded the service, with the record entry noting the name of the person “acting as a scribe for Dr. X.” (For example: “I, David Jones, PA, am scribing for, and in the presence of, Jane Davis, MD.”)
      • The physician’s signature and date, acknowledging that the physician reviewed and signed the entry. (Per Medicare’s update in Transmittal 713, the physician’s signature meets minimum standards.)2 The physician is attesting that the note is an accurate record of both his or her words and actions during that visit. (For example: “I, Jane Davis, MD, personally performed the services described in this documentation, as scribed by David Jones, PA, in my presence, and it is both accurate and complete.”)
      • The qualifications of each person. 
  6. Critical-care services may not be billed as shared visits. These services should be rendered, documented, and billed by one provider based on the documentation of the billing provider. When multiple physicians and APPs provide critical-care services on the same date of service and are part of the same group practice, the physicians’ service time should be aggregated, and the service billed under one physician’s national provider identifier (NPI). The APPs’ service time should be aggregated, and service billed, under one APP’s NPI. (Note that at least one provider—the billing provider as designated on the claim—must independently meet at least 30 minutes of critical-care service in order to bill the service with critical-care service codes.)



Some, but not all, payers have special requirements for enrolling and contracting with APPs. As part of your initial considerations, it is important to know what to review in order to understand any requirements to which you may be bound. 

  1. Review current payer contracts, provider manuals, and bulletins for APP provisions. Contact your payers to inquire about their credentialing and contracting of APPs. Document the name of the person you spoke with, the date, and what was conveyed. Review hospital policies on utilization and credentialing limitations.
  2. Research relevant state scope-of practice and licensure requirements; similarly to physician state licensure, payers expect you to follow state requirements.
  3. Note that some payers, such as many Medicaid payers, do not allow APPs to bill under a physician’s provider number when performing independent services—the payer expects the practice to bill services under the APP.
  4. Credential APPs with payers that require credentialing; evaluate whether you should credential with payers where credentialing is optional, based on your ability to meet supervision, coverage, and clinical-practice requirements combined with financial considerations. The best practice is to credential APPs with all payers allowing credentialing.


States frequently oversee specific licensure and scope-of-practice requirements for nurse practitioners (NPs) and physician assistants (PAs), and often they differ.

  1. Review the didactic and clinical training of both NPs and PAs to determine which is more in line with your needs and clinical philosophy. Different types of APPs have varying supervisory requirements, prescriptive authority, and rules for written protocols.
  2. Contact your state’s licensing board to understand the differing levels of autonomy and scope of practice for your state, including physician-supervision requirements (e.g., physical proximity and documentation-review requirements), as well as any limitations on medication-prescribing abilities.
    • Some states clearly specify which services can be delegated to an APP, and some permit the supervising physician to determine the services he or she believes the APP is qualified to perform.
    • Some states require state-authorized written protocols; others require the protocol to be on file at the practice site and available if requested.
  3. Understand and operationalize any documentation requirements necessary to meet scope-of-practice and licensure regulations.



Physicians utilize APPs in different ways, in light of various goals and perspectives.Differing state rules for PAs and NPs may influence a physician’s or group’s decision for the type of APP to select.

  1. Understand physician-supervision requirements, and evaluatehow they will be met from an operational perspective.
  2. Draft and execute required collaborative agreements that govern the supervisory relationship.
  3. Provide documentation and coding training to new providers (new to medicine, and new to the practice/specialty). Oversight intensity may lessen as the clinical relationship matures and the physician grows comfortable with the APP’s clinical approach, bedside manner, documentation adherence, etc. 
  4. Communicate and provide clinical mentorship to develop the APP to become a strong provider.



As an extension to payer enrollment and contracting, it is critical to understand each payer’s billing guidelines with regard to APPs and to evaluate your internal processes to ensure they are met.

  1. Develop clear tools to assist with patient scheduling and billing. If the practice decides to follow Medicare “incident to” guidelines, it should funnel new Medicare patients or Medicare patients with new problems to physicians. If a practice chooses to allow an APP to see all types of patients that fit the APP’s scope of practice, the billing system will need to be set up to bill.
    • Using the APP’s billing number for payers that credential him or her.
    • Using the supervising physician’s billing number when the payer allows the APP to bill under the physician’s NPI.
  2. Medicare Administrative Contractors (MACs) have varying policies regarding “incident to” and shared visits. Ensure an in-depth knowledge of your MAC’s requirements. For instance, one MAC states clearly that no office-based newpatient shared visits can be billed by a physician; rather, the service should be billed under the APP. Another MAC states that office-based shared visits in which the physician documents his or her service and plan of care for any new problem—and the APP follows that plan of care—can be billed under the physician. 
  3. Not all MACs provide clarifications, so use more conservative interpretations of “incident to” when your MAC is silent.
  4. The most conservative interpretation for Medicare “incident to” services is as follows:
    • The APP is an expense to the practice (e.g., not provided at the expense of another entity).
    • The APP provides the service face-to-face to the patient with appropriate collaboration and physician supervision.
    • The patient’s presenting conditions are established. 
    • The physician creates a plan of care during a face-to-face encounter prior to the APP’s encounter with the patient. 
    • A supervising physician is in the office suite during the visit (direct supervision). 
    • The service is billed under the supervising physician. 
    • Further, shared visits in the office are billed under the APP when the service includes a new patient or new problem, and thus does not meet “incident to” requirements.
  5. Once the structure, policies, and procedures for the APP utilization design are established, develop appropriate controls and monitors, and educate the team to minimize issues.
  6. Conduct periodic (at least annual) documentation and claim audits to ensure APP services are documented and billed according to the appropriate guidelines.

Allison Wilson and Valerie Rock are consulting senior managers at the professional-services and certified public accounting firm PYA. Lori Foley is Office Managing Principal of the firm’s Atlanta office and Managing Principal of Compliance Services. PYA helps clients navigate and derive value amid the complex challenges related to regulatory compliance, mergers and acquisitions, governance, business valuations and fair market-value assessments, and more. For more information, please visit 

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