Medicare billing for PAs: 4 trends to watch

Medicare would have saved $194 million in 2018 if indirect billing for nurse practitioners and physician assistants were eliminated, but directly billing these providers would adversely affect small primary care practices, according to a study published in the June issue of Health Affairs. 

Four things to know:

1. For directly billed services, Medicare and many commercial insurers pay 85 percent to nurse practitioners and physician assistants of what is paid to a physician for the same service, according to the report

2. Eliminating indirect billing would harshly affect small primary care practices, which would have seen the greatest drop in revenue if indirect billing had been eliminated. 

3. Independent, smaller private practice physicians are already facing financial strife with rising operation costs and stagnant reimbursements. Hospitals and corporate entities continued their buying spree of physician practices last year, according to an April 2022 report from Avalere. The number of private practice physicians dropped to 26 percent in 2021, down from 38 percent in 2019. 

Because of indirect billing via a supervising physician, much of the care provided by nurse practitioners and physician assistants cannot be observed in claims data, the Health Affairs report said. 

4. This is cause for concern as the professions represent a growing percentage of the healthcare workforce. The physician assistant field is projected to grow 31 percent between 2020 and 2030, with 40,100 jobs added during that time, according to the U.S. Bureau of Labor Statistics. Nurse practitioners are projected to grow 45 percent in the same period, with 121,400 jobs added. 

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