In most circumstances, the Centers for Medicare & Medicaid Services (CMS) will not allow billing or payment under the Medicare Physician Fee Schedule (PFS) for services furnished by interns and residents within the scope of approved training programs. Instead, the Medicare program generally pays physicians who are not residents under the PFS for professional services, and pays for medical education through direct graduate medical education (DGME) and indirect medical education (IME) payments made to the hospital. Generally, to be eligible for Medicare PFS payment for services provided in a teaching setting, the services must be personally furnished by a physician who is not a resident (which includes interns and fellows).

Despite this general rule, there are a few circumstances in which Medicare PFS payment is, in fact, available for services provided by a resident. These limited circumstances include: situations in which the teaching physician is physically present during the critical or key portions of the service; certain anesthesiology procedures furnished by a resident if the teaching anesthesiologist's involvement can be documented and satisfies certain requirements, and moonlighting services furnished by a licensed fellow or resident outside the scope of an approved program (see the recent GME @ Dentons article, The ins and outs of reimbursement for fellow moonlighting).

Additionally, there is an exception (often referred to as the "primary care exception") that allows a teaching physician to bill under the PFS for low- and mid-level evaluation and management (E/M) services provided by residents in approved graduate medical education (GME) programs if the services are furnished in certain primary care centers. The primary care exception is the subject of substantial interest and inquiry, because it presents a rare circumstance in which services furnished by a resident without a teaching physician's physical presence are payable under the PFS. This exception applies only if very specific requirements are satisfied, though. Note that unless a state Medicaid program or a commercial insurer has also adopted the primary care exception, this exception is limited to Medicare services.

To meet the primary care exception, a primary care center is required to attest in writing that the residency program satisfies the following conditions:

• The services must be furnished in a primary care center that is in a hospital outpatient department or ambulatory non-provider site that satisfies the requirements for the teaching hospital to receive DGME payments for the time residents spend on patient care activities at that site. The residents' services will not fall under the exception if the resident is assigned to a physician's office outside the primary care center or to make home visits;
• The residents furnishing services outside the physical presence of the teaching physician must have completed more than six months of an approved residency program;
• The teaching physician must be immediately available to the residents furnishing the services and may not supervise more than four residents at one time;
• The supervising teaching physician must (i) have no other responsibilities (including other supervisory responsibilities) when the services are furnished by the residents; (ii) have primary medical responsibility for the patients receiving services from the residents; (iii) review the care furnished by the residents either during or immediately after each visit; and (iv) document participation in the review and direction of services provided by the resident. This documentation must show that the teaching physician reviewed the patients' medical history and diagnosis, the residents' physical examination findings and the treatment plan; and
• The primary care center must be considered the patients' primary location for health services, such that the residents will generally furnish care to an established group of patients during the course of their training program.

The primary care exception only applies to certain lower- and mid-level E/M services provided within an approved GME program. Teaching physicians providing E/M services with a GME program that falls under the exception may submit claims for services provided by residents for the following CPT Codes: 99201-99203 (for new patients) and 99211-99213 (for established patients). Additionally, the following Healthcare Common Procedure Coding System (HCPCS) codes are included under the primary care exception: G0402 (for initial preventive physical examinations and the face-to-face services provided to new beneficiaries), and G0438-G0439 (for the annual wellness visit including the personal preventive plan first visit and subsequent visit). Examples of services furnished by residents that could fall under the exception include chronic care for ongoing conditions and acute care for undifferentiated problems.

Primary care centers do not need prior approval to furnish services under the exception, but their documentation must demonstrate that the training site, the residency program, the services furnished and the teaching physician's involvement satisfy the requirements of the exception. The Dentons team listed above can help you determine whether the exception is applicable in given circumstances and can analyze other issues related to reimbursement of services provided in a teaching setting.