Can Nurse Practitioners Bill Medicare? Incident To Rules Explained

Yes. A nurse practitioner can bill Medicare directly under their own NPI once they’re enrolled through PECOS, and Medicare pays 85 percent of the physician fee schedule rate for that claim. There’s a second path too. Bill the same visit incident to a supervising physician, meet a specific set of conditions, and Medicare pays the full 100 percent instead. That 15 percent gap is where most practices leave real money uncaptured, and it’s also where Medicare auditors are paying attention in 2026.

Before using incident-to billing, make sure your NPPs and supervising physicians have the appropriate Medicare enrollment and credentialing in place.

Can Nurse Practitioners Bill Medicare Directly?

Start here, because most of the confusion clears up once this part is settled. Nurse practitioners are recognized billing providers under Medicare Part B. Enroll through provider credentialing services  and PECOS under an individual NPI, and a practice can submit claims for services the NP performs directly, no physician cosignature required. Practices that outsource this piece through outsourced medical billing services tend to catch enrollment gaps before they turn into denied claims.

Medicare pays 85 percent of the physician fee schedule for those claims. This isn’t new. The Balanced Budget Act of 1997 set that rate, and it hasn’t moved since, regardless of how much scope of practice law has changed in individual states. An NP in a state with full independent practice authority still gets paid 85 percent when billing directly. The reduced rate is a Medicare payment rule, not a reflection of a state’s licensing decisions.

Here’s the part practices often miss: that 85 percent applies to nearly every Medicare-covered service the NP is licensed to perform, in any setting Medicare covers, including new patients and new problems. Direct billing carries no supervision requirement at all. That’s exactly why it’s the default option, and why incident to billing exists as an add-on, not a replacement.

What Is Incident To Billing for Nurse Practitioners?

Incident to billing lets a practice submit the nurse practitioner’s work under the supervising physician’s NPI instead, and collect the full 100 percent physician rate for it. Same visit, same NP, 15 percent more revenue. But only if every condition below is met, as laid out in the Medicare Benefit Policy Manual, Chapter 15.

Medicare requires all of these:

• The visit happens in a non institutional office or clinic setting, place of service 11. Hospitals, skilled nursing facilities, and emergency departments don’t qualify.
• A physician personally performed the initial visit for that condition and documented a diagnosis and plan of care.
• The nurse practitioner’s visit follows that established plan. A new complaint, a new diagnosis, or a plan the NP builds independently breaks the incident to chain for that encounter, even if the patient has been seen before for something else.
• The supervising physician provides direct supervision during the visit.
• The claim is filed under the NPI of the physician who was actually supervising that specific visit, not just any physician in the group.

Miss one of these and the claim belongs under the NP’s own NPI at 85 percent. There’s no partial credit on this one.

What Changed in the CY 2026 CMS Rule on Supervision?

This is the update every NP-heavy practice needs to know for 2026. Direct supervision used to mean the physician had to be physically present in the office suite, not necessarily in the exam room, but somewhere in the suite and immediately available.

CMS made that permanent for real-time audio and video technology instead, effective January 1, 2026, under the final CY 2026 Physician Fee Schedule rule. A physician can now supervise incident-to visits from another location as long as the connection is live, interactive, and running for the entire visit. Audio only doesn’t count. A phone call doesn’t satisfy the requirement, and neither does a physician who logs off a video session at noon and leaves the NP seeing patients solo at two. For a deeper look at the requirements, see our related guide on Incident-to Billing Services.

One carve-out is worth knowing. The virtual supervision option doesn’t apply to services carrying a global surgery indicator of 010 or 090, mostly procedures with a built-in follow-up period. Those still require the traditional in-suite presence.

We’ll say the quiet part here: this rule makes incident-to billing easier to qualify for on paper, and that’s exactly why CMS and the OIG are watching documentation more closely, not less. A timestamped, named supervision log matters more in 2026 than it did in 2024. Practices reviewing their incident-to workflow can also benefit from provider credentialing services to keep supervising physicians and NPP enrollment information current.

Direct Billing vs Incident To Billing: Which Pays More?

When Can’t You Bill Incident To for a Nurse Practitioner?

• New patients, every time. There’s no incident to option for a first visit.
• Established patients with a new complaint or diagnosis the physician hasn’t evaluated yet.
• Any hospital, skilled nursing facility, or emergency department encounter.
• Visits where no physician from the group was actually available to supervise, even if one is listed on the schedule.
• Visits where the NP is managing a condition the physician never personally diagnosed or built a plan for.

Bill any of these incident to and the claim is wrong from the moment it’s submitted, not just risky. Route them under the NP’s own NPI at 85 percent instead.

Incident To vs Split/Shared Billing: Don’t Mix These Up

Practices confuse these two constantly, and the mix up shows up in denials and audits alike. Incident to only exists in the office. Split or shared billing only exists in the facility: hospital inpatient, hospital outpatient, and the emergency department.

