Understand Medicare Physician Supervision Requirements
By G. John Verhovshek, MA, CPC
Medicare supervision requirements apply to outpatient services in both the hospital setting and the physician office. Following physician supervision requirements is crucial for compliance and reimbursement. Services not meeting applicable guidelines are considered “not reasonable and necessary,” and are ineligible for Medicare payment; however, the rules differ depending on the type of service(s) provided.
Note: Medicare physician supervision requirements do not apply to hospital inpatient services. For inpatient services, the Centers for Medicare & Medicaid Services (CMS) defers to hospital policy and Joint Commission on Accreditation of Healthcare Organizations (JCAHO) standards.
For Outpatient Diagnostic Services, a Physician Must Supervise
For diagnostic services in an outpatient setting (hospital outpatient or physician office), only “a doctor of medicine or osteopathy legally authorized to practice medicine in his or her state of practice,” as defined by §1861(r) of the Social Security Act, may act as a supervisory physician.
The 2010 Hospital Outpatient Prospective Payment System (OPPS) Final Rule verifies, “Physician assistants, nurse practitioners, clinical nurse specialists, and certified nurse midwives who do not meet the definition of ‘physician’ may not function as supervisory physicians for the purposes of diagnostic tests” (Federal Register, Nov. 20, 2009).
CMS recognizes three primary levels of physician supervision. In the context of outpatient diagnostic services, these are defined as:
1. General supervision: The procedure is furnished under the physician’s overall direction and control. The physician must order the diagnostic test and is responsible for training staff performing the tests, as well as maintaining the testing equipment. He or she does not need to be present in the room during the procedure.
2. Direct supervision: The meaning of “direct supervision” varies according to the precise location at which the service is provided:
- In the physician office, the supervising physician must be present in the office suite and immediately available to furnish assistance and direction throughout the procedure’s performance.
- For hospital outpatient diagnostic services provided under arrangement in nonhospital locations (such as independent diagnostic testing facilities (IDTFs) and physicians’ offices), the supervising physician must be present in the office suite and immediately available to furnish assistance and direction throughout the procedure’s performance.
- For services furnished directly or under arrangement in the hospital or an on-campus provider-based department (PBD), the supervising physician must be present on the same campus and immediately available to furnish assistance and direction throughout the procedure’s performance.
In any case, the physician does not need to be present in the room during the procedure, but must not be performing another procedure that cannot be interrupted, and must not be so far away that he or she could not provide timely assistance.
3. Personal supervision: A physician must be in attendance in the room during the procedure’s performance.
Regardless of location, if a physician personally provides the entire service, supervision requirements are not a concern.
Note, as well, that supervision requirements apply only to the technical component (the actual test administration) of a diagnostic service. A physician always must provide the professional component (reading/interpreting of results) for diagnostic services.
Resource: Medicare physician supervision requirements for outpatient diagnostic services are defined by CMS Program Memorandum B-01-28, change request (CR) 850 (April 19, 2001), and may be found in Medicare’s Internet Only Manual, 100-02 Medicare Benefit Policy Manual, chapter 15, § 80.
Fee Schedule Lists Supervision Requirements per Code
The National Physician Fee Schedule Relative Value File assigns a physician supervision level for all CPT® and HCPCS Level II codes. The column labeled “Physician Supervision of Diagnostic Procedures” contains a one- or two-character indicator. These apply specifically to outpatient diagnostic services.
The most common indicators are:
• 1– Procedure must be performed under general supervision
An example of such a procedure is the technical component of ambulatory electroencephalography (EEG), 95950 Monitoring for identification and lateralization of cerebral seizure focus, electroencephalographic (eg, 8 channel EEG) recording and interpretation, each 24 hours.
• 2 – Procedure must be performed under direct supervision
Included in this category is the technical component of many urinary studies, such as 51792 Stimulus evoked response (eg, measurement of bulbocavernosus reflex latency time).
• 3 – Procedure must be performed under personal supervision
Examples include the technical component of several X-ray studies, for instance 70370 Radiologic examination; pharynx or larynx, including fluoroscopy and/or magnification technique.
• 9 – Concept does not apply
For instance, the concept of physician supervision would not apply to surgical procedures such as 29806 Arthroscopy, shoulder, surgical; capsulorrhaphy.
A “0” indicator (procedure is not a diagnostic test, or procedure is a diagnostic test not subject to the physician supervision policy) currently is not assigned to any CPT® or HCPCS Level II code in the Relative Value File.
Resource: The Medicare National Physician Fee Schedule Relative Value File is available as a free download on the CMS website: www.cms.gov/PhysicianFeeSched/PFSRVF/list.asp?listpage=4. Select the most recent (last-posted) file for download.
Provider Status May Affect Supervision Level
For some services, supervision requirements depend on the training of the provider administering the service. Such services are identified in the Relative Value File with the following indicators:
• 4 – Physician supervision policy does not apply when the procedure is furnished by a qualified, independent psychologist or a clinical psychologist, or furnished under a clinical psychologist’s general supervision; otherwise must be performed under a physician’s general supervision.
Services assigned this indicator include all central nervous system assessments or tests in the range 96101-96125.
