Billing

Proper Submission of Fee-For-Time Compensation Arrangements and Reciprocal Billing Arrangements

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Proper Submission of Fee-For-Time Compensation Arrangements and Reciprocal Billing Arrangements

Fee-For-Time Compensation Arrangements Reciprocal Billing
A substitute physician (referred to as fee-for-time compensation arrangements or “place holding”), is retained by a practicing physician on a contractual basis to provide services during an anticipated absence of no more than 60 days. The fee-for-time compensation arrangements physician receives a per diem reimbursement from the practicing physician and provides services to patients who would normally be seen by the practicing physician. Occasionally, a patient's regular physician may arrange coverage by a substitute physician for services during the regular physician’s absence. Because this is a reciprocal billing arrangement, the patient's regular physician may submit a claim to Medicare Part B using his/her own NPI and receive payment when specific conditions are met.

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Fee-For-Time Compensation Arrangements

Fee-for-time compensation arrangement rules apply to situations in which a practicing physician anticipates an absence of up to 60 days, and hires a substitute physician to manage the practice during the absence. Reasons for absence may include pregnancy, illness, vacation and ongoing medical education. Usually, fee-for-time compensation arrangement physicians do not have their own individual practices and are paid by the absentee provider on a contractual per diem basis.

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Facts to Remember

  • Services are not confined to the physician’s office, and may include other customary sites.
  • Nonphysician practitioners may not bill under fee-for-time compensation arrangements.
  • The fee-for-time compensation arrangement concept applies to short-term absence of the regular physician. It is not applicable for one-day coverage arrangements, for adding new providers to a group or for a trial period for a new provider.
  • Fee-for-time compensation arrangements do apply to coverage arrangements for a deceased physician.
  • A claim may be submitted by the regular physician (using his/her own NPI) when:
    • The regular physician is unavailable to provide the service
    • The Medicare patient has requested and agreed to the service
    • The fee-for-time compensation arrangement physician is paid on a contractual basis
    • The regular physician identifies fee-for-time compensation arrangement services with modifier Q6 (service furnished by a fee-for-time compensation arrangement physician) on all applicable claims, in Item 24D of the CMS-1500 claim form
    • The 60-day limit for fee-for-time compensation arrangement is observed
    • The regular physician maintains a file of all such services, including the substitute physician’s NPI; this file must be available to Medicare if requested
    • Substitute physicians do not need to be enrolled in the Medicare Program but must have a valid NPI and are not required to be of the same specialty
    • Postoperative services are included in the surgical fee and may not be billed on a fee-for-time compensation arrangement basis
    • Services beyond the 60-day timeframe must be billed by the substitute physician in his/her own name, and not associated with any direct payments from the regular physician
    • A new period of covered visits can begin after the regular physician has returned to work
    • E/M services should be billed as appropriate to the regular physician; patients considered “established” to the regular physician are not considered as “new” to the covering physician

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Fee-For-Time Compensation Arrangement for Medical Group Billing

  • As above, the fee-for-time compensation arrangement physician is paid by the regular physician.
  • A regular physician may have left the group and been temporarily replaced with a fee-for-time compensation arrangement physician. In this scenario, the physician who has left may still be considered a member of the group until a permanent replacement is obtained.
  • Claims on behalf of the regular physician must reflect his/her NPI and copies must be retained along with the substitute physician’s NPI number.

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Reciprocal Billing Arrangements

Reciprocal billing is appropriate for occasional absences by the regular physician, and coverage by a substitute physician includes office and other customary sites of service. In this situation, the regular physician may submit a Medicare Part B claim using his/her own NPI, when the following requirements are met:

  • The regular physician is unavailable to provide the service
  • The Medicare patient has requested and agreed to the service
  • The period for reciprocal billing does not exceed 60 days. The regular physician identifies the services as substitute physician services by entering HCPCS code Q5 modifier (service furnished by a substitute physician under a reciprocal billing arrangement) in Item 24D of the CMS-1500 claim form
  • The regular physician maintains a file of all such services, including the substitute physician’s NPI; this file must be available to Medicare if requested
  • Reciprocal arrangements may exist with more than one physician and do not need to be in writing
  • Postoperative services are included in the surgical fee and may not be billed on a reciprocal basis
  • Services beyond the 60-day timeframe must be billed by the substitute physician in his/her own name
  • A new period of covered visit/services can begin after the regular physician has returned to work
  • “Incident To” services may be included when billing for services, providing that all coverage criteria for such services have been met
  • The defined period of covered services begins on the first day the substitute physician provides covered services on behalf of the regular physician, and ends with the last day on which these services are provided before the regular physician’s return. The period includes days on which no services are rendered by the substitute physician and also includes days when another substitute physician provides services. A new period may start after the regular physician returns to work

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Reciprocal Billing Guidelines for Medical Group Billing

  • When physicians in the same group provide substitute services, these rules do not apply. These claims may be submitted in the group’s name, identifying the particular physician who actually rendered the service, except for the hospice circumstance described below.
  • Hospice: when a group member provides services on behalf of another group member who is the designated attending physician for a hospice patient, modifier Q5 may be used by the designated attending physician to bill for services related to a hospice patient’s terminal illness that were performed by another group member.
  • When a medical group submits claims for a substitute physician’s services who is not a group member, modifier Q5 must be added to the procedure code. In this circumstance, the NPI of the performing substitute provider must be added to the claim.

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Reviewed 8/28/2024