OIG Finds High Use of Unqualified Personnel When Physicians Bill for 'Incident to' Services

August 6, 2009: The Office of Inspector General (OIG) of the Department of Health and Human Services recently released a report on physician "incident to" services billed in 2007 under the Medicare program. The report found that when Medicare allowed physicians more than 24 hours of services in a day, half of the services were not performed personally by a physician, and that unqualified nonphysicians performed 21 percent of the services that physicians did not perform personally. Also, the report found 49 percent of rehabilitation therapy services (including primarily therapeutic exercise, massage therapy, ultrasound therapy, therapeutic activities, and electrical stimulation) performed by nonphysicians were furnished by staff not trained as therapists that the OlG found to be unqualified. The report can be accessed at http://www.oig.hhs.gov/oei/reports/oei-09-06-00430.pdf 

The OIG recommends that:

  • physicians only bill for services provided by nonphysicians who have the necessary training, certification, and/or licensure pursuant to state laws, and Medicare regulations;
  • a modifier be used on the claim form to ensure physicians are billing for services only provided by nonphysicians with appropriate qualifications; and
  • CMS take appropriate action to address claims for services that were "for rehabilitation therapy services performed by nonphysicians who did not have the training of a therapist."

Medicare rules require that physical therapy services provided incident to a physician be furnished by a person who is a graduate of professional physical therapist program. Medicare is authorized to only pay for services provided by those trained specifically in physical therapy. As the report indicates, about half of the physician offices billing "incident to" are not complying with this requirement.

APTA is alarmed by these findings and calls on CMS and Congress to act to prevent unqualified personnel from providing physical therapy services. To ensure high quality care, physical therapy services should be furnished by licensed physical therapists and physical therapist assistants under their supervision. The APTA urges Congress to take action to completely remove physical therapy as an "incident to" service in physician offices and to tighten Stark II referral-for-profit regulations to eliminate financial incentives that contribute to high physician billing of physical therapy services."