That is the topic of a Health Affairs Forefront article by Neprash, Perkins and Mehrotra (2025). This is an important question as approximately one in four visits are now provided by nurse practitioners (NPs) and physician assistants (PAs) across the Medicare program. NPs and PAs can either bill payers one of two ways:
They can bill Medicare directly (that is, using their own unique National Provider Identifier) and receive 85 percent of the Physician Fee Schedule rate for any given service. Alternatively, they can bill Medicare indirectly—or “incident to” the services of a physician. When NPs and PAs bill indirectly, Medicare reimburses at 100 percent of the Physician Fee Schedule amount. The latter is obviously more lucrative but comes with strings attached, related to where and how Medicare permits indirect billing. Approximately 60 percent of all eligible NP and PA billing is direct, and the other 40 percent is indirectly billed.
The authors go on to argue for the termination of indirect billing, but note that the American Medical Association (AMA) formally opposes efforts to eliminate indirect billing. While I am not informed enough about the topic to have an opinion either way, it is worth reading the whole article to see how the authors make their case. Either way, NPs and PAs are likely to have an increasing role in the US health care system into the future.