Split or shared billing lets a physician and an NP who both saw the same patient on the same date bill under whichever provider performed the substantive portion, meaning more than half the total time, or the physician performed and documented the key medical decision making. Critical care works differently. The substantive portion there is time only, and time spent together at the bedside counts once, not for each provider separately.

Both models require documentation identifying both providers, and the billing provider has to sign and date the note. Get the setting wrong, office versus facility, and neither model applies the way you think it does.
For a practical comparison of these two billing approaches, you can also reference Incident-to and Shared Services: Demystifying Billing for Care Provided by Multiple Professionals.

What Is the Compliance Risk of Incident To Billing?

The Office of Inspector General is running a national audit of Medicare Part B incident to payments, with results expected in fiscal year 2026. That’s not a background detail. It’s the reason a lot of practices are taking a second look at their NP billing right now.

Indirect billing has grown fast enough that peer reviewed research on indirect billing trends has tracked it as a national pattern worth watching, not just a Medicotech observation. Picture a family medicine group in Toledo running three physicians and five nurse practitioners across two locations. For two years, every NP visit gets billed incident to, on the theory that a physician is somewhere in the building most days. When an auditor pulls documentation, half the incident to claims don’t show which physician was actually supervising which visit, and a third of them involve a complaint the physician never personally evaluated. That’s not a rare finding. It’s close to the median one.

Most incident-to repayment demands trace back to documentation, not intent. Nobody set out to bill incorrectly. The plan of care wasn’t dated, the supervising physician wasn’t named on the note, or a follow-up for one condition quietly became a workup for a new one. Coding errors compound the problem fast, which is why practices lean on dedicated medical coding services staffed by AAPC-certified coders to keep E/M levels defensible before a claim ever goes out. Fix the documentation habit and the compliance exposure drops with it.

Which Billing Method Should Your Practice Use?

Run this quickly for every recurring NP visit type in your practice. Is it an established patient, on a plan a physician actually built, in the office, with a physician genuinely reachable by live video or in person for the whole visit? Bill incident to and take the 100 percent. Missing any piece of that? Bill direct under the NP’s own NPI and take the 85 percent. It’s a fifteen point swing, but it isn’t worth taking if the documentation can’t back it up.

If your practice bills more than a couple hundred Medicare claims a month through nurse practitioners and nobody’s audited the incident to mix in the last year, that’s the first thing worth checking, before the next fee schedule update, not after an audit letter arrives. It’s also worth pairing with a broader look at medical billing and coding services to identify documentation and coding gaps that can contribute to denials.

The 85 versus 100 percent question isn’t really a paperwork preference. It’s about whether your documentation matches what actually happened in the room, or on the video call, during that visit. Get that match right and incident to billing pays for itself many times over. Get it wrong and it becomes the finding an auditor circles first.

FAQ: Nurse Practitioner Medicare Billing

Can nurse practitioners bill Medicare under their own NPI?

Yes. Once enrolled through PECOS, a nurse practitioner can bill Medicare directly under an individual NPI for services within their state scope of practice. Medicare reimburses these claims at 85 percent of the physician fee schedule rate, a rate set by the Balanced Budget Act of 1997 and unrelated to a state’s scope of practice laws.

What is incident to billing for nurse practitioners?

Incident to billing lets a practice submit an NP’s visit under a supervising physician’s NPI instead of the NP’s own, and collect the full 100 percent physician fee schedule rate. It only applies in an office setting, only for established patients on a physician built plan of care, and only with direct supervision in place.

How much does Medicare pay nurse practitioners compared to physicians?

Medicare pays 85 percent of the physician fee schedule when an NP bills under their own NPI, versus 100 percent when the same visit qualifies as incident to a supervising physician. On a 100 dollar service, that’s an 85 dollar payment billed directly, or a 100 dollar payment billed incident to.

What changed in the 2026 incident to billing rules?

Effective January 1, 2026, CMS permanently redefined direct supervision to allow real time, interactive audio and video technology instead of requiring the physician’s physical presence in the office suite. Audio only calls don’t qualify, and the change doesn’t apply to services with a global surgery indicator of 010 or 090.

Can incident to billing be used for a new patient?

No. Incident to billing never applies to a new patient visit or to an established patient’s new complaint the physician hasn’t evaluated yet. A physician has to personally see the patient first, establish the diagnosis, and document the plan before an NP’s follow up visits can qualify.

What’s the difference between incident to billing and split/shared billing?

Incident to billing applies only in the office setting. Split or shared billing applies only in facility settings like a hospital or emergency department, where a physician and NP both see the same patient and bill under whichever provider performed the substantive portion of the visit. The two never overlap.

What happens if incident to documentation doesn’t meet Medicare’s requirements?

The claim should have been billed under the NP’s own NPI at 85 percent, not the physician’s at 100 percent. The Office of Inspector General is actively auditing Part B incident to payments in 2026, and documentation gaps, not billing intent, are the most common reason practices face repayment demands.