• 5 – Physician supervision policy does not apply when procedure is furnished by a qualified audiologist; otherwise must be performed under a physician’s general supervision.
An example of a service assigned this supervision requirement is 92640 Diagnostic analysis with programming of auditory brainstem implant, per hour.
• 21 – Procedure must be performed by a technician with certification under general supervision of a physician; otherwise must be performed under a physician’s direct supervision.
Included in this category are several evoked potential studies, including 95926 Short-latency somatosensory evoked potential study, stimulation of any/all peripheral nerves or skin sites, recording from the central nervous system; in lower limbs and 95927 Short-latency somatosensory evoked potential study, stimulation of any/all peripheral nerves or skin sites, recording from the central nervous system; in the trunk or head.
A “22” indicator (procedure may be performed by a technician with on-line real-time contact with physician) currently is not assigned to any CPT® or HCPCS Level II code in the Relative Value File.
Therapy Services Have Unique Supervision Requirements
CMS designates several supervision categories specific to physical therapy services. These categories assign the required level of supervision based on the provider’s level of training:
• 6 – Procedure must be performed by a physician, or by a physical therapist (PT) who is certified by the American Board of Physical Therapy Specialties (ABPTS) as a qualified electrophysiologic clinical specialist and is permitted to provide the procedure under state law.
• 66 – Procedure must be performed by a physician or by a PT with ABPTS certification and certification in this specific procedure.
• 6a – Supervision standards for level 66 apply; in addition, the PT with ABPTS certification may supervise another PT, but only the PT with ABPTS certification may bill.
• 77 – Procedure must be performed by a PT with ABPTS certification, or by a PT without certification under direct supervision of a physician, or by a technician with certification under a physician’s general supervision.
• 7a – Supervision standards for level 77 apply; in addition, the PT with ABPTS certification may supervise another PT but only the PT with ABPTS certification may bill.
Document for Success
CMS guidelines specify, “Documentation maintained by the billing provider must be able to demonstrate that the required physician supervision is furnished.” The guidelines do not provide examples of appropriate documentation; however, for those services requiring personal supervision, the physician should document, with a comment and signature, his or her presence during the test. For services requiring direct or general supervision, the provider performing the service should document the physician’s direction or presence in the office, as required by the level of supervision, and the physician should confirm with a signature.
If a mid-level provider administers the test without physician supervision, the medical record should document clearly that the service is within the provider’s scope of practice as allowed by state law.
Compliance tip: Diagnostic testing requirements for physician supervision are distinct from incident-to billing requirements for mid-level providers. Incident-to requirements are not applicable to diagnostic testing in the office setting. The Medicare Benefit Policy Manual, chapter 15, § 80 states, “Diagnostic tests may be furnished under situations that meet the incident to requirements but this is not required.”
Mid-Level Providers May Supervise Outpatient Therapeutic Services
As outlined in the 2010 Hospital OPPS Final Rule, “All hospital outpatient services that are not diagnostic are services that aid the physician in the treatment of the patient, and are called therapeutic services.” Supervision requirements for outpatient hospital therapeutic services are different than those for outpatient diagnostic services.
Whereas only a physician may provide supervision for outpatient diagnostic services, nonphysician practitioners (NPPs) including “clinical psychologists, licensed clinical social workers, physician assistants, nurse practitioners, clinical nurse specialists, and certified nurse-midwives, may directly supervise all hospital outpatient therapeutic services that they may perform themselves within their State scope of practice,” according to the 2010 Hospital OPPS Final Rule. The NPP must be privileged by the hospital to perform the services he or she supervises, and must abide by any applicable hospital physician-collaboration or supervision requirements. An NPP may not supervise a service he or she cannot perform personally.
In other words, for therapeutic services in a hospital outpatient setting:
- A physician may provide supervision at the required level (general, direct, or personal), or
- An approved NPP may provide direct supervision for the service, as long as the NPP legitimately may perform the service him- or herself.
In this context, “direct supervision” may be defined:
- For services provided in the hospital or on-campus PBD of the hospital, the physician or NPP must be present on the same campus and immediately available to furnish assistance and direction throughout the procedure’s performance.
“In the hospital or on-campus PBD” includes the main building(s) of a hospital or critical access hospital (CAH):
- under the ownership, financial, and administrative control of the hospital or CAH;
- operated as part of the hospital or CAH; and
- for which the hospital or CAH bills the services furnished under the hospital’s or CAH’s CMS Certification Number.
For off-campus PBDs of hospitals or CAHs, the physician or NPP must be present in the off-campus PBD, and immediately available to furnish assistance and direction throughout the procedure’s performance.
In either case, the supervising provider does not need to be present in the room during the procedure, but must not be performing another procedure that cannot be interrupted, and must not be so far away that he or she could not provide timely assistance.
There are some exceptions: Regardless of the NPP’s scope-of-practice or other qualifications, only a doctor of medicine or osteopathy may provide direct supervision for cardiac rehabilitation (CR), intensive cardiac rehabilitation (ICR), and pulmonary rehabilitation (PR) therapeutic services, as outlined in the 2010 Hospital OPPS Final Rule.