NP and PA billing is one of the most misunderstood areas in medical billing — and one of the most audited. The rules around incident-to billing, split-shared visits, and supervision have all shifted in recent years. Here's where things stand in 2026.
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This is the fundamental decision point. When an NP or PA provides a service, you can bill it under the provider's own NPI (at 85% of the physician fee schedule for Medicare), or potentially under the supervising physician's NPI as an incident-to service (at 100%). The difference is real money — 15% more per claim under incident-to.
But incident-to billing has strict requirements. Not every NP/PA service qualifies. Getting this wrong is one of the most common compliance problems in primary care practices.
You can't bill incident-to for new patients — the physician must see new patients first to establish the relationship and create the initial plan of care. This trips up a lot of practices that have NPs seeing new patients as a matter of workflow. If your NP is handling all new patient intakes, those claims have to be billed under the NP's NPI at 85%.
CMS implemented split-shared billing rules in 2022 that changed how practices bill visits where both a physician and an NP/PA see the patient. The substantive portion rule means the visit bills under whoever provides the substantive part of the E&M service.
For 2026, the determination of "substantive portion" for visits other than critical care is based on time or the key components of the visit (history, exam, medical decision making). If the physician documents and provides the key clinical work, billing under the physician is appropriate. If the PA does the bulk of the work, the claim goes out under the PA.
Medicare distinguishes between direct supervision (physician in the office suite), general supervision (physician available but not necessarily in the office), and personal supervision (physician present in the room). The level required depends on the type of service and setting. Most E&M services for NPs require at least general supervision — but incident-to requires direct.
State scope-of-practice laws add another layer. Some states allow NPs to practice independently without physician supervision; others require collaborative agreements. Your billing practices should align with both Medicare requirements and state law — they don't always say the same thing.
The telehealth flexibilities that expanded during COVID have been extended through 2026 for some services. NPs and PAs can bill telehealth visits under their own NPI in most circumstances. The incident-to rules generally don't apply in the telehealth context the same way they do in-person — which simplifies some things but eliminates the 100% billing option.
Commercial payers don't always follow Medicare's incident-to rules. Some commercial plans require NPs and PAs to be separately credentialed and will only reimburse under the provider's own NPI. If your NPs aren't credentialed with commercial payers, those claims may be denied or bundled into the practice's global billing without the payer even knowing the service was provided by a mid-level.
Check each of your major commercial payer contracts for their APP billing requirements. It's often different from Medicare, and the reimbursement rates may actually be the same as the physician rate — making the incident-to issue less financially relevant for commercial business.
